{"id":909,"date":"2022-11-14T15:48:34","date_gmt":"2022-11-14T15:48:34","guid":{"rendered":"https:\/\/fanso.io\/blog\/?p=909"},"modified":"2022-11-14T16:16:41","modified_gmt":"2022-11-14T16:16:41","slug":"membership-pricing","status":"publish","type":"post","link":"https:\/\/fanso.io\/blog\/membership-pricing\/","title":{"rendered":"How To Set Your Membership Pricing"},"content":{"rendered":"<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">You have started a membership website to satisfy a market requirement, and yes, you want to make money from it.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">But how do you set your membership pricing?<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">You might check out competitor prices, and you set yours by using it as a benchmark. You could look at your cost and add a little margin. You just follow your instincts and keep going.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">So what is the best membership pricing strategy among all of these? All these approaches can work, but they all leave money on the table. The most profitable membership pricing approaches put customer value in front and are driven by your customer&#8217;s interests and purchasing habits.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">So let&#8217;s find out how you can increase the money your subscription website makes and sustain your recurring revenue business.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">We will walk through why understanding <\/span>how to price a membership site<span style=\"font-weight: 400;\"> is important, outline common <\/span>membership pricing strategies<span style=\"font-weight: 400;\">, and explain what should be the subscription model you must follow.<\/span><\/span><\/p>\n<div id=\"toc_container\" class=\"toc_white no_bullets\"><p class=\"toc_title\">Table of Contents<\/p><ul class=\"toc_list\"><li><a href=\"#Things_to_consider_when_pricing_a_membership_website\"><span class=\"toc_number toc_depth_1\">1<\/span> Things to consider when pricing a membership website<\/a><\/li><li><a href=\"#Membership_pricing_models_to_follow\"><span class=\"toc_number toc_depth_1\">2<\/span> Membership pricing models to follow<\/a><\/li><li><a href=\"#Build_your_membership_website\"><span class=\"toc_number toc_depth_1\">3<\/span> Build your membership website<\/a><\/li><li><a href=\"#Conclusion\"><span class=\"toc_number toc_depth_1\">4<\/span> Conclusion<\/a><\/li><\/ul><\/div>\n<h2 style=\"text-align: justify;\"><span id=\"Things_to_consider_when_pricing_a_membership_website\"><span style=\"color: #333399;\">Things to consider when pricing a membership website<\/span><\/span><\/h2>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">When it comes to <\/span>membership pricing<span style=\"font-weight: 400;\">, there are several factors to consider, but make sure to choose the one that works the best for your business.\u00a0<\/span><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">So let&#8217;s jump into the important factors that influence your <\/span>membership pricing<span style=\"font-weight: 400;\">.<\/span><\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Subscription business type<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">First, define what kind of content or product you are going to create for your subscription business. Can you present the content as a &#8220;premium deal&#8221; to your prospects? Or is it a budget offering? When pricing your membership services, understand the value you want to give your members so that you can decide what to charge.<\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Your target market<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">Before starting your membership website, perform thorough market research. Learning about the market you want to enter helps you understand the market expectations, trends, and pricing. You must also look at your competitors&#8217; pricing, as it gives a basic idea about what your target market is willing to spend.\u00a0<\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">How much is your audience willing to pay?<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">When it comes to the willingness of your audience to pay for your subscription services, each one has a different idea of a fair price, and hence it isn&#8217;t easy to find out the amount they are willing to pay. So what you can do as a content creator is to conduct market research and understand more about your ideal customer base. If your target audience is too broad, niche down your services to come up with content that works for all your users.<\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">The revenue you want to make<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Another excellent way to come up with the right<\/span> membership pricing<span style=\"font-weight: 400;\"> is to calculate the price backward from your expected revenue.<\/span><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">For example, make a plan about the amount of revenue you want to generate in a given time frame. That is, how much money do you want to make every month or per year to cover all your expenses and make a profit?\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">Once you come up with the final number, divide it by the total number of subscribers you want to get in the timeframe.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">For instance, if your goal is to make $5000 every month, you must get the following:<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">20 subscribers who pay $250monthly.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">100 subscribers who pay $50 monthly.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">500 users who pay $10 monthly.<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Remember that it isn\u2019t easy to get a large subscriber base when calculating your <\/span>membership price<span style=\"font-weight: 400;\"> on this theory. And it might actually be expensive to attract more subscribers to your membership website.<\/span><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">But make sure you work on this by offering unique and premium offerings to subscribers and trying out a combination of revenue approaches to cater to different audiences.<\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Your unique selling point<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">All membership businesses that do great will have excellent unique selling points or USPs. This differentiates your business from the crowd and assures that you offer unique content.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">By defining your USPs, you can position your subscription service in the market by differentiating the unique value you provide.<\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Member churn rate<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">When pricing your membership services, do not forget the subscriber churn factor. Theoretically, your subscribers must stick with you for long. But the reality is that many people would leave your membership site for other services, and when pricing your services, you must also take it into account.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">If you are new to the term, the churn rate is the percentage of people who leave your subscription website during a given membership period.\u00a0According to data, average <\/span><span style=\"font-weight: 400;\">subscription-based platforms experience a 6.7 % churn rate<\/span><span style=\"font-weight: 400;\"> every year.<\/span><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">But it is difficult to forecast the churn rate you must expect without having any data. The easy way is to calculate your monthly churn rate by analyzing how many people abandon your membership website every month.<\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Overall costs<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">Another important thing to consider when choosing the membership pricing strategy is your overall costs and expenses. This can include your online tutoring software price, domain, web hosting, other tools, maintenance costs, and related costs. To keep your subscription business profitable, make sure the revenue you generate always covers all of your expenses, at least the minimum.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><span id=\"Membership_pricing_models_to_follow\"><span style=\"color: #333399;\">Membership pricing models to follow<\/span><\/span><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">If you want to start a membership website, you need a membership model that does two main things:<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Keeps non-members out of the site.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Make people actually want to pay you.\u00a0<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Before launching your membership website, it is significant to consider different factors you must consider in your pricing strategy. Now that you know about the factors to consider, let&#8217;s get into the common <\/span>membership pricing strategy<span style=\"font-weight: 400;\"> you can adopt to power your subscription service.\u00a0<\/span><\/span><\/p>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Fixed pricing\u00a0<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Fixed pricing, also known as flat pricing is one of the common <\/span>membership pricing<span style=\"font-weight: 400;\"> strategies you can adopt. Fixed pricing is simple: A fixed type of offering, a features that doesn\u2019t change, and fixed pricing per month.<\/span><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">Fixed pricing is excellent as it is easier to communicate and easier to sell to the audience. You can hike your rate if you want to add more valuable features or additional products or content.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Flat-rate <\/span>membership price<span style=\"font-weight: 400;\"> can be easier for your potential audience to understand, often bringing in more revenue for your business.\u00a0<\/span><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><b>Suits best for:<\/b><span style=\"font-weight: 400;\"> Subscription businesses with single buyer persona and limited features. Fixed pricing doesn&#8217;t work great for businesses where resource costs vary between users.\u00a0<\/span><\/span><\/p>\n<h4 style=\"text-align: justify;\"><span style=\"color: #333399;\"><b>Benefits of fixed pricing model<\/b><\/span><\/h4>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Easier to explain to clients and sell to them.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Easy and simple payment processing and billing.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Improves the productivity for businesses to shift their work on revenue generation and retaining subscribers.\u00a0<\/span><\/li>\n<\/ul>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Tiered membership pricing<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Tiered <\/span>membership pricing<span style=\"font-weight: 400;\"> is where subscription businesses offer multiple price packages with different product and service offerings. The number of packages can vary, but most subscription businesses offer two, three, or a maximum of four pricing tiers.<\/span><\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">Tiered pricing allows subscription services to differentiate the pricing of different offerings according to different target audience.\u00a0 Generally, the tiers are basic, standard, premium, etc. Pricing iers must have unique features to make the value difference extremely clear.\u00a0<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><b>Suits best:<\/b><span style=\"font-weight: 400;\">\u00a0Membership businesses that have many offerings and a large users base with different requirements, usage, and budget.\u00a0\u00a0<\/span><\/span><\/p>\n<h4 style=\"text-align: justify;\"><strong><span style=\"color: #333399;\">Benefits of the price-tier model<\/span><\/strong><\/h4>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Flexible pricing model and sustainable.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Suits users with diverse needs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Improves the customer&#8217;s lifetime value as they choose to change the tier as the requirements change.\u00a0<\/span><\/li>\n<\/ul>\n<h3 style=\"text-align: justify;\"><span style=\"color: #333399;\">Usage-based pricing model<\/span><\/h3>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">Now coming to this membership pricing model, it is a consumption model or pay-as-you-go. This makes this pricing strategy becomes more variable as it is charged based on the usage consumption of users. This involves a fixed basal rate, and users are charged for additional usage.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"color: #000000;\"><b>Suits best for:<\/b><span style=\"font-weight: 400;\"> Subscription businesses of which users&#8217; usage consumption is expected to differ considerably.\u00a0<\/span><\/span><\/p>\n<h4 style=\"text-align: justify;\"><span style=\"color: #333399;\"><b>Benefits of consumption pricing model<\/b><\/span><\/h4>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Offer users the flexibility to pay based on their usage.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Attracts new subscribers with minimum costs if usage is low.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Users whose content consumption is more might be charged more than users who don&#8217;t consume the resources frequently.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><span id=\"Build_your_membership_website\"><span style=\"color: #333399;\">Build your membership website<\/span><\/span><\/h2>\n<p><span style=\"font-weight: 400; color: #000000;\"><a href=\"https:\/\/fanso.io\/\">Fanso<\/a> simplifies the process of building your membership website and helps you to be flexible with your pricing strategy and selling. Fanso is a ready-made community marketplace script that can help you <a href=\"https:\/\/fanso.io\/blog\/how-to-start-a-subscription-based-website\/\">build your membership platform<\/a> based on your required customizations.<\/span><\/p>\n<p><span style=\"font-weight: 400; color: #000000;\">If you choose a community platform script like Fanso, you just need to pay for the hosting and other plugins you will need for your membership platform.<\/span><\/p>\n<p><span style=\"font-weight: 400; color: #000000;\">Fanso comes in 2 <a href=\"https:\/\/fanso.io\/pricing\">pricing plans<\/a>, \u201cStarters\u201d priced at $699 and \u201cProfessionals\u201d at $1499, which is a one-time cost with no monthly or yearly renewals.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400; color: #000000;\">Set a monthly subscription fee, a one-time fee, etc., for your clients to access your subscription services. With Fanso, you can keep all your revenue. We do not take a commission from your earnings; we just charge a one-time fee and don&#8217;t charge any transaction fee. Being said that, you can make money through your subscription business through commissions.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400; color: #000000;\"><a href=\"https:\/\/fanso.io\/blog\/how-to-build-an-online-community-platform-using-fanso-io\/\">Build a thriving online community<\/a> for your membership website using our engagement features and exchange deals with peers and creators.\u00a0<\/span><\/p>\n<h2 style=\"text-align: justify;\"><span id=\"Conclusion\"><span style=\"color: #333399;\">Conclusion<\/span><\/span><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">The first step in choosing membership pricing can be challenging. Do not fall into the trap of analysis and paralysis. Doing initial research and analysis about your target market is great, but never make decisions blindly. Be flexible and ready to revise membership pricing as your business grows and markets change.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400; color: #000000;\">Want to gain some inspiration to convert your business idea to a full-fledged membership platform? <a href=\"https:\/\/fanso.io\/contact\">Get in touch<\/a> with us\u00a0right now to partner with the industry&#8217;s best online tutoring tech partner to bring your ideas to the table.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>You have started a membership website to satisfy a market requirement, and yes, you want to make money from it. But how do you set your membership pricing? You might check out competitor prices, and you set yours by using it as a benchmark. You could look at your cost and add a little margin. &#8230; <\/p>\n<p class=\"read-more-container\"><a title=\"How To Set Your Membership Pricing\" class=\"read-more button\" href=\"https:\/\/fanso.io\/blog\/membership-pricing\/\" aria-label=\"More on How To Set Your Membership Pricing\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":910,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_generate-full-width-content":"","inline_featured_image":false,"_lmt_disableupdate":"","_lmt_disable":""},"categories":[28],"tags":[24,64],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v17.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How To Set Your Membership Pricing<\/title>\n<meta name=\"description\" content=\"We will walk through why understanding how to price a membership site is important, outline common membership pricing strategies.\" \/>\n<meta name=\"robots\" content=\"index, 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