Ever since announcing the closure of my social media membership in March, I’ve been the go-to person for other membership owners who are considering closing theirs as well.
“It seems memberships have reached their peak and are now declining,” one peer said. In all the conversations, the big question asked is: Are memberships dead?
I don’t think so. But I do think the membership model is changing. This is important for community managers, strategists and owners, because community makes a huge impact on membership retention and churn.
I have some strong opinions based on both experience and observation when it comes to memberships:
- By their nature, memberships put you in a never-ending cycle of production. Whether your model is a subscription box or membership service, you have to produce something tangible for your members or subscribers each month. Some people love this. Others do not.
- The traditional membership model relies on only a small percentage of members taking advantage of their benefits each month.
- Though retention stays high in memberships that ensure consistent transformation, there is always a hole in the bucket. Attrition is normal, and you have to refill your bucket regularly.
- The market is shifting. Gone are the days where people happily paid $27-$118/month for several programs or services they might not consistently use. Quality trumps quantity. People are gravitating toward low-ticket memberships ($9/month seems to be the magic number these days) or high-ticket ($200+/month), and they aren’t collecting them like Pokémon anymore either.
The Production Hamster Wheel
A never-ending production cycle isn’t a bad thing, but it’s not for everyone. Obviously, what you produce depends on the scope of your program.
Missy Helderman’s Find-Your-Fit program is a subscription box that sends perfectly sized bras to your mailbox every month. Owner of The Bra Market in Indiana, Missy already stocks an inventory of bras in her shop. Find-Your-Fit allows her to leverage that inventory to build a customer base throughout the nation.
Dachelle McVey’s Literary Adventures for Kids Clubhouse gives members unlimited access to online book clubs that can be used either for enrichment or homeschool curriculum. Historically, the membership has required Dachelle and her team to create an entire book club, a curricular unit around a specific book, every single month.
As you can imagine, Dachelle’s membership requires a lot more time and effort than Missy’s. Dachelle loves the work and the book clubs she creates are sold separately as well, so this pace works for her. Missy, on the other
Community connection: Be intentional about how much content you promise for your community. Understand that not only do a lot of deliverables put pressure on you and your team, but also on members. A hefty load of content and resources in memberships sounds like a value-add, but often overwhelms members and causes them anxiety driven by fear of missing out (FOMO). More is not always better. Sometimes more is just more.
The Business Model of Memberships
Everyone who teaches memberships as a business model sells clients on the ideas that memberships are the fastest way to passive income. You create something once and it serves hundreds to thousands of people each month.
But almost all profitable memberships make money because a small percentage of members are using them at any given time. Even in memberships with 1,000 or more people, you’ll have 50 to 60 on your live calls and a handful of customer service emails each week from people using other features. Bigger memberships might have more actively engaged communities, but participating in discussions is not the same as using your membership benefits.
But even if people aren’t using everything, you still have to give them what you’ve promised. Think of it like a gym. Certain items are expected at every gym — treadmills, elliptical cross-trainers, stationary bikes, free weights, weight machines, etc. Even if most members don’t use the treadmills, you still have to have them. And some members might never touch a single piece of equipment, choosing only to use the sauna, pool or locker room showers.
This reality appeals to a lot of business owners, but some entrepreneurs don’t like the idea of collecting money each month from people who aren’t doing what they signed up for. And it can be frustrating to show up for calls with just a handful of people, which is often the case in all memberships.
Community connection: Measure success through objective data points, not by how active conversations are in your membership community. Your most active members might not be doing anything with the membership content. Build in feedback loops based on the transformation your membership promises to measure how far your members are progressing on their journey, and which membership benefits they value most.
You Need to Always Be Selling
Memberships are great for cashflow, providing regular revenue each month with injections of revenue also coming quarterly or annually from members who made long-term commitments. But even the best memberships have attrition, or as I said above, a hole in the bucket.
There are lots of strategies that support retention, many of which I use with clients, but you can never keep 100% of your members renewing year after year. It’s normal for people to come and go.
To keep the revenue from your membership reliable, you have to either have an evergreen model where your membership is always open for enrollment or a closed model where you have specific launch periods throughout the year. In either case, you need to sell to offset the loss of members and you need to sell a lot if you want your membership to grow year after year.
If your membership is a key pillar of your business, you can standardize your sales process and allocate most of your time to promoting the program and enrolling members. If the membership is one of many offers, you might find yourself feeling stretched too thin.
Community connection: If you’re delivering a high-value membership experience, your members could be your best publicists. Consider how to enroll them in the growth of your membership. Several low-ticket membership owners give every member the opportunity to become an affiliate with the goal of having their membership fee covered through referral credit. This motivates members to invite their friends and the more friends they have in your membership, the more likely they are to stick around.
Shifts in the Market
If we were inside The Three Bears, this is when I’d tell you Baby Bear ran off with Goldilocks. For years, when I worked with memberships, $27-$118/month was just right. Now, everyone is leaning hard toward Mama Bear or Papa Bear with little in between.
Though $9 memberships are popping up left and right, I’m also seeing some in the $10-$15 monthly range. And at the other end of the spectrum, I’m seeing memberships going for $200-$1,000/month.
I’m gleaning two bits of information from this observation:
- Membership owners are either banking on thousands of members at a can’t-say-no low price or focusing their efforts on a committed few who are investing too much not to actively participate.
- Consumers are tired of feeling the pressure of “getting their money’s worth” and choosing low-dollar memberships with the belief that even if they only use three to four benefits in the course of a year, it’s money well spent. Consumers are also tired to being in memberships with people of varying levels of commitment. High-ticket memberships don’t just provide a higher level of service, they tend to attract members who are more consistent.
Community connection: As pricing shifts according to market expectations, so will community. You might see shifts in activity in your membership community and a drive to be seen and known. Consider individual outreach with your members to assess what is working and not working for them. Changing your pricing isn’t usually necessary, but understanding your members’ perspectives is useful.
Why I Closed My Membership
I loved leading the Success on Social membership. I still have the sticky notes with the names of every founding member and I believe I provided a lot of value to my members over the past two years. Sales were strong when the membership was $27/month and slowed waaaayyyy down when the rate increased to $47/month.
When I first announced SOS was closing, I wasn’t really able to articulate the reasons but I can now:
- It’s time. Social media has drastically changed in the past two years. Though the content calendars provided in the membership are still as valuable today as they were when we started, everything else got stale much faster than I predicted. What I’ve found this year is that social media is still a great vehicle for visibility and authority but how you do that is nuanced. Best results require individual recommendations, not generalized ones.
- I’m not made for the mass market. I do my best work with small groups and individuals in environments where I can go deeper than surface level in our work together. Our membership was perfectly cozy at 36 members and as attrition happened, I found myself so in love with the remaining members, I wasn’t driven to refill the bucket.
Community connection: Closing a membership can feel like a failure. If you are invested in your members, there’s a natural period of mourning and a desire to ensure they are able to transition well. Be as honest as you can for the reason you’re closing the membership, be as generous as possible during your sunset period, and — if it makes sense — provide members with a next step if they want to continue working with you.
Memberships to Consider
To prove I don’t hate memberships, or think they are useless, I’m going to share some of my favorites here.
- Liz Wilcox’s Email Marketing Membership (affiliate link) — $9/month; you get a written template each week for your email newsletter, plus a video overview and access to courses on email marketing. My creative well runs dry like everyone else’s, and it’s nice to reach into Liz’s vault and pull out a prompt or two to help me when that happens.
- Lizzy’s Club — $9/month; Lizzy’s club is a potluck of training, recommendations and live documentation of all things online business. Elizabeth Goddard is the person who first introduced me to Voxer coaching, and I’ve been following her ever since. She’s also a fan of super-low-ticket offers.
- The Collab Club — $21/month; Nicole Batey specializes in collaborative audience growth strategies. I’m brand-new to this membership, and I’m looking forward to learning to better leverage collaborative opportunities that come my way.
- Her Mastermind — $47/month ($11.75/month through May 31); Sabrina Victoria’s membership is centered around a weekly live networking call on Zoom. No fluff. No recordings.
- Clutter Free for Life — $24.99/month; I helped Kathi Lipp to design this membership four years ago, and I still love every part of it. Members get a monthly decluttering plan, challenges, weekly coaching and support through a Facebook group and membership portal.
- Red House Writers Collective — $760/year; If you’re a Christian writer, whether you want to sell to the Christian market or not, this is an encouraging place to work on the business of writing. The membership includes workshops, coaching and accountability focused on writing, marketing and systems to support your writing career.
- Profitable Pipelines — $400/month; If Facebook or Instagram is how you get clients, this membership will help you increase your productivity and your results. You need to be a GroupTrackCRM (affiliate link) customer to qualify, but the program provides an end-to-end plan for attraction, conversion and retention of clients through social media.
Now that you know what I think about the current state of memberships, it’s your turn. Have you made similar observations or are you seeing something different?