The ultimate guide to scaling your business with a membership program

Ready to add a membership program to your suite of services? Read this first …

While one-on-one services are where most coaches and consultants start, there’s a limit to the amount of clients that kind of business can serve.

That’s usually when business owners start to look at all the one-to-many business models that exist – courses, high-ticket coaching programs, productized services, done-for-you agency style services and the membership program.

With so many options, how do you choose the right one?

One of the decisions I help people with the most is how to structure their offers. There are many ways to scale a business and deliver value to clients.

It’s important to pick the right model; yet, it’s not an easy decision to make. A lot of people are excited about one program or another because they think it’s going to be “passive”. While this may sound like the perfect outcome … passive income is a myth.

(Yes, you can ignore all the BS marketers!)

Previous effort or an investment of time or money is the fuel for any result. And if you’re not spending time on the delivery, you’ll find yourself marketing more to fuel the machine.

Either way, being fixated on fantasies like passive income should never be the goal. Instead, business owners are better off focusing on how they can grow steadily while reducing the amount of cost required to generate a sale over time.

Choosing the one-to-many model that’s going to get you and your clients better results is the start. Because the more your business delivers on its promise, the easier it will be to make a sale.

One of the models I’ve found myself most excited about is the membership program.

I used to think it was an impossible pipe dream.

You mean recurring revenue every single month, limitless numbers of clients and all I have to do is create an online space for them? 

And when I began to dive into that rabbit hole, all I saw were the problems – bringing community together, getting people to sign on in the first place (a lot of work for such a small fee) and then the churn …

Oh the churn!!

I became skeptical that everyone was attracted to membership sites because the thought they were cash cows. In other words “too good to be true”. For those who they were working for, it was immensely profitable and for the rest … they were hard, if not impossible, to get going.

What I was missing (like many others) was the fact that these models are nuanced. There are so many variations that they (when set up right) can work for a wide range of niches, personalities and clients …  and be wildly successful.

It wasn’t until I began to work with a number of clients with memberships that I realized how different they actually were. I used to think that the entire outcome was focused on the community. And like many others I’ve spoken to recently, I was not alone.

Many business owners assume that the main skillset required is community building and it’s simply not the case.

If access to a community of support isn’t the primary benefit your clients receive from working with you, then you don’t have to focus on that in a membership program. That’s one of the biggest objections I’ve come across when speaking to established business owners.

What I like most about the membership business model is that it provides a lot of flexibility in how you deliver, charge and how long you work with people.

Some of these models look more like courses, others more like coaching support.

Just like with any other offer or package, as the business owner, you get to decide how to set it up and provide a solution that meets the needs of your clients and your own.

The best membership programs adapt from the strengths of the business owner and build on previous success.

My client Hunter Clarke-Fields, founder of the Mindful Mama Mentor, has a mindful parenting program that used to be a course and is now a membership. Because she delivers a lot of value in the form of training to her members, there’s a minimum commitment period of three months for a higher monthly fee of $99 as well as a lifetime option payable for 12 months for $69.

She’s elevated the value of her program by providing long-term access. This isn’t adding to her workload as she’s committed to showing up in her community monthly and launches three times per year.

And there’s a big incentive to take the lifetime option for parents who can’t commit to completing all the material in 3 months. She’s effectively removed a barrier for buyers who’d be unsure they could take advantage of a limited time live program. That’s important for parents of very young children.

Many of us have felt overwhelmed after buying courses and realizing the timing wasn’t right or the content couldn’t be easily adapted for our actual needs.

Those experiences have left us more fearful of investing in our ideas and dreams. I’ve always felt that validation and “eyes on my brand” are two of the most important benefits of any program. And that requires access to the coach or mentor we’re investing in.

What if we need that validation months down the road and we no longer have that access? Or there’s a premium price to getting it and we’ve already spent so much?

A membership program can take those risks away. Especially for clients who’re investing in long-term results. If they’re learning a complex skillset, changing a behaviour or transforming the way they see themselves, it can take time. 

There’s a lot of integrity in a program and business owner who recognizes that change takes time and is open about that reality.

Another one of my clients, Coach MK, runs an online running program called Fitness Protection. Her community consists of women and men who run but don’t consider themselves “runners”. The majority of them are at the back 1/3 of the marathon. Her job is to remind them that they “ran the freakin marathon!” and didn’t hurt themselves doing it.

She has a unique way of helping them maintain their fitness year-round so they’re always race ready. She also sees her job as keeping them “tethered” to their coach so they don’t lose their motivation and commitment, even when they are injured. They can move back and forth between three different training programs depending on what they need.

All this for the price of six fancy coffees (over-priced & too sugary) per month. Her $29 membership program not only gives them a monthly training program, a supportive community but access to leadership from several coaches who’re always rooting for them.

With her membership program there’s no reason for people to leave the program (and they rarely do). Because it’s affordable and focused on building and maintaining a life-long healthy habit, it’s worth the investment. In this case there is no limit to the number of people who could be supported at the same time.

So it seems easy right? 

Just throw up a sales page and invite everyone you know to it … and it will flourish. Not exactly.

Choosing the right model for your membership program

What I love about membership programs the most is that there are a few different models within this business model. Deciding on the primary function of the model will help you set it up properly for lasting success.

There are some important attributes to consider. Firstly, know the core benefit your members will receive from joining. What will make their life better. Here are three main types of membership business models that coaches & consultants launch that can thrive:

  1. Education
  2. Coaching
  3. Community

Many memberships will have a combination of all of these but there’s still ONE main one that has to remain consistent for the program to stay relevant. If you’re thinking of starting this type of offer, make sure you have a plan to over-deliver on one of these.

Education – Increasing skills & capabilities through knowledge

A membership site can simply be another way to charge monthly for dripped out content and offering ongoing support. For businesses that drip out new, relevant content every month to help their members do ongoing tasks like lesson plans or social media, a monthly recurring membership program is a great way to deliver important content to them consistently.

This attracts people to the highly valuable content at a price-point or commitment level that they can get their head around, reducing a barrier to giving it a try.

With these kinds of programs, there is often less emphasis on the coaching or community which means that the leaders of the group may not have to be as ever-present to make it relevant. While it’s always a good idea to have a place to ask questions, group admins can be hired to manage it giving freedom to the business owner.

Which is so often a desired outcome for business owners – programs that can run on their own.

Coaching – Provides access to in-time mentorship

Coaching communities might just be my favourite types of membership programs. They usually offer access to a leader or mentor with a strong skill set for a lot less than private coaching because it’s a group setting. If the group is small enough, you should get your questions answered. So group size does have an influence on price-point.

Many coaching and access-focused memberships are run as alternatives to group coaching programs. The members will also get connected to other group members so the ones that are most successful have members with similar goals.

One of the people I helped shift from primarily an education & community model to a coaching model is Andréa Jones of the Savvy Social School. Andréa’s social media agency was growing and so was her audience.  She created a group for people who wanted to do their own social and needed some guidance.

The group got going but it didn’t grow to the level she envisioned … initially. After we worked together she made two key shifts that helped her double the members in her program and increase member retention.

The first was adding bi-monthly coaching calls to the offer. Her members wanted help with specific challenges and timely opportunities. This was not something that previously created training would help with. Because social media is very fluid and always changing, immediate access was key.

Secondly, we figured out that the people who needed her support the MOST – and would probably stick around a long time for it – were other social media managers who needed a place to troubleshoot and ask questions.

By getting more clear on her ideal members and focusing on serving them, she’s created a membership community that’s gone from surviving to thriving.

Community – A space for like-minded people with something distinct in common

The most common membership programs we hear about are communities. Their primary goal is to connect people with common interests which can be for support, knowledge, business opportunities etc.

Even though they are the most common, they are the trickiest. The benefits of joining a community that’s all about the community might be different for each member. Some may be quite active – gathering info, helping others, sharing wisdom, meeting people – but others may not be as involved.

Strong, lasting communities often have well-liked leaders and some way of getting value from them that they couldn’t access otherwise or they have such a strong common interest with the others, they wouldn’t want to miss being a part of it.

The problem with membership programs that are focused on community is that you’re competing with free. Because there are so many free interest groups out there, churn for paid communities is high. The value of the connections they experience must be much higher than they could get for free elsewhere.

Core components of strong membership groups

In all types of groups, the return on investment (ROI) must be met in order to avoid churn. Especially when advertising is driving interest and sales the cost per acquisition (CPA) must not exceed the lifetime value (LTV) of the client.

In other words, you’re growing a membership program to serve people in the best way possible. You’ll want to attract people who stay a while, especially if there is no minimum time commitment. And that ultimately comes down to meeting and surpassing their expectations.

If you’re thinking of starting a membership program or growing your existing one, you’ll want to get clear on the key outcome members must receive in order to find it valuable as well as the extras they might not have expected.

Some of these include:

  1. Validation & support (it just feels good to be heard)
  2. Problem-solving (saves time figuring out what do to next)
  3. ROI (leads to a revenue opportunity greater than the cost of the program)

Pricing a membership model right from the start

Like with pricing anything, the goal is to charge the amount that best reflects the value of the service your client will receive.

With membership programs, there’s a tendency to charge less than the value of the outcomes promised as business owners want to start it with momentum. Getting a lot of people in at once can cause people to charge too little and can sometimes turn people off from buying.

When I see a low monthly price for a group, it signals to me that its community driven or there’s a lot of members. Because I prefer to develop strong relationships, I usually look for groups with less people and more access to the leader.

Common pitfalls found in membership program (a.k.a. why they don’t work)

The problems associated with running a membership program are very similar to any other business model. Except in some cases where the price point is so low and there’s no minimum time commitment, the problems can be even bigger.

It’s really hard to sell any type of service or package with the following conditions:

  • Audience is too broad. In the world of business to business I see this all the time. They try to grow communities based on the network of the business owner and invite everyone to it. In order to serve everyone, they keep it open and then it begins to stall because there’s not enough commonality amongst the members and not enough of them get their needs met.
  • Focus is not specific enough. Related to the above, if the focus or topics aren’t specific people won’t know why they should join and other support options will be considered. A strong membership program should be set-up as the BEST place for that person to get their issue addressed so there’s no real competition. Niche hard.
  • Does not solve a complex problem. If a membership program is focused on solving a simple problem that gets solved immediately, then members may not find a need to stay very long. That’s when churn becomes a big issue. More and more people will have to be found to sell to and that brings the profitability right down.
  • Relies too much on community. I’ve already mentioned that relying on the community as the sole benefit and the people in it to do the work in making the group great, is risky. Strong leadership is very important and will be the differentiator in leading the growth of the clients for the long-term.

If you’re launching, transitioning to or interested in growing your membership program and want to do it right, I have 10 years experience helping online business owners design and grow their business with group programs and memberships.

I’d love to help you choose the right model and growth strategy for you. If this sounds like your next best step, click here to apply for a free 30 minute strategy session right here!