My membership program gave me $13k paydays, and total lifestyle freedom. A membership program can be used in almost any business, provides consistent regular income, unlimited growth potential, and total lifestyle freedom. It can make being in business a TON easier. That’s a whole lot of upside to having one – but what are the drawbacks? And how much does one actually cost to set up and run?
Ultimately I closed my membership program down, despite the income. I’m revealing exactly how much income my mentoring program generated, and sharing lessons learned from running my programs, so you can decide whether having one is right for you (and if you’ve already got one, how to make it even easier for you and better for your members). Warning – LONG post alert! You might need some tea for this one!
I sat at 2am, words flying from my fingertips and on to the screen. I love this time of day to work, even though the experts say it’s when you’re not really that productive – actually for me, these witching hours have this magic to them where it’s so quiet and peaceful and like it’s nothing but you and the quiet comfort of the night.
From this little e-book that flew to all corners of the globe, came a stream of passive income products.
I LOVED the freedom that passive income gave. It meant we were no longer location-tied, we could literally live anywhere in the world, and work as little or as much as we liked. It meant time to homeschool the girls, take trips up into the mountains on a Wednesday afternoon if we liked, or down to the beach early in the morning. (We did tons of both).
Yet still, 19 months after opening, I closed it down. I then went on to launch a second membership program with my shared Vegan site, which ultimately lead to a successful sale for us, as we were able to show our buyer consistent monthly revenue. (One of the best things about running a membership program that receives monthly payments, is consistent, reliable, dependable income coming into your business every single day, if you want it to!).
Right here with Freedom and Flourish, I’m launching my third membership program, which I’m so excited about- using knowledge I’ve acquired that I’m sharing right here in this post, is ensuring that my new membership is better than anything I’ve ever created before.
These are the main lessons I learned running a membership program, so you can create your own, improve the one you have, or simply because I hope to show you how running a membership program can transform your own life, as well as that of your members.
Who Should Run A Membership Program?
You can create a membership program no matter what you do – I was a photographer when I first started mine – and you don’t have to be a coach.
Many membership sites teach you how to do something better, but not all! I’ve seen
- membership sites that are just online communities (in fact I paid $97 per month to be a member of an online facebook group that was a lively business community),
- membership programs that offer new stock photos every month,
- memberships that simply give you big discounts off their products and services,
- memberships which enable you simply to belong to an association or body and allow you to use their badge on your sites and allow you to register on their sites and enter their competitions,
- recipe memberships where you get sent new recipes every month (my vegan site used this model)!
- workout sites where you send out monthly or weekly workouts,
- membership sites for travel recommendations and discounts,
- membership sites for social media tips, and so on!
The list is endless, and you can easily make this income model work for you in your current business, with a little creativity! Think about how you can help the kind of person who already works with you, in a deeper way.
Can you package your services and offer them a bundle discount and early bird booking options, for paying monthly, for example?
Membership sites really can work for anyone and almost any business.
So if you want to create your own membership site, start here, with the lessons I learned about passive income running membership programs – including how much I earned after 12 months with my first membership program.
1. SHOCKER – Passive Income Is Not Really Passive Income?!
Ok, you got me. Creating a membership program for me, was not at all passive. I was in my facebook group so often and with such in depth responses to my member’s cries for help, that I burned out from being in there and trying to help everyone. Hello, boundary issues.
Not only that, I was so determined to provide ‘value’ that I went totally overboard on creating freebies and sharing fresh content in there every single day to inspire and uplift everyone. While I did create an incredible community, and I mean, amazing and I am still so proud of it! it had such a feeling of sisterhood and support – but it was unsustainable for me to continue to do this.
But what about the beach trips? What about the mountain trips? Well, I did outsource early on, which meant we had a fabulous babysitter / nanny with us two days a week which gave me time to work, plus I outsourced a ton of other stuff too.
But I didn’t outsource the one thing that was taking up all of my time and energy, and I hadn’t addressed why I felt the need to over deliver (which meant I frequently failed on my promises, due to the burnout from trying to keep up with my own tail and ideas and dedication to the members).
The outsourcing allowed me to take time away from the business, but I could never mentally switch off from it. I was always ‘on’, and the girls didn’t really have enough of ‘me’ even though we did have a ton of fabulous family trips.
Solution!? Plan out your precise model before you launch – and stick to it! I’m a launch- fast- and- work- it- out- as- you- go- along type person naturally, but it meant I had to figure out a lot of things while I was ‘in the fire’, so to speak, and that was stressful.
Get in outsourcers and plan for your business to be as hands-off as possible – read this post to get a real idea of how you can whittle down your work time while still earning a great income and having a great impact.
That way, when situations and issues come up (as they do in any business or income stream), you can address them with your full attention, rather than from a place of physical and energetic depletion.
With that lovely gift of hindsight, I now know I should have got a community manager to take care of my facebook group, leaving me free to concentrate on what I do best – creating content which helps people, and working with people directly in small programs. Focus on doing what you do best, and figure out what you can outsource – before you start.
2. Passive Income CAN BE ENTIRELY PASSIVE
Yep. In total contrast to the above, I’ve learned all my lessons about creating passive income, and what I’ve learned is that you can create almost entirely-passive income. Which involved some painful personal lessons concerning my ego. Gulp.
I realised I wanted to be needed, and appreciated, which is why I felt like I NEEDED to be in my group every day, and like I was the only person who could help my members. While I know my information and lessons to share are incredibly awesome 😉
of COURSE there are people out there who are better at other things than I am! Community management being one of them. I even tried to design my own course material and design it, instead of doing normal things like hiring somebody on Fiverr to do it for me for a fraction of the time, cost and stress!
This was a huge lesson to learn, but I learned was so freeing! My members don’t need me after all? We don’t need to be in this weird co-dependent relationship?! Woo! Goodbye, being a slave to my business, hello to a business that ACTUALLY CAN BE ALMOST COMPLETELY PASSIVE.
I learned this lesson again working with my partner of the Vegan site. I wrote the copy, he worked with an ads team and design team to set up a funnel, and had a facebook manager do the ads and group monitoring. Everything was outsourced, members got exactly what they needed, and there was zero drama and minimum effort, with maximum results for everyone, especially the members.
This is how you make a passive income product passive, and it is totally possible.
3. Keep An Eye On Cost – How Much A Membership Site REALLY Costs To Run!
This is one area I struggled to find balance. While setting up a membership program seems cheap – you just download some sort of software, or upload your training materials to dropbox, right? I realised pretty fast that if I was to have a flourishing membership site rather than a small group that would generate close to zero profit for the longest time until it built momentum, I’d have to spend money on my marketing the program to get people to discover it.
I found a dream of a facebook ads manager to help me – one of the best in the business actually – at a cost of $1500 per month. PLUS ads on top, which some months ran into 2k+. So I had to make sure I was making over $3500 in my business every month just to cover my client acquisition costs.
On top of that I had my VA fees which were anywhere from $50-$300 per month, and my hosting fees for the actual site and content itself – $97 per month, plus all of the tiny little things we buy and pretend not to notice like graphic packs or logo designs or invoice software or the countless little things that all add up. Plus I kinda had to pay myself something, seeing as I self-appointed myself the family breadwinner when my husband left his job.
But not counting my wages, that left me a minimum business operating cost of around $4000 every month just to be in business, let alone make profit. So yes, my membership site gave me $13K paydays – but I definitely needed them!
I’ll be honest, I have a super-high risk tolerance when it comes to business. I’m unafraid to try new things, and invest where necessary – I invested in my facebook ads manager and ads when my business was two months old and I was earning next to nothing. Thankfully my husband trusted me, and thankfully it worked out, but it was a risk. You have to be pretty sure of the risk-reward ratio if you’re going to jump in and invest in traffic generation right from the beginning.
How Much Money Do You Need To Invest In Growing Your Traffic For A Membership Program To Be Successful?
Of course, you don’t have to spend this much on traffic. I know some business owners who are generating thousands and thousands of page views every month for free using Instagram, Pinterest, SEO or whatever works best for them.
But for me, using Facebook advertising was a really quick and easy route to generating income in my business, which is how I was able to grow it so quickly, with over 330 monthly paying members after 12 months, and generating over $180,000.
You have to choose what works best for you, and what’s easiest – the best way to track what works for you is to track your email list and your traffic so you can see where your traffic is coming from, and look to increase your spending costs there. (If you want to know more about my facebook ads campaigns, including the exact funnel I used, go here)
Even then, you might not necessarily choose the platforms that give you the most results – right now, I’m gaining traffic from Instagram for this site, which is weird as I don’t really use it as often as I ‘should’, yet I’m concentrating growing my traffic on Pinterest, as I love using it!
Over time I might refine this but because this site is new right now, I’m sticking with what feels good! (and probably always will).
4. Will A Low Price Membership Really Give You The Income + Profit You Want?
On paper a membership site sounds great, right?
330 paying members – approximately how many I had after a year, paying $27 per month, resulted in a monthly income of $8910.
Almost 10k a month – and all you have to do is deliver a little digital content every month?!
Yet running this membership site was ridiculously hard work, because I didn’t hire the team I needed to really make this program easy and simple to run, and because of my tendency to over-deliver.
Looking back, while I was DIY’ing everything, I could have hired a graphic designer, a better accountant, a Pinterest and Instagram manager, and even someone to create the content for me!
Which of course, would then would have eaten into that $8910 pretty quickly. And don’t forget, if we look at my operating costs of approx $4k per month, and then you consider that remaining $4900 had to support a family of four, it doesn’t actually start to look that great.
And of course I wasn’t earning $8910 from the beginning – my first month (before I got on board with Facebook Ads) netted me just $600, at which point my husband looked at me as if he was insane to leave his job and all of us move to a tiny island in the Mediterranean.
The $8910 per month wasn’t all the income I received, however – and it was the extra content I created that really made the financial difference for me. My members were highly engaged and loved my content, so they would purchase content upgrades, premium programs, and my books and private mentoring too- meaning that as a result of this membership program, I hit my first $30k month; a level of income I never thought would be possible for me.
So financially, creating a membership program was definitely the right step for me to take – but I learned a lot of hard and fast lessons the first time around.
My second membership with the vegan site was so hands-off (partly because I was only a very minority partner) that I barely thought about it at all – I went completely the opposite way!
And with my new membership program right here, I think I’ve finally found that great balance where my members get exactly what they need, when they need it (goodbye, over-delivery and over-whelm), coupled with a more personal level of support which is energising for me to provide, not depleting.
A good membership program, when done correctly, can be a win for everyone!
A membership program can also be low-cost to set-up and run, and it can be less time-intensive too, IF you get the right support team in place from the beginning and know how you plan on attracting – and keeping- your members, with minimum cost- and without it taking over your life as a result.
5. The Biggest Thing That Kills Your Membership Site Income + Profit
Membership retention is the biggest killer of membership programs. To combat this I had a ‘win-back’ program in place where they were offered an incentive to return, shortly after leaving, and my retention rate was one of the highest in the industry, at around 85% still remaining members after a year. This was mainly thanks to how much work I personally put into it and my presence in the online support group that accompanied the program!
However I made one near-fatal mistake when starting my membership program. For some reason, when starting my program, I created a twelve month membership program, instead of an ongoing one. So at the end of the twelve months I had these super advanced members who had done all of the trainings and were super down with marketing;
and yet I also had a ton of newbies who didn’t know the first thing about funnels and advanced strategy or energy work. I struggled to create content to retain my members who had completed the initial twelve months, which didn’t simultaneously alienate those newer to the program.
I eventually came up with the solution of creating an advanced version of the program, but I did lose about a third of my members in doing so. But sometimes, you have to make a short term loss to make a long term gain– so ultimately from both a financial and a personal viewpoint, this was absolutely the right decision, and the members were disengaged from the community and program, so probably would have ultimately left the course anyway.
What I’ll Be Doing Differently This Time Around
The Freedom & Flourish membership program has definitely had a lot more thought and planning go into it than any of my other previous programs! However, I am also a more advanced and accomplished business owner since launching my first one, so I know what systems and strategies I need to have in place in order to make it both a valuable program, and financially viable.
Here are some of the things I’m doing differently this time around!
1. A dedicated helpdesk. My membership platform (the incredibly awesome Kartra) comes with a built-in helpdesk facility, to help manage member questions and any queries that might arise. It is testimony to the nerd in me how ridiculously excited I am about this.
2. A stronger personal assistant. My current assistant is brilliant, whereas when I ran my first membership site I had real issues with my assistant – she was the first one I had ever hired so I was kind of learning how to work with and manage people as I went along. But my new assistant – and team! – will ensure that my program runs as flawlessly as possible, from marketing to client support.
3. No facebook group. Yep! Right now there are about a million facebook groups that I’m part of, and I only use one or two local ones. Why? For me, it’s social media overload. I believe in nurturing ourselves offline, and creating a business that is as ‘hands-off’ as possible, especially when it comes to the admin and development side. Personal development involves real, deep work – an immersive experience, whether that’s doing work in our journals, or undertaking a workshop – hopping in and out of a facebook group doesn’t really help you to progress, and can often be distracting, in my experience, even if there is a wonderful community – and for those quick questions we all occasionally have, the Freedom & Flourish membership provides full email support.
It also frees up my time to do what I’m best at – creating awesome content that helps my members earn more money and reclaim their time in their business!
4. LOWER price point!
Yes, my price point is even LOWER than before. I’ll be honest, I deliberated on this one for a long time, but the price kept coming back to me as the one that ‘felt’ right. (Yep, totally an intuitive business owner over here)! I knew from the beginning I didn’t want a high-end price point, because Freedom & Flourish is about supporting, not depleting you in your earlier years of business – and I’ve ended up thousands in debt because of online courses I’ve taken which actually, I barely remember the name of now and the impact in my business has been barely significant (though still arguably valuable in that if nothing else, they’ve taught me what I don’t want or want to provide).
Our programs will always aim to support members in that area – I know what it’s like to desperately need the information that could make a difference, yet not having the money to pay for it OR the time to search for hours for the info online.
It’s also less because I’ve figured out how to make it less time-intensive for me to run – which means my time is freed to be able to create more content and work on our accountability programs.
So, will running a membership program make you profit in your business?
Something to consider when planning passive income streams is how easy it will be for you to sell it and get members coming in! With a low-price point passive income model that I had, I had to rely on selling products OUTSIDE of the membership program that were priced higher, in order to make the program truly profitable!
Which is a whole other load of work, and ultimately you might be better off creating a simple course, book, or other form of passive income – especially if you are short on time, or have a relatively new business and / or you aren’t quite familiar with outsourcing or hiring a strong team to help support you as you grow.
However if you have a good solid plan in place (this is coming from me who is the total opposite of a planner-type personality)! and you’re ready or prepared to either put in the time and energy required and / or hire a support team to help you implement at the same time as growing,
A membership program could absolutely be an incredible income stream for your business, that, when run in the right way, can be as ‘passive’ as you wish it to be.