Advantages and Disadvantages of Running a Membership Site

The Advantages and Disadvantages of Running a Membership Site

If you have been paying attention to the buzz surrounding the subject of membership sites on the internet, you will have heard about the many benefits of owning one. On the other hand, if you are new to the concept, you may be wondering what the big deal is. Well, of course, there are advantages and disadvantages to consider. We’ll start with some positive benefits that you won’t want to miss!

==> Advantages of Running a Membership Site

1. Passive Income: The first and most obvious benefit of any membership site is the passive income it generates from membership fees. The definition of passive income is “income derived from investments in which the individual is minimally involved.” To be successful, a strong initial effort is needed to get your site running and a passive income stream flowing. After that, you may well find yourself earning more and working less.

With a passive income, you can make money 24 hours a day seven days a week. Unlike a service based business, with a business that generates passive income, you can take your family on vacation and still make money while you are away from the office.

2. Residual Income: Membership sites also enable you to earn residual income. Residual income is income that keeps coming in to you on a regular basis. When you create a membership site, your customer will be paying a monthly membership fee for a time period that you designate.

You may only charge your customers twelve payments, and after they have paid those payments, grant them a lifetime membership at no additional cost. You may opt to charge a yearly renewal fee, or you may decide to have the payments charged to them on a continual monthly basis for as long as they remain a customer. Whichever method you choose, you are creating residual income for yourself.

3. Inexpensive To Start: Another great benefit to a membership site is that it is relatively inexpensive to start. Of course you will need to put some money into it, but if you can do the web design work yourself and choose to market your business using free marketing methods, you can get your site up and running for less than $200. That includes the domain registration, hosting account, membership management program, and any additional tools such as an autoresponder.

4. Expert Status: As your membership grows in popularity, so will your reputation. You will begin to be seen as an expert in your field. Subscribers will automatically look to you for advice and inherently trust your judgment. Essentially, you will be building and promoting your own brand. When you have a recognized and trusted brand, you dramatically increase your ability to offer other products and services under that same brand name. Because your brand is proven and trusted, your new products automatically become trusted as well.

5. Built In Affiliates: By offering an affiliate program, your customers will be able to earn income through the referrals they bring to you. If you are consistently providing your customers great content and quality information, they will most likely be happy to tell others about your site; couple that with the fact that they can make money doing that, and they will be shouting your praises from the rooftops.

When the majority of your customers are helping you to market your membership site, you will be able to reach a much greater number of potential customers than you would ever be able to reach through your solo marketing efforts. This, of course, will lead to a greater number of new subscribers and a larger income.

==> Disadvantages of Running A Membership Site

When you start educating yourself on building a membership site you will hear about how to choose your niche, how to set up your site and how to research your potential clients needs. One thing you won’t hear much about, but that you also need to take into account, is the amount of time you will have to spend maintaining and updating your site. While this can be a very lucrative source of income, you do have to be able to put in enough time each day, week or month to keep it running smoothly and growing steadily.

There really are quite a lot of things that much be done regularly to keep a membership site running smoothly and its content new and relevant. Depending on the type of membership site you create, the most difficult aspect may be constantly coming up with new content.

1. For people with content sites, if your content is not of good quality and constantly updated, you will loose your member base. Remember, people are paying you for unique and relevant information that they cannot easily find on their own.

TIP: When it comes to creating content, you may find it easier to hire a ghostwriter, rather than struggle to write it all on your own. A ghostwriter may also help you brainstorm new things to write about.

2. New content must be edited, formatted, uploaded and linked on a regular schedule. This can be a very time-consuming process. You may find it helpful to set aside a regular, recurring day or date to do this. In other words, your members will expect you to upload new content to your site on the same day of the week or month.

3. If you miss updating on the scheduled day you can expect a flood of emails wanting to know where it is. If you use WordPress for your membership site, you can use the delayed post feature, enabling you to upload the information ahead of time, but not actually showing up until the date you specify.

4. As the owner of a membership site, you may also incur a daily amount of emails regarding both customer relations issues as well as technical issues. You will probably also get a certain amount of general questions and requests. Of course, you can outsource this to a virtual assistant, which will allow you to work on other things.

NOTE: These things are not meant to discourage you in any way from starting a membership site. The many advantages of membership sites can far outweigh the disadvantages. However, you need to be aware of all the aspects involved so you can be prepared and know exactly what to expect before deciding to commit to running your own membership site.

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