What’s the Difference in Strategy for a Free Membership vs. a Paid One?

Membership Free vs Paid

Explore the key differences in strategy between free and paid membership sites. Learn pricing models, content tactics & monetization tips. Why don’t you join us live with your questions next Tuesday? https://f0k0.short.gy/rH1LTo

In this insightful video, we dive into the critical differences between strategies for free and paid membership sites. Learn how each model influences content creation, audience engagement, and revenue generation. We’ll explore key factors that can impact your decision-making process, ensuring you choose the path that aligns best with your goals. Curious about how to maximize your membership potential?

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The Show’s Main Transcript

[00:00:14.360] – Jonathan Denwood

Welcome back, folks, to the Membership Machine Show. This is episode 145. In this episode, we’ll be discussing the differences in strategy for a free membership. This is a paid membership website. I have a lot of knowledge to share with you on this subject. I’ve got my great co-host with me. Kurt, would you like to introduce yourself to the new listeners and viewers?

[00:00:44.980] –  Kurt von Ahnen

Yeah, my name is Kurt von Annen. I own a company called Manana Nomas. We also work directly with the great team at WP Tonic.

[00:00:52.240] – Jonathan Denwood

Fantastic. As I mentioned, we’ll be examining the differences between free and paid memberships. It should be a great discussion. But before we go into the meat and potatoes of the show, I’ve got a message from one of our major sponsors. We will be back in a few moments, folks. Three, two, one. Coming back, folks. As I mentioned earlier, before we proceed to the main part of the show, I received a message from another sponsor, which Kirek will discuss with you. Over to you, Kirek.

[00:01:25.540] –  Kurt von Ahnen

Well, Jonathan, we’re excited. Today’s episode is sponsored by Misterio, Mysterio LMS. And here’s why we are excited about having Mysterio sponsor us. They’ve got a free version that’s not a trial, and it’s not limited. You get unlimited courses, lessons, and students, all for free, forever- no credit card required. So if you think about that, you can build your entire course business without paying a cent. Now, it has a drag-and-drop editor available. It includes quiz creation functionality. Student progress tracking is built in. There’s payment processing with either PayPal or Stripe. That’s all in that free version. However, if you’re looking for certificates, content, drip, or advanced features, you can upgrade to Pro and access all that information at Misterio. Com. That’s M-A-S-T-E-R-I-Y-O. Com. Io. Com.

[00:02:16.950] – Jonathan Denwood

All right, that’s fantastic. Let’s go straight into it, Kirk. We normally ask you if someone came to you for advice, but let’s just go straight into the show notes I’ve prepared. What would you like to do in the intro?

[00:02:33.280] –  Kurt von Ahnen

It’s interesting because we always start with this question, and this is the one topic where I think the question really fits.

[00:02:39.780] – Jonathan Denwood

All right, off we go. Somebody was coming in for some advice.

[00:02:43.500] –  Kurt von Ahnen

If you’re running an agency, this is a basic level of discovery. It’s like, what are your goals? What are you trying to do with this? Is this a business? Is this a hobby? Is this a nonprofit? Are you trying to generate income? Is this a marketing effort? And As you ask these questions and you get feedback from the client, you’re able to help create the strategy that’s going to help them successfully launch to get the results that they want.

 

[00:03:11.280] – Jonathan Denwood

What do you see as the pros of a free online membership community?

 

[00:03:18.880] –  Kurt von Ahnen

So we say, what are the benefits of it? The benefit is you don’t have to worry so much about locking the dang thing down. In theory, if you’re creating You’re creating a free membership. You’re creating content that you want to share. You’re creating content that you want to distribute. And so your project becomes a distribution model rather than a revenue model. And so you’re less concerned about certain membership tools or locking things down or proprietary messaging. It’s more like you’re trying to distribute the content rather than restrict the content. Whereas if you’re focused on revenue, then the strategy is a little different. You’re focusing on what What do I offer for free as that lead magnet? But then what do I lock in behind the paywall to drive the revenue side of it? It’s two very different strategies.

 

[00:04:11.620] – Jonathan Denwood

What’s the cons of a free online community? I’ve got some ideas on this.

 

[00:04:17.900] –  Kurt von Ahnen

There’s a saying, that which is free is never valued. When you are constantly giving away free information, if you You don’t give away free information too long and you never flip the switch on revenue, you never build that value portion of your presentation. And so that’s one danger. So I think there’s some upsides to free content, but there’s also you got to be cognitive of your audience and the value proposition that you’re putting forward and make sure that you give yourself some slack, that you recognize your own value in the process. Don’t get lost in it.

 

[00:05:02.140] – Jonathan Denwood

Yeah, I think one of the problems is that people underestimate the time taken up in moderate in a community Obviously, the barrier of entry on the free is going to be lower. I think you mentioned when you, Unami, one of the problems I’ve heard, especially with school, because school They really push as part of their platform that you can set up free communities and paid communities. We talked about school a few weeks ago, and it was only $99 a month. I didn’t realize at the time they brought out, I think they call it their hobbyist plan, which is around about $9 something. So they got two plans. And I think you can do free and paid on But I know when you have published courses on UniMe, I’ve heard from people that have published free courses on school. They get inundated with DMs, DMs from every Tom, Dick, and Harry. What I mean by DMs, listeners and viewers is direct messaging, and you just get absolutely swamped with every, like I say, Tom, Dick, and Harry trying to sell their Will You? Their service, their digital plan, their social media plan, their ability to get more students for you.

 

[00:06:39.220] – Jonathan Denwood

I’ve heard it’s endless. So be aware of that. But I think it’s also… It’s debatable if you’re dealing with a free plan, are you getting any real value then trying to build a Facebook group? Because that’s going to be free. It’s debatable. They’ve both got their strengths and weaknesses, haven’t they?

 

[00:07:13.180] –  Kurt von Ahnen

Yeah. Most famous Honestly, I have an associate, an acquaintance. They built a Facebook group pretty successfully. I had joined their group when it had 100 people in it, and it was great. It was a wonderful group. A lot of people pouring into it. It was a peer-to-peer networking thing. It was really cool. Over time, that grew to over 10,000 people. And yeah, that’s awesome. He grew a community, 10,000 people. But the amount of grifters and spam and nonsense that started to come through the page, old timers like me were like, Let’s just bail out of this thing. Then the other side is- Well, can I just interrupt?

 

[00:07:58.960] – Jonathan Denwood

That was Dan, too. It’s one of those choices, wasn’t it? You can moderate. Like I say, it needs a lot of moderation, doesn’t it? You need to have policies when you join a Facebook or join, you’re doing it yourself, a free community. That’s why it takes up a bit of time if you’re going to do it properly because you need time to kick them out, don’t you?

 

[00:08:20.840] –  Kurt von Ahnen

This particular example is one of the examples where I’m really like, you can’t really depend on big tech because there’s a couple of times where Facebook and him had some disagreements on what was posted and he got suspended and couldn’t manage or moderate his own group. And then the other side of the coin was, I personally feel like once that group got to a certain size and they had gotten in for free and he hadn’t sold any access to anything yet, his ability to convert that audience to paid access was greatly limited.

 

[00:08:58.240] – Jonathan Denwood

Yeah, totally understand that. Let’s go on to paid. What are the pros of paid online communities?

 

[00:09:07.740] –  Kurt von Ahnen

I think it really comes down to use case and what you’re using for the paid community. For instance, If I’m on Patreon, I don’t have much design freedom, but I have control over who gets in to see what content. So that’s cool. When you’re doing a paid community, it gives you the ability to control what is seen by who. So that’s the major benefit. The other benefits come in when you start making other decisions based on platforms. So for instance, we’re super big advocates in the WordPress space. So we can build membership-restricted, really interactive, engaging properties in WordPress that don’t have to bankrupt the creator for making it, but give them unbelievable control over the content, the design freedom, and how things are delivered to people.

 

[00:10:05.420] – Jonathan Denwood

Right. And what’s the cons?

 

[00:10:09.760] –  Kurt von Ahnen

I think the biggest con is I’m I’m going to rabbit trail off of your idea, and that is people don’t recognize the work, the babysitting, the labor it takes. It’s a business. It’s another business that you’ve built.

 

[00:10:26.700] – Jonathan Denwood

A lot of people don’t appreciate the amount effort in supporting their websites, do they?

 

[00:10:32.880] –  Kurt von Ahnen

No. If you have a host like WP Tonic, they take care of updating your plugins and stuff. But if you’re solo, if you’re doing this thing on your own, you want to make You want to keep your plugins updated. You want to make sure your hosting is clean. All these things are factors. You have to moderate who’s coming and going. You have to review the orders. And there’s a certain amount of customer service that has to go with these projects. And that’s where I think a lot of people people just completely discount. They don’t even consider it when they get into the project is that when you get up to 500 people paying to access your website, there’s a certain percentage every month where a billing doesn’t go through, a credit card expires, something’s declined. They think they paid and they didn’t. They have to reset their password. They have a caching issue with the computer they’re using at home. Nothing’s wrong with the website, but they’ve got some browser caching issue. There’s support issues that come up, and you own it, so you have to support it, or hire someone to do the support for you.

 

[00:11:39.140] –  Kurt von Ahnen

But those are things to strongly consider. If you’re in a paid environment like Patreon, for example, some of that workload gets offset to Patreon, because Patreon would take care of the support. Patreon would help reset passwords. Patreon would help- Or they’re supposed to.

 

[00:11:58.240] – Jonathan Denwood

Like the stories I’ve heard that their support can be a bit iffy, to say the least.

 

[00:12:03.980] –  Kurt von Ahnen

But at least that scenario is supposed to take that off of your back. But even on Locals is another one, right? There’s Patreon, there’s Locals. There’s a bunch of these where they’re meant to be like community circle, Mighty Networks. We’ve covered those before. But there’s all these different ways to restrict content. But there’s always support and labor on the back end of that decision, and it’s to consider that before you launch your project.

 

[00:12:32.480] – Jonathan Denwood

I think the other thing between free and paid is we do another podcast, me and Kirk, called the WP Tonic Show. It’s really aimed at WordPress power users, freelancers, and small agency owners. We did an interview with a quite successful YouTube influencer in the WordPress space, Imran. I’m not going to pronounce his second name, but Imran. It’s nick. Of Web Squadron. He’s got over 100,000 subscribers. He concentrates on a page builder called Animator, but also gives general advice about running that agency. He was saying, but he does his membership through YouTube, but they’re micropayments. He asked for $3 He said a lot of his audience is outside the USA and Europe. It’s in the Far East. It’s in the Indian subcontinent. Really, he made the decision that a lot, I don’t know if it’s a third or half of the videos that he provides, you got actually paid to watch them. But like I say, they’re micropayments, $2, $3. But in some of these markets, that’s a fair bit of money, but that’s why he’s using YouTube. I personally, he was unconcerned that, like I pointed out to him, that he might have the channel blocked.

 

[00:14:15.560] – Jonathan Denwood

He pushed back on that, didn’t he? He said, I’m very careful about not using royalty-free music from YouTube, and I do this and that. I personally think that I wouldn’t say he was being naive, because he didn’t strike me as somebody that’s naive. But somebody out of pure spite might start complaining about his channel, and you only need three strikes, and you’ll lose your channel. So I wouldn’t want all my apples. So there’s that point I’m making, but there’s also this area of micropayments. Do you think that… Do you think I was waffling a bit? But I think there’s this subsection of micropayments as well, isn’t it?

 

[00:15:10.240] –  Kurt von Ahnen

Well, yeah. This comes down to use case and doing good discovery with who you choose as your service provider or vendor. A good vendor is going to take a look and give you advice. When you look at the volume of viewers Imran has, for example, that volume with that micropayment makes it well worth his while to make the videos. He’s not doing it to become independently wealthy and have a stock in Facebook, I don’t think. He’s just trying to…

 

[00:15:39.080] – Jonathan Denwood

I don’t know. Make a good living. Because they are just Because YouTube, I’m correct, YouTube’s taking 30% of those micropayments, are they not?

 

[00:15:50.280] –  Kurt von Ahnen

Well, on that interview, he thought the percentage was much less. He thought it was like 18 or 19%. And still, I think that’s large.

 

[00:16:00.000] – Jonathan Denwood

That’s still in that slide, don’t you?

 

[00:16:01.880] –  Kurt von Ahnen

Yeah. It’s a hard one to point out to, but if your volume is big enough and you can afford to offer micropayments and increase the size of your audience by doing that, it’s well worth it. We have to remember that in this subscription-rich environment we’re in right now, it’s not unusual for households now to have four or five different television subscriptions. And so they have Hulu, they’ve got Disney, they’ve got Prime, they’ve got Roku, Paramount. And so people have an appetite or a stomach for $3, $4, $5 When you start creasting into that $49 a month phase of pricing, I think you’re in a different market. And so I think you have to play differently based on the content you make, the scheduling you have for the content and your delivery method.

 

[00:17:04.160] – Jonathan Denwood

Yeah. You can join the show live, and if you’ve got any questions, you can ask them, Join the show, folks. We normally do this. We have changed the time this week, but we normally promote it, and it’s on Tuesdays, and it’s normally around 4: 00. Hopefully, I’ll be able to keep doing that. I might have to change it around. But we got somebody commenting here that he never gets striped for that because he’s using royalty-free music. Like I said, I’ve known people that had miscellaneous claims made, and like I say, and if you do go down that route, it’s extremely hard to get a response from YouTube. I’m just pointing out what I’ve heard.

 

[00:17:55.740] –  Kurt von Ahnen

It’s coming from our Google.

 

[00:17:57.440] – Jonathan Denwood

I think we’re going to keep this particularly for the episode short and sweet, folks. We’ve gone through some good points in this first half. We’re going to go for a middle break, and we got some good content for the second. Keep with us. You’re going to learn something. We will be back in a few moments, folks. Three, two, one. We’re coming back, folks. I want to point out that we got a great free resource. We got a curated list of the best WordPress plugins and services if you’re looking to build your membership community We’ve got some nice special offers from the sponsors of the show, folks. You can get all these goodies by going over to the parent company of the Membership Machine Show podcast, and that’s WP Tonic, which is the major sponsor of the show. You go over to wp-tonic. Com/deals, wp-tonic. Com/deals. The main offering is a course done by Kirk that shows you how to build a membership or community website on WordPress from beginning to end using the best solutions that save you a ton of time. That’s normally slightly under $49, but we’re doing it at half price if you go to the WP Tonic deals page, and you can get the course and the other special offers all on that page.

 

[00:19:23.580] – Jonathan Denwood

Let’s go into the next section, what separates free content paid content? Use these questions to decide your content should be paid or free. Number one, what issue is resolved by? So I’ve written up some subtitles, But I think the main question, I think with a lot, I tend to take the same. It’s got to be solving a pain rather than bitments, really. But what’s your view? Is there a big difference between paid and free content?

 

[00:20:06.000] –  Kurt von Ahnen

I think this is a hugely controversial subject, actually, Jonathan. Take a look at people like Gary Vaneerchuk. Gary Vaneerchuk has become famous, telling everybody that they need to give away their best content for free. They need to prove their value. And once they become invaluable to somebody, they get to leverage that value for a reimbursement payment, whatever, right? So there’s a process to that. But there’s also this residual thinking, this thought that’s like, I’m going to give people just enough so that they pay me to get access to the rest of the answer. And so we hear these things like, give away your best stuff for free. And you’ll hear people like Tony Robbins say that or Russell Brunson or any of that, the new pack of super smart dudes. You’ll hear them say that stuff. But in reality, when you pay attention to their ads, their come to our free webinar or go to the free webinar and you see how they run that program, they’re not giving you all of the information at the free webinar. They’re not giving you all of the presentation in the free sales call. They are very much touching stuff on the surface to get you interested, to sell you an expensive platform.

 

[00:21:29.660] –  Kurt von Ahnen

And And so I think it’s very interesting to see what some of the experts in the space say versus what they do. So I struggle with it myself. I think that I give away an awful lot of great content, all the different podcasts I’m on and the blog post that I publish, and you do the same thing. But at a certain point, is that the same level of information and one-on-one consulting that someone gets on a with one of us or a discovery call about a project? And I would have to say, no, absolutely not. The one-on-one time, that premium time comes with a much higher level of integration, interactivity, and What I would say is probably a better end result for the audience, whoever that audience is.

 

[00:22:21.040] – Jonathan Denwood

I think I totally disagree with Venechek, but who am I? He’s made a ton of money I haven’t, but I just disagree with it. I think there’s a difference in being generous and using Pacific content. I’m a great fan of this mythology that I’ve pushed during this podcast a lot, haven’t I? Of getting your first course out. Don’t let it become war and peace. Don’t spend six months building some monstrous first course. I’m more about you need a landing page, you need to promote your upcoming course, and for it to be a microcourse with a specific purpose, and for the people taking the course to get a specific success from it. I don’t think it should be more than 12 lessons myself at the most. Then after you’ve got your first batch of students through it and you’ve learned from the process and you haven’t been overwhelmed, you can then use that course as a lead magnet. I’ve a low price, probably a low price trigger lead magnet. In your next course, that’s going to be bigger, but you use that mini course as a, like I say, it’s not a free magnet that I think, or you could decide to use it, but I think it’s a low price trigger.

 

[00:24:00.000] – Jonathan Denwood

Around anything around five, nine dollars. What do you think about this?

 

[00:24:06.900] –  Kurt von Ahnen

I think it’s humorous because I literally just spent the last week building this type of trip wire sales system for my power sports project. We’ve put together a mini course with a lead magnet to attract people to it. It’s twenty-seven dollars. People get a very specific, actionable training that they can implement in this three-lesson mini-course. At the end of the three-lesson mini-course, they are pitched a $197 monthly fee, similar to a junior consulting package. And then, I think you already know this, but our top package on that website sells for $45,000 per store. And so people would say, ‘Well, how do you get from $27 to $ 45,000?’ That doesn’t make any sense. It does make sense. If you build value and demonstrate it through each of the steps we just discussed, people will build faith and trust in you, and they’ll make that leap when it’s appropriate.

 

[00:25:09.640] – Jonathan Denwood

Yes, I’ll get back to the free or Purchase Option. There’s a major YouTube WordPress influencer. He’s got over a quarter of a million, I think, followers. He was offering a free course through a couple of his videos, and it took you to school, but you couldn’t automatically join. You had to apply to join his free course. Obviously, I got in, but then he’s offering other paid courses through the school. So he’s using the free school, but he’s keeping the numbers. You just can’t join. I would strongly advise against it. It’s unlikely to attract anyone to your free course, as you’ll likely be inundated with scammers. And DM messaging, then it’s going to be over. If you’ve got any in, I suppose that if you’ve got none, it doesn’t really matter. Well, I think it does because a lot of the people you’re going to get excited about are just going to be DMing you, aren’t they?

 

[00:26:28.480] –  Kurt von Ahnen

It’s a peculiar way we’re discussing this, because people will hear this and say, ‘ Well, if I’m getting a ton of DMs, I’m probably getting a ton of traffic, and that’s great. ‘ And it’s like, no, you’re getting all the traffic you don’t want. You’re getting people that are like ambulance attorneys, right? They’re just ambulance chasers. They are trying to find, skim whatever dollars they can off of someone who looks desperate. This is one of those situations, Jonathan, where I have tried some of these SaaS platforms. I’ve experimented with them just to see how they work. And I constantly get wrapped up in some spam circle. Whereas when I build something in a platform I own, like WordPress on my own URL, you build it. Do you have a lot of people coming to the property right away? No. You could buy ads, you could purchase a mailing list, or you could take steps to drive traffic. However, you won’t be inundated with a barrage of nonsense either. It’s like traffic that comes to the property is the traffic you directed there, and you’re going to see your conversion rates off of real traffic.

 

[00:27:34.440] – Jonathan Denwood

All right. I think I’m going to end it now. We’re providing you with valuable insights into running a free course, a membership-based program, or a paid one. There’s a lot of self-fertilization. I’ve got emergency services coming past me. Making a hell of a racket, folks. We’re Good. Hopefully, you gained some insights about it. As I mentioned, we also have a Facebook group called the Membership Machine Show. If you’re interested in joining, it’s a great resource. So, Kirk, what’s the best way for people to find out more about you and what you’re up to?

 

[00:28:19.020] –  Kurt von Ahnen

Well, for business, we’re at Manana Nomas. Anything Manana Nomas. Com, X, Facebook. And if you’d like to connect personally, feel free to reach out to me on LinkedIn. I’m the only Kurt on LinkedIn.

 

[00:28:31.020] – Jonathan Denwood

Yeah. I also want to point out that the main sponsor of the show, the WP Tonic, also has a great YouTube channel with a load of content that will help you. So go over to YouTube and join the WP Tonic show there, WP Tonic. As I mentioned, we have over 1,700 videos covering a wide range of topics related to building a membership website. It’s a great free resource. We will return next week with another topic to help you build a great, successful membership or community-focused website for you and your family. We’ll be back soon, folks. Bye.

 

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