Are you looking to start a membership site for your business?
Membership sites are an excellent way to generate passive revenue for your business. However, they can also be expensive to start and run.
There are a number of costs associated with running a membership site. Generally speaking, this includes website hosting, website development and design, and marketing. It’s important to make sure you account for all of these costs if you’re planning to start and run a membership site. This way, you’re less likely to run into surprises down the lane.
In this article, we’ll break down the costs of starting and running a membership site using membership site software and self-hosting a membership site on a CMS like WordPress. We’ll talk about the one-off costs as well as recurring costs.
Membership site software
If you’re not particularly membership-savvy, you might consider using membership site software to launch your membership site. Kajabi, for example, is membership management software that makes it easy (supposedly) for business owners to get their membership site up and running quickly.
Since it’s a hosted platform, you don’t have to worry about buying a domain or signing up for web hosting. All you have to do is select the plan that’s most suitable for your needs and you can start creating membership content and promoting it to your target audience.
Kajabi’s Basic plan starts at $119 per month (billed annually) which is suitable for up to 1,000 members. This means that membership site software (like Kajabi) will cost you in the ballpark of $1,428 (at the very least) to get your membership site up and running.
Be sure to check out our article on Kajabi Pricing Plans 2022: Are They Worth The Money? for more information.
Self-hosted membership site
If you choose to go the self-hosting route, you’ll need to buy a domain and pay for website hosting to get your website up. We recommend using a CMS like WordPress to run your membership site because it’s (a) open-source, (b) flexible, and (c) scalable.
Once that’s done, you’ll need to pay for a premium membership plugin as well as payment processor fees to start and run your membership site. Keep in mind that the costs to run your membership site will go up as you grow and scale.
Here are the main costs of starting and running a membership site in WordPress:
Domain registration and website hosting
One of the first things you’ll need to pay is the domain registration fees. This is the fee that you pay when you register your membership site’s domain name. The domain registration fees vary depending on the domain name you choose. At the minimum, you can expect to pay around $10 to $30 per year for a generic .com domain.
Once you’ve registered your domain name, you’ll need to host it somewhere. For this, you’ll need to sign up for a web hosting plan. Hosting fees vary depending on the size of your website. Generally speaking, membership websites are more resource-intensive than regular corporate websites or portfolio websites. Hosting fees can range anywhere from $35 per month for basic (beginner-friendly) plans all the way up to $100 + per month or more for more advanced plans.
As your membership site grows, you’ll need additional features, resources, and storage space that the advanced hosting plans offer. So, you can expect to pay more for hosting your membership site as it scales. This is why it’s important to factor in potential growth into your budget when planning out the costs of starting and running a membership site.
Membership plugin or platform
The membership plugin or platform you choose to power your WordPress membership site is an important consideration. The membership plugin will take care of essential features and functionality such as setting up membership plans, presenting membership content to users, accepting payments, and managing member accounts and memberships.
It goes without saying that the best membership plugins out there require you to purchase a premium license. This is because the free versions of membership plugins are pretty limited in terms of functionality. So, if you’re serious about starting and running a membership site, we recommend going with a premium plugin like LifterLMS or LearnDash.
Most paid WordPress membership plugins have a recurring annual license you can get for your website. LifterLMS will run you $149 per year to get started whereas LearnDash will cost $299 per year.
Another important consideration to bear in mind is that switching from one membership plugin to a different one isn’t easy. So, it’s best to research the features and functionality before committing to a membership plugin.
Check out our roundup of the 15 Best WordPress Membership Plugins (Compared) for more information.
A membership plugin handles most of the technical aspects of running a membership website. You can use it to create membership plans, accept payments, drip content, and manage members. However, most membership plugins don’t come with built-in options to create pages.
To build visually aesthetic pages for members, you’ll need to use a page builder for WordPress. Some of the most popular options include Elementor, Divi, and Beaver Builder. Elementor, for example, will cost you $59 per year for a single-site license.
Before choosing a page builder plugin for website design, make sure it integrates seamlessly with the membership plugin you’re using.
If you’re running a paid membership site, you’ll need a way to let members pay you when they register for a membership plan. For this, you’ll need to integrate a payment processor with your WordPress site.
It’s also important to use a popular payment processor that most users are familiar with like PayPal or Stripe. Most payment processors charge transaction fees. This means you’ll be charged a pre-determined transaction fee each time a new member signs up for a membership plan. Usually, this is around 3% + $0.30 per transaction.
If you’d like to give customers the option to be able to pay using a credit card then you’ll need to get an SSL certificate for your domain. An SSL certificate will run you around $100 per year.
So far we’ve talked about the different tools you need to build your membership site. However, there are plenty of additional tools that you’ll need to interact with members and deliver a good membership experience.
One of the first things you’ll want is an email marketing tool that integrates with WordPress and your membership plugin. This will make it easier for you to interact with members as well as non-members. You can use an email marketing plugin like Mailchimp to build your email list. Mailchimp starts at $13 per month and lets you send up to 5,000 emails per month.
If you plan on creating video content for your membership site, you’ll need to sign up for a video hosting platform. As the name suggests, a video hosting platform lets you host all video content on it. This way, you don’t have to upgrade your hosting plan to get more server resources. Wistia is a video hosting platform that’s perfect for membership site owners. It will cost you $19 per month billed annually to host up to 20 videos.
Check out our article on the Best Video Hosting Sites for Course Creators for more information.
Which option is right for you?
To sum it up, if you use membership site software, your initial costs will be lower than if you were to set up a self-hosted membership site from scratch. However, your recurring monthly costs will be significantly higher. The membership site software is easier to get started with, especially if you’re not particularly tech-savvy.
Setting up a self-hosted membership site will cost you more initially but give you more control over the features and functionality your site offers. In addition to this, monthly costs will be significantly lower than if you went with a hosted membership platform.
That said, it’s important to analyze the features you get as well as the one-off and recurring costs carefully before committing to either option.
The costs of starting and running a membership site can vary considerably depending on the size and complexity of your site. It’s important to thoroughly research the costs of starting and running a membership site before making a decision.
Membership site software (like Kajabi) makes it easy to get your site up and running quickly. Alternatively, you can set up a self-hosted membership site for much less using membership plugins (like LifterLMS or LearnDash). With a self-hosted site, the main costs to consider include domain registration, website hosting, membership plugin charges, and payment processor charges.
We explained the different costs of starting and running a membership site. Hopefully, you’re in a good position now to take the next steps.
Are you thinking of using membership site software or taking the self-hosted membership site approach? Which tools or plugins will you use? Let us know in the comments section below.