Thinking about reducing the price of your membership?
Right now, you may be wondering…
‘Why in the world would I ever want to reduce the price of my membership?'
Surely that's the opposite of what I should be doing?
The short answer is yes…
Ideally, the price of your membership should be going upwards…
To correlate with the value of it increasing over time…
Especially when you’ve probably invested a lot of time, energy and resources into making it more valuable and result-oriented…
But the reality is sometimes very different…
There are some legit reasons why you may need to lower the price of your membership…
And this is something we're going to explore…
Lowering the price of your membership WITHOUT causing issues for your existing member base…
Because that's the last thing you want to do!
So if you're seriously considering lowering your price, then read on to find out how you should approach it…
Let's start by answering this important question…
Why would you ever consider lowering the price?
Well, the answer to question is not as straightforward as it may seem…
With memberships, there are so many factors that could either increase subscription numbers or send them plummeting…
And there are certain situations where reducing the price is the best move to make for the future of the business…
Situations like…
When you’ve completely changed your offering
The great thing about memberships is that they’re dynamic…
People can switch them up every now and then to offer new solutions or expand on their material.
But let’s say you’ve totally shaken things up…
Either by bringing in additional membership levels or diminishing your membership’s value…
Decreased signups are a plausible side effect of this.
A common example of the latter is when you start off with a very hands-on and interactive membership…
Then you suddenly decide this is no longer feasible or maybe you simply don't want to be so hands-on anymore…
And changing your membership offering is the next logical step…
The result: you’re going to have to adjust your membership price accordingly.
Your membership prices were initially high
It’s not unusual for membership owners to enter the market with high prices…
So, let’s imagine that when you launch your initial membership price was too high…
The natural response to that is a low signup rate…
Or maybe you've recently increased your prices and signups have flatlined.
These scenarios are bound to disturb any membership site owner…
And while of course it's never a good thing to go backwards in your pricing…
These are situations where reducing the price of your membership is a necessity.
BUT before you go tweaking those membership prices let's look at the implications of doing so…
Implications of lowering your price
Let's be frank…
Reducing the price of your membership will be seen as a failure…
That you've got something wrong…
And your membership wasn't worth the initial price you were charging…
It will be perceived in many cases as a negative…
Which could be damaging to your brand.
It could be a massive red flag to some and put people off joining your site.
And this isn't restricted to you lowering your price…
The same thing happens when you implement a price increase…
People question your reliability…
Changing your pricing strategy isn't an easy sell!
Then there's your existing members…
They're locked in paying that higher price…
And they – quite rightly – won't be happy when new members join your community with access to the same resources for a fraction of the price…
Your existing members…
It's with those existing members that things get a little complicated…
Most membership plugins won't allow you to lower the price for existing members…
So they'll need to manually take action themselves…
And that's a bit of a pain for them.
These are things you need to be mindful of.
So if you want to lower your price, how do you approach it…
Ask yourself:
Do I really need to reduce my price?
While plummeting subscription numbers is as good a reason as any other to re-examine your prices, it’s not always the right reaction.
In fact, with a price increase, it’s expected that membership numbers go down…
With all things membership, it's vital that you do the actual math.
It's not just about the number of signups…
It's all about member lifetime value…
For instance, if you double your price and get half as many signups overall, you still make the same amount of money, right?
Assuming people stay the same amount of time of course…
But once you crunch the numbers, you still come out on top.
And in this case, reducing your prices isn’t an issue…
That's why you need to base your answer to this question on the maths…
Instead it could be time to take your marketing strategy to the next level or refine your messaging to attract the right kind of members to your site.
Is pricing really the issue?
So, you’ve just launched your membership, and it’s built on a remarkable premise.
The problem is that no one is signing up…
And you think that's down to the price, however, there's a good chance that price has nothing to do with it.
Ask yourself this…
Did you build up an audience before launching the membership?
Contrary to popular belief, when you build it, people don’t always come.
Online businesses are quite complex in this way…
You need an audience!
But what if you do have a huge audience, but your signup numbers don’t make sense?
It could be that you didn’t validate the idea.
So, how do you know if it resonates with your audience?
No one can supply when there’s no demand, it’s just the way things are.
With that in mind, idea validation and audience building are the two fundamental activities people need to handle before they start a membership.
If you’ve evaluated these two areas and still want to revisit pricing, what’s next?
Reduce your membership prices seamlessly by:
1. Being transparent
Changing your prices out of the blue could raise multiple red flags…
But a sure way to handle that is to let your members in on every step of the journey…
It doesn’t just reinforce their trust in you, it also maintains your credibility.
But remember that timing matters…
Don’t let them hear it after the price change has already been implemented or through the grapevine.
2. Making the transition to a lower subscription simple
While this aspect will depend on the membership plugin that you're using…
You shouldn’t leave your members to their own devices.
There’s no guarantee that your members will receive your update on time…
But you can get ahead of that by sending an email three months before the price change.
It doesn’t stop there…
You could make the process even more seamless by creating a little how-to video that addresses some frequently asked questions…
Maybe even do a walkthrough video on how to make the change.
3. Offering incentives to existing members
What do you do with members who are locked in paying your initial rate?
This could rub them the wrong way if they find out people are getting it cheaper.
The solution: offer some incentives…
It could be free time or bonus material…
Either way, it’ll put their minds at ease, so they don’t feel like they’re missing out.
One way to get around this is to create a two-tier membership…
Your members…
Some members will pay a higher rate for more content, and some pay a lower rate for the basics.
If you increase prices for the higher tier members, the best way to do this is to increase the value of your membership.
Find something to add to your current price point that makes it fit for premium members.
It could be anything from extra content to one-on-one access or even group coaching.
Meanwhile, members at the lower price point get the features your membership currently offers.
So they get just the basics, none of the new stuff…
Even better, you could give existing members the liberty to downgrade to the cheaper level.
At the end of the day, it’s a win-win situation for everyone…
And a much more attractive alternative to lowering the price of your membership.
How to avoid having to reduce your price
If you're reading this and are early on in your membership journey, you might be starting to feel anxious about getting your pricing right now…
Please don't…
This isn't a common occurrence…
And is very unlikely that it's something you're going to have to do…
Having to reduce your price after launching your site is rare…
But if you want to make sure you avoid having to consider it, here are some things you can do:
1. Arrive at your membership price… then launch lower
In most cases, you know exactly what you want to charge for your membership from the get-go…
The thing is, when you first open the doors, it's better to kick off with a special launch offer price.
Ideally, this will be the lowest price you ever offer your membership at.
Aiming too high could jeopardize your chances of gradually adjusting your price as you gain momentum.
‘Why' you may ask?
Well, at that initial stage, your membership is not all it could be.
There’s still room to expand.
If your prices are already too high, there’s little to no room to increase them as you grow.
2. Don’t fall into common traps
We see a lot of people get the logic wrong when it comes to deciding on how much to charge for their membership…
These are usually people who have sold other types of tings before…
For someone who has tinkered with other types of online ventures and succeeded, it’s easy to think that memberships work the same way.
You may be used to charging an hourly consulting fee…
Or receiving thousands of dollars every time you publish a course…
But memberships don’t work that way…
This is a case of comparing apples and oranges…
While this unequal comparison could do a lot of damage, listening to the wrong people could add to that.
Filter any advice you receive on how to run your membership…
Especially when it’s coming from people who’ve never run a membership site before.
Sure, reducing the price of your membership isn’t something you’d readily want to do…
We get that…
But, if the situation calls for it….
The tips I've shared in this post will get you safely across the finish line…
But if there's one piece of advice I'd like you keep in mind, it's this…
Unless you've totally overhauled what you're offering, reducing the price of your membership should be a last resort…
It will be seen as a failure…
And it will cause complications for you with existing members…
So always question whether or not the price is the issue…
Or whether the problem lies elsewhere in your business.
Thank You For Listening
We really appreciate you chosing to listen to us and for supporting the podcast. If you enjoyed today's show, please share it using the social media buttons on this page.
We would also be eternally grateful if you would consider taking a minute or two to leave an honest review and rating for the show in your podcast app of choice. They're extremely helpful when it comes to reaching our audience and we read each and every one personally!
Finally, don't forget to subscribe to the podcast to make sure that you never miss an episode
