Membership sites and online courses — two online business models that are actually quite different.
But, how do you go about choosing which one is best for you?
Watch the video or read on to learn the pros and cons of each so you can build the best info-product business possible.
Membership Site vs. Online Course Businesses
The biggest difference between these two types of info-product online businesses lies in their payment methods.
A membership site runs on a recurring payment model. Every month, customers pay a recurring subscription fee in order to maintain access to both your existing and new monthly content.
On the other hand, an online course business is built around once-off payments or payment plans for each course you create. Course materials are created once and made available to customers for a fixed period of time.
Membership Site Businesses
Now that you know what a membership site is, what are its advantages and disadvantages compared to online courses?
Membership Site Pros
Building a membership site does have it’s upsides:
- Content is only available to customers if they keep paying their monthly membership fees
- Members are incentivized to stay on or return whenever they want to engage with your products, services or content
- Your monthly revenue is more predictable because it’s recurring. In fact, if you can minimize churn, your revenue will grow each month
What Is Churn?
It’s the number of customers that cancel their membership before their next billing date — resulting in a loss of revenue to your business.
Negative Churn: you lose more members than you gain each billing period.
Positive Churn: you gain more members than you lose each billing period.
Because churn is such an important factor for any membership or subscription-style business model, you must constantly work to reduce it.
This is typically done by adding new value to your membership to keep existing members around while also marketing to attract new members to replace those who left.
Membership Site Cons
It’s also important to understand the downsides of a membership site business before starting one:
- You're on the hook to deliver new content each month. This often requires hiring a reliable team to help you
- You’ll need to spend time and resources marketing your membership to achieve sustainability and positive churn
- Membership growth can be slow and frustrating when you first start
- Churn is a constant issue you’ll need to address by increasing the value of your membership
Online Course Businesses
On the other hand, there’s many reasons why online courses are great for both course creators and students alike — but is it the right kind of info-product business for you?
Let’s find out...
Online Course Pros
If you’re not keen to keep creating content month-after-month indefinitely, online courses can be very attractive. They:
- Only require a one-off payment from customers to get access to the content you've already created
- Have scheduled launches, often simplifying your marketing strategy
- Don’t require an indefinite commitment to create recurring content for your customers
Online Course Cons
However, online courses do have their drawbacks:
- You’ll need to spend dedicated chunks of time to market each launch of your course(s)
- It’s difficult to predict how many people will purchase each of your courses
- Monthly revenue is much more difficult to predict and will be determined by the number of courses you sell as well as the frequency of your launches
Interested to learn more about how to build an online course business with Thrive Apprentice? Just watch this tutorial:
Which Business Model Should You Choose?
When deciding between a membership site and an online course business model, keep the following in mind:
- Your available time
- Your ability to create content consistently
- The type of business you want to run (solo-business vs. hiring a team to help you)
If you decide on creating a membership site, it will demand your 100% focus and dedication to keep delivering valuable new content each month.
To make this happen, you’ll probably need to hire a team that can handle that work for you to keep your membership community happy.
On the other hand, if your business is based on consulting services or 1-on-1 coaching, then packaging and selling your expertise through online courses is a better option.
It's less hands-on giving you the time to create, market and sell your courses on a more open schedule.
Now It's Your Turn
Do you have experience running a membership site or online course based business? Or are you still deciding which info-product business model is best for you?
We’d love to hear your thoughts and questions about the pros and cons of each in the comments section below!