Membership Site vs. Online Courses — Which Business Model Is Right for You?

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.

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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!

Author: Hanne

Hanne knows exactly what companies have ever retargeted her (she keeps an updated file). And when she's not busy discussing high-level funnel design over cocktails with the equally geeky, you'll find her discovering a place for the first time

  • Adam says:

    I was just checking out your latest email thrive on Friday. And your highlight site is ikario.com and Shane has a paid membership community on this site.

    What is he using for his community?

    Buddy press or buddy boss

    What theme does he use for the community?

    If it’s TTB how does he style it?

    And will TTB be styled to work with buddy press or buddyboss?

    What payment processor does he use for his membership?

    It really is a great idea to sell a course and then funnel the users into a paid membership community, best of both worlds.

    • Hanne says:

      Hi Adam,

      Shane is using Discourse for the community side of the site. And yes the whole site is created using Thrive Theme Builder.
      He’s using ThriveCart.
      And no you won’t be able to use TTB to style Buddypress because that’s a theme on it’s own.

  • Ivaylo Ivanov says:

    Nice

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