How to price a membership people keep paying for

Most creators pick a membership price the way they’d pick a number out of a hat: five dollars, because everyone else charges five dollars. Then they spend a year wondering whether it should have been three, or ten.

There’s a better way, and it doesn’t need a spreadsheet. Work out what a month costs you, open with one price, and let your members tell you what the second one should be.

Start with what a month costs you

A price that loses money is wrong however fair it feels. Before you choose a number, write down what one member costs you each month:

• Your time. How many hours go into what members get: the extra post, the early video, the answers in the comments? Give those hours a rate you’d accept from a client.
• Anything physical. A sticker club has printing, envelopes and postage for every member, every month. Price that first, then add your time.
• Fees. Whoever takes the payment keeps part of it. More on that below, because it changes what a small price is worth.

Divide your monthly hours by the number of members you can realistically expect in the first few months, not the number you hope for. If the answer is higher than you’d dare charge, the membership is promising too much. Cut what’s in it before you cut the price.

Open with one price

Three tiers look professional. They also ask a new visitor to compare three lists of benefits before they’ve decided whether they want to support you at all, and they ask you to make three sets of things every month.

One plan is a yes or no question. It’s easier to explain in a sentence, easier to deliver, and it tells you something useful: whether people want this.

A good first price is one you could say out loud to a fan without apologizing. For most creators posting digital work that lands somewhere between the price of a coffee and the price of a lunch. Lower than that and the fixed part of the processing fee takes a real share. Much higher, and you need to be giving people something they’d otherwise pay for elsewhere: lessons, files, coaching, a product in the post.

Add a tier when someone asks for it

A second tier earns its place when members ask for more than the first one gives. Someone wants the project files. Someone wants a monthly call. Someone tells you they’d happily pay more just to help.

That gives you the two kinds of tier worth having:

• More access. The same work, plus something that costs you little to share with one more person: source files, an archive, a behind-the-scenes series.
• More of you. Feedback, calls, commissions. These cost you time for every member, so price them by the hour and limit how many you take.

Avoid a tier whose only benefit is a longer list. If you can’t say in a few words what it adds, your members can’t either.

Offer a year as well as a month

Some members would rather pay once and not think about it again. A yearly plan gives them that, and gives you income you can plan around.

The usual discount is two months free: charge ten times the monthly price for the year. It’s generous enough to notice and easy to explain. Members who take it have already decided to stay.

On Drate, plans that belong together share one card, with a tab for each term. Give them the same name under Offered with when you edit a plan, and visitors pick monthly or yearly in one place instead of reading two cards.

Let people try, and keep something free

Two things help someone who isn’t sure yet.

The first is a free trial. A monthly or yearly plan on Drate can start with a trial of up to 30 days. A member enters their card, gets full access, and isn’t charged until the trial ends. A week is usually enough for someone to find out whether they’ll use what you make.

The second is leaving the door open. A members’ post doesn’t have to be hidden completely. In the post editor, the Paid access starts here line decides where the free part ends: everything above it is for anyone, everything below is for members. A visitor who has read three good openings understands what they’d be paying for far better than one who has only seen a row of locks.

Know what reaches you

Small prices lose more to fees than they look like they should, because part of the processing fee is a fixed amount.

On Drate, members pay you directly through your own Stripe account. Drate takes 5% of what members pay for memberships, and Stripe charges its own processing fee, which depends on your country and the member’s card. At the time of writing, Stripe’s standard rate for a card in the United States is 2.9% plus 30 cents. With that rate:

• A $3 membership leaves you about $2.46. Nearly a fifth has gone.
• A $5 membership leaves you about $4.30.
• A $10 membership leaves you about $8.91.

Check Stripe’s pricing for your own country before you settle on a number, and read Get paid through Stripe for where the money goes and when it’s paid out.

Change it when you’ve learned something

Your first price is a guess with reasons behind it. After a few months you’ll know more: how long the work really takes, which benefits people use, what they ask for.

When you do change a price, tell your members before it happens and say why. People who have supported you from the start are the last ones who should be surprised. And if the membership has grown beyond what you can keep up with, it’s better to take something out than to quietly deliver less.

A place to start

If you want one line to take away: charge what a month honestly costs you, for one plan you can describe in a sentence, with a yearly option and a free look at what’s inside.

You can set all of that up on Drate. Pick a template, add a plan, and publish when it looks like yours.