To gain the profits and credibility you are expecting from operating your own membership site, your site needs to endure for the long-term. This requires gaining new members who will stay and pay recurring fees over time. One good way of gaining new members is to have your current members advertise for you by promoting their affiliate links to people they know in an effort to boost your member ranks. However, they will want to be compensated for their efforts, which often means they’ll take a percentage of the recurring membership fee. The question is, is this a good strategy to follow?
The answer is arguably “yes” for the following reasons:
1. Without the efforts of your current members, you likely would never have gotten these new members to join your website and pay a recurring fee for access to your membership site. Therefore, without your current members’ effort, you’d have no extra profit to begin with.
2. Your current members only get paid if they bring in new paying members. If that new member decides to cancel his/her subscription, the current member’s recurring commission disappears as well.
3. That recurring commission comes from the new member’s recurring fees, so again, the commission doesn’t come from profits you’re already making, such as the current member’s recurring fee. It only comes from people he/she recruits who agree to join your membership site.
Again, without your current members’ efforts at promoting your membership site, you’d gain no extra profit. For example, if your membership fee is $20 per month and you’re giving 50% profit to your current customers, you’re still gaining $10 extra per month. It’s better to earn $10 extra per month than $0 extra per month, right?
For more information on membership sites, check out “Membership Sites Made Easy: How to Cash In On Your Own Membership Site.”
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