02:35 – Where to begin
04:15 – Handling resistance when charging
07:00 – How to generate leads
09:03 – Free vs. paid membership
14:14 – If you don’t have an area of expertise…
17:52 – No product, what to sell?
23:05 – Avoid THIS mistake
26:18 – Segmentation is key
27:44 – How often should you turn up?
32:09 – The challenge of being open 24/7
38:59 – BIG takeaways
46:12 – A quick summary
46:40 – Where to put your focus on
47:46 – Selling memberships directly on the front end
Want to build a recurring business? James can help you HERE
James: James Schramko here. Welcome back to SuperFastBusiness.com. Today, I’m very excited because we’re talking about a sweetspot topic of mine, which is recurring subscription memberships. I’ve brought along an expert in this subject, and you might have heard about him lately because he seems to be super famous. He’s all over the airwaves. I think because he’s releasing a course about this. Welcome Stu McLaren to the call.
Stu: Thanks James! Happy to be here buddy.
James: Stu, you are publishing a course about this stuff, so I thought it would be a great time to get you on a call, and maybe we could compare some notes, ask you a few challenging questions that I get asked all the time in my own community because as much as members have heard me answer it, I’m sure they’d love to find out what you think as well because you have an extensive and deep knowledge of memberships. You’ve put in together the tribe course, which is really phenomenal. Based on the videos that I’ve been watching, we really do sing from the same hymn book by the sound of it.
Stu: Yeah. It’s funny, you know, we were talking, we’ve got a lot of mutual friends, and they’ve always talked and spoken so highly of you. In fact, just the other day, I was watching a video of you and Ryan Levesque where you guys were talking shop and membership sites actually came up. It was interesting to hear your perspective on a bunch of things, which hopefully we’ll talk about today. But yeah, we definitely come from the same angle when it comes to approaching a membership site.
James: Fantastic. Because you’ve got this course, everyone out there is doing interviews with you. I’ve listened to a couple, and they’re great. I listened to the one you did with John Lee Dumas recently, and he’s always a great host. I think if someone’s coming into this whole idea of membership sites, that would be a good background type of interview to go and listen to, to get up and running as to why you want a membership.
Today, I specifically want to take it up a notch. I actually want to turn up the flame a little more into the intermediate and advanced section. But before we do that, let’s just get the easy stuff out of the way.
Can I still have a membership even if I have no list, no marketing skills, no product, and no expertise?
Can you start from scratch?
Stu: The ultimate question, right? So, here’s the deal, I think today more than ever, it’s easier to get started. One of the things that I’m seeing with a lot of clients is the ability to create a lot of momentum fast using Facebook groups. So if you’re starting from scratch and you’ve got no audience, no list, no expertise, or anything in that nature, starting with a Facebook group is the fastest and easiest way to get started. Of course, my recommendation is to start with a free Facebook group.
The advantage there is you could easily transition once you’ve begun to build that community and build that connection with people easily transition to a paid group. So there’s a couple examples, friends of ours, who have started similar groups. There’s a couple named Jill and Josh Stanton. They started a free Facebook group, and in the period of about five to seven months I believe, it has been since they’ve been running that, it’s closing in on 20,000 people. It’s a very engaged community because they pay attention to it. They treat it almost like a membership site. But the great thing is that has fueled the growth of their membership site. So they use it as a platform to feed the actual paid membership.
So for people who are just at the bare beginnings, my belief is that starting with a free Facebook group and really nurturing that community is a great way to get started and create momentum.
James: What kind of resistance would you expect when someone tries to put a payable up or charge people? Are they turning off the free Facebook group, or are they adding something on extra?
Stu: They’re definitely adding something extra. So I think that, you know, it’s not a matter of turning it off per se, but it’s a matter of using one as a source of leads to feed the other. So think of the Facebook group as more of an area where you can discuss, and share ideas, and support one another.
But a membership site is typically where you’re going to provide more organized training materials that are actually going to support people in executing and helping them, almost like go and have a pathway to accomplish what they want. Does that make sense?
James: It does make sense. I think a typical resistance that I would either have myself or that I hear is how much time are you going to be spending on Facebook servicing this free group to find your buyers versus another medium like podcasting, where you can put in an hour or two that’s quite leveraged over another platform like Apple, and you can still have a community, because I must admit, to this point, I’ve resisted having a Facebook group in favor of having a paid forum as the place where I want to spend my time and serve my customers. But on a side note, I was definitely going to ask you, how much has Facebook impacted products like the one that you actually co-founded and built up, which was Wishlist members, how much is it pushing into these platforms?
The impact of Facebook
Stu: It’s definitely pushing into it. A lot of people have always asked me, “Should I start a Facebook group, or should I keep the community within my paid membership?” Between us James, I’ve always been a proponent of keeping the community in the paid membership because the reality is, we don’t own Facebook. So Facebook one day, if it just decides that they don’t like groups anymore and boom, there goes your whole community.
However, here’s the reality of the situation, there are more people on Facebook today than ever before. It’s like a natural daily habit of all these people to check Facebook on a regular basis. So the reality is, that’s where people are. So one of the things that I think is important, especially if you’re looking to generate leads for a membership site, is to leverage Facebook.
You asked a question about how much time should I spend on there. I don’t know that there’s a set gauge where I could say like, “OK, James, for you, carve out half an hour or an hour each week, and that’s it.” I think that managing a community, you kind of got to flow with it, because sometimes, it’s going to be more intense, other times, it’s going to be less. But I do think that you get out of it what you put into it.
“You get out of it what you put into it.”
So even for example, like for the first time ever, I have started a Facebook group in conjunction with a product launch. Now I’ve personally never done this before. I was hesitant because you know, in any product lunch, you’re going to be running a million miles a minute, and you’re going to be pulled in all kinds of different directions; so I too had the concern of, how do I manage this in the midst of a product launch?
But here’s what I found, as long as you give guidelines for how the community interacts, and you’ve got somebody, it doesn’t have to be you, but you got somebody that’s starting and engaging in the conversation with the people that are joining, it can serve as a tremendous tool to help you generate buzz and excitement for whatever product you’re selling; whether that’s a course, whether that’s a membership, whether it’s a physical product, whatever it is that you’re selling, Facebook group, when it’s nurtured the right way, can really generate a lot of buzz.
The way that I’ve managed it is we have somebody, her name’s Sandra, she’s done just a phenomenal job just keeping conversations going. We could probably explore that. It’s another conversation, but she’s done a great job of that. And then, what we’ve done is we’ve just scheduled Facebook live time, where I do a Facebook live exclusively for the group. So that’s where I’m investing. I’m investing my time there, producing a Facebook live, responding to questions, helping people however I can, and that has, we’ve seen it already, that served us tremendously well for this particular launch. So there’s a lot of connector that can be extracted from a free Facebook group.
Use other people’s groups
James: Yeah, no doubt about it. I see it happen a fair bit because it is easy and the people are there. I guess, another approach that I would point out just to polish that is you can still put, and I’ve seen this done, you can still put Facebook live videos in other people’s groups, if they’ll let you. I’ve seen a couple of marketers do this very effectively, where they’ve used other people’s Facebook groups as surrogate hosts for their community.
Stu: Wow! I like that a lot man.
James: Well, that’s been my marketing strategy for the entire time online is to use groups and forums to find customers for my products and services. But I’ve still resisted opening a Facebook group, and I wanted to ask you about that, because I imagine, I’m keeping an eye on it, and there maybe a day when I do it, but for now, the value that my own membership has brought is immense. And probably because I got in before Facebook. I’ve been doing that one for maybe eight years. Because I’ve got an established community, and because it’s away from Facebook,
I’m doing other little things like, I’ve got an app that people can use on their phone, where they can log in to the community directly from the app. It remembers their password, and basically, they can have their own, little, contained environment. Because one of the things that I’m most concerned with in my market is how distracting it could be for entrepreneurs when they’re just spending most of their time reacting to Facebook because there are very, very smart engineers sitting there at companies like Facebook saying, “How can we keep these people glued to our platform?”
Free vs. Paid membership
Stu: Totally. I think too like if you have a paid members area where you do have a community component, you definitely want to be hypersensitive to the cannibalization of that paid community. So for example, like when I was running a membership site with Michael Hyatt at PlatformUniversity.com, we have a paid forum that was part of that community. So we did not have a Facebook group. In some situations, it makes sense, especially like we were talking at the very beginning for people who are perhaps just getting started, no following, no audience, whatever; Facebook groups are fast and easy way to get started. So I had to recommend it for that group.
If you do however have a paid community, I think I would be cautious because it can cannibalize the value that people get from the paid community. So for example, one of the tough decisions that I’ve got coming up, and I’ve already made it, but I got to figure out how to navigate, and I’ve got to give it some thought, is so we started this free Facebook group for this launch. The idea is that we would discuss the concepts and ideas, and I would answer questions and so forth of four people who are going through the launch materials that we’ve produced. Now that has been amazing so far. We’ve had well over 2,000 plus people who have joined that group.
The question then becomes, what do I do once the course and the promotion is finished? Do I continue that group or do I close it down? This is a tough decision because we’ve got all this momentum in this free group, but the reality of it is, one of the value ads of this particular course that I’m launching is that there’s going to be a private discussion area. So I don’t want the two to conflict. I don’t want people like you said to have their attention split. So we’re actually going to close the free one.
Now I’ve got to do that in an eloquent way. I’ve got to make sure that I manage expectations, and I’ve got to communicate that all upfront; otherwise, I’m going to have a whole bunch of unhappy people. But you still got to think about those things long term in terms of how does the free influence the paid and vice versa.
James: It’s such a good topic. I’m glad we discussed this because I don’t think I can have this conversation with many other people who have the data behind it. But yes, because I’ve got a paid membership, it’s something I’ve resisted. I’ve seen two or three communities open a Facebook group while they still had a paid membership, and it bled their paid membership dry. I’ve also seen plenty of people with free Facebook groups try to switch it off and move to paid and only get a handful of their buyers come across. So I think a free Facebook group, just to really stress this, is a really good starting point for the person with no list, no product, no expertise, and no marketing skills. You could at least combine.
I think, in fact, Facebook actually suggests groups, doesn’t it? It looks at your friends and their interests, and it says, “Hey, create a group for people who like Gary Vaynerchuk,” or in my case, “People who like such and such surfboards.” It’s often suggesting me to create a group for people who like SuperFastBusiness.
One of the other little side issues that I would be concerned about is when I turn off a group, I’d be worried that maybe the members would start a new one that’s unofficial, which would be my even worse nightmare.
James: That would definitely be a consideration. OK, so if you had no list, obviously you can start building a list by either starting a group or participating in other people’s or doing something like content marketing, or a podcast, or a joint venture, or starting webinars. Marketing skills, not that hard to come by these days because there’s so much training on it. But I can see a big objection for some people who are saying, “Hey, I’m not even an expert.” How much of an issue is that?
2 pathways to develop a membership
Stu: Well, it can be an issue. To me, there are two pathways to take if you don’t have a particular area of expertise. The first pathway is you develop some expertise. One of the things that I always ask people is, “What are you known for?” Let’s say James, you and I, we had a great conversation, and then we leave our conversation, and you’re with another group of friends. What would you say to refer people to me? In terms of like, what am I known for, so that if that comes up in conversation, somebody has a problem or challenge that my area of expertise can help them with, would I come to mind for you?
The key thing that I say to everybody is like, you’ve got to become known for something specific. So that’s if you want to go down the pathway of developing an expertise. If you don’t want to go down the pathway of developing an expertise, there’s a ton of options there too. One of them is that you become a curator of content. So somebody who’s done this really well is a guy named John Gallagher. He has a membership site called Herb Mentor.
What he has done, he’s not the expert by any means, what he’s done is he’s gathered other experts together, and he has curated their materials inside of a membership called Herb Mentor. Now this community has been around literally for, I think it’s eight years now. It’s got over 3,000 members, and again, John does not create any of the content. He’s not the expert. He’s the guy behind the scenes.
Another example is Andrew Warner from Mixergy.com. Again, he’s built up this community of startup entrepreneurs. He did it first by creating and delivering a ton of free content. It was all interviews with other startup entrepreneurs. Now what he has done is, he’s become really good at interviewing because he does it so often. But he’s not the expert. What he did was he asked and surveyed his audience and just found out what it is they want to learn more about, then he went and found the experts who specialize in those areas, and he interviews them. And together, they create course material that he then provides now inside of a paid members area.
So if you don’t want to go down the path of developing your own expertise, there are many options for you to be able to develop a membership site where you’re not necessarily the expert, but you’re bringing together the expertise of others. Does that make sense?
James: It does. Some of the things I liked there is you’ve come up with ways other than the very common one that I see where people want to do a 50-50 partnership with the expert. I see this a lot. I’m like, hey, do you realize, they’ll probably give you the information for nothing, or at the least, you could pay them a fee to create it one time? Or maybe you give them an ongoing licensing royalty, but you do not have to give away half the farm because I strongly believe the marketer brings far more value to the table than the expert.
Stu: Totally, yeah. To that point James, there are a ton of experts out there who are just dying for some type of a partnership like that, if you ever did want to go down that route. But even to speak to your point further, you don’t need to go down the partnership route. There are a ton of experts who would just love to get their content in front of more people. So as long as you’re smart and strategic about how you structure the membership, there are a ton of options for you even if you don’t have an expertise.
“You don’t need to go down the partnership route.”
James: Yeah. Let’s just transition while we’re very close to this, when people say they don’t have a product, because I think this almost overlaps, like what are they going to sell to these people if they had a membership?
Can you start without a product?
Stu: OK. When I’m looking to design a membership, I always go straight to the market I want to serve. For me, I think this gets skipped over way too often.
James: Hang on a minute. You mean you need to create a product first and then try and find customers to buy it? What are you thinking man? That’s too easy.
Stu: With membership sites, golly. Listen, just start with the market. So when I’m starting with the market, I’m looking for two specific things. I’m looking for their external problem and their internal problem. So let me explain. This was a concept I learned from a guy named Don Miller. Don has a course called Story Brand, and it’s brilliant. It’s all about how to position your product, your company, yourself through the lens of a story if you will.
“Look for the external and internal problem.”
One of the things that he said was in every story, the main character experiences two types of problems, often three types of problems. But the first type is the external problem. The way to think about this is what would your customer go to Google to search a solution for? So an external problem of a parent who has a young toddler. I bring this up because I might be experiencing this myself. But the external problem is my toddler won’t go to bed at night. And so, that’s what they’re going to Google to search for. They’re typing in, “how to get my toddler to fall asleep,” or “how to get my toddler to eat their meal,” or “how to stop my toddler from biting,” as an example. So those are external problems. Again, the easy way to think about that is what would they be typing into Google to find a solution for?
Then, the internal problem; the internal problem is like all the mental baggage that we all have. It’s the fears, the self-doubt, the limiting beliefs, the anxiety. All those things that keep us up at night. So what I want you to think about in terms of the internal problem or challenge is what keeps them up at night? So as an example, going back to the parenting one, if you went on Google and just typed in like, “how to get my toddler to sleep + forum” as an example, you would land on a bunch of parenting forums. I guarantee you, in there, you would find both external and internal problems.
Internal problem for a parent that kind is they start to doubt themselves. Am I a good parent? Am I doing things the right way? Is my child going to grow up properly? Is there something wrong with them? So there’s all these like fears, and anxieties, and doubts that they may not vocalize or share but they’re definitely thinking them, they’re definitely feeling them.
And so for us, when we are crafting products and services, we want to both address the external and the internal. But too few people address the internal and that is really where you connect with people at a heart-to-heart level. When you can give voice to the things they’re thinking and feeling, but they can’t actually vocalize, like they haven’t been able to vocalize that but you’re giving voice to that, that’s when you really connect with people on a much deeper level, and that’s what makes great products, and services, and ultimately membership sites.
I always start with the needs of the market, where are their problems and challenges, external and internal. And the third one, just in case you ever did want to know, is the philosophical challenge. It’s really like the good vs. evil. I think you and I, James, would be in the non-hustle camp and there’s another camp that would be the hustle camp – that will be like an example of a philosophical problem or challenge. But for the most part, we all just need to focus on external and internal problems first.
James: Right, and choosing an enemy to throw rocks at helps people identify with you. It’s one of the five persuasion elements that Blair Warren teaches.
James: Definitely, you’re right. I’m against the workaholics who champion life-draining, family-draining things. That’s actually one of the things I liked about your videos I’ve been watching. Apart from you’ve got a quirky humor, which is fun, like the little mosquito slap in the forest, but you’ve incorporated familiy and timeout in the woods. I could relate to that. I spend time out in the waves. I surf every single day.
My memberships are able to give me the leverage to be able to do that. Because it’s just more efficient or more effective to sell a result, perceived outcome or actual outcome than it is to sell time or to sell a set of deliverables. I think so many people, when they’re thinking memberships, the big question we get is – what do I have to put in it? What do people get? And they’re very deliverables-focused. Do you get this one?
Stu: Yeah, totally! I’m just making a note myself because this is such a great point. You know, in a membership, one of the number one mistakes, like by far that I see people make, is they think that the more information they provide inside of a membership, the more valuable it will be, and there couldn’t be anything more further from the truth.
Why people cancel their memberships
The number one reason that people cancel from a membership site is overwhelm. It’s not that your content is not good. It’s that they, you delivered way too much and there’s a seed of doubt that is now planted in the mind of that customer that says, “I can’t keep up with this! And if I can’t keep up with this, why would I continue paying?” and then boom! They’re gone.
More content doesn’t necessarily mean more value. What I do recommend inside of a membership site is to provide people clarity and direction. That’s what people want. They want to be able to come in with a problem and be guided to a specific solution or outcome, just like you said. When you sell the outcome then what happens now is, it’s not a matter of how much volume you give them, it’s a matter of how quickly can you get them to the outcome in the fewest number of steps. Would you agree?
James: Absolutely, and if I look back to the Genesis of my own first forum, the creation story was that I was being an affiliate for someone else’s product, which was an affiliate product, and I offered to coach people to help them support the product for 60 days after they purchase the product, and to do that I created my own forum. And that forum had all the elements of all the other forums that I was a member of that sucked, taken out of it, and reversed.
The biggest complaint
And I tell you what, one of the biggest complaints that I had, we really should look back to this, the biggest complaint that I had for all the forums I was a member of was that the people who started the forum were never, ever there. They were completely absent! They’d start this, and sell the dream, and then they would never show up, and there’ll be no access, which is one of the main reasons they wanted to be a part of the forum. So I said, “I’m going to nurture and support you if you buy this product from me,” and I got my first 78 members on a 60-day free trial, which was billing after if they stick around.
I remember, in the beginning, there was no content. There was nothing. It was a shell of a forum, and the first post was really like introduce yourself, and let’s talk about this course you’re doing, and we just built it from there. And here we are, I’m on my second version of that forum. It started again about four or five years ago, and I switched to cross from one to another, and that’s a story in itself. But that was me exiting a partnership and taking to total ownership to balance out the scales of justice.
It was not bad with the previous partner, it’s just that we were moving in different paces and directions, so I had to just make an adjustment there. But here’s the thing, my forum now, it’s like a well-stocked supermarket. There’s a lot of things in there, a lot of resources. People are constantly digging up gold. As a result of doing Ryan Levesque’s course, which I encourage my customers to do, I’ve had my team go through and start segmenting our forum into the 4 buckets that we identified from our survey. And now, they’re coming up with the four perfect dream tracks for the four buckets. So if someone joins because they have a team and scaling problem, then they’re going to only get the training for team and scaling for that first induction phase. And I want to talk to you about that. Do you think we’re on the right track in terms of segmenting our onboarding given that we have a fair bit of material now?
Segmentation is key
Stu: Yeah, absolutely! Just like we said, if you were to just pile all of that information in one area, when somebody comes in, now they’ve got to sift and sort through it all to figure out what’s relevant for them. That takes brain energy, and what’s going to happen is they’re not going to do it because they’re going to be overwhelmed by it.
Now, you breaking that into buckets and then creating tracks for them, provides that clarity and direction for people so now, they don’t have to do that thinking. You’ve already done that for them and you’re just basically saying, “Hey, based on your responses, here’s where you’re at. And because you’re here, here’s the steps you need to follow and here’s the material to support you along each step.” That is the perfect way to be able to approach it.
Now, I want to ask you too, James. Because you talked about being involved, how often are you in your community in terms of nurturing them, responding, interacting and engaging with your community?
James: Well, in terms of frequency, I log in everyday and I have done eight years unless I’m on a plane. I log in everyday and I can do it from my phone which is one of the major drivers for this business model. And it’s worth noting that like you, I had other business and I’ve sold them off. I had an SEO business. I had a website development business. I sold them this year just to focus on the coaching stuff. I got the high-end program, SilverCircle, where I’m coaching a lot of the well-known and respected experts in our industry. And then I’ve got the mainstream one, SuperFastBusiness, which is what’s attached to this particular podcast. I would spend around about 30 minutes a day on average to groom my forum – to answer posts, to respond to personal messages, to move a thread here or there or keep it on and stuff.
And as you alluded to before, I do have some community support or management support from my team. I’ve got a nice little team that I have in my business full time, and what they do is things like, they go through our back of membership analytics dashboard and they’re looking for the most popular posts – the ones people will share the most, the ones they responded to the most. And we collate that each week into a weekly news post and we publish that as a weekly news and then we broadcast that to members. And this is kind of like longline fishing. If one of those threads is of interest to the member, and they get that email, that would remind them to re-engage. Keeping in mind, we’re not on Facebook. We bring people back through that and we also bring back people through behavioral triggers using tools like Intercom. If they go absent for a while, we’ll prompt them you know like, “How’s it going? Need a hand?” that sort of stuff. And with our new onboarding, that’s going to take care of a lot of the heavy lifting.
I am there frequently, and I might spend a couple of hours in there if I’m really in the zone. And this is the best thing of all – it could be first thing in the morning, it might be late at night, it could be some time in the middle of day, in between coaching calls, but I get to choose when I turn up to my forum and that’s what I like the most about it. We also have members all around the world, and it’s supported by local meetups, little face-to-face thing. If we’re going to count the time I contribute to the membership, we should also add in the live monthly training that I do which usually goes for about 90 minutes. And here’s an interesting thing, Stu – I used to do it every week when I started doing that. And then people were getting backlog. They weren’t being able to either show up or watch the recording quickly enough. They start to feel this sense of missing out or overwhelm. And when I moved that back to once a month, it was the perfect timing. They look forward to it. They start thinking about what’s coming. They put in special requests.
We deliver the live training and we get a huge proportion of members who a) watch the videos, b) turn up live, and c) this is the one that blows me away, the amount of people who log in in a 24-hour period is off the charts. For non-Facebook metric, it’s very, very high and that’s because of a few factors, but I think one of them is setting an expectation when people join. And another thing which you also talked about in your video and is worth brining right here is we’re not permanently open these days. While we’re rejigging the background, doing the new onboarding tracks, segmenting our sales offer into four different bucket-referenced sales pages, and four different pre-sale email sequences, we closed it. And what happened was we brought out this waiting list, and I’ve open it once a month at the moment. And every time we open, we get a cattle crash through the front doors but that’s the same time when I’m ready to receive those people. I’ve blocked my calendar. I’m able to put more time into the community, and I can spend several hours onboarding, looking after people, making sure that my team are geared for support around payment methods, login challenges and those things. And that’s worked out really well for us.
Stu: That’s awesome! I think a big mistake that a lot of membership sites have is they’re open all the time, 24/7. And the challenge with that is that there’s no sense of urgency for people to join. It’s, “I’ll come back to it, I’ll think about it afterwards.” For us, one of the scariest moment was us going from 12 promotions a year down to four. We consciously made this decision because one of the things that we found was when we were open all the time, and we were doing a monthly promotion, it was eating up into our promotional calendar. And so, it didn’t create breathing room, and we wanted to create some breathing room in that promotional calendar.
So we went from 12 down to four – scariest moment. But what ended up happening was we ended up generating more new members in those four promotions than we did in the 12. And so we thought, hmm. And so we ended up going from four down to two, which was even scarier. Like two times a year. We’re only open twice a year. But those two promotions outperformed the four promotions that we were doing before that.
Here’s why: number one is that when you’re closed for a long period of time, it creates a huge sense of urgency to join when you do finally open. The second reason is that it gives you more space, more breathing room to make the promotions that you do do world class. So you create a ton more momentum with the promotions because you’re able to invest more time in making them spectacular. And number three, exactly what you said, which I think is so important for people to realize, and that is that that first week that people join your membership is the most critical week of their entire lifetime of their membership.
And so, you better be available. You better be ready, and your team better be ready to be able to support them in that onboarding process because what we want to do as membership site owners is we want to get them engaged as quickly as possible. If we get them engaged, then they’re much more likely going to stay, not only for the first month, but many months thereafter.
And the crazy part is that the sites that we run and our clients, members are not staying for months, they’re staying for years! I think a huge part of it has to do with the fact that we’re not open all the time. When we do open, we can concentrate our resources in really supporting those members, like you said, and really nurturing that community. And then, instead of focusing on promoting, we’re focused on serving and really nurturing that community. I think that that goes a huge, long way in terms of the long-term success of a membership.
James: I’d venture to say it’s really the only thing. I was sitting there, sharing a meal with this stranger that I just met but heard all about in Detroit many, many years ago, and this fellow is called Dean Jackson. He was telling me about his real estate subscription membership. He had thousands of members paying hundreds a month, and I did the math in my head, it was a lot. It was like millions of dollars a month. And he said, “James, all you need to worry about is making sure that people have a continued reason to stay for the next month, and so on.”
And that’s why I develop things like live monthly training. There’s always a new training coming. We’ve managed to mainstay our community with an annual live event, which is a real, secret source for my business because this is like the super meetup of members, and they swarm from all around the world here to Manly. I hold it next door so I have a small commute, and I get to sleep in my own bed.
The thing is we get a nice window. We get kind of a nine month, talking about it, getting excited about it, then it comes. And then afterwards, we’ve got content from that community that we put out there, like one video each week for the next 12 weeks after the event. We got another three months after the event to bathe in the glory of that event. So what we’ve ended up with is an annual reason for people to stay, and I’m on the same page as you.
I’m not so focused about getting customers. I’m really, really, obsessively focused about retaining customers and making sure that I generate success stories. And I consider myself, and this is probably a throwback from coming from the automotive industry where I was on a virtually commission-only basis, I consider myself a performance-based coach that I need to earn the coaching fee through someone getting results. I really get a lot more than just a dollar value. When I look at our success thread, and I see what members have been able to do with the material, that excites me! That lights me up. At the high level, when my customers have big wins, and they’re changing their life, that excites me.
So I guess, in this case, I really think my customers are the heroes, and they help each other. I think there’s such a community feel, and I often equate subscription membership similar to running a family where it takes a bit of energy, and it’s a little bit unpredictable, and you’re not quite sure what you’re going to get, and it changes as you go. I’ve had like five versions of my forum over the last few years where we started out as affiliates, we went through this business consultant phase, a lot of us then now went into product creation, and they’re all leveling up. My whole community is growing up. And can you believe this, we’re about to run our 12th major event next year.
Stu: Wow! That’s crazy, dude.
James: Yeah. It’s like this super mature group that is just something bigger than me. And when I go and meet people at the local meetups, which the members organize and the members run, it’s just amazing to see people who can come together and talk the same language for once. Because out in public, people talking internet marketing get stared at as if they have five heads. What do you mean a DNS or a URL? And they get to talk, and they’re excited, and they’re smiling.
So there’s something magical about creating a membership that was an idea, and you turn into reality. I think that’s what I am keen for people to experience your course for because I want them to be able to learn best practice quickly from someone who’s been in the trenches. And of course, I’m going to support that. People who buy your course through the link that I’ll be giving them will also get access to my membership so that I can support them, and nurture them, and give them some extra experience. That’s something that I think would be a winning combination.
Stu: Oh, that’s amazing dude! I’m grateful. I think there’s a number of big takeaways from what you said, James. I’m sitting here, smiling, and I was taking notes, because the money is made in memberships, not by getting new members. The money is made in keeping members happy and helping them get results. I love the way that you have shifted your entire focus around the results of your members.
I mean, who wouldn’t want to be part of that? Who wouldn’t want you championing for them to get results? Who wouldn’t want you celebrating their results? I mean to me, the thing that we as membership site owners, marketers, business owners, if we just focus on creating great success stories, if that’s like the focus of our business, we can’t help but win because that puts your mind, and your heart, and your focus in the exact right areas.
I appreciate you supporting, James. I mean, I’m very passionate about this. I was fortunate when I co-founded Wishlist Member. I got to interact with literally like tens of thousands of membership site owners. This stuff has been learned over the years. Basically, I put people into two groups. One I would call the hobbyist, and the hobbyist was somebody who started a membership site as almost like a way to generate some side income, and they would do pretty decent from the launch, but then, they were missing a few key strategies, a lot of some of the things we talked about here today. And so their sales would just taper off, or die off, or the membership would plateau, meaning they couldn’t get beyond a certain level.
And then there was another group, a much smaller group, this was like the people that were focused on the strategies that would take it and scale it. A lot like what you’re talking about here today with a mindset shift around the focus of serving the members and focus on retention. A lot that that group would focus on. And that’s why I paid attention to.
And so what I then did was I started to look for an opportunity to be able to take what I had learned from this group, this business owner group, and apply it to my own membership. That’s when I partnered with New York Times best-selling author Michael Hyatt and we basically write from the get go. We had 1100 members the first week, 2500 members after the first year, 4500 after the second year and over 6000 after the third year and this continued to grow to this day.
For me this is like, I’m in the trenches. I’m applying everything that I not only learned from the tens of thousands of customers that I got to serve with Wishlist but from being in the trenches and doing it. And now, it’s been so much fun just watching clients launch membership sites and all kinds of markets.
Patty Palmer’s a client of mine this year, former teacher and she’s an art teacher and she noticed that there were a lot of art teachers that were always scrambling last minute to get their lesson plans together. And then, the internal, remember the internal challenge we talked about, the internal challenge was, ‘I’m not a good art teacher. I’m going to be found out that I’m not really good at art’ and so what she did was she created a membership site that provides art lesson plans for these teachers. And she launched it to her audience, first week she had 923 members joined. It’s amazing! Like an art teacher, art community.
Other example like, John Goodman, he’s a gentleman that helps personal trainers. And similarly, his business model was very launch oriented so it was up one month down the next depending when he would launch a product. So he wanted more stability, put together a membership site, we worked together on that, he launched his. And in the first week for him, his launched generated over 800 members at $30 a month. Immediate stability in the business.
And these are in markets that are not make money. These are in different unique niches where it’s not about making money but it’s about providing value and being real clear on the needs (the external and internal) and then creating content that serve those needs. When you do that right, the sky’s the limit.
The thing that I love about it, is just what a membership site then creates. I mean, you talk about it and I smiled. How every day you are in the water, riding the waves. To me that is what this is all about. As a father of two young kids like for me, this time with them is more important than any other time in their lives. So for me this is why I’m so dedicated to being at home with the kids because this is the most important time of their lives.
And it also creates the means for us to be able to contribute on a whole different level. I mean, we didn’t talk about it a lot today at all but that’s a big part of why I do this as well and so, I just want more people to experience it, like you James, I’m passionate and enthusiastic about it as well and I want it for more people because it is an amazing, amazing business model.
James: Yeah, just a couple of points there. Yeah, I’ve got a few teachers in my crew there, the Sams, Shane and Jocelyn Sams and they do lesson plans and that’s been wildly successful. And also, Jarrod, who is the world’s first and only PE Geek teachers. He teaches PE teachers how to use technology. And we created a recurring membership subscription for him and virtual online summits and it’s just amazing to see these things come to fruition. He was in the classroom teaching when I met him.
James: I’m like, “Jarrod, what are you doing? Get out of the classroom and go and serve more people.” He now travels around the world doing workshops and teaching. He is basically turning fat kids into skinny kids.
Stu: That’s amazing! What an opportunity for him too. The way like, completely transforming the way that he is able to show up to the world. It’s amazing.
James: He’s evolving himself much like a Pokemon Go character. He’s just evolving and evolving. It’s just wonderful to experience that first hand. Like we didn’t mention it but I really think we should mention you do a lot of good things for people overseas who are underprivileged. And I think that’s very heart centered and should be acknowledged. And I know it’s in your videos so I won’t labour on it but I just wanted to say, “Well done”.
If you can look after yourself financially and I can really relate to that as a parent, I’ve got 4 kids and I’ve provided for my family basically since I was about 20. I’ve been working and had that responsibility. And you know what was magic the other day is, I was surfing with my 21 year old son out the front here and it’s just nice to have been experiencing those kids in my life and watching them grow and develop and also to see a different approach than just selling your time in a job. To have that influence on them, it definitely gives them a different viewpoint.
James: We really have covered a lot here. Just a quick summary. We’ve talked about what you might do to get started even if you don’t have a list, even if you’re not an expert. We’ve covered off all of the major issues there. We talked about where you might get traffic whether it’s going from your own group or going to other peoples and some tips there about other marketing channels. We’ve talked about overwhelm, clarity, direction, segmenting, how to get new members onboarded, the fact you don’t always have to be open. We didn’t really cover too much about tools and tech and I’m sure that comes up a lot but it’s really not the biggest issue these days. You should focus a lot more on the marketing and the offer and be ready to serve. Would you agree with that?
Stu: Totally! I mean today more than ever, the tools make it easier than it’s ever been. There are fast and easy ways to get started with different platforms if you’re not super technical. If you want to create a more elaborate, there are tools to help you support that but it’s never been easier with the tools that are available today for sure.
James: I usually say to people, “Listen, if you’re just getting started, the tools off the shelf are easy enough for you.” And if you’re ready to go advanced and you want to throw a little bit of money at it, I tell people “Just hire Dave,” he’s my technical go to guy. He’s been there for me from the beginning because I am not technical. I just want to point that I’ve no technical chops whatsoever, I wouldn’t know a php if it slap me in the face.
We talked about some little side issues, it probably don’t come up as much but it’s about having a live element and really meeting your customers and knowing them well.
One thing I want to ask you about, “Can you sell memberships directly at the front end?” I’m curious what the funnel look like for the most successful one you worked with.
Stu: Yeah, absolutely! In fact, I think that’s… those when you sell it on the front end, that’s where it creates the best buyers and the best members.
James: Oh, I agree.
Stu: What I don’t like is, I don’t like seeing people try to shoehorn a membership as an add-on, hoping that people will just stick. They’ll sell the value of one product and then they’ll throw the membership on as a bonus or something like that.
James: Or even if they force it on them without their consent which is a common problem I see people doing and then they’re going to get chargebacks and a bad reputation pretty quick.
Stu: Absolutely! I mean, if you put the same marketing energy behind selling the membership site on the front end, you will attract high quality members. I don’t even like doing low dollar trials because it’s the same thing.
James: Me neither. I don’t want someone to join because it’s cheap.
James: I want them to join because they think I can solve their problems.
James: I actually found the very best members came off a paid workshop. Like, you’ve been running live workshops, very easy to offer people ongoing support after you’ve created the relationship. I think because of group dynamics, people come together with the forming stage and then they go through all that storming to work out who is who and then they go into norming, they become normalized and then they go into performance mode, the performing phase, then you can either have the breakup or you can continue as a member of the community and that’s how I fed my community in round two – it was off the back of live workshops.
Stu: To me, the more energy you put into selling it on the front end, I think the better. I love the way that you positioned that, selling it on the back end of events because there are relationships that’s been built there. What I don’t think is effective, just like we said, is trying to shoehorn it in as a bonus on something else, or as a low dollar trial. You’re not going to attract the long term members that you want.
James: Yeah, that’s good. Well, Stu thank you so much. It’s good to find someone with values and it’s like we’ve been living in parallel universes and finally collided and you know I like what you’re teaching and I like what you’re putting out in the marketplace so, thank you.
Stu, thank you so much for joining us.
Stu: James, really appreciate it. Thanks so much buddy.
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