I often speak about how to magically transform your content and audience into digital membership revenue. At the end of the talks, the most frequent question I get is “what is the difference between a paywall (or subscription) and a membership?

So what’s the answer?

I like to think that there are three different levels of paid content products.

Let’s go through all three levels, and I’ll explain why you must be at level three to succeed.

Level 1: Paywall

A paywall is a technology. A paywall is a way to gate your content so that it is not freely available to everyone. While this is an important part of your revenue strategy, a paywall alone will not be your salvation. You can’t simply add a paywall to your existing site and expect people to start paying for your content. When publishers fail to monetize their content online, the problem is usually that they put up a paywall without a strategy or marketing plan. They instituted a paywall, thinking it was a Field of Dreams situation, that “if you build it, they will come.”

That doesn’t work. There’s more to it than that.

Level 2: Subscription

A subscription is a business model. Of course, how it works is you charge customers for access to your content for a set period of time, at the end of which they can choose to renew or lapse their subscriptions.

A subscriber has a transactional relationship with your company. They subscribe to the content behind a paywall, and they’re a customer. You care that they come in the door, and then you worry about renewal efforts, and that’s as deep as the relationship goes.

A subscription business model is an important part of what you need to do, but true success in the online world lies in the third option: a membership program.

Level 3: Membership

A membership combines the business model of a subscription with the technology of a paywall, but there’s more to it than that. Creating a membership means that you are creating a community around your content, that you are understanding and meeting your audience’s needs with information, inspiration, and interaction.

Members have a stronger emotional connection to your brand than subscribers do. For example, I’m a Netflix subscriber, but I’m a member of the Museum of Fine Arts. There’s a big difference in the relationship between customer and company.

Customers feel proud to support services that bestow membership, like the Museum of Fine Arts, and that kind of pride isn’t attached to a subscription service like Netflix. PBS supporters feel this same kind of pride: it feels to them like their membership makes this great content possible and makes them part of a community of supporters.

A membership sends a clear message: You are important. You are a member.

You can brag about your membership. I’m excited to tell people, “Hey if you ever want to go to the museum, I can take you.”

Who are the most devoted members of your audience, and what are they willing to pay for? What problem can your content solve for them? How can you create an outstanding user experience that allows them to discover and consume your material when and how they need to, on any device?

Memberships often offer more than basic content. Netflix just offers entertainment; the Museum of Fine Arts has tiers of benefits that go beyond simply accessing the museum, such as discounts on dining, special events, guest passes to bring friends, reciprocal admission to other museums, and opportunities to attend exhibition opening events.

It doesn’t take much for you to turn a subscription service into a membership model, but the perceived value to the reader is enormous.

The difference between being good and outstanding is very small, yet so few people go that last centimeter to stand out that the rewards are much greater for those who do.

This goes beyond offering past magazine issues behind a paywall. The companies that do this the best add services, such as live help, special discounts, free shipping, etc. Think about how much cachet Amazon has added to its Prime membership: it started with free shipping, and now it includes music, movies, exclusive programming, storage space, and more.

A lot of content creators decide to charge for content and then just buy the paywall technology—and fail. Some people realize they need a subscription service, and they implement that business model . . . and it fails. But those who create a membership platform—creating a community that provides inspiration and drives brand loyalty—find true success online.

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More about Rob: Rob Ristagno drives dramatic digital revenue growth for media companies. He is an award-winning speaker, author, and the CEO of The Sterling Woods Group, a firm that partners with publishers to refocus digital marketing efforts and to launch “start ups” from within.

Rob is the author of A Member is Worth a Thousand Visitors, which details the five forces proven to drive successful digital membership programs.
Prior to starting Sterling Woods, Rob was a senior executive at several niche media and e-commerce businesses, including America’s Test Kitchen, where he was COO. He started his career as a consultant at McKinsey. He lives outside Boston with his wife, Kate, daughter, Leni, and black lab, Royce.

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