The Top 10 Reasons Why Membership Websites Fail … and What You Can Do To Avoid These Mistakes

The Top 10 Reasons Why Membership Websites Fail … and What You Can Do To Avoid These Mistakes

membership websites fail

Niche content membership websites are one of the fastest growing areas of internet business.  There are thousands of individuals and small businesses making significant revenue from a wide range of subjects. However like in any area of business there are some sites that struggle and others that fail.  From my experience these are the ten most common reasons for failure.

Reason for Failure #1 – Ignore What Works in Print Publishing

Print publishers – newspapers, magazines and newsletters – have perfected the art of generating income from content. Hundreds of years of publishing experience are crammed into every edition.

Look at:

  • Headlines that grab your eye
  • The way images are used
  • Subscription pricing
  • The different advertising formats (display, classifieds, jobs, directories, etc)
  • Reader offers
  • And so much more

Ignore these lessons at your peril!

Success Tip:  Buy a newspaper and magazine. Make a list of what you learn under the headings:

  • Design
  • Navigation – look at the cover, content page and ‘links’ within articles
  • Headlines – how do they grab your attention (factual, emotional, questions, etc)?
  • Copy – how are the articles written to maintain interest?
  • Content mix – what is the mix of content – features, letters, news, reviews, directories, etc?
  • Revenue generation – list ALL of the ways the publisher makes money – different types of paid advertising (incl. sponsorship), subscriptions, newsstand price, back issues, readers offers, photo sales, events, etc.

Reasons for Failure #2 – Copying What Print Publishers Do

Sounds like it contradicts point #1?

Well it doesn’t really.

Most of the things that print publishers do need to be done by online publishers to succeed.

HOWEVER all these activities need to be done differently online. They need to be adapted to the way the internet works. They need to meet the needs of web users.

Let me give you some examples:

  • Print publishers aggregate stories and publish them in batches. Internet users want stories as they happen in regular updates
  • Most publications have long feature articles. Internet users tend not to read long articles. They consume content in bite size chunks.
  • Publishers tend not to have a dialogue with readers. Internet users want to interact by leaving comments, discussing stuff in forums, asking questions via email, etc
  • Adverts in print publications often dominate pages. Ads online need to blend in.

Success Tip: Learn from print publishers, but adapt everything they do to meet the expectations of your online audience.

Reasons for Failure #3 – Provide Freemium Content

The natural tendency of membership website owners is to hide all of their content behind password protection.

This is a mistake.

Every content website should make a percentage of its information free.

This serves several purposes:

  • Helps drive free search engine traffic
  • Builds trust with visitors
  • Enables you to establish your authority
  • Gives first time visitors a reason to return or sign up for an email newsletter

Success Tip: Make at least 20% of your content free and update it regularly

Reasons for Failure #4 – Poor Design

Design is important.

You only get one chance to make a first impression.

A good design says ‘This site is professional’. Prospects want to subscribe to a professionally run website.

Success Tip: Invest in a professional design. It will pay you back many times over.


Reasons for Failure #5 – Sells Features, Not Benefits

So many online businesses sell features and not benefits. Telling your audience you have the world’s largest wine database or that your stock tip website is viewable on a mobile phone is fairly meaningless.

However telling your audience that:

  • You have the world’s largest wine database which means you will always be able to find the best deals


  • Your stock tip website is viewable on a mobile phone which means you will never miss a deal and so make more money

These are benefits and they mean something to your potential buyer.

Success Tip: Whenever you mention a feature on your website, you should always think about the benefit that it has for your prospect. Even if it seems obvious to you don’t assume your visitors will take the time to make the connection.

Reasons for Failure #6 – No Relationship with Prospects

People rarely find a website and immediately reach for their credit card. They tend to want to get to know the site over time. Build trust slowly… and only then do they subscribe.

The problem is over 90% of visitors, even if they like what they read on your site, will never return. They will be lost prospects.

Success Tip:  Your website’s number one goal should be to get visitor’s email address. Once you have this you can build a relationship through a newsletter, offers or interaction.


Reasons for Failure #7 – No Community

Internet users have information overload.

The number one reason that members let their subscription lapse is they find they don’t have the time to read all the information provided.

The number one reason that members renew their online subscription is they feel part of a community.

Creating a sense of community is a critical part of running a successful membership website.

Success Tips: Create community amongst members using a forum, a member directory, comments, classified ads and offline events


Reasons for Failure #8 – Single Revenue Stream

Many membership websites prosper with a single revenue stream, namely paid subscription.

However many others never reach profitability because they take too long to build their member base. These sites can often survive by having additional revenue streams.

Success Tip: Ensure you have multiple revenue streams which could include advertising, sponsorship, a job board, paid directory listings, affiliate marketing, pay-per-view content, paid downloads, a store selling ebooks, merchandise, events, courses and webinars.


Reasons for Failure #9 – No Personality

People buy people.

When people sign up to a website they are not only buying access to the content they are buying access to the editor. Yet many websites lack personality and voice.

Fun and engaging people often lose their charisma, personality and style when the put pen to paper.

Success Tip: Give your website and content personality. Write in a conversational style as if you are having a one-to-one conversation with your reader. Also use all the capabilities that the Internet has to offer. Mix text articles with audio streams, video clips, downloadable reports and podcasts. Multimedia is what sets the net apart from print publications and allows you to have fun with the way you get your message across.


Reason for Failure #10 – Content Available Elsewhere for Free

It is common sense, but worth saying anyway. If all the information that you are offering is available for free on the web, then people won’t pay for it. Period.

However there are some exceptions, for example:

  • If there is too much information on the web about your subject, then people will pay to have it simplified and distilled by an expert. For example there is a huge amount of free information about Internet Marketing, yet there are many very successful paid internet marketing websites run by recognised experts e.g.
  • If your content is time critical people will pay to get timely access e.g. stock tips.
  • If the site has a strong community only accessible to paid members

Success Tip: Do research before starting a site and find a niche which is not well covered.

If you already have a site which is not getting customers as quickly as you would like, search the web to re-assess what information is available. Possibly re-think your niche.


From my experience, these are the ten most common reasons why membership websites fail. The good news is all these failings are easy to put right.

Above all successful membership website owners are focused, determined and persistent.

And they get their reward …

Never lose sight of the fact that running a membership website based on your passion is one of the best business opportunities in the world. Work where you want, when you want and make a substantial and growing income.

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