For anyone who has built a community, it doesn’t take long to figure out that monetizing it can come with a few challenges.
It’s the natural next step to take after investing hard work and dedication into building out and scaling an engaged community, a step that has a proven track record of providing great value to its members. It takes a while to get to this stage and it is no easy feat. After all, asking members for money straight out of the gate is extremely unlikely to pay off.
However, when you’ve proven to members that what your community provides is worthwhile, and they’ve become loyal to the space you’ve provided, delivering more at a cost is a great way to enhance this communal space, demonstrate the value of membership, all the while compensating for the hard work you put in.
In this article, we’re going to break down the following:
Here we go! ⬇️
Why monetize a community?
Monetizing a community can be a great way to turn a passion-driven, value-adding marketing strategy into its own profit stream. It provides financial benefits to the Community Managers while still providing value to its members.
Possibly one of the most important points to mention when asking why a community might be monetized is that building a community takes a lot of work.
The time, labor, and resources that it takes to build a community, and to uphold the momentum necessary to continue scaling it, is not free and it deserves to be compensated. This goes for an individual building a community, right up to a larger-scale organization building out another in a line of communities.
Beyond that, it can be easy to forget that community building is network building. Each person who joins a community brings their own skillset and perspective to the table, and getting them all in one place to share knowledge is no mean feat. Having access to such a resource is incredibly valuable, so introducing a pricing model to reflect this value is a reasonable step to take.
Finally, growing and sustaining a community can become expensive! Ensuring that you’ve got the right tech stack, staff, quality of content, and more, will often come with a cost - so monetizing a community is a savvy way to offset these costs and allow the community to continue evolving.
What to consider before monetizing
Value first
As our CEO and Founder, Richard King, put it in a recent episode of the Inside CLA podcast:
“What community-led isn’t is a quick-fix win to closing leads or generating revenue.
It's really a long-term play to delivering true value to that community, and that true value should be free, in my honest opinion.”
So, it’s important to make sure that before you think about monetizing a community, you’ve proven the value of your community already.
Be it through fostering a collaborative, approachable environment or supplying high-end content or educational resources, you’ve got to have something that proves to your audience that you’re worthwhile.
You have to know that enough of your audience will think you’re worth paying for, otherwise, you’re not ready to monetize the community.
Know your audience
Before taking the steps to monetize your community, you need to have a crystal clear idea of what your audience is there for.
What is it that unites your community members? What are they finding in this community space that they can’t find elsewhere? What are you providing that they enjoy the most?
Anything you attach a price to will need to align with the interests and needs of your community.
For example, if your members want to learn more about something, consider introducing some paid-for educational content. Or similarly, if your members are keen on accessing more networking opportunities, priced events could be the way to go.
Additionally, it’s vital that you have enough of an audience to justify adding any cost. There’s no concrete number for a big enough audience, so this sits with the Community Manager or manager to decide when is appropriate. However, keep in mind that the amount should be determined by how much is needed to keep the community growing, factoring in relevant overhead costs and what’s needed to turn a profit.
Is your audience engaged enough?
While you need a decent number of community members in order to justify adding any cost, there’s no number that will be able to combat a completely disengaged community.
It’s imperative that the community members are actively interested and involved with what your community is already providing - and that can’t happen overnight!
It also can’t be sustained without continued dedication to hitting those engagement goals.
Providing true value, as Richard mentioned earlier on, is a key way to make sure members are actively engaging with the community. Keeping them engaged can look like regular updates and emails to remind them that the community is theirs to play with. Plus, having multiple channels for discussion and networking, and being proactive as the team behind that community to make sure the conversations can keep flowing.
6 ways to monetize your community
1. Advertising
One of the most straightforward ways to monetize a community is through advertising. Depending on the size and niche of your community, you may be able to attract advertisers who want to reach your audience. For example, if you run a fitness community, you could partner with fitness-related companies to promote their products or services to your members.
To make the most of advertising, it's important to be transparent with your members about sponsored content and ensure that the advertising is relevant to their interests. You can also use advertising as an opportunity to showcase products or services that you genuinely believe in and think will benefit your members.
2. Membership fees
Another way to monetize a community is by charging membership fees. This works particularly well if your community offers exclusive content, tools, or services that members can't find elsewhere. For example, if you run a community focused on personal finance, you could offer members access to financial planning tools or investment advice in exchange for a monthly or annual fee.
When setting membership fees, it's important to balance the value you're offering to members with the cost of membership. You don't want to charge too little and undervalue your community's offerings, but you also don't want to charge too much and discourage potential members from joining.
3. E-commerce
If your community has a strong niche, you may be able to monetize it through e-commerce. For example, if you run a community focused on vintage fashion, you could sell vintage clothing or accessories through an online store. Alternatively, you could offer community-branded merchandise that members can purchase to support the community and show their pride.
When selling products through your community, it's important to maintain quality and consistency. Members trust you to offer products that align with the community's values and interests, so you don't want to damage that trust by selling low-quality or irrelevant products.
4. Crowdfunding
Crowdfunding is a way to monetize your community by pooling resources to fund a specific project or initiative. For example, if your community is focused on environmental activism, you could launch a crowdfunding campaign to raise money for a local clean-up project.
When launching a crowdfunding campaign, it's important to clearly communicate the project's goals and the impact it will have on the community. You also want to offer enticing rewards or incentives for members to contribute to the campaign, such as exclusive merchandise or recognition on the project's website.
5. Events and meetups
Hosting events and meetups is another way to monetize your community while strengthening its bonds. Depending on the nature of your community, you could host in-person or virtual events that offer members a chance to connect and learn from each other.
When planning events, it's important to consider the costs and logistics involved. You want to make sure that the event is accessible to all members who want to attend, and that the event aligns with the community's interests and values.
6. Premium content and sponsorship
Community Managers can create premium content such as courses, e-books, and webinars and sell them to their members. This can be a great way to generate revenue while also providing additional value to community members.
In addition to this, Community Managers can work with sponsors to promote their products or services to the community, or even work together to create premium content that then features both sets of branding for increased exposure. Sponsorship can take many other forms too, such as sponsoring events or providing products for community giveaways.
To sum up
Monetizing a community requires dedication, a proven track record of providing great value to members, and ensuring that the community is engaged.
Before considering monetizing, it is important to ensure that the value of the community has already been proven and that you know your audience well.
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