009: You Don't Need to Charge a Lot to Build a Thriving Membership
🗓 July 21, 2019
Ward and Meredith chat about building an audience through email marketing, keeping pricing low, and the challenges of business growth.
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Ward: [00:00:31] Alright, I'm here with Meredith Harold of the informed SLP. Hi Meredith. How you doing?
Meredith: [00:00:35] Good. How are you doing today?
Ward: [00:00:37] Excellent. Excellent. Thanks for taking some time to join.
Meredith: [00:00:40] Of course.
Ward: [00:00:41] All right, so we usually start at these off by asking how did you begin your business and in kind of what is your business? Let's get a quick overview of that.
Meredith: [00:00:50] Yeah, so I have my PhD in speech language pathology and right after I got my PhD I went and started working as an SLP in schools. So a lot of people don't even know what slps are but basically we have a fairly similar job in the school system as a teacher would accept we specialize in supporting kids with speech and language. So helping kids with like dyslexia autism disorders such as that. And so I started my business as I was winding down one of my SLP jobs and started to realize you know, what the one thing that people have a lot of trouble with which is understanding the research that's published regularly in our field and what's best practice and staying up-to-date with the best possible treatment techniques. It's something that's really hard for. And I you know felt like because of my PhD in my background in science that I kind of was the best person to bridge that Gap. So my business actually started not really necessarily planning on it being a business. I was about to transition back into higher education and start working as a professor again, and I actually started my business thinking. Oh this might be something. That I can do commit as I move from being an SLP into being a professor to try to bridge the gap between what scientists at universities are creating and what slps in practice are doing and so it kind of started actually as a blog like I had I knew that it could be a business, but I wasn't necessarily. Tied to the idea of being an entrepreneur because I was about to start a full-time job as a professor.
Ward: [00:02:28] So let me just interrupt you for a second here. So the You Started With a Blog at that was kind of like Ground Zero as far as you beginning this business, even though you weren't even doing it necesarily as a business at that point.
Meredith: [00:02:40] Yeah, and actually the way I started it started it was In retrospect genius and I didn't even really even realize that at the time because I was I'm an acceptance speech language pathologist and a scientist. Like, I don't know anything about business. I mean, I'm learning it now, but basically what I did is I built up my website and I had this idea that each month I would go to published Journal articles on our scientific websites pull all the ones that were published that month read them myself and then translate them for slps. Instead of you know, having a hundred scientific Publications instead narrowing it down to like ten that SLP is would really care about and basically explaining it to them how they could use in clinical practice. So when I started my website. I basically had built everything out and all of my systems in order to do this. But the thing I didn't know is whether or not people would want to read it. You know, I knew that it would be fun for me every month to basically translate the science for clinicians, but I had no idea people wanted it. So what I did is I was already in a bunch of online SLP groups on Facebook and I had people that I talked to on Twitter and Instagram and things like that. So I understood where slps hung out on social media. And I basically created a post that says hey guys, here's this shell of a website. Here's what I want to do. Would you listen or what you read this? If every single month, I dug through the scientific literature and gave you basically like a short little, you know, magazine type, you know overview or review of the research that's out there and I had put on my social media posts. I was like, you know, I'm not going to start doing this research and writing it for you guys and less people want. So let's get you know a list of at least 300 people who want it and if you want it then I'll start doing it and I was offering it for free. So basically what I did is I had an email signup where people would enter their email basically saying, yeah, I want this free thing that you're thinking about doing send it to me and within the first 48 hours I had a thousand people sign up for it. And so that's one of those like in hindsight kind of you know, Critical or steps that I had taken is, you know, I was collecting email addresses before I realize how valuable it was going to be to me. And then the other thing that I think was really valuable is I had started my website as just a free thing like basically saying hey I kind of want to do this for people would people be willing to read it and basically over the first year of having my website. I'm trying to remember the numbers here. I had gotten to an email list of 12. Thousand before I ever monetized and so I basically continue to offer it for free for a year and a half before I realized. Okay. I've got you know, 12,000 people and a you know, sixty percent open rate on this thing. Maybe I should start charging for it. And so that's the point in time at which I decided to turn it into a membership site. And you know, I think it's kind of funny because I think a lot of businesses. It doesn't make sense for them to be an online membership. But a lot of businesses, it makes perfect sense and thus you know monthly, you know blog review thing that I was doing made absolute perfect sense to be a membership because it had a monthly release. I have lots of people that basically were already showing me they loved reading it and my social media traffic was growing like crazy. So I turned it into a membership site at that point in time. And initially like in the first month that I did it I charge people three dollars for it because I was like, oh people have been reading this for free like they won't pay for it. Right? Like I can't I can't ask him to start paying for it after they've been reading it for free and so I started at three dollars and then I got smart and started to realize what what that said about my perceived value of the website and ended up later increase in the price to seven dollars a month, but I don't really have any plans to increase the regular membership much higher than that because you know, I don't know. I started this business as a service to slps and the thing that's become the most valuable to me is the fact that thousands and thousands and thousands of slps read it. And so I'm kind of sticking with that right?
Ward: [00:06:58] Well, let me interject again here. So just that what we'll dive into the pricing in a second so deftly want to go into that, but just to back up with just to back up a minute to give folks a lot of folks that listen to this and that are in the middle of trying to create a membership business. A big big challenge that we've heard that they've expressed to us are is around building an audience, right? It's hard to get that that email list going get that social media following going. So I really want to hone in on how you did that. So it sounds like the very beginning you realize there was a problem and the problem was okay there's a lot of research being published on the SLP industry in various journals. It takes time to read that and sympathize it and then apply it what if I just created a little summary for people and then delivered it monthly. So was that just based on your own experience of man, this is annoying It takes a lot of time or was it based on you kept hearing people complain about?
Meredith: [00:07:51] No is based on my own experience of realizing how frustrating it was and realizing that as scientists. You don't really realize how time consuming it can be in all the barriers for a clinician. Like I think that thing that really put me in the right space is that I understood kind of both sides of it and was able to translate it. So yeah, it was based on personal experience and my own frustration. I basically identified a problem with this very, you know, small group of people. You know, I'm and I have a niche audience. And created a solution that I thought would work.
Ward: [00:08:24] You basically were solving trying to solve your own problem, which is definitely one approach to building a business that people should pay attention to like if folks out there have an obvious problem in whatever industry there in that no one at you know one that they know of Elise is addressing the problem. That's that's a good example of a place to explore as far as a business idea. And so just take that to the next the next step to follow the breadcrumbs here after that. You went on I think you said Facebook right and just started asking people, you know, is this something people would want and then try to get them to join an email list of sorts, right?
Meredith: [00:08:59] Yeah, I basically said if I you know were to offer this to you. Would you want it and I started out by offering it for free.
Ward: [00:09:05] So when you say would you want it was that just purely like would you want it for free? It was the that was like you made that clear. Did you make it clear that oh, but I would be charging eventually.
Meredith: [00:09:13] Oh, no. I had no plans to monetize from the get-go. Like I said, I'm not a business person and I was kind of a, you know, I wasn't even thinking about that. I just was thinking about let me create this solution because it makes me feel good to create the solution for people and when I said do you want it? What I was asking is if I write this will you read it? And so people? Yeah, so people enter their email address to basically say, yeah take your time to write it. I'm willing to read it. Like I think this would be good.
Ward: [00:09:38] Right so you were kind of do like a community service of sorts who are just trying to be helpful.
Meredith: [00:09:43] Yeah. I was just trying to be helpful and I did it because I wanted to feel helpful like I wanted to use my expertise and use what I knew and create a solution because it feels good to create solutions for people, you know, so it really just kind of started from that. Yeah. Yeah. No, I think that's a great place to start and that's something else that you know, folks listening should really pay attention to is how do you do and as far as building an audience initially is how do you provide value for the kind of people that you want to serve and help and for a lot of folks that that value would be like you said blog posts, maybe a podcast basically information something that helps solve their problem right now. And then in the future, you can figure out a way to maybe monetize that solution or make a more robust solution that that you then charge for but there's some version that's free looking at your website. It looks like you still maintain your blog. So it looks like you are still giving out free information at the moment.
Meredith: [00:10:37] Yeah, but the vast majority of what I'm doing as bill is within the membership. I you know, like 95% of what we have is actually in the membership right now. Not on the free side.
Ward: [00:10:47] yeah, and that's reasonable. They all the everyone could figure out their own ratio as far as how much they want to give away and how much and how much should be locked behind a you know member space pay wall or something. But yeah, I like that's a good origin story. I think that's a real clear as far as step-by-step. So why don't we dive into the the initial pricing that you discussed? I think you said it was initially three dollars a month. Is that right?
Meredith: [00:11:09] Yeah, so it was free basically everything that's in the membership site now was free for a year and a half before I decided to monetize and then I started charging people $3 and then I quickly realized that if you under charge people it says something about what you think the value of what you're offering is and so I thought about it more and realized like I came to him or what I thought was, you know, reasonable price. And so yeah now it's seven dollars per issue, but we have two different sides of it. And so people if they Pie by both sections, that would be like $14 an issue when we publish issues.
Ward: [00:11:44] people are paying per issue or are they paying just a general monthly fee?
Meredith: [00:11:47] There at those are the same things with my membership site because every month we have a publication think of it kind of like a magazine that comes out once per month so you can think of it as paying per month or per issue, but that's the same thing you know.
Ward: [00:12:00] I see I see so there's one issue one one big piece of content you release per month.
Meredith: [00:12:05] Yes.
Ward: [00:12:06] And it's released on a specific day saw like you'd rip out a bunch of pieces of content over the month.
Meredith: [00:12:11] Exactly.
Ward: [00:12:12] Gotcha. Yes, I make sounds yeah kind of like an online magazine or summary of sorts. So you had mentioned that you start off with a three dollar price point after it was free and then you move to $7. So I'm just kind of curious. Where did that number come from? The three where the seven come from is that Based on data was that they said customer feedback is it? Every pulled out of a hat. Where did that come from?
Meredith: [00:12:39] Yeah. So the three dollar number came out of nowhere like in hindsight that was a silly, you know number to be using that I think that honestly the $3.00 per issue or month thing was rooted in fear that people wouldn't be willing to pay for it, you know, because I had been operating for a year and a half with just giving it for free and I was nervous that people wouldn't pay for it. But I also knew that I needed to pay the bills because I was paying for you no website hosting fees and everything membership or I mean email websites and everything. So I needed the money to keep it alive. But then the seven dollar price. I'm a lot more comfortable with and you know that came from a combination of asking my customers, which I actually don't necessarily think or is the best strategy. Because if you're offering something that's never existed before they don't know what to pay for it. They don't know what they think they would want to pay for it. And actually when I did survey my customers it was all over the place, like some people said that they would only be willing to pay three per month other people said that they'd be willing to pay $45 per month and it was just it was bananas. Like people don't know what they people don't know what they want to pay until you actually start, you know, trying to offer something but the reason the reason I'm comfortable with the you know, the $7 a month thing and that could that could go up by. You know, maybe 30% or 40% but I'll never get up anywhere near like the $20 per month price point or anything. It's because I feel like that is reasonable and ethical and I simply feel comfortable charging slps that rate. I mean speech language pathologist make the same or maybe a little more than teachers, you know, so and also it matches my mission. Like I want to get to the point where I have you know, 10,000 15,000 subs, and if I move my price point too high, I think that it, you know gets to a point where a lot of people start to not be able to afford it and I don't want being able to afford it to ever be a barrier because I'm not necessarily offering something that I consider to be like a premium product that only some people in my field are going to buy. I'm trying to create something that everybody in my. Is going to buy and I also I see really really low cancellation rates like the most common reason people leave eour membership is because their credit card expires and they forget to update it in time and then they come back later. Like people really don't cancel because of money. So so I feel I just I feel really comfortable at that price point because I think that it's a reasonable price to ask of clinicians.
Ward: [00:15:13] Yeah. I think that's I think that's a fair a fair way to do pricing right there. Some people are you should have a very data-driven pricing based on surveys and cancellation rates and growth rates and all that kind of stuff. And then and then a lot of then there's other folks who completely just go by their gut or what they feel like make sense. You know, we personally try to go somewhere in the middle of those two things definitely leaning a little bit more on the gut side of things just because you own the business, right you talk to your customers all the time. You've heard, you know their feedback. I'm sure on the pricing you as an SLP know like you were saying what kind of money they make so I don't sometimes it's okay to leave money on the table. I guess is what I'm trying to say.
Meredith: [00:15:56] Yeah,
Ward: [00:15:57] but it that's something that especially when you're first starting I think people need to be weary of cuz it you need to you need to be able to charge enough to get the business off the ground and if so, you can't start off being. Uber generous I'd argue until you know, if you're pricing model and business model has a fit with people. You kind of need to charge enough to be a sustainable business. And then at that point you can kind of reassess whether okay, should I increase the price? Should I decrease the price? I keep it the same but until your. At a point where you can sustain yourself and your staff and and do that all well, right and take care of your customers pricings a little tricky. So right now I was looking at your team looks to keep a good amount of people on the team is that it's obviously the price you're charging is enough to cover yourself your team salary and also to be able to support the many customers you have right?
Meredith: [00:16:49] Yes. Yeah. And in fact, it's yeah, it's yeah, it's plenty enough and I you know, I think that. I think that I was able to get away with starting a membership website and charging a really low price because I had a really big audience before I ever monetized. I had a lot of people who trusted trusted me already. And so, you know when I monetized it was to a list of you know over 12,000 people who were already reading my stuff, you know what I mean? I think it would be really different if I didn't already have an audience that I already had a big audience. So I knew that I. Go from 0 to 60. Pretty quickly.
Ward: [00:17:28] So let's just transition a bit too regarding a cancellations and and refunds it sounds like you've a low cancellation rate, which is great. Right? That's the dream of everyone who has a recurring Revenue business. It sounds like the main reason though is some kind of credit card failure. Not not because people want to leave but is is I assume there still must be some people leaving either because of money or because of their they no longer are in the profession or they don't find it useful for whatever reason. Is there anything you're doing to try to actively keep those cancellations down or is it low enough that it's not even a problem on your radar?
Meredith: [00:00:05] It's low enough that it's not even a problem on my radar. I mean honestly like the the three like number one reasons people cancel. The top one is just credit cards expiring and you know, People are people are you know, inherently lazy like I'm inherently lazy, you know what I mean? Like if I subscribing to something and my credit card expires and I don't go update it. It might be three months before I realized. Oh wait, I still want that thing and then go take care of it, you know, but memberspace naturally takes care of most of that for me, you know, so I don't have to actually deal with it. I have to prompt people, you know, as you know, but I do lose some people because they just never end up updating their credit card, but I actually get a lot of people back to. Later, we'll be like, you know, I want to restart my membership. Do I need to steam, you know? Do I need to do anything different or just you know, go in and update my credit card, but yeah expiring credit cards is the number one reason and then I do get other people who cancel and it's usually because they are moving to a different job or they say that they just don't take the time to use our content. So they just say, you know, I wanted to read it, but I just didn't take the time to do it and so I don't need it. Or they're retiring or I very rarely get people who will say. Oh, I'm trying to cut expenses but sometimes it's that too. But yeah for the most part I just do not worry about cancellations because it's so low, it's not it's you know of all the you know things I'm trying to tackle right now that just isn't one of them because most people don't cancel.
Ward: [00:01:35] Right that sounds like a great problem to have and most people would love to be able to not have to focus on that right and just had a focus on growth I was so so so kind of speaking a growth you and mention it sounds like the business is doing well. You're not you're not hurting for for Revenue. Everyone seems to be paid for taking care of your customers. Do you have sort of an end goal in mind or like what how big you want to get or if you want to kind of maintain the current size or what are your thoughts there?
Meredith: [00:02:03] Well, yeah. So the funny thing about me is you have to keep in mind that I never really intended to be an entrepreneur in the first place. And so I have a lot of I have a lot of growing pains related to not knowing what I want. And so I started this in mid-2016. So as of May 2019, I'll be leaving my university job because this website and membership has kept me so busy and it has grown so much that I need to take the time to baby it and it can easily replace my University salary now and so I'm actually quitting my full-time job as a professor to do this membership website exclusively. Yeah, and so that was a really hard choice for me because I really love being a professor. But I also really love this website and the community that I've built and you know, I basically had to sit there and look at it and realize that I could only do one or the other like I can't keep having two full-time jobs. And so you know for now I my plans are for the next year or it's going to be to adjust to that to adjust to finally actually having time to really deeply look at my own website and the services I'm offering and figuring out, you know, if there's other things I want to offer but you know, honestly if it were to stay roughly the size it is now forever that wouldn't be a problem because I'd always be able to pay my salary. But of course, you know, I want it to get bigger because part of the reason that I started this was to get more science to more of our that more of the clinicians in our field. So I mean. I don't know. I don't know. I don't want to be a mega company with you know, 30 employees. Plus I you know, just me and I have 12 people who are part-time either as employees or independent contractors depending on what they do for me and honestly like where I am now is a lot on my plate as it is so I don't know.
Ward: [00:03:59] No, I mean that that's a good thing to think about sometimes is like especially for business. It's like a lot of people just assume you just grow for growth's sake like, of course, she keep growing and getting bigger, of course, of course, but if you step back and think about it and try to think of well, what is bigger look like and what would my day-to-day be like what I enjoyed that that actually what I want or or do I like where I'm at now if maybe I could refine some things make something smoother, but am I but you know, do I like where we're at now? Maybe I just want to figure out a way to maybe increase profit without necessarily increasing the amount of staff or an amount of work that I have to do. So, yeah, I know it's a those are good thoughts to be having. Do you know sort of what what's next for the business like what you're going to focus on I guess in 2019. Is it just kind of getting getting your bearings to be focused on just this full-time? Is that the main the main focus?
Meredith: [00:04:50] For the most part I mean some of the things on my kind of like short-term to do list over the next six months is I'm going to start offering courses. So people will have, you know, the membership with the monthly content, but then they'll also be able to purchase courses and so that will be a huge thing to add on to my site. And another thing is to you know, I've always been really active in social media and that's where I've gotten most of my audience from but I also think I can do it better. I'm getting really close to having Instagram swipe up. And so I need to get ready for that and you know be able to start, you know, selling off of Instagram, which I haven't previously been able to do so, yeah the courses and kind of starting to you know, fine-tune and grow my social media presence. And I have a bad habit of not necessarily thinking like years in advance, but thinking in like one-year increments, so that's all for 2019. Who knows what'll happen after that?
Ward: [00:05:47] Yeah, that sounds like plenty. I think that's a good place to end it. Is there anything else you wanted to mention?
Meredith: [00:05:52] No, I don't think so. All right, cool. Well, thanks. Thanks for the time Meredith who was great talking with you.
Meredith: [00:05:57] Thank you so much for having me. I appreciate your guys support.