Membership vs Subscription: What’s the Difference and Which Is Best?

The difference between a membership and a subscription comes down to what people pay for. With a subscription, customers pay a recurring fee for a product or service, such as a streaming library or a monthly box. With a membership, they pay (or sign up) to belong to a group, which usually means exclusive content, a community and member-only perks. Many websites combine both.

Membership and subscription websites are a great way to monetize your website. Both options give you a source of recurring and predictable income. But what is the difference between a subscription-based website and a membership website?

At first glance, they seem to be the same thing. However, the differences between the two business models go beyond mere terminology.

This article explains the membership vs subscription differences and helps you decide which business model is right for your website.

What Is a Membership Site?

First, let’s explain what a membership site is. A membership site is a website where some content is reserved for members only. In other words, if you’re a regular visitor, you cannot access that content unless you become a member of the site.

Membership content can include:

• Masterclasses, workshops or trainings
• Exclusive ebooks
• Members-only courses
• Private podcast episodes
• Livestreams and members-only videos
• Exclusive blog posts, articles or whitepapers
• Industry-specific magazines or publications

In some cases, you can access the membership content simply by creating an account with the website. The membership doesn’t cost anything other than your email address.

Other membership websites require you to pay an ongoing fee to be able to access the members’ content. The fee can be paid monthly, quarterly or yearly, depending on how the owner sets up the payment intervals.

Some membership sites also offer a combination of free and paid membership content as well as different membership levels.

A membership website often incorporates an element of community. By joining, you not only get access to the content but also other members. You can interact with other members online and some memberships also have networking opportunities or regular member meetups.

A good example of a membership website is Pat Flynn’s Smart Passive Income, whose paid creator community combines a private forum with courses, live office hours and member-only workshops.

Benefits of Membership Sites

As mentioned earlier, a membership site can provide you with predictable, recurring income every month. But there are a couple of other benefits of having a membership site.

Sense of Community

If you’re looking to build a community around your offers or your industry, a membership site is a great way to go. You can leverage the interaction between members to form friendships, business relationships, and create brand advocates.

But to do that, you’ll need to be engaged within your community and encourage members to participate as well.

Capitalize on Exclusivity

Memberships are often associated with the feeling of belonging to an inner circle. The level of exclusivity is not necessarily attached to a price but more to the fact that as a member, you’re part of an insider community. This is especially true if you have an open/closed membership model where members can join only during specific times and in limited numbers.

Drive More Revenue Without Overhead Costs

Lastly, since membership sites revolve around gated content, you don’t have to worry about overhead costs typically associated with sites selling physical products. Digital products don’t require physical storage and there are no shipping costs either.

What Is a Subscription Website?

Now that you know what a membership website is, let’s define a subscription website. A subscription-based website is more focused on revenue generation.

In essence, it’s a financial agreement between an individual and a website where the website grants access to either a service or a product for an ongoing fee.

For example, Netflix is a subscription-based website. For an ongoing monthly fee, you get access to the streaming service and all the entertainment content in its library.

Stock asset libraries are another type of subscription-based website: for a monthly or yearly fee, you can download photos, templates, music or fonts typically used in design and video.

You pay for a subscription on a regular basis: monthly, quarterly, yearly or another predetermined interval.

Unlike membership sites, subscription-based websites usually don’t have a community aspect attached to them. Therefore, there isn’t a sense of belonging associated with a subscription-based website. But the regular influx of fresh, new content is often beneficial enough for subscribers to continue paying for their subscription.

Benefits of Subscription Websites

Like membership sites, subscription websites can bring in additional income to your business. But that’s not the only benefit.

Foster Brand Loyalty

If you provide your subscribers with a quality service or product, they’ll keep their subscription active and remain loyal to your brand.

Attract More Customers

Subscription-based pricing is often more appealing to users. It lowers the barrier to your service or products as it’s easier to pay $25/mo than $500 at once.

Earn More Through Upselling

You can use the subscription-based offers to give your subscribers a taste for what your services or products are like. This builds trust which allows you to continue marketing to them and upsell them into one of your higher priced programs or products.

Membership vs Subscription: Key Differences

Both models bring in recurring revenue, but they sell different things. Here is how they compare side by side:

	Membership	Subscription
What people pay for	Belonging to a group: exclusive content, community and perks	Ongoing access to a product or service
Community	Usually central to the offer	Usually absent
Content	Can be a fixed library, courses or member-generated content	Needs a regular supply of new content or products
Pricing	Free, recurring or one-time, often in tiers	Recurring: monthly, quarterly or yearly
Main reason people stay	Relationships, status and exclusive access	Convenience and fresh content
Typical examples	Professional associations, creator communities, online academies	Streaming services, stock asset libraries, premium newsletters

In practice, the line is blurry: most paid memberships are billed as a subscription, and many subscription sites add member perks. Think of a subscription as the way people pay, and a membership as what they get.

Membership or Subscription Website: Which One Is Right for You?

Now that you know the difference between a membership site and a subscription website, you might be wondering which model is right for you. The ultimate choice comes down to your goals and how much time you have, but here are a couple of points to keep in mind:

• Since membership sites often have a community element, you’ll need to engage and be active in your own community. If you can’t dedicate time for daily engagement, a subscription website might be a better choice.
• On the other hand, membership sites don’t necessarily require a constant stream of new content. They can thrive with pre-existing content and user-generated content.
• You can often charge more for a membership site due to the exclusivity associated with memberships.
• If you publish new content on a regular schedule and your audience mainly wants that content, a subscription is the simpler model to run.
• You don’t have to choose just one. A free membership tier can grow your audience, while paid subscription tiers unlock premium content and the community. Clear membership types make this easier to explain.

How to Create a Membership or Subscription Website on WordPress

Creating a membership or subscription website on WordPress is easy. All you need is the right plugin, such as Ultimate Membership Pro. In Ultimate Membership Pro, each access level is called a Membership, and you can create as many as you need, free or paid.

For a subscription model, you can bill members on a recurring schedule, every few days, weeks, months or years, with free or discounted trials, prorated upgrades and downgrades, and expiry reminders. For a membership model, you can also sell one-time Memberships that grant lifetime access, a fixed period or a set date range, which is useful for cohorts and founding-member offers.

Payments run through built-in payment gateways such as Stripe and PayPal. Members can hold several Memberships at once and renew or cancel them from their account page.

In addition to that, you can release content on a drip schedule and restrict content by category or post type with a single rule, so new posts are protected automatically.

Final Thoughts

Both membership and subscription websites add a recurring and predictable revenue stream to your business. Although often used interchangeably, the two business models are different. The differences might seem subtle, but they can play a crucial role in how you decide to operate your business.

If you want the best of both worlds, combine memberships and subscriptions in one business model. Ultimate Membership Pro can run both on the same WordPress site. It’s sold as annual plans, and you can compare them on the pricing page.

Frequently asked questions

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