Preparing Your Community for Monetization
100% of my favorite communities care more about the community, than the money it produces. As I reflect back, this holds true:
My 12-year old Illinois State Champion travel baseball team
My College RA Staff
The guys I lived with in College
The non-profit cafe team in LA
The friends we traveled with across the globe with for 3 months in 2023.
Each of these communities required cash to be involved. Whether rent, league fees, salaries, or donations ― money was exchanged.
Even if this is the case, the point was never the money. The money was just part of the process.
Every community builder will eventually wonder how they could charge for their community. Running a community effectively takes time, effort, and resources. In short, money.
But simply because some communities cost money to operate, it doesn't mean they all need to charge.
Not Every Community Should Monetize
I've spoken with dozens of founders who believe they're ready to monetize when they aren't.
Many of them are driven by the appeal of profit, but deterred by the work involved to get there.
I'm often quite optimistic about the potential of monetizing communities, but not always. Below are some patterns I've observed when monetization might not be the right move:
Treating community purely as a lead or demand generator.
Wanting "Passive" Income ― Community is not a passive investment.
Believing their community will just be "better." Why? Because they're the ones who are leading it. Ego is a red flag in community-building.
Unclear vision for what the community will exist to do together.
Minimal understanding of what people might be willing to pay for.
In order to be primed to monetize, a few key things need to be in place.
The Key Ingredients for a Profitable Community
Engaged and active members.
I've seen some community builders suggest that the goal is to monetize their communities as fast as possible. I tend to agree with the sentiment, but with one caveat. Without engagement, monetization will never work.
Clear value proposition and purpose.
If you've been following me for a while, you know this matters to me. If you don't have vision, no one will follow. If you don't have clarity, they won't know how to follow. You need to clearly explain why the community you're building offers personal transformation. If you're not comfortable in value proposition, it's unlikely people will be willing to pay.
Strong community culture and trust.
This is the hardest element to hone, but it's also what differentiates your community from the next. While trust and culture are similar to engagement, they're not the same. A strong culture is built upon trust, and it's what undergirds engagement. Without it, you may have people engaging, but only a superficial level.
To be ready to monetize, I suggest appealing to inner transformation as the key selling point. People buy benefits, not features. And if you ever intend to deliver on your promise (which I argue you must), trust is the linchpin.
Integrating Community into Your Business Strategy
Don't invest in community because it's cool right now. Only invest in it if it aligns with where your business is headed.
Another Revenue Stream
I spoke with a co-founder last week who was looking for more revenue. He hadn't considered community, and I'm confident it would align well with how their business already operates.
If you are in the people business (coaching programs, education, events, productivity, etc.), community could work well.
Attaching a community to what you already offer is a good bet. For example, if you sell a course, why not get feedback about that course in real time? Why not continually offer more value for those who have already clicked "purchase"? They already trust you enough to have bought something from you, so why not keep working with them? Why not keep learning from them? Why not offer more value to serve their goals and aspirations?
Create a compelling offer that adds more human interaction, and go from there.
Offering & Marketing New Products
When I first started helping founders launch their own communities, I thought that this would be the primary selling point. Helping founders know what their customers really wanted. I've discovered it's an added benefit to community, but not the primary thing. It's worth noting here, because community does offer you the potential to grasp what your audience wants more of.
I don't suggest using community to find Product-Market Fit (PMF). Instead, I suggest testing new products within the community, gaining feedback, and adapting. Remember, this is why communities are built on trust. You're not trying to eek out as much money from your customers. Instead, you're building new products, resources, or services that they genuinely want.
If your community trusts you, then they'll tell you if what you're offering is ideal or not. It's a fantastic way to test new products. Don't rely on ads or trends to tell you if there's demand, rely on your actual audience instead.
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I've created a brief self-assessment to see if community might be a good fit for your business. Take a moment and consider the questions in the image:
Interpretation:
Investing in community is an investment in your customers. I know founders who've told me that community is what their clients loved most about what they offered.
Community is proof of care for your clients. It shows your customers that you are invested in their flourishing, and not just your bottom line.
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If you want to create a community, but you don't know exactly what or how to offer it, get in touch.
Best,
Jesse
