Unlocking Revenue: Debunking 5 Myths in Building Profitable Online Communities

Imagine owning a thriving digital sanctuary—an online haven where you nurture growth, facilitate connections, and cultivate a vibrant community of eager clients. 

As you navigate through the virtual corridors, you bask in the glow of fulfilled potential and the satisfaction of making a meaningful impact. Here, you're not just a coach or therapist; you're the architect of transformation.

Welcome to your digital empire—a place where your vision comes to life and your legacy takes root.

Now, take a step back. What did it take to get here? Did you need to invest copious money and hours to make this happen? Did you need to hire a huge team to manage the community? Did you need to piece together disjointed software and platforms?

Having read through CIrcle’s extensive Benchmark Report for 2024, I’m here to say that many of the assumptions we have about successful online communities are utterly false. So much so that you may just have to retire your tired excuses for avoiding this business model after all, and instead, adopt the membership community model as a way to make money and impact.

Here’s a look at 5 of the most common myths around building an online community that should no longer hold you back.

Myth #1: You need a ton of money to acquire members.

Contrary to popular belief, the acquisition of members doesn't hinge solely on financial resources.

In fact, research indicates that the most successful online community creators, particularly those earning the highest revenue, are less inclined to splurge on member acquisition than their standard counterparts.

Instead of relying solely on hefty marketing budgets, these savvy creators have honed in on innovative, cost-effective strategies to attract members. From leveraging organic reach through social media and cultivating word-of-mouth referrals to hosting engaging events and offering valuable content, there's a myriad of approaches that don't require deep pockets.

Ultimately, it's not about the size of your budget but the ingenuity of your tactics and the value you provide that truly resonates with potential members.

Myth #2: You need thousands of members to have a rich, engaging community.

For those who equate large numbers with lot’s of engagement, this may come as a surprise: Size isn't everything when it comes to online communities.

In fact, the research shows that many successful communities have 500 or fewer members. And here's the kicker: The most profitable membership communities are no more likely to be massive with over 5,000 members. Success isn't measured by sheer numbers but by the depth of engagement and value provided, especially when makers use this as a primary way to make money.

That said, I need to add a few “but…” statements here.

For instance, in any given online community, only about 10% of members will post responses, ask questions, show up for group sessions, present information, etc. And of those, only about 1% will fall into the category of “very active.”

Yet, as we all know, having a broad range of perspectives in a community makes things like breakthrough thinking, innovative ideas, and lively debates much more likely.

Increasing the size of your online community, then, does increase the odds that you’ll have a more robust environment. It also results in greater leverage, since for the same amount of effort, more people experience its benefits.

Myth #3: You need a bunch of expensive, complicated tools to manage a successful community—especially if you don't have a large team to support you.

Quality over quantity reigns supreme when it comes to community management tools.

You don't need an overwhelming array of complex and pricey software; what matters most is identifying and utilizing the right tools that align with your community's objectives and dynamics.

In our research, we found that many highly successful creators streamline their toolkit to include just three essential components: a robust community platform to promote engagement and interaction, an efficient email marketing system to communicate effectively with members, and strategic automation tools to streamline processes and enhance efficiency.

By focusing on these core tools and leveraging them effectively, community managers can cultivate thriving communities without unnecessary complexity or expense.

Myth #4: Successful communities are free; that's how they attract and retain members.

While free communities might seem like the norm, the truth is that successful communities often charge for access. Only 7% of the most prolific communities are free, compared to 21% of standard ones.

The vast majority require some form of payment, whether it's a direct fee for access or bundled with another product or service.

So, how do you know if you should offer a freemium community or charge for access? In short, here are three reasons you may want to consider a free community, at least initially:

You have a lot of content, but it lacks depth.

You have very little content and/or a very small audience.

You don’t have a powerful unique value proposition and are in a saturated market.

If these don’t describe you, chances are, you should have a pay-to-play model.

Myth #5: Managing a successful community requires a large team.

Running a successful community doesn't have to be a daunting task that requires a large team.

Contrary to common misconceptions, many thriving communities are managed with minimal or no full-time help.

This report shows that approximately 60% of highly successful communities operate without any full-time staff. In other words, profitability and impact isn't necessarily contingent on the size of your team but rather on the quality of your strategies and tools.

By implementing the right tactics and leveraging efficient tools, community managers can effectively oversee every aspect of their community, whether it's moderating discussions, responding to member inquiries, or organizing events.

With the proper resources and a strategic approach, you can achieve remarkable results, bolster this as an effective way to make money, and create a vibrant, engaged community without the need for a large team.

What does it really take?

So, what sets successful online communities apart? They're driven by a clear understanding of their members and fueled by creative, strategic approaches.

Ready to explore the world of online communities? Download the Benchmark report for more insights. And if you're itching to put your newfound knowledge into action, why not give Circle a try with a two-week free trial?

It's time to debunk the myths and embrace the potential of your online community. Let's make it happen together.