SEM Tycoon

**Bryan Le** · 07-06-2006, 06:01 PM

Hey guys,

I have a very interesting question that I'd like expert opinions on. I am working on a current project and am wandering whether I should make it free or not - though I won't disclose anything about it now, I just want overall opinions on this subject...

There are sites out there that offer a lot of things for free - think about all the social networking sites, etc. as well as any site that has free services to offer. I suppose they make their money from ads since they will bring a lot of traffic...for being free.

However, is this better then charging a small fee for a membership? For instance - $1.00 - $5.00? This would be a monthly charge, and would result in a residual income...

The debate here is whether or not it is better to build a site with free services and make money from advertisers and sponsors, or to offer a "side plate" that compliments the service at a fee...

Or:

Offering a service for a small monthly fee, but serve no ads, and make money strictly from memberships.

I hope I explained this well enough - if not, just post and complain and I'll be sure to clear up any messes I may have caused

Bryan

**Hexation** · 07-06-2006, 06:02 PM

I think your

Quote:

Offering a service for a small monthly fee, but serve no ads, and make money strictly from memberships.

is the best idea.

**handsome rob** · 07-06-2006, 06:16 PM

PlentyOfFish makes $10k/day from adsense because it's a service that most sites charge for, but they offer it for free. The design is also extremely basic, but 10-freakin-K-a-day!

**Andreas Bard** · 07-06-2006, 06:31 PM

This really depends on what kind of target group you have for your site and what topic it have.

But if you take a monthly fee for the service, you should have the site ad free, and if you offer it fro free, put up ads to profit from.

I would do it like this:

If they sign up for a "Gold Account", let them have the site ad free as an extra advantage, if the have the free version, they have to see the ads.
I do not know if that works for your concept, but I think it is **** good.

//Andreas

**imported_mattd** · 07-06-2006, 07:11 PM

I'd look for an ad-free membership, but keep the site free. An alternative - depending on the site obviously - is to have extra features available for paid-membership combined with no adverts.

Maybe its just me, but if a site charges then it has to be **** GOOD to make me want to come back, especially in this age when there is always a free alternative - and if there isn't a free alternative, you can bet there will be one! If you want to charge for the site then whilst you are building a reputation and traffic you'll have to go free IMO, and that could take ages and cost money.

**SteveAR** · 07-06-2006, 07:19 PM

i think it depends on who your targeting and what your site is about. example if your charging for ringtones and there are hundereds of sites giving free ringtones then you might not get what your aiming for.

what will the subscription include if youll have one? thats the Q. you can always have adsense as well if you decide to do both. i do that on www.thenextelforums.com we have a monthly subscription , sell ad space and adsense and we have so many things for free.

**Mike** · 07-06-2006, 07:42 PM

If what you are offering on the site is restricted to membership, that in turn means it is blocked from being indexed by search engines. Not saying this is a bad thing, but be sure to factor in that you are going to have to spend more on advertising your product than you may have to otherwise.

This is actually a dilemna I am beginning to face. I offer a service that many sites charges in the range of $30-$50 per year for. I like being able to offer free services, but honestly, the quality of my content is not yet as good either. There are things I can purchase to make the site more informative, but the companies that offer this doesnt like to offer it to sites like mine, meaning they will charge me 10 times more money or more to access what they have.

So far, I have chosen to stick with the free method and make my money from advertisements. Even if I did go to a pay site though, I would still work advertising into the site.

**Pax** · 07-06-2006, 11:27 PM

I think it depends on what your competitors are doing.

If they are doing it free with ads, do the same, but offer a no ads version for a small fee.

That's what I would do anyway.

**Nitin M** · 07-07-2006, 12:18 AM

ditto on the other ideas but i would suggest something more than just dropping the ads for the site supporters ... give them something to feel special. this very much depends on the type of site but let's say it's a site where members have a profile ... make sure the supporters get a "cool" designation in the profile or wherever you might show member names ... like a little trophy, or let them have a bigger av or something like that. if you go with the trophy type idea make sure it is a link to the "become a site supporter" page and also a hover over with something cool.

**Skribblez** · 07-07-2006, 08:51 AM

hmm... try thinking about it this way:

$1-$5 each month is nothing to most people, it's just pocket change. I know I'd surely pay that extra dollar to get rid of annoying pop-up ads every month. Also, considering the fact that $1-$5 a month is such a small amount, you're guaranteed that most of the subscribers will continue to subscribe, therefore bringing in a very stable amount of income each month.

Payments of $1-$5 can build up very fast, because, like I said, it's just pocket change and means nothing to most people. Now, WHO wouldn't have an extra $1-$5 to throw around?

I doubt you'd even have to spend much on marketing a site like yours.

**imported_mattd** · 07-07-2006, 09:31 AM

1 or 5$ is fine if you have one site to subscribe to, but it all starts to add up. A 5$ site here, a 5$ site there etc before you know it your spending 50 a month just on websites, let alone your bills!

Its a difficult one - I think people expect websites to be free, especially if there are adverts. I get the feeling you have to be very good in your field to be able to justify charging a fee for it - obviously depends on what you have in mind ofcourse.

**Bryan Le** · 07-07-2006, 01:46 PM

How about offering a free beta based on the invitation system, and then once the site is working smoothly, moving over to paid subscriptions...low price at first, then steadily raising it?

**imported_907Group** · 07-07-2006, 02:03 PM

If you are starting off, keeping the site free can bring in many visitors. Once the site launches and well established, you can always add premium section or paid membership for additional features.

Charging $1-$5 isn't bad depending on what kind of site it is. If it's towards younger audience, they don't have a way to pay for it.. no cc, no paypal, etc..

You can always add a paypal donation button on the site. If I see a good site, I usually donate some money to them. Best luck.

**clenard** · 07-07-2006, 05:46 PM

Quote:

Originally Posted by Bryan Le

Hey guys,

I have a very interesting question that I'd like expert opinions on. I am working on a current project and am wandering whether I should make it free or not - though I won't disclose anything about it now, I just want overall opinions on this subject...

There are sites out there that offer a lot of things for free - think about all the social networking sites, etc. as well as any site that has free services to offer. I suppose they make their money from ads since they will bring a lot of traffic...for being free.

However, is this better then charging a small fee for a membership? For instance - $1.00 - $5.00? This would be a monthly charge, and would result in a residual income...

The debate here is whether or not it is better to build a site with free services and make money from advertisers and sponsors, or to offer a "side plate" that compliments the service at a fee...

Or:

Offering a service for a small monthly fee, but serve no ads, and make money strictly from memberships.

I hope I explained this well enough - if not, just post and complain and I'll be sure to clear up any messes I may have caused

Bryan

From my personal experience - I suggest $5.00 minimum... I learned this trick in Telemarketing and how AT&T gets customers with "hidden charges". Basically, $5.00 makes people decide "it's gotta be better than a $1.00 a month site"... it's also a small enough fee to make them "not care' about stopping payment. But, $1.00 fees make people think "why wouldn't it just be for free then?" almost too scammy sounding.

BUT in my opinion -- I've got two Social Networking Communities.. both doing well. I almost charged for one and even the thought scared a few people away. On the other hand - a competitor that did charge has went down pretty fast lately... he ended up changing it back to being a free site.

I say - build a membership base and give the first 5,000 members or so a free lifetime membership - then go ahead and charge the rest. That way atleast people know you have members and it makes it worthwhile to join.