Product Operation: How to build a membership payment system for a product?

This article explains the difference between differentiated payment and non-payment from several perspectives, and considers why users are willing to spend money to purchase membership.

What is a membership?

The original interpretation of membership was to refer to members of certain groups or organizations. Later, businesses categorized and sorted these groups and gave them names such as clubs, elite groups, and niche groups, in order to develop products and improve services to suit their tastes.

This is the product of full competition in the market economy, and the market supply derived from personalized needs is constantly segmented and re-segmented. Some businesses also adopt a membership system to accumulate members, offer discounts, and allow them to enjoy membership benefits.

Several Membership Types in a Market Economy

1. Nominal Member

——Refers to membership that users do not need to pay any cost for, which is usually given as a gift by merchants and used by merchants as a way to attract new users.

For example:

1. Enter your mobile phone number to become a member in supermarkets, barber shops and other stores
2. Membership vouchers are distributed on the roadside

2. Tier Membership

Level membership means that users need to spend a certain amount of time, energy or skills to accumulate honor and privileges. Level membership can stimulate users' enthusiasm and sense of participation, and provide feedback on their efforts.

For example: users spend a lot of time and skills in the game, complete the tasks, and then upgrade their levels and receive props.

3. Paid Membership

Users need to pay money to purchase convenience and permissions. We say that knowledge is priceless, but this priceless does not mean free. We see many people who have achieved certain results in their respective professional fields. They will sell their knowledge to gain value while helping others in need.

For example: selling online courses and audios from audiobooks.

Role of Members

1. An important part of building a user growth system

The user growth system is an important component of an Internet product.

The growth system can effectively assist the operation and growth of the product itself, making the product more full and attractive. Just like us humans, in addition to having a good body, if we also have rich knowledge and connotation, we will be more elegant and spiritual. The membership system can make the product more enriched and meaningful in its growth mechanism, playing a role of icing on the cake.

2. Connect users and improve user loyalty

It is not enough for products and users to be connected, there needs to be a closer connection for better sustainable development. Ordinary contacts have too little cost for users to abandon. The role of membership can strengthen the relationship between users and products, increase usage frequency, and improve user loyalty.

For example: If you become a member of a KTV, you can enjoy a discount. The next time you get together with friends or colleagues, you will still choose the KTV that has given you a membership. First, you may feel familiar with the place because you have been there before; second, there are discounts so you can save money.

3. Achieve revenue and reward business efforts

The resources that platforms or companies provide to users have incurred huge costs in terms of manpower, material resources, social resources, and time to enable the services to be produced.

Therefore, when these products create value for users, the platform will also recover costs and realize profits through payment. After all, the huge labor and operation and maintenance costs require funds to be sustained.

For example, online course platforms such as "Get App" and "NetEase Cloud Classroom" not only need to pay the cost of team development to build the platform, but also need to use operating costs to attract teachers from all walks of life to come to the platform to explain the courses. All of these require the use of paid VIP memberships to recover costs.

How to differentiate the products of the VIP system?

We have just analyzed the types of members and their roles, but this is all from the perspective of the platform and merchants. If we want to design a VIP system, we need to change our thinking angle and think from the user's perspective.

Let’s think about why users are willing to spend money to buy VIP. Only when the users’ psychological expectations and the value they need are met will they be willing to pay for it.

1. Save user time and improve user efficiency

Many people firmly believe that "time is money, time is efficiency." Especially in first-tier cities, everyone is busy at work and has a fast pace of life. In many cases, everyone is racing against time. If a paid product can save users time and improve efficiency, many people will be willing to pay for it.

The bank is an institution that is closely connected with our lives. We deal with finance every day and often need to go in and out of the bank to handle business. But there is a problem. To get a number, you either have to wait for a long time or get up very early. This is also a headache. Bank VIP channels can save some financiers from such trouble.

Another example is VIP membership for some products, such as blind date or recruitment products. The system or background will automatically match you with information that meets your requirements and filter out irrelevant information that may interfere with users. Greatly improve user search efficiency and save time.

2. More and more popular resources

We all want to be able to spend our money on things that make us feel happy. Entertainment is an industry with strong demand and rapid updates, especially when our favorite stars star in TV series and movies. If we can't see it immediately, we will feel lost and bored.

For example: On iQiyi, Tencent Video, and Youku Video, we need to purchase VIP to watch the latest and hottest movies and videos to meet our urgent needs for entertainment and watching videos.

For example, many popular scenic spots such as Jiuzhaigou, Lijiang, and Lushan also require you to buy tickets before you can visit. The parks in the city are open to the public free of charge.

3. Value-added services, enjoy privileges

Many times we are also willing to spend money for more value-added services. Since you have spent money, you should enjoy different rights and interests from ordinary users.

• Let’s take videos from iQiyi, Tencent, Youku and other platforms as examples. VIP members can enjoy better picture quality and skip ads, enjoying the highest clarity and viewing experience.
• For example, members’ download speed can be increased by 10 times.
• There are also some consulting services. Members can enjoy one-on-one exclusive customer service, while ordinary users can only communicate with intelligent robots. These are the product privileges enjoyed by members.

4. Highest cost performance, maximum value

We all know there is a rule that the more things we buy and the more times we buy, the more discounts we can get from the boss.

Likewise, suppose there is a service.

Users can use this service to save some money every time they shop. For some users with high consumption frequency, this is undoubtedly very attractive. The more times they use it, the more money they can save.

JD.com and Tmall have designed JD.com Plus membership and Tmall 88VIP respectively.

• JD.com offers 8 benefits including Jingdou rewards, coupons, free shipping, etc.
• In addition to enjoying discounts when shopping on Tmall, you can also communicate with Alibaba products such as Xiami Music and Ele.me. This design can be said to be very tempting. For heavy consumers, both cost-effectiveness and usage value can be maximized.

If users do not use it, the membership fee will naturally be earned by the merchant. If the user uses it frequently, the profit from the user's multiple consumption of the product can be offset. It is a win-win situation for both merchants and users.

5. Show your status and satisfy your vanity

I remember when iPhone 4 first came out, if you logged into QQ on your iPhone, your avatar would show "logged in with iPhone".

Regarding this phenomenon, there are actually many classmates around us who would borrow other people’s iPhones to log in to QQ. In fact, it is just to satisfy our little vanity.

Similar functions include: recharge QQ yellow diamonds, QQ show, etc. Although this one may seem empty and ironic, it is actually very effective. Many times we are willing to pay for vanity.

summary

We need to think about how to build a product payment system from the perspective of product differentiation. The article explains the difference between differentiated payment and no payment from several perspectives, and thinks about why users are willing to spend money to purchase memberships. Users are actually paying for the value they need, and providing the value users need is actually creating the competitiveness of your own product.

Author: I am in the advertising class

Source: I am an advertising class