Category Archive: 'Subscription Business Model'

$14.5M in Digital Subscription Revenues for The Economist

Date: May 15, 2012 Topic: Revenues, Subscription Business Model Tags: , , , , ,

While most publications have seen a decline in subscription rates over the last decade, The Economist has been able to double its circulation to 1.5 million in that time, mainly the result of some savvy marketing.

Of that1.5 million, recent reports indicate that 100,000 are digital-only subscriptions, garnering approximately $12.7 million in online dollars for the 169-year-old publication. In addition, The Economist has 15,000 Kindle and Nook subscribers, which accounts for a conservative estimate of $1.8 million in revenues. That’s a total of $14.5 million in online subscription revenues alone!

But getting back to that savvy marketing. An off-the-record source informed me that The Economist has made a conscientious effort in its branding to be THE publication of cosmopolitan intellectuals, and indeed, it’s hard to find a smart world-traveler or business exec who’s willing to talk trash about The Economist. Thus, aspiring smart people feel almost compelled to buy a subscription. It’s tribe marketing at its best.

The Economist has also been savvy enough to capitalize on “lean-back” devices like the Kindle, Nook, and iPad, which are more friendly platforms for their long-form content. They not only know their market, but their medium. While some readers may be asking for mobile (which they provide), the majority are going to be grateful to be able to read lengthy articles at their leisure on a lean-back device.

Posted by MinalB21
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Paywalled Aggregator Backed By ‘Big Newspaper’ Shuts Down

Date: May 11, 2012 Topic: newspaper paywalls, Subscription Business Model Tags: , , , ,

As we mentioned in our last post, marketing to niche audiences is a great way for general news pubs to rake in online dollars.

But what about the flip side — paywalled aggregators?

There haven’t been many to choose from, but a year and a half ago, The New York Times Co., The Washington Post Co., and Gannett invested $4 million each in Ongo, an online news aggregator with a paywall.

But Ongo had a confusing subscription offering, with a basic service that included “selected” content. Subscribers then had to pay more for individual publications, priced at different rates. In addition, much of the content was available free on the Web through other sites or metered paywalls. And so now, sadly, Ongo is shutting down.

Ongo’s strength may have been that subscribers could access their content from  multiple devices — desktop, tablet, mobile — and have an ad-free reading experience. As Ongo founder Alex Kazim said in an interview with paidContent last year: “We realized that users won’t pay for content — however, they will pay for a better user experience.”

Even though we disagree with the first half of Kazim’s statement (and have ample evidence to the contrary), there’s wisdom in the latter part of his statement for all of us. Failure makes for great lessons. In Ongo’s case, the technology was well-suited to reader behavior. It’s just that the marketing and pricing were off and couldn’t course correct in time to satisfy Ongo’s ‘Big Newspaper’ investors.

Posted by MinalB21
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Is Harvard and MIT’s $60M Investment in Online Ed Good or Bad News for Paid Content?

Date: May 4, 2012 Topic: Launches, Subscription Business Model Tags: , , ,

Harvard University and the Massachusetts Institute of Technology (MIT) announced this week that each school would be investing $30 million (yep, that’s $60 million total) in creating free online education courses.

As some of you may know, online education sites like Lynda.com and ArtistWorks.com are some of the hottest paid content niches out there. So competition from universities willing to provide educational content free of charge may give subscription site professionals reason to pause.

On the one hand, this could be a repetition of the “original sin” committed by newspapers, who made their content available free online and with no plans to monetize. They cannibalized the revenues in their own industry and are now struggling to smack together a way to monetize their work.

On the other hand, when Google came out with its free Google Website Optimizer, companies creating testing software were nervous. Yet, according to our sister site, WhichTestWon.com, free testing software introduced more people to the industry and led to an uptick in testing over a 24 month period. Turns out, thousands of marketers got their start with the free Google product, and then felt comfortable enough to “upgrade” to a paid software that better fit their needs.

So in this case, perhaps Havard and MIT will help more education consumers feel it’s “normal” to take online courses, and thus open the market for the rest of us. Niche online education folks may not be celebrating yet, but they may want to put the champagne on ice.

Posted by MinalB21
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$3M in Subscription Revenues For BostonGlobe.com, But Site Still Struggling to Convert

Date: April 30, 2012 Topic: Conversions, Subscription Business Model Tags: , , , ,

BostonGlobe.com’s paywall doesn’t seem to be the rainmaker it is for its parent company, The New York Times.

Recent reports of BostonGlobe.com’s free trial offer (April 24 – May 6) allowed me to take a closer looks at the company’s conversion and revenues. It turns out that Beantown’s flagship news outlet has only been able to convert 18,000 readers into paying subscribers since instituting a paywall last September. With 6.2 million unique visitors in 2011, that puts the site’s conversion rate at about 0.3%.

That also means that the site can be expected to garner about $3 million in subscription revenues this year. Compare that to The New York Times with 450,000 paid subscriptions and a conservative estimate of $77 million in subscription revenues, and you can see why the powers-that-be at the Globe are willing to buck best practices by offering a free trial without requiring a credit card number (we strongly recommend against this).

Some have speculated that the low conversion rate may be because the Globe has failed to articulate the benefit of its online platform, other than the site’s ability to adapt to any mobile device. It may also be because the Globe doesn’t have the national (and international) appeal of the New York Times. Plus, putting free content on Boston.com and having a more stringent paywall on BostonGlobe.com (there’s no metered access like the Times), makes it a difficult sell with no foot-in-the-door offer. And lastly, the Globe has chosen to make online access free to its print subscribers. While this may be an enticing tactic for some papers, valuing online content separately and pricing it similar to print has allowed other legacy print publications to garner more profits during this period of trial-and-error in the digital publishing industry.

Posted by MinalB21
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Top 15 Lessons From Subscription Site Insider’s Summit in SF

Date: April 27, 2012 Topic: Events, Subscription Business Model Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , ,

For those of you who missed it, our Subscription Site Summit in San Francisco was a smashing success, with two days full of practical tips and inspired business advice. I’ll be writing a more in-depth summary next week, but for now, here are the top 15 takeaways from our guest speakers:

  1. The paid content business is a $15 billion a year industry — Anne Holland, Subscription Site Insider
  2. “Faked” overlays can convert more than traditional landing pages — Mike Manning, LoopNet
  3. Come up with a demographic and psychographic profile of your “average” customer and, when in doubt, ask what he/she would want and respond to any new initiatives — James Taylor, ArtistWorks
  4. An attitude of “Everything is new again” will help you survive a shrinking/changing market — Torry Burdick, Mortgage Success Source
  5. When your site relies on member engagement, increase it by not only providing them with concrete tips on how to best use your service, but send those tips via postal mail — Mitch Davis, ExpertClick
  6. If you’re using Google for your PPC campaign, ask them for access to their Beta programs, like Google Dynamic Search Ads or Google Communication Ad Extensions — David Herscott, NetX
  7. Test! — Justin Rondeau, WhichTestWon.com
  8. Marketing is not about getting people to buy, but rather, getting people to buy now — Bill Baird, Baird Digital
  9. If you’re running both print and online subscriptions, renew your subscribers the same way they came in — Helen Hoart, Harvard Health Newsletters
  10. It’s easier to sell “content and data” than “news” (even though they’re often the same thing) — Brain Hunt, The Recorder
  11. Kindle has 80% of the eBook market, so start there — Fred Gleeck
  12. Don’t use a flip camera when creating videos. Do use the less expensive cameras that are used to create B-roll — Brenda Power, ChoiceLiteracy
  13. Subscription revenues can be 3 times the revenue lost by CPM drop when going to a metered access model — Alisa Cromer, Local Media Insider
  14. When onboarding, offer subscribers a welcome video, a congratulations and thank-you email, an email with suggested first steps, and notification about how they can get help/support (but not all on the same day) — Noah Fleming
  15. Events are hard, but worth it — Andrew Krauss, Inventor’s Alliance

Look for more tips and advice over the coming week, here on Paywall Times and on our sister site, Subscription Site Insider.

Posted by MinalB21
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