Subscription website publishing is to charge for access to premium content on the Internet. Or in very simple terms, a subscription website is a website that has pages of content that are only available to subscribers.
It is the digital equivalent of the traditional magazine or newsletter.
In practical terms, a paid subscription website has two parts:
- The first part is the free area. This usually focuses on persuading prospects to become paying customers. The free part can just be a long list of benefits, or can be samples of premium content that visitors can read so they know what is in the members area.
- The second part is the premium content, which is password protected and only available to paying members.
People visiting the site usually have to register their details online in order to be provided with a user name and password to get access to the member-only information. The content is usually articles, but may also be news and views, video clips, audio, games, online radio stations,course material, an image library, access to a forum or downloads such as ebooks, music or software.
Subscription can be free or paid.
On a free subscription web site the site owner provides access to their premium content in exchange for a persons contact details. The goal of these sites is usually to build an email newsletter list through which other products and services can be sold. Getting personal details is also a way for the site owner to monitor an individual’s activity in the member’s area. This is particularly important on forums or on sites where people can leave comments. If a site owner knows who is leaving comments they can ban people who are unpleasant, argumentative or rude.
On subscribing, members receive a password that allows them to login to the private member area for as long as their subscription is valid. The length of membership varies from site to site. It can be as short as one hour or as long as a year. Very often, membership is sold as a rolling monthly subscription.
What are the most popular subjects for subscription or membership websites?
On the web, with its global reach, any subject can become a profitable business.
1. Weight Loss, Fitness and Exercise
Diets and fitness are evergreen subjects. They will always find a willing audience happy to pay for advice.
Closely aligned to #1, health is becoming an important subject for information and membership sites. They cover topics such as dealing with children with illness, coping with your own illness, vitamins, mental health, etc.
3. Starting a Business (including a Home-Based Business)
Starting a business has always been popular in the magazine and print newsletter world. This popularity has now transferred to the online world. Some membership sites deal with part-time businesses working from home, such as making money on eBay. Others are more professional, helping entrepreneurs put together business plans and raising funding.
4. Make Money from an Existing Business
Making existing businesses more successful is a rapidly growing area of online publishing. These sites enable business people in the same industry to share tips, tricks and opportunities to build their business. These websites are often far more practical and down to earth than industry associations.
5. Internet Marketing
Internet marketing has become a sector in its own right, with dozens of membership websites emerging over the last five years. They look at every niche marketing subject including SEO, SEM, social media marketing, pay per click, etc.
6. Making Money from Investing
Newsletters with share and investment tips have been around for a long time. Now many of them are moving online. There are a few very important advantages from being on the internet. These include the ability to provide real-time updates, interactive charts, discussion forums where members can discuss tips and archives of trading information so members can look back at previous recommendations.
7. Improve Your Personal Life
The subject of dating and relationships continues to grow as an important market sector, with many huge sites turning over millions of pounds. uDate.com has 6,000 new members join every day while Friend Finder has over 6 million registered users. Introductions are a sector dominated by the big players, but there are still a lot of opportunities for subscription websites in related subject areas.
8. Learn How to…
These are sites that educate and train amateurs and enthusiasts alike to pursue a hobby or improve their skills. It could be needlework, fly-fishing or digital photography.
9. Moving to…
These are sites about moving to a new place or country, usually a sunny climate. Over the last few years, this has become a very popular subject.
10. Lifestyle and Religion
Websites that are communities, centred around a kind of lifestyle or religious belief attract strong and loyal followings.
And of course the websites with an Adult Content!
Adult content sites make more money than all the other categories put together. This is a huge industry with staggering revenues, but it’s a tough place for new entrants to get started.
Successful Subscription Sites
Consumer Reports has one of the world’s largest subscription sites with over 1 million members. They started their subscription service in November of 1997 and members pay less than $30 per year to access their content. ConsumerReports.org is the website of Consumers Union, an independent, nonprofit testing and information-gathering organization. Members get unbiased opinions about the usefulness of almost every product or service.
Carfax.com receives more than 1.83 million visitors each month and services the needs of more than 23,000 automobile dealer subscribers. Car Fax makes buying a used car as risk-free as buying a new car by backing every Vehicle History Report with the Car Fax Buyback Guarantee. Car Fax is the best protection against buying used cars with costly hidden problems.
Thestreet.com provides the serious investor or trader daily market analysis and specific, action-oriented investment and trading ideas. They don’t list their number of subscribers, but were listed in Consumer Content Reviews top 25 subscription websites in 2001.
This site boast of having over 80,000 members that pay $35 per month for this in the trucking industry. They match truckers and people looking to get loads transported from one place to another.
Secrets to their Success highlights successful home-based internet entrepreneurs. They also give site reviews, tips, and strategies to help you start an on line business.
It is important to consider all pros and cons of a free membership versus a paid membership for the business model.
Benefits of a Free Membership:
Free memberships have hidden benefits. People love free things, and they are very likely to sign up as a member if they are receiving something for nothing on a regular basis. For example, one might have a PLR (Private Label Rights) article membership and the free membership provides people with 5 free articles per month. If they enjoy this, they could then have the choice to upgrade to the paid membership.
Benefits of a Paid Membership:
Obviously, the main benefit is that it is a regular income earner, whenever each member’s subscription is due. Paid memberships can provide with the funds to outsource a lot of the work involved to bring new content to members. It can also allow the expansion of membership marketing horizons by investing in advertising and promotion.
Benefits of a Combined Free and Paid Membership:
As mentioned above, the free membership can be the method employed to have people sing up. They can then be presented with the option of upgrading to the paid membership in order to receive more content or higher quality content (depending on what type of membership the site is running).
So which is the best model?
Ultimately the combination option can be considered the best choice for most membership marketing situations. It provides the best of both worlds by encouraging people to sign up to receive content for free, and also to upsell them to the paid membership.
Naturally, every situation will have a different requirement, needing the assessment of the situation before making a decision. Before even the start of making a membership site, one must research whether there is a market for the products. Then set a target to acquire a certain number of new members every week or every month. To lower the cancellation rate, make the free membership highly attractive by over delivering. As long as people are members of the free option, it is possible to stay in constant contact with them and show them the benefits of upgrading to the next level of membership.
The free version is simply the front door that new members take. In order to keep them in the house, delivering quality content on time is vital. Pricing the membership is another factor one must spend time considering. By assessing similar memberships the site can be priced competitively.
Membership sites provide the ultimate recurring income model. These have the ability to bring continuous income on a monthly basis while helping the build up of good relationships with the members, resulting in a highly rewarding experience for both owners and the members.
In fact, no one is sure where the web is going; this undeniable shift away from free content will certainly make life more difficult for the Googles of the world who rely on free content to fuel their search engine. Consumers may turn to company’s like Apple for their media, who adopted the “paid content” model early on by making content available for small fees through iTunes and more recently showing consumers how convenient it is to access a magazine or newspaper digitally for a small fee on their iPad.
The Nielsen Company asked more than 27,000 consumers across 52 countries if they will pay for online news and entertainment they now get for free. As expected, the vast majority (85%) prefer that free content remain free. Yet there are opportunities to be found in the details. Indeed, when asked to focus on specific types of content, survey participants are more willing to at least consider paying for particular categories, especially if they have done it before. Online content for which consumers are most likely to pay—or have already paid—are those they normally pay for offline, including theatrical movies, music, games and select videos such as current television shows. These tend to be professionally produced at comparatively high costs.
Whatever their preferences, consumers worldwide generally agree that online content will have to meet certain criteria before they shell out money to access it:
Better than three out of every four survey participants (78%) believe if they already subscribe to a newspaper, magazine, radio or television service they should be able to use online content for free.
At the same time, 71% of global consumers say online content of any kind will have to be considerably better than what is currently free before they will pay for it.
Nearly eight out of every ten (79%) would no longer use a web site that charges then, presuming they can find the same information at no cost.
As a group, they are ambivalent about whether the quality of online content would suffer if companies could not charge for it – 34% think so while 30% do not; and the remaining 36% have no firm opinion.
But they are far more united (62%) in their conviction that once they purchase content, it should be theirs to copy or share with whomever they want.
Despite the growing consensus that the media may only be able to generate appreciable online revenues by charging consumers for content, there is little agreement on just how to do that. Companies are experimenting with a range of payment models, from full service subscriptions to individual transactions, or micro payments have proved cumbersome to implement in the past. But a more manageable system may be no more enticing. Only 43% say an easy payment method would make them more likely to buy content online.
Regardless of what systems they choose, media companies will almost certainly not abandon advertising: and consumers will doubtless still see ads along with paid content. For the 47% of respondents who are willing to accept more advertising to subscribe free content, that may be tolerable. Yet it will probably not sit well with the 64% who believe that if they must pay for content online, there should be no ads.
Newspapers have been implementing subscription systems (also known as “paywalls” on their websites to increase their revenue which has been diminishing due to a decline in print subscriptions and advertising revenue. While subscription systems are used to bring in extra revenue for companies by charging for online content, they have also been used to increase the number of print subscribers. Some newspapers offer access to online content including delivery of a Sunday print edition at a lower price point than online access alone. Creating online ad revenue has been an ongoing battle for newspapers – currently an online advertisement only brings in 10-20% of the funds brought in by a duplicate print id. It is said that “neither digital ad cash nor digital subscriptions via a paywall are in anything like the shape that will be needed for newspapers to take the strain if a print presence is wiped away.” According to Poynter media expert Bill Mitchell, in order for a subscription system to generate sustainable revenue, newspapers must create “new value” (higher quality, innovative, etc.) in their online content that merits payment which previously free content did not.
Data on subscription content – top challenges, revenue sources and marketing tactics.
Paid content publishers must navigate the challenges of rapidly changing technologies and an ongoing recession.
Top challenges: Subscriber acquisition and retention, competition from free sources
Challenges to Paid Subscription Publishers by Type
Acquiring new subscribers is the top challenge for all marketers. When the economy slows, sales of subscription content take a hit alongside lots of other products.
Subscriber retention is also a significant challenge for most marketers – with one interesting difference: B2B (business to business) marketers focused on online products are likely to report subscriber retention as a top challenge. Online content and data services for the B2B market are often seen as mission-critical information that can be more easily integrated into customs’ day-to-day job functions than a print product.
The proliferation of blogs and social media has introduced hundreds of “expert voices” to virtually every niche of publishing. Consultants and thought leaders from related businesses have found these media to be effective channels for branding themselves and their companies, as well as for generating leads and public relations opportunities.
Publishers with an online component can combat these free sources by providing a mixture of free and paid content on their websites. Using free content, such as blogs or video, or providing a tiered subscription model that lets nonsubscribers access some information from your site, provides a way to demonstrate publishers value to potential customers. It also gives the publishers a channel for upsell-marketing to paid subscriptions.
So if all the content is offline or behind a pay wall, the publisher should consider ways to provide some access to visitors who aren’t yet subscribers.
Conversion rates are declining
It appears that some fraction of the money that’s normally spent on alternative information products, such as attending conferences and subscriptions to hard copy publications, is being moved online. Subscription Websites are viewed as an inexpensive, useful alternative.
Unfortunately, that movement is far from a zero-sum game, and Web revenues rarely make up for what’s lost on the print side. But diversifying a product lines remains a crucial way to ride out volatility in its market.
B2B publishers face declining revenue from core product
Newsletter subscription sales and advertising revenue remained the major sources of revenue for B2B publishers of offline and online products. But differences emerged when B2B publishers were asked whether revenue from specific products was increasing, declining, or staying the same.
B2B publishers with an online focus reported revenue gains in several areas. Among the biggest gainers:
Site licensing — 72% reporting an increase in revenue
Consulting — 63% reporting an increase in revenue
Audioconferences/Webinars — 52% reporting an increase in revenue
Content licensing/Syndication — 50% reporting an increase in revenue
However, B2B publishers with an online focus reported declining revenue from several important product lines, including:
Magazine subscriptions — 75% reporting a decrease in revenue
Newsletter subscriptions — 64% reporting a decrease in revenue
List rentals — 63% reporting a decrease in revenue
Conferences/Seminars — 57% reporting a decrease in revenue
By contrast, B2B publishers with an offline focus saw slim revenue gains overall. The only areas of growth these publishers reported were in:
B2C publishers face even bigger revenue declines from core products
Paid content providers in the consumer world are taking a harder hit than B2B publishers in the current economy. That trend may reflect the proliferation of free alternatives for many types of B2C content.
B2C marketers reported revenue declines in key product areas, such as:
List rentals – 65% reporting a decrease in revenue
Newsletter subscriptions – 62% reporting a decrease in revenue
Advertising/Sponsorships – 50% reporting a decrease in revenue
Subscription websites – 44% reporting a decrease in revenue
Marketing budgets shifting from offline to online – but be careful<
The shift from offline to online marketing, and from branding to direct-response campaigns, is apparent. Nearly a third of publishers are taking an aggressive view toward their online marketing budgets compared to only 6% who say the same for offline budgeting.
Before following the crowd, it is helpful to keep several things in mind:
Studies dating to the Great Depression have correlated increased or stable marketing spends with faster recovery and growth. As enticing as it is to cut marketing expenses, you may be doing so at the long-term expense of your business.
Maintaining a strong brand in a downturn can distinguish you from the majority of companies who are laying low. Agile companies have used downturns to gain share and market position on former industry leaders. One way to take advantage of the troubles facing publishers is to leverage the inexpensive impressions that are available.
While the Internet lends itself to the direct and measurable, brand marketing remains an important element. Many companies have found that when they moved too radically toward the greener pastures of paid search and email, while cutting brand marketing, their direct marketing got more expensive on an acquisition basis. Brand marketing drives those searchers, email subscribers and even Twitter followers.
A mixture of online and offline marketing tactics receive high rankings
The display represents marketers’ take on several different marketing tactics:
The size of each bubble corresponds to the number of marketers using the tactic
Where the bubble lies from left to right indicates that tactic’s contribution to revenue
Where the bubble lies from top to bottom indicates the percentage of marketers reporting “good” or “very good” ROI for the tactic
Combining online and offline messaging within campaigns can enhance response rates – particularly in higher-priced or complex sales, where one touch is seldom enough to produce a conversion.
Landing in the middle of the pack are popular marketing tactics, including:
Marketers still unsure of the value of social media marketing
When it comes to social media, we have barely reached the stage of knowing what we don’t know.In the chart above, it is seen the percentage of respondents using a given tool that report that they are unsure of its efficiency.
In many cases that figure far outpaces the percentage of those who have an opinion on ROI. This is exemplified by Twitter, where half of the respondents using the micro-blogging tool don’t know what effect it is having.
Testing is essential to weather the tough economy
Online Tests Rated
Offline Tests Rated
Providing great content alone isn’t always enough to withstand a recession. Continually improving the methods used to attract and retain subscribers allows one to make the most of the marketing investments. That means continued testing of even small elements of the marketing and conversion process, such as landing pages, email subject lines, and offer copy.