The Content Subscription model

PaywallThis post is the first of a multi-part article on methods to monetise large digital audiences. The subscription model itself requires high quality content more than a large digital audience.

The digital subscription model is similar to a paper magazine subscription – users periodically pay to keep receiving content, whether it’s daily, monthly or annually. The digital version is often called a paywall.

In order to implement a paywall, the website owner requires a registration mechanism and a payment system. The registration system can range from Facebook Login to a proprietary implementation.

For the payment system, there are systems which can be tailored, to third-party providers such as Apple’s App Store. The issue with the latter, is the commission can be as much as 30% of the value of the subscription. The upside of course, is that the content owner doesn’t need to worry about the billing, the integration is often easier, and the third-party (such as Apple of Google) handles chargebacks and user support.

Implementing a paywall will often result in a significant drop in traffic. There are variations to limit the loss, such as making specific sections of the website free, other parts premium, and a variety of hybrid models between the two extremes. Websites such as FT.com allow users to view a number of pages before they need to buy a subscription.

Content owners can sell different levels of subscriptions, such as free, silver and gold (to access all areas).

Another method to boost subscription levels is to sell bulk subscriptions to indirect customers, such as Ford and the New York Times.

The subscription model requires more customer service than many of the alternative monetisation methods. The flip side of this though, is that customers will often keep subscribing to the website on an auto-renewal basis.

B2B and B2C

The subscription model works just as well with B2B (Business to Business) and B2C (Business to Consumer) models. Take for example, TechMarketView in the B2B sector, and The Times in the B2C world, although the former fall into the Freemium category which we’ll cover tomorrow.

The future

My view of the future of the subscription model is micro or even nano-payments, where users will have a third-party wallet and when they view a web page, money will move from the wallet to the owner of that web page. Pages may cost a few pennies, or may even be variable depending on the length of the article or other parameters.

The advantage for users is that they can move between websites without a high commitment (i.e. subscription) to a single site.

 

View the complete list of content monetisation methods.

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