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MarketingSherpa Email Summit 2015 - SAVE $700 - VIP PRICING ENDS THURSDAY
Jun 21, 2001
Blog Post

The Week: Anne Advises Online Publishers to Toughen Up on Subscription Pricing

SUMMARY: It's the biggest question everyone selling subscriptions to a Web site or email newsletter asks,
Oh what misery pricing new subscription products is. I don't know about you, but I've spent years pricing new products and invariably come up wrong. (Most infamous: the time when my 1996 price tests revealed Internet execs would be willing to spend $95 a month or $1,250 a year to be FAXED the top 10 related biz news summaries of the day. Yeah, and more than 100 of them subscribed to it!)

Over the past couple of months I couldn't help but notice two trends in the pricing arena. The first is the plethora of free site, ezine, and discussion group publishers emailing surveys to their opt-in readers in order to ask, "What would you pay if we charged?" (And pretty much these days it seems if you're not owned by either a trade magazine or internet.com you've sent out one of these surveys.) See our story below about that.

The second trend is that online B-to-B publishers are launching paid subscription offerings at rock bottom, scavenger-level prices such as $3.95 a month, $10 a quarter, $19 a year....

Enough already! Just because lots of online B-to-B content was free in the past doesn't mean, now that we've all agreed to charge, that we should devalue it. If you are insecure about your new pricing model as least have the decency to cloak your maidenly fears in "special discounts" -- as in Current Reader Discount, Buy Before September 1st Discount, and Co-Marketing Partner Limited-Time Discount. Lou Betancourt of BULL MARKET REPORT told me this week that he's slowly using various offers (openly promoted as limited time discounts) to bring his paid subscribers in stages up from $129-$199 over the next year.

What's a reasonable price point for a Web-only product? Whatever a print subscription publication, of similar editorial "value" and percent ad sales, would normally charge. Plus more 'cause you've probably got easy-to-search archives, minus less 'cause you are e-only. (So why not call it even?)

What's a reasonable circulation sales rate for a paid non-ad-based product? In my experience -- and this is a VAST generalization -- it's about 1/100th of the circulation you could expect as a "free" controlled circulation trade magazine or nominally priced consumer rag. (So yes, Fairchild's reported expectations of winning thousands of $995 subscribers for its new WWD.com service are absurd.)

While there are loud and persistent rumors afloat that several major players, including NY Times Digital, are launching a new Online Publisher's Association in 1-2 weeks, I'm actually going to refer you to an older, mainly print-world association to help you figure out subscription pricing. Yup, the NEPA - Newsletter and Electronic Publishing Association (http://www.newsletters.org) -- may be your best bet for getting pricing standards for subscription print competitors in your niche. Just buy their membership directory and check pricing for yourself.

In the meantime, stop slamming your content with begging bowls and rock-bottom prices. By low-balling your price, you devalue your product. Have some pride. Gird your loins. And if you fail, look first to your content's perceived value and your direct marketing tactics. Pricing is NOT always at fault.
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