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Mar 01, 2001
Case Study - The Story of a Profitable Subscription Site

SUMMARY: When all-free Web site launched a paid subscription-only sibling site, we rushed to get the exclusive insider story for you on how it works, and what makes it successful. If you are launching a subscription site - especially if it's a database-driven evergreen resource site - this is a useful Case Study.

Christianity Today International has been running a
profitable free content site online since 1994. Although the
site appealed to a broad consumer audience, market research
showed that a solid 20% of visitors were professional pastors.
Also, the organization had a history of success selling offline
resources to pastors, such as books, audio-tapes and CD-ROMs.
So, after a great deal of internal thought and discussion, the
organization decided to take the plunge and experiment with a
subscription-based site.

John LaRue, VP Internet Research & Development, says,
"Advertising is good for this market segment, but we didn't need
another product to generate traffic to sell it. We already have
other areas for church leaders where we're selling ads. In fact
like anybody else we tend to have more space online then we can
sell. I kept asking if this should be free, but the market
research gave us an indication of what percent of the audience
would pay and the numbers were really good compared to other
products -- both online and print."


Despite the fact that Christianity Today has been in
business since 1956 and as LaRue says, "We understand our niche
pretty well", the team did not make any assumptions going into
the development process.

First they carefully surveyed pastors both by direct mail and by
email. LaRue says, "The mailed version was a four-page
traditional survey with a whole bunch of ideas. This helped
develop which concepts came out on top. The online one was
smaller and helped refine the features."

Results showed that pastors were willing to pay for easy-access
to illustrative stories, quotes or facts (known as
"illustrations") that they could incorporate into their sermons
to bring their message to life. LaRue says, "Pastors are
constantly in need of materials." So, the new subscription site
-- entitled -- was built around a database of
3,500 illustrations fully searchable by topic and bible verse.
Plus, paid subscribers would receive 10 new illustrations per
week via email. Additional content included an online journal
featuring skill-building articles written by some of the best-
known preachers in America.

The site launched late 1999 with a direct mail campaign. The
initial piece was a double postcard offering a 30-day free trial
for $39.95. Copy included endorsements from a range of
"celebrity preachers" to appeal to both evangelical and
mainstream pastors.

In addition, LaRue promoted the site online by placing
promotional banners on sister-site and
including announcements in the site's appropriate free email
newsletters.'s visitors who weren't sure
about paying for content had the option of receiving a free
newsletter featuring just one weekly illustration and tantalizing
headlines for the remaining nine. Buyers had their choice of
three paid subscription levels: Basic (just the ten weekly
emailed illustrations) at $19.95, Enhanced for a bit more and
Premium (including the searchable database) for $39.95.

After a year, raised its premium price to
$49.95 to reflect the fact that the site's content had doubled in
size. The site began renewing initial subscribers in October
2000 by sending an emailed, opt-out announcement 30 days before
automatically billing subscribers' credit cards for another year.
LaRue's "wonderful" customer service person followed up on all
expired and changed cards via email and phone.


LaRue says, "We exceeded expectations the first year. is budgeted to generate more than $400,000 in
revenue with a gross margin of 25% for the 2001 fiscal year. We
currently have 7,500 paid subscribers and have seen no slow down
in the growth curve since we launched."

95% of subscribers chose the Premium subscription (formerly
$39.95, now $49.95.) About 5% of subscribers chose the $19.95
Basic subscription. Almost none chose the middle, "enhanced"
subscription, so this option was dropped fairly early on. The
site's renewal rate is currently a healthy 60-70%. Traffic has
steadied to about 42,000 home page impressions a month, with four
to ten times that many impressions on other subscribers-only
pages. LaRue says, "We know pastors are going in there."

Direct mail campaigns were definitely successful; however, LaRue
learned not to put a phone number on the postcards. He says,
"Registering people by phone became a customer service nightmare.
Some people thought they could sign up for it but they didn't
have to be online." Now all responses are driven to the Web
site, and from there visitors can find a number to call customer
service if they want to.

Due to the success of, Christianity Today
International is planning to develop two more paid content sites
in 2001!
See Also:

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