Bill Myers, CEO Hamilton New Media, has more experience selling subscriptions to online-only content than almost anyone else in the industry. He comes from a background in classic print newsletter publishing; and, his last site, Bill Myers Online, had a renewal rate of more than 80% for its $995 per year subscriptions.

Myers folded this service two months ago to concentrate on his software business (Hamilton New Media produces Membergate, a product that publishers use to create and manage their sites.) However, since all of his customers and most of his close friends are online subscription publishers, Myers remains close to the heartbeat of the industry. Here are the highlights of our interview with him:

BEST QUOTE: "I have a friend who publishes an online newsletter for 1950-51 Fords. He has 1,500 subscribers at $89 a year. It's not even a newsletter -- it's a listing of parts available for that car. Those collectors want those parts!"

1. Picking a Target Audience

Prospective subscribers must be online (obviously); comfortable with paying for print or online information in the subject area and price point you choose; and in a tightly defined niche totaling 2,000-5,000 people interested in a very specific topic.

You don't want a site with millions of members who aren't qualified or motivated to purchase a subscription. In fact it's better to have 500 passionate readers who will pay a high price for your content than thousands who will complain about paying anything.

2. Pricing

Myers recommends publishers contemplating for-fee launches first consider what their time (or their staff's time) is worth to create and maintain the publication for a year. Then work backwards from that amount to figure out how many units you need to sell at a price-point that's reasonable for your niche audience to pay. If you have to sell thousands of units, then your idea may not be a workable one.

Remember it can take more effort for an independent publisher to market a low-priced site than an expensive one. It can be easier to sell and service 1000 customers at $100 a year versus 10,000 customers at $10 a year.

Myers notes Membergate's most successful customers charge at least $97.50 per year, the average is $197-$297 per year. He is strongly in favor of pricing annually vs. monthly when possible because it's less work to charge subscribers' credit cards once a year.

3. Topics That People Will Pay For

First of all, running a subscription-based site is work. It will take 8-10 hours of your day, every day. So Myers recommends that you pick a topic you feel passionately about. Something you might want to write about even if you didn't need to earn a living. Luckily, subjects that arouse that sort of passion in you are also often topics that others are passionate enough to pay for.

To get an idea of the type of niche that works in the consumer marketplace, Myers brainstormed up a few topics, such as how to make a living as a travel writer, or comprehensive news and notes on using ground penetrating radar tools for treasure hunting.

4. Marketing a Subscription Site Successfully

Myers is very much against giving away content for free. Instead he compares a subscription site to a gated community. Non-members can stand outside the gate and watch the members drive in, but they can't get in themselves until they've paid. In fact, he blames TheSteet.com's difficulties in selling subscriptions on the fact that that site allowed non-members full-access for a free trial period.

His favorite home page format is to allow non-members to see short summaries of the latest stories for free, but a "members only" page comes up when they try to read the whole story. You should also allow (and even encourage) non-members to use the site's search function, but again only summaries would appear instead of entire stories.

Myers believes getting site traffic should not be difficult because if you have picked a niche that's tightly targeted enough, there will only be 2-3 other sites online that focus on that topic. Therefore you'll have an easy time getting good search engine rankings. He also recommends promoting B-to-B sites by speaking at related seminars and conferences.

5. Most Popular Site Feature

In Myers experience, his site's bulletin boards were its most popular feature. In fact 70% of traffic went directly to the bulletin boards, and some subscribers used the site as their personal Home Page so they could keep tabs on the conversation throughout the day.

Private bulletin boards have a different dynamic than public ones. Members feel safer and more comfortable in private. They also get value from the sense of community they have with their peers who are also paid members. This feeling of community can help keep your renewal rates high, because as Myers put it, who wants to leave behind their group of friends?