NONE: Re: ONLINE-ADS>> Slate Subscription Fees
Re: ONLINE-ADS>> Slate Subscription Fees
Cliff Kurtzman (cliff_at_tenagra.com)
Fri, 26 Dec 1997 12:08:43 -0600
"Greg Bulmash" <greg_at_bulmash.com> wrote:
>Considering the GVU survey which states that
>the main reason many people won't pay for web content is because they
>can find similar/comparable content for free elsewhere, I wonder about
>the feasability of this. Does anyone believe Slate's content is so
>compelling as to make it worth paying to receive? Does anyone agree
>with this price which is equal to if not exceeding the price for a
>snail mail subscription to most print monthlies?
I don't think you have quite hit the reason why this won't work. For
example, associated with one of our web sites, we have a discussion group
with 2,000 subscribers that pay $50 per year to join the group, even though
there is a free newsgroup (and probably other free discussion groups) on
the same subject. The $50/year subscription fee buys our subscribers no
original content from us. But it does just about cover the cost of hiring
a full time moderator/list administrator/payment collector and operating a
mail server that can handle the load of up to 50 messages a day that are
distributed to the 2,000 subscribers.
So why are people willing to pay for the service even though we are not
providing them any content for their money? Primarily for three reasons:
1) there is real value to the participants to having a moderator that
reduces the chaos and junk that would go out on the list if it were not
moderated; 2) the community of participants on the particular list makes it
a valuable place to be for the people on the list -- another moderated list
without the same community would be less valuable even if it were free; and
3) the list deals with a business subject that is very valuable to the
businesses of the participants.
For a more detailed case study of the site, see Min's New Media, November 1997:
B-to-B Publisher Wins with Creative Ad Pricing, Subscriptions
http://www.wellengaged.com/engaged/seidman.cgi?c=web&t=5&q=41
Think about the value that this list, Online Ads, brings to your business.
I've been overwhelmed by the e-mails that Richard and I have received
during this holiday season from people who have told us the difference
Online Ads has made to their bottom line over the past year. Would you be
willing to pay $50 per year for this list? My guess is that, for the same
reasons I gave above, about 25% of the participants would pay to subscribe
(don't worry, we have no plans to go to a subscription model for this list
at present -- while we truly appreciate the support of those good folks who
sponsor this forum, making Online Ads a profit center was never our primary
objective.)
I know from hard experience that one of the biggest battles that Slate
faces is that it is a web site dealing with politics. Political web sites
have been folding like flies, and our experience in the past from running a
(now defunct) politics-related site ourselves has been that it is an
extremely difficult endeavour. You would expect that supporters of
political candidates and issues would be willing to advertise for the
exposure, but we've found that even national political groups are rarely
willing to spend real cash on online advertising. I don't expect this to
change any time soon.
So Slate is going to be forced to pursue advertisers that are looking to
reach a similar demographic to their readership, which is a much harder and
lower value advertising sell to make than if you can directly sell to
people involved in the subject matter of your web site. Finally, unlike
Tenagra's site in the case study above or the Wall Street Journal
Interactive site, I don't see that Slate's content is going to be
considered of critical value to the bottom line of too many people's
business, so they are going to have to get people to subscribe out of their
personal resources. This is a much more difficult thing to do than
attracting a business subscriber.
--Cliff
Clifford R. Kurtzman, Ph.D.
President and CEO
The Tenagra Corporation
http://www.tenagra.com/
281/480-6300
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