Expertise as a service: the subscription model in B2B media
The past decade has given rise to the subscription model, revolutionizing the way many businesses operate. But what can B2B media learn from this?
Before the 2010s, there was no ‘subscription model’. A subscription was when you paid to have the Beano delivered to you once a week, and that was that. Nobody ever thought this would provide the foundations for a major shift in our economic behavior, restructuring the way we think about the concept of payment and ownership. I certainly didn’t. I just wanted to read the Beano.
Yet here we are. In 2020, you can subscribe to just about anything. From streaming services to razor blades to children’s shoes; if you can name it, someone will probably charge you a modest monthly fee to let you use it. But what can we learn from society’s great pivot towards the subscription model? And, if you aren’t already offering a subscription service, how might doing so be in your best interest?
Why we subscribe
The key to understanding all this could be taking a look at why someone might want to subscribe to a service or product to begin with. In an article by Forbes examining this very phenomenon, the writer suggests that millennials don’t like feeling ‘anchored’ by ownership and would prefer not to be tied down. But when it comes to individual consumers, the subscription model is often more of an economic necessity than a choice. This aversion to feeling tied down to a product or service is actually more applicable to B2B companies.
In 2016, the US Census Bureau reported that businesses consisting of under 100 employees accounted for 98.2% of all businesses in the country. Such a large quantity of small businesses gave rise to the subscription model; it allows for greater agility in the marketplace and prevents these smaller organizations from having to commit to large-scale investment.
The perks of the subscription model for media businesses
For publishers with a vast array of content at their disposal, the subscription model guarantees a steady revenue flow and provides customers with access to that content without forcing them to fork out in large sums.
Pivoting to the subscription model has given a new lease of life to a variety of B2B companies. Take Adobe, for instance - offering a cloud-based subscription service allowed them to massively reduce the installation time for their software. Simultaneously, it gives companies who require their software the power to pick and choose which parts they want. This approach ultimately allows B2B businesses to reach a wider range of prospective clients, tapping into smaller businesses who might only be able to afford part of a service rather than the whole thing.
Hosting content on a paid-access, subscription-based online community allows media businesses to truly claim ownership over their work and reap the benefits accordingly. With a designated space to share content and decide who has access, businesses can manage their own revenue streams and have complete control.
And if all that doesn’t sound like reason enough to be offering a subscription service, try this on for size: offering your audience the opportunity to take their business elsewhere is actually a great way to build brand loyalty. No, really - offering your audience the chance to sample your wares without being locked into a long-term arrangement provides you with an opportunity to build a strong working relationship with companies who otherwise might not have been able to afford it. Not demanding large-scale transactions from the outset shows a flexibility that could give brands the edge over competitors who still want to do things the old-fashioned way.
All about the value
Another rule of vital importance when employing the subscription model? Give your audience value for money; and, more importantly, don’t make them pay yet more for services on top of their subscription fee unless they’re truly worth it.
Take Sky Sports and their recent pay-per-view debacle - a B2C subscription model but still one we can learn from - as an example of what not to do. Despite already charging a monthly fee to access their channels, Sky then tried to charge football fans £15 a pop for selected games. The result? A mass boycott of pay-per-view matches, forcing Sky to backtrack within a month and abandon the scheme altogether. This tells us that people will pay for subscription-based services if they feel it’s worthwhile, but balk the second that value for money comes into question. There’s nothing people hate more than feeling cheated.
On the other hand, offering different levels to a subscription service can be a great way to incentivize customers and keep them engaged in the product. Netflix have nailed this formula, charging more money to add a greater number of devices to their subscription package. Prior to the pay-per-view fiasco, Sky’s model was a fairly successful one too; offering the main Sky channels in their basic package and charging more to add features such as sports and movies means that customers can pick and choose what they want, rather than being forced to pay for channels they have no interest in using. Giving customers a feeling of control over the content they’re paying to access will ultimately be more rewarding for all parties.
Done properly, the subscription model can be the best way to ensure a steady revenue flow and build brand loyalty. But it’s after people sign up that the hard work really begins. You must treat your subscribers with respect and make them feel important so they know where their money is going; offering exclusive content and tailoring your work to the interests of your subscription base are good ways to do this. It is here that online communities can once again prove to be useful. By creating a sense of community and engaging with their audience, businesses can build relationships that last and ensure that their subscribers feel they are getting their money’s worth. Meanwhile, having ownership over the analytics of an online community means that the needs of those subscribers can be met. Understanding which groups engage with which content and where the overlaps are allows you to shape your product around the requirements of your audience.
Most important of all is making your product or service indispensable to your users, leaving them wondering how they ever survived without you. When your service becomes a part of their daily routine, it becomes much easier to convince them to stick around. Remember that anybody can acquire subscribers; the hard part is keeping them.