A successful blogger recently said to me “If the New York Times can’t make money out of charging a subscription for their content what chance do I have?”
This is a sentiment that I regularly hear from small publishers and individual experts, so I want to dispel this myth once and for all.
The big traditional publishers are the worst role models any online publisher can follow. Like the music industry before them they have completely failed to adapt to embrace the opportunity presented by the internet. Instead they have chosen to blame weak copyright laws, Google and anyone else they can point a finger at for their own failings.
In the music industry it is the individual bands and small music labels that are profiting by mixing music download sales with merchandising and promoting concerts whilst keeping overheads low. In the publishing world it is similar. It is individual experts and small online publishers who are reaping the rewards by providing quality niche content from which they generate multiple revenue streams.
In the world before the web people paid the large publishers to aggregate news stories which covered a broad range of subjects. This service was valuable to the reader because there was no other cost effective way of achieving the same result.
Today customers can source and aggregate their own news whenever they want. Rarely will the print newspapers break a story which has not already been covered online. The traditional publishers will argue that they do more rigorous research and are more accountable for what they write, but the truth is most journalists now source their stories online and, because of the pressure of getting to press, they no longer have the time to do the rigorous research.
Over the last few years the national and regional newspapers have lost their competitive advantage but not their high cost base.
Therefore niche publishers should not look to these publications as their role models. Rather they should look to the web-only niche sites that are making good money.
Today competitive advantage comes from providing highly specialist content to a tightly defined audience. The content should be unique in its sector and delivered in a timely way.
Just about any subject can be a successful paid content site. There are consumer subscription sites about writing sermons, belly dancing, flying micro light aircraft and live-aboard yachting that make hundreds of thousands of dollars a year.
There are membership business sites covering helium extraction, running a restaurant, making insurance claims and investing in start-ups that do even better.
The key things you should consider when thinking about setting up a paid content website are:
1) Know your subject well. You need credibility and authority
2) Understand what information is available for free. How can you differentiate your offering to give it value?
3) Know who you audience are and how to reach them
4) Know how you are going to source content that is exclusive and timely
5) Develop a voice and personality for your site which is unique and distinctive
6) Don’t rely on a single revenue stream. Consider some free content with ads, premium content with membership, strike affiliate relationships, sell downloadable products (ebooks, software, reports, etc) and promote offline events
7) Create a community around the site content to build loyalty and high renewal rates
There has never been a better time for specialist publishers to setup a commercial website. If they stay niche and target a tightly defined audience with unique and timely content there is no reason the site shouldn’t prosper.
If I was a big traditional publisher I would plan on building an online empire by launching a thousand sites run by individual experts rather than a handful of mega sites with teams of journalists writing undifferentiated news.