Ideal Subscription Fees


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A good subscription website is popular and makes everybody happy. The subscribers get value for the money they invest and the site owners make profit because of the popularity of the site.

The subscription websites need to be so priced, that the customer feels that he is getting value for the money he has invested and the owner should be able to say that for the unique idea and the content that he is offering to the client, he is able to make a decent profit. Therefore it is very important to adjust the subscription fee in a way that the customer and the owner both are satisfied and happy. The million dollar question, then, is how do you price the website registration for value and profit? A few points to be kept in mind while deciding on the pricing for the subscription website are:

1. Decide how much profit will you consider as profit. You will have to decide on the amount of profit that you are looking at, to call the website profitable or worth all the effort that you are putting in. Would you consider your website profitable if it generated £25000 a year, or would you consider it profitable only if it made £50,000 and above.

2. Decide on a profit formula. For the amount of profit you want to make, decide on the fee that you would charge from each subscription, this will in turn determine the number of customers that you are expecting will subscribe at that particular fee. For example If you want to make £50,000 a year, you'll need 5000 subscribers who will be ready to pay £10 a year, or 1000 subscribers at £50 a year, or 500 subscribers at £100 a year, or 50 subscribers at £1000 a year.

3. Weigh your site topic against your subscription fee and the profit formula. If your answer to the following questions is ‘yes', then you will be so much closer to making your subscription website a success. The questions are: Is the subscription fee that you are charging commensurate with the service or the content you are offering to your clients, do you think you will be able to get the number of subscribers who are ready to pay the fee you are asking for the content that you are offering them.

Along with the above points the rule no-1 for the success of any subscription website is to keep the overheads low. You have to work hard to get the kind of profits you are looking at from your subscription website, it will not fall into your lap the moment you set up the site.

Start with a plan

To make a success of any business you need to start by having a business plan and the path you propose to take to achieve the business goal that you have set. For a subscription website, you can probably have a goal to have profits of say £50000, when you are making the business plan it will help you define each stage of the operation- of setting up to working of the website. It will also help you to define the kind of costs for each stage, keeping your budget and profitability in mind, the start up costs, overheads and the ongoing costs and the number of subscriptions that you are looking at to become profitable.

If you are not used to making business plans, you can perhaps review an already existing plan and modify it to suit your particular goals for the website. You can even buy readymade budgeted plans like Business Plan Pro or Web Strategy Pro for a very reasonable cost. Both these programs take you through the entire process of making a business plan. As you work and refine the business plan, you will arrive at a more realistic subscription fee, you will also be able to define more clearly your costs, overheads, running costs, marketing costs etc.

Review the business plan to remain on track

It is a good practice to review the business plan on a monthly basis, keeping in mind the original goal all the time. This will keep you on the right track and along the way you might even get lucky and find alternative ways of accomplishing certain tasks.

This article was written by Craig Dawber of Need advice and guidance with your online business check out the resources found in this website.


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