So you are all set or ready to transform your existing Business into a Subscription Based Model!
Are you planning to launch a Subscription Based Model of your business to cater the audiences in Digital Space and also to leverage the booming Digital Ecosystem?
Then you should thoroughly analyse some essential factors prior taking any final decision! Otherwise, your subscription based model can backfire and can make the situation even worse.
In this rapidly growing digital ecosystem, the business landscape is also changing very fast. Subscription Based Model for online businesses is an example of that change.
Now a days we hear a term very frequently “Pay as u go”. This concept is totally based on this Subscription Based Model.
Let’s say you want to purchase an online service for a specific time frame within that time if it seems interesting then only you will renew your subscription.
So you have the freedom to choose & this has only come after the introduction of this kind of business model.
Whether you are a digital media owner or you have a digital product or you offer a specific online service, Subscription-based system can be great irrespective of size & scale of your business.
So if you look around your digital neighbourhood you will find that all kinds of online businesses are transforming their business model into this.
From Web Hosting to online music streaming, Subscription based concept has totally revolutionised the traditional way of selling products/ services online.
Even big publishing houses are also channelising their revenue model towards this because the way online advertising is getting affected by the constant usage of different ad blockers.
But before delving into something at first you have to know what are the prerequisites! Otherwise, how will you know whether you going into right direction or not?
So what are the prerequisites?
Not actually prerequisites but a set of questions that you need to ask yourself. So after answering these questions you will find your answer!
#1. Is your product/ service an established brand?
When you are launching a subscription based model of your business that clearly signifies you have a cult following among your target audiences.
Otherwise who will spend money on your product/ service if it’s not a popular brand?
So ask yourself this question first! Has your product established that so-called reach, loyalty & value among its customers?
Let’s say you are running an online media, till now your only source of revenue is through advertisements. But as the scope is getting limited in this space so you have decided to come in this subscription model.
But until & unless you are an established brand why people will buy your subscription? Right?
#2. Do people trust/ rely on it?
When your product’s brand value will be generated one thing will surely come, that is the trust among people towards your product.
And remember one thing people always spends on brand reliability/ loyalty. You can spend 2 to 3 times more on a reputed brand.
But you will think twice before spending a dime on a new name which hasn’t established it’s credibility till now.
#3. Do you have an alternative revenue stream?
From my previous two questions you must have understood that it will take time to earn some revenue if you are not a big name already.
So till then what will be your back up plan? Means how will you/ your digital property sustain? Do you have any sustainable idea for the initial days.
If yes then welcome, start experimenting with this new model but if not then at first try to find some alternative way then invest (time/ money) on to this.
#4. Do you think you are adding some value?
Yes! It’s the most vital question. Why people grab a Subscription of a well-known online magazine? Why people buy a subscription of a popular online music streaming service?
Because they all give a certain value. So think of your scenario, what value you are adding through your digital platform/ product/ service. Is it solving any particular purpose?
Otherwise why people will spend their hard-earned money on you?
#5. Do you have the technical expertise to develop the platform?
When you are planning to launch a new business model it requires a technological infrastructure/ backbone! Who will work on that?
Do you have that resource or if not then do you have the money to hire that kind of resource (s). Otherwise it will get stuck in its execution phase.
In this era of technological dominance without a solid technological backing, moving even an inch is quite absurd.
#6. Have you crafted a blueprint (Financial & Legal)?
When you are planning to introduce a Subscription-based business model have you ever thought what complications it can bring?
Remember in this model currency transaction will play a vital role because people will buy your subscription in exchange of money. Right?
So where money transaction is involved lots of Financial, legal & tax related complications are bound to comes. Do you have any work around for that?
Have created any detailed blueprint for this?
#7. Have you done enough market research?
In the segment where you are planning to launch your business have you done enough market research? Otherwise how will you be able to stay on top of your competitors?
So think about these! Hope you will get the answer.