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Making Money from a Subscription Site

Posted on April 16, 2003

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Making Money from a Subscription Site
by Kevin Bidwell

Originally, the Internet was free. It was intended as a way for people to exchange information. Web sites were basically just text documents posted for all to see.

Over time, more and more people began entering the Internet world and posting and looking for larger and larger amounts of information. There were enough "eyes" on Internet sites to make them a good source of income. The sites themseleves were still free, but often provided space for advertising among the information--much like a magazine.

In the last few years there has been another change. Ad revenue has become less available and the demand for good information has increased dramatically. When there is high demand and low supply, basic economics teaches us there is a place to make a profit.

As a result, many sites that once were free are now becoming "subscription" sites. You want to see the info? You have to pay.

If you want to create a subscription site, here are some keys to success:

1. Choose your Topic Wisely

Choose a topic with high demand and low supply. The more unique and valuable the information you provide is, the more people will pay for it.

2. Offer a Free or Reduced Trial

If you have a quality site with expanding content, one of the best ways to get subscribers is to offer a 3 to 30 day free trial. Let people "test drive" what you are offering. Free is best, but even a $1 membership works well.

3. Offer a Free "Reduced" version

If you are offering investment advice, for instance, you might offer some information for free to everyone who subscribes, but save the most valuable information for your paying subscribers. Send out your new information for free but reserve all archives in your member's section. By going for volume with your "free" version you can leverage the prospects for your "paid" site.

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4. Automate Payment

As your subscriber list grows, you will not want to spend several days every month simply typing in credit card info. Make sure to use a merchant account provider that allows you to automatically re-bill your subscribers.

5. Provide a "Tour" of your site

When someone is considering joining your site, give them a clear taste of what is inside. Even if you have a free trial, a few pages of "tour" can help you make the sale.

6. Set the Right Fee

Maximizing revenue for the subscription sites depends on two factors: New subscribers and retention.

In a site with very wide appeal should be priced in such a way that people join easily and stick around for a long time. For example, if your monthly subscription is just $5 you will have many people who don't cancel even if they are not using the site often because of the low price point. The same site charging $50 would have a much lower retention rate.

Try various price points until you find a good balance.

In a site with very specific appeal, you would want to price it based on what the market would bear. A subscription site giving important information to professionals might easily bring in more than $100 per subscriber per month. In fact, if you have solid, one-of-a-kind information, you will find your retention rate is very high as well.

Again, try various price points until you find a good balance.

While there are many factors to starting and running a successful subscription site, these six can help you get going on the right foot. Put them to work and pretty soon you may have 1,000 people paying you $24.95 per month to access your site!

About the Author

Kevin Bidwell is owner of

Kevin is offering a FREE BUSINESS START-UP KIT to everyone who visits his site. If you liked this article, you will want to subscribe to his newsletter. Send a blank email to:


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