OnDemand WTP Pricing Research

You Want To Grow Audience Revenue? Differentiate Pricing | NetNewsCheck.com

A second step in improving the digital customer acquisition process is developing targeted content and subscription packages focused on a customer segment’s interests and pricing tolerance. Several publishers are now launching enhanced digital content packages for segments of their audience with deep interest in sports, business, local news, lifestyle topics and other categories.

Customer consumption data is necessary for understanding what audience segments exist in a market, whether there is a sufficient market for a dedicated product and putting a price on that access.  If a publisher can develop several specialized digital products, the opportunity to offer different bundles of content is another tactic for acquiring customers and growing revenue. The cable industry provides an easy case study in packaging strategy, with its basic, enhanced and premium channel packages.

Once a publisher has acquired and retained digital subscribers, the differences in value each customer places on the product, their ability to pay for their subscription and their variation in usage of the product, means that the publisher can, and should, charge them different amounts to renew their subscriptions.

If publishers have a “one price” renewal pricing policy, they will be overcharging customers who have not established a habit of reading the content or cannot afford to pay the full price. Those customers will stop their subscription, leading to elevated churn and wasted acquisition expense. At the same time, the one price may be too low for other customers that would be willing to pay far more for the subscription. Differentiated pricing allows a publisher to have more subscribers and more revenue than they would under a one-price model.

Digital consumption data, at the individual customer level, is the most important data element to capture to support this type of targeted pricing strategy.  Unfortunately, these data are often hard for publishers to acquire, prepare for analysis and act upon because the quantity of data is very large and requires very specific expertise that is often expensive as well as hardware and software capable of handling the volume of data.

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You Want To Grow Audience Revenue? Differentiate Pricing | NetNewsCheck.com.

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