Subscription Service Readiness Checklist: A Planning Tool for Book Publishers
The overarching question all publishers must ask, the existential über-question, trumping all others, is: Where will revenue and earnings come from in the future? The answer to this question is fundamental: all other aspect pertaining to digital media – whether it is asset management, metadata solutions, or social media strategies – are dependent upon these future revenue dynamics.
For many book publishers, future revenue will be significantly derived from the delivery of subscription services that provide access to collections of a publisher’s content, delivered directly to individuals and groups of individuals. The attractiveness of publisher-branded subscription services is the consistency of the annuity revenue streams they generate, the percentage of revenue retained by the publisher, and the strategic value of having a direct relationship with the customer.
Are subscription services an opportunity your publishing organization should pursue as part of its future revenue strategy? If so, what are some of the issues that need to be tackled before a successful subscription program can take wing? Let the Subscription Service Readiness Checklist initiate the discussion.
Subscription Service Readiness Checklist
- Content Focus
Does your current book offerings have one or more key areas of subject matter focus? Do acquisitions and product development take place within the context of a publishing program, with strategic areas of focus or is the front list – or is it serendipitous, based upon editorial whimsy? In subscription services, book publishers deliver value by providing access to collections of thematically related works. Subject matter focus is an absolute requirement.
Not only should there be domain focus to the list, there should also be an ongoing investment and product development commitment to these key subject areas. One critical success factor to retention of a subscriber base is the regular and ongoing addition of new materials to the subscription service.
- Critical Mass
If there are particular areas of content focus, do one or more of these areas of content represent a critical mass of content, a collection that represents sufficient value by itself? If a publisher does not have critical mass of focused content, then it cannot offer a viable subscription service. Without critical mass, a publisher must be resigned to throwing titles over the wall to institutional or consumer aggregation services and hoping for the best.
- Market Segment Viability
Not all market segments can sustain a subscription program with strong earnings and lasting power. The target customers must place value on having access to content collections sufficient to justify ongoing renewals. Among the strongest value propositions for collections-based subscription services can be made to customer segments in the area of professional reference: the knowledge worker for whom time is money. Healthcare, legal reference, energy and environmental fields, and engineering content are some of the areas that are especially suitable. Another customer segment ripe for opportunity is the enthusiast or “prosumer” marketplace. Enthusiast/prosumers often display a huge appetite for information and an ongoing commitment to the area of interest.
- Sales and Marketing Readiness
Congratulations: you have a critical mass of content that customers value. Now: are you ready to sell to them? With publisher-branded subscription services, publishers sell directly to individuals and organizations. This carries many benefits:
- First you don’t have to give the lion’s share of revenue to a middleman.
- Second, you don’t lose control of the customer relationship to an intermediary – you can create and maintain a direct relationship with the customer.
- Finally, the insights gleaned through the direct interaction with customers, and the analytics data this interaction creates, allow you to revise and enhance your offerings – something impossible to do when going through most distribution intermediaries.
Sadly, many publishers get the deer-in-the-headlights look when thinking about selling direct, entrenched as they have been in their legacy channel relationships, lo these many decades. Carpe diem, folks, and say hello to your audiences. If you don’t create a relationship with your customers, someone else will.
- Content Readiness
In order to support content-based subscription services, content must be prepared in a markup-based format to support the efficient ingestion of volume of content without a lot of elbow grease. You likely already have your titles in EPUB2 or EPUB3 (I hope so), in which case you are all set. What is most important however is not necessarily the supremacy of one data format or another (EPUB2 vs. EPUB3 vs. NLM vs. TEI) but rather that is in A structured, markup-based format, and that standards are applied consistently. The consistent application of data standards are the key to automation, which in term is a key to cost containment in the deployment of content services.
(One point on content readiness: No, Virginia, PDFs are not a markup-based format. The use of PDF seriously compromises the manner with which content can be managed, transformed, and delivered. While there are some inventive solutions in place that try to leverage PDF-based content in digital service delivery for publishers that have no other option, these do not represent long-term delivery solutions.)
- Organizational Commitment
The final, and perhaps most important, ingredient for success is the level of organizational commitment to the program. The promise of annuity revenue streams is attractive, yet requires management buy-in to support ongoing commitment from across the organization.
- From Sales and Marketing: ongoing commitment to create and maintain relationships with customers.
- From Editorial and Production: Ongoing commitment to continue to add to collections within defined subject domains to support renewals
- From Finance: Understanding and commitment to the dynamics of subscription-based revenue models, which deviate significantly from the revenue trajectories of traditional book offerings.
This cross-organizational commitment is essential for success. No matter how clearly the opportunity may be seen by some, the success of subscription programs are significantly compromised if the organization does not strive with a shared sense of purpose.
The creation and delivery of subscription services represents a significant shift for book publishers. It is a vastly different financial model, as well as a significantly different relationship to the customer. However, for those organizations that have such opportunities, and are able to profitably pursue them, subscription services will figure prominently in their emerging revenue strategies and play a significant role in ensuring the sustainability of their organizations for a long time to come.