Online Business And Subscription Models

Most online businesses use a list that is generated by leads. This list can be the most important aspect of an online business and when you stop and think how much it has cost you to generate your list you begin to appreciate why it is seen as so valuable to online business marketers who are trying to make money online.

You also begin to understand why the list needs to be worked and worked and why leads should not just be forgotten about after the initial sale or joining of the list. They are a valuable commodity.

Subscription Models

The first type of subscription is the free member. They join your list on the promise of an E-book or an online course or they might join because joining is free and they get to use the products and services as a free member.

The next type of membership is a one time payment membership. This type of membership is great for products and services that have a limited lifespan such as an email list. You may pay or get your customer to pay a once only payment to blast email advertisements to a list knowing that within a year that list will be unresponsive and basically useless.

The third type of membership is fixed term membership and this is fairly self explanatory. You would offer this if you have services or products that are best run over a period of months and so as installments are made the next issue of the product is released until the customer has the full product in hand.

This method is great for mentoring programs where the customer is being individually mentored over a specified period. A single payment may be daunting and make finding students hard whereas a staggered payment method keeps them close and allows for easy exit if the mentoring is not for them.

The forth type of membership has a recurring fee structure and this works well if you are offering your customer regular updated information for which the customer pays a monthly access fee.

You have to keep the information very relevant on these sites so that you don't have a steady loss of customers from one month to the next.

The cost of the monthly fee has to be less than the benefit that the customer is going to receive from maintaining their membership for another month.

The fifth type of membership is the one that your telecom business is probably using. This model is based on demand with the customer being billed according to units of use. Power companies use this model too.

The first four subscription models can be used successfully with online business ventures. What you have to think of before you start to use any of these models for your online business is which model is best for you? Which one is going to be the easiest to manage? Which one allows you to maximize the amount of money you can glean from each customer?

Sorry to finish this article with so many questions but one final question: If it costs $x to find and subscribe a customer what is it worth to keep them on your books and not loose them?

Half of what you paid? But then what about the good will that may have been built and the personal relationships? What is all this worth? It is worth while putting some effort into these questions before you decide on the best subscription model for your business.