Friday, January 04, 2013
The grubby business of exchanging actual words for actual money
"We believe this is the right price point for our newspaper at this time," said the Guardian's marketing director at the end of 2011 to explain why the price was about to rise from a pound to £1.20. Just over a year later it's going up again, this time to £1.40. "We believe this is the correct current price point," says another statement.
Inevitably the same people will be saying something similar to justify the next price hike in a year's time. What they won't say is what they're bound to be thinking - isn't there something perverse about putting a tax on the declining number of people who support you in order to subsidise giving your content away to people who don't?
I sympathise with the people who have to make these decisions. They're in an impossible position. As demand shrinks the basic product ought to be cheaper, as it is in the record business. In press it works the other way. Cover price revenue is one of the few levers a hard-pressed publisher can pull. They ask themselves whether the rump they're left with will stop buying if they put up the price. They guess a percentage, then close their eyes and jump.
Meanwhile, in another part of the forest, I've been saying for years that some of the people who make airy predictions about new digital business models should leave the security of their banker-funded old media empires and try to walk the walk they've been talking for so long. Andrew Sullivan, probably the biggest political blogger in the English-speaking world, has announced that this is what he's doing. From February 1st his full output will only be available for the payment of a $20 annual subscription.
I'm sure Sullivan's people know all the tricks to ensure that as many as possible of his millions of followers pay the sub. If an old magazine hand may offer an observation to someone entering the real world of trying to part private citizens from the actual cash money in their pocket (in which of course the proprietor of your local car wash knows more than the cleverest person in the Groucho club) it would be this.
Many of your followers will disappear with a wooshing sound the moment you even hint at charging. A noisy minority will fall over themselves to give you their money and will make sure everyone knows they are doing it. An argumentative minority will hang around to complain that what you're doing is a) morally wrong and b) bad business practice.
Don't worry about any of these groups. The people you have to worry about are the ones who fully intend to subscribe, in some cases think they already do subscribe, but never actually get round to it. They're the ones.