The July 2009 issue of Reader’s Digest has a piece titled “The Price ($0.00) Is Right.” Chris Anderson, editor of Wired and author of Free: The Future of a Radical Price, discusses the various ways that “free” can work to the advantage of both online businesses (specifically publishers) and customers.
While some take an either/or approach, Anderson is more nuanced: It’s OK, he says, for sites to give away mountains of free content, and it’s also OK for them to phase in some system of paying for it. He believes the New York Times, for instance, had no choice but to begin giving away content online if it wanted to remain “a thought leader that maintains its leadership by dominating the conversation.” He is a believer in tiered marketing — offering a free level of service and a paid level, with enough bells and whistles at the paid end to entice non-payers to give it a try.
Even customers who are paying nothing are bringing something to the table — “time and attention,” Anderson says. He believes that advertisers will pay to have access to both, but that sounds a lot like the philosophy that’s driven Internet news for the last ten years or so, the one that many papers are abandoning because they can’t find enough paying advertisers. In some ways, I this failure is actually a failure of imagination — not thinking far enough outside the traditional advertiser base and not accepting that in 2009 it may take 140 small- to medium-sized customers to make up for one gigantic account from years gone by. It’s hard to readjust the scale of your thinking about advertiser size downward when your potential circulation has increased exponentially — from maybe a few thousand or hundred thousand in a relatively concentrated geographical area, to millions and millions around the world — but it has to be done.
Ironically (I suppose) the piece isn’t available at the Reader’s Digest site, at least not anywhere that I could find it. I paid $3.99 for my copy at the Wal-Mart checkout. I’m not a regular RD reader, but I do pick up the occasional issue and am seldom disappointed in the variety of articles and features. Maybe this is the best way to ensure paid customers: Providing enough quality content to keep them reaching for their wallets.