Selling the Sizzle, Eating Your Steak. TheStreet.com’s Subscription Business
It is funny after the Dot.com bust taking him and his cleints with him Jim Crammer still has a business outside of Federal Pen, but he does! America is home of the Free and Brave!
So how does JC make a living detroying wealth?
Another grat blog breaks the story, maoxian.com.
http://www.maoxian.com/ TheStreet.com’s Subscription Business
In TheStreet.com’s most recent 10-K, they revealed their subscriber numbers in detail for the first time (as far as I know … can’t remember seeing them in any previous 10-K filing). Here’s an edited excerpt about their paid services:
“Paid services revenue is derived from annual and monthly subscriptions to the Company’s 13 subscription newsletter services and our paid Web sites RealMoney.com and RealMoney SilverPaid services …
Subscription revenue for the year ended December 31, 2008 ($30,376,549) decreased by 11% when compared to the year ended December 31, 2007 ($34,119,565).
The decrease is partially attributable to the outsourcing of TheStreet.com Ratings business to Grey House Publishing in the second quarter of 2007. Prior to the outsourcing of this business, subscription revenue included the full sales price of the product. Revenue now reflects a fee based upon a percentage of the sales price, which is recorded as licensing revenue. Subscription revenue from TheStreet.com Ratings totaled approximately $1,772,000 in the year ended December 31, 2007, as compared to approximately $147,000 in the year ended December 31, 2008.
Excluding the impact of the Ratings outsourcing, revenue specifically from our subscription services business decreased by 7%, the result of a 9% decrease in subscribers to our subscription services from approximately 85,600 as of December 31, 2007 to approximately 77,600 as of December 31, 2008 …
While the retention rates across our subscription products remain strong, with renewal rates during the year ended December 31, 2008 of 63% and 90% for annual and monthly subscribers respectively, which are unchanged from the prior year, our lower acquisition rates across our subscriber marketing channels resulted in lower year over year subscribers and subscription revenue.
For the year ended December 31, 2008, approximately 76% of the Company’s net subscription revenue was derived from annual subscriptions, as compared to approximately 71% for the year ended December 31, 2007. The Company calculates net subscription revenue by deducting anticipated refunds from cancelled subscriptions and chargebacks of disputed credit card charges from gross revenue. Refunds and chargebacks totaled less than 1% of gross subscription revenue during each of the years ended December 31, 2008 and 2007.”
Wish I could see a breakdown of revenue for each of their 13 newsletters; nevertheless it’s interesting stuff to a budding newsletter writer like me. On average they’re collecting about $400 a year per subscriber; I guess I’m not charging enough.