Psychotherapy.net Garners Seven Figures with Innovative Video Streaming for Professional Development

Case Study: Creating the Perfect Product Mix

Nineteen years ago, psychotherapist Dr. Victor Yalom had a vision to capture the teachings of his mentor Dr. James Bugental on video for training purposes. That vision has turned into a seven-figure online subscription business that offers education and training to clinical psychotherapists across the country. Psychotherapy.net’s chief operating officer Marie-Helene Yalomspoke with us about creating the perfect product mix and adapting media formats to attract and retain long-term customers.

Company Profile

Founded:  Founded in 1996 with VHS tapes and a print catalog. Video streaming started in 2013.

Employees: 9 full-time employees

Business Model: Hybrid:subscriptions, one-off sales and affiliate sales.

Paying Subscribers: 330 individual subscribers and between 50-100 institutional subscribers.

Location: Mill Valley, California

Website: http://psychotherapy.net

 

Overview

Founded in 1996, Psychotherapy.net was started by Victor Yalom, PhD to share training tapes with colleagues and educators. Initially, Dr. Yalom wanted to capture and preserve valuable training and techniques from his mentor James Bugental, PhD.He started out by selling the training tapes in VHS format at conferences and then producing a print catalog to showcase the company’s products. As the Internet became more mainstream, Dr. Yalommoved beyond conference and catalog sales to the Web.

Since those early days selling videos at conferences and online, the company has expanded, offering a variety of products to other therapists, educators and institutions. Psychotherapy.net’s current product offerings include DVDs; signed books by Dr. Irvin Yalom, a noted therapist and author in the field and Dr. Victor Yalom’s father; affiliate sales; continuing education credits; and starting last spring, streaming video subscriptions.

 

Target Markets

Psychotherapy.net has two primary target markets: 

1)      Individual therapists seeking additional training, professional development, and continuing education

2)     Institutions that want access to the videos for teaching purposes, including universities with graduate clinical psychology programs, clinics, hospitals, insurance companies, government agencies like the Veteran’s Administration,and prisons.

Content

The purpose of Psychotherapy.net’s content is to provide training to mental health professionals through videos of noted therapists or therapists introducing new techniques.

Featuring legendary psychotherapists including Carl Rogers, Albert Ellis, Salvador Minuchin, Aaron Beck and Jacob Moreno, the videos capture live sessions and include commentary and explanations throughout. They may illustrate a one-time session or show a progression, highlighting different techniques and tools over time as well as explaining the techniques step by step. Originally, an entire session was recorded with interviews before and after, but the new format is more beneficial to the site’s audience.

“Students very rarely see real therapy being done. The only way to show them therapy is to show them a real session and to show it from the masters,” Marie-Helene Yalom said. “The alternative is to fly an expert in to show students how to do training versus the cost of showing a video.”

Psychotherapy.net strives to cover a wide range of topics relevant to therapists and counselors. They choose video topics based on what topics are missing or outdated in the current video collection and what current psychotherapy topics are of interest. In many cases, the Psychotherapy.net team will ask a psychotherapist who is an expert on that topic if they can videotape a session. In other cases, therapists will come to then with a desire to tape a session.

Occasionally, they will run into a session that has been previously taped by a psychotherapist. In that case, the Psychotherapy.net staff will evaluate the quality of the video, and if it is good quality, they will work with the therapist to create a teaching video, adding commentary and explanations. In all cases, Psychotherapy.net gets the appropriate releases from the participants.

The videos are available in DVD and streaming video formats and can be purchased individually or as part of a subscription.To date, there are more than 200 titles in the video library. New videos are added about every six weeks, and each video includes a completed transcript and files that are automatically linked to the video on the site’s streaming video platform.

This is a useful feature, particularly for training purposes. Here’s how it works: after the automatic transcription is performed and proofread, it is synchronized with the video, so when a subscriber clicks on a word in the transcript, the video will begin playing at that specific point. Users can also search by topic or keyword and the transcript will highlight all occurrences of that word.

Another great feature is that viewers can make clips by highlighting the desired section of a transcript and clicking on the “make a clip” button. This is ideal for classroom teaching or assigning a specific clip as homework. Transcripts can be printed or downloaded for teaching or note taking. In addition, instructor’s manuals for most of the videos are available for download in a PDF format.

Click here to view a clip from one of the videos: CBT for Personality Disorders Video with Arthur Freeman, EdD

In the case of institutional licenses, videos are accessed via a custom URL or a proxy server.

Currently, there is little if any competition in this market, allowing Psychotherapy.net to dominate the space.

Revenue Streams

Psychotherapy.net generates seven-figure revenues from subscriptions, one-off sales and affiliate revenue.

Videos are the core revenue stream for Psychotherapy.net, including one-off DVD sales and streaming video subscriptions, which add a steadier, longer term revenue source. Yalom cannot yet determine whether subscription sales will overtake one-off sales, though sales have been strong to date with an average of 1.5 new subscribers per day since May.

Individual licenses are available in two monthly packages:

1.       Choice plan, for $39 a month, subscribers can access two videos per month from a library of more than 200.

2.       Unlimited plan, for $79/month,subscribers can access the entire video collection.

Both subscription options require a six-month commitment. Half of their subscribers choose the Choice plan, and half choose the more flexible Unlimited plan, so Yalom believes they’ve chosen the right product mix and pricing structure.

In addition, each video can be streamed for a one-time cost (e.g., Evidence-Based Treatment of Bipolar Disorder for $49), providing an additional revenue source from non-committal prospects.

For individual sales, 45% of revenue comes from one-off DVD sales, 30% comes from instant streaming of individual videos without a subscription, and 25% are instant streaming of individual videos with a subscription. As of January 2015, the company had 330 individual subscribers.

As of May 2013, group licenses are available to universities, clinics and other institutions in three packages – Essential, Expanded and Full Collections. The collections are set ata fixed price based on the number of potential users (e.g., 50 students in a program), rather than price per seat, and the collections are tailored to an institution’s specific needs. The collections include:

 

The Essential Collection seems to be the most popular, though an individual collection’s popularity varies based on an institution’s budget and needs. Regardless of the collection they choose, universities and institutions can purchase additional titles at a discount based on the schedule shown.

For group sales, 55% of revenue comes from streaming subscriptions, and 45% comes from one-off DVD sales. Yalom expects the percentage of streaming subscriptions to continue increasing.The company has between 50 and 100 institutional members.

Psychotherapy.net also has affiliate revenuesfrom several vendors including GoodTherapy.org, a directory of psychotherapy practices; Sound Filters, which offers sound screening to ensure patient privacy during sessions; and TherapySites, a company that helps therapists create their own search engine friendly websites.

In addition to individual and group sales, minimal revenue comes from continuing education, book sales and affiliate commissions.

 

Marketing Tactics

SEO and SEM

Having been online for nearly 20 years, Psychotherapy.net acquires many of its new subscribers through organic search. Its search rankings are helped by regular additions of new content, including blog posts, articles and new videos. In addition, the company utilizes pay-per-click advertising, including Google AdWords.

Social Media

Psychotherapy.net has a YouTube channel with 7,777 subscribers, as of January 26, 2015. The channel includes snippets from videos to give prospective customers the opportunity to see a video before they make a purchase or subscribe.

 The company’s Facebook page has 12,370 likes, as of January 26, 2015, and is updated regularly with relevant articles as well as Dr. Yalom’s popular cartoons.

Word of Mouth Marketing

Psychotherapy.net also gets leads via word of mouth marketing from its individual and institutional clients. In the business for 20 years, Psychotherapy.net was one of the pioneers in offering video content. It built a reputation among therapists, counselors and educators who helped spread the company’s name among their colleagues and peers. 

Trade Shows

Psychotherapy.net attends two to four trade shows a year to develop contacts with librarians and university professors for future sales. Previously, the company did regular trade shows with a focus on selling DVDs and building its brand.

Conversion and Retention Tactics – Individuals

Sample Videos and Six-month Commitment

Psychotherapy.net does not offer free trials to individuals, but prospects have the opportunity to view sample videos. It allows non-committal prospects the option of making one-time purchases of videos or subscribing to the Choice or Unlimited plan. For those who subscribe, there is a six-month commitment, helping Psychotherapy.net retain customers on a consistent basis and, with credit card information on hand, there is a greater likelihood that customers will renew.

Newsletters

Psychotherapy.net’s regular email newsletters help the company convert readers into customers and subscribers. Yalom found many years ago that including unique content and the right email subject line significantly increased open and click-through rates, and some of the newsletter’s most popular content is Dr. Yalom’s popular therapist-focused cartoons. The newsletter is a good way for the company to stay in touch with its customers, while also announcing new videos, articles and interviews. The newsletterschedule matches that of the video production schedule, so a new email newsletter comes out about every six weeks.

Six-Month Commitment

Psychotherapy.net retains individual customers by requiring a six-month commitment on its streaming video subscriptions. Because many subscribers are still in their first six-month period, it is too early to tell what the retention rate will be. However, with credit card information already on file and new content posted regularly, it seems that retention for the new streaming service will be high.

Conversion page

To make a subscription purchase, individuals click the olive green “Subscribe Now” button. It appears above the fold on the right hand side. This button takes prospects to another page where they select the Choice or Unlimited plan by clicking “Add to cart.” Once they’ve done that, a box pops up with restrictions. To continue with the purchase, prospects click “Submit.”

 

Prospects can then click “Checkout now” or click on the shopping cart icon in the upper right hand corner of the screen. Once on the Shopping Cart page, prospects complete a three-step process, starting with a review of the item to be purchased, followed by the input of billing information and the creation of an account if the prospect does not already have one.

 The page includes a Contact Us button and toll-free phone number in the upper right hand side of the screen which is helpful. We also like the FAQs and delivery options on the right hand side, and the one-column format for the billing information.

However, additional improvements are possible. For example, the “Continue” button, which initiates the request for billing information, is below the fold. We recommend that the “Continue” button go above the fold, be made larger and shown in a bright color with text in a larger font.

The Shopping Cart also includes the navigation bar, search box and clickable links which can potentially distract an individual from making a purchase.Best practices recommend removing all navigation bars and clickable links other than the “buy” button on a conversion page.

The page could also benefit from offering both plan options, Choice and Unlimited, with the Unlimited option being listed first (on the left), and explaining the benefits of each option, helping the prospect make an informed decision. Better yet, Psychotherapy.net could highlight or mark the Unlimited plan as the one with “Best Value” in order to drive more conversions for the higher-priced subscription.

 

Conversion and Retention Tactics – Group Subscriptions

Free Trials

Psychotherapy.net offers free trials for institutions that typically last a month. The company can internally track how many times their videos are viewed by a particular institution.

Sales Calls

Psychotherapy.net gets a lot of inbound calls from librariansinterested in providing as many resources to their universities as possible. The calls are fielded by three in-house sales people. Thesales repsalso encourage usage of the group licenses by staying in touch with their contacts and professors who use the materials.

 

About Marie-Helene Yalom

Marie-Helene Yalom has been with Psychotherapy.net since 2009.Prior to joining the company, she served as the brand strategy and measurement research manager for Hewlett-Packard.Before that, Yalom was a consultant for Coopers & Lybrand in Paris. She became involved with Psychotherapy.net after marrying Dr. Yalom, and serves as the company’s chief operating officer and an owner/partner.

Yalom manages budget and finance decisions, overseeing the development and on-going management of Psychotherapy.net’s e-commerce websites, brand identity and communication, art-direction for all print and on-line materials, advertising including online advertising, analytics, and product development. She is also intimately involved in the content development and direction of the training videos.

Yalom’s position at Hewlett-Packard gave her the opportunity to watch how people interact with technology, teaching her one of her greatest lessons as a subscription site executive – think very carefully about the user experience.  “Not all customers will be technically savvy, so it is important that each task be easy to execute,” recommends Yalom. With Netflix being the biggest player in the online video market, Yalom and her team have created a user interface that mirrors Netflix with the ability to search or browse by topic, approach, or expert. With Netflix as a model, the video menu is familiar to customers and easy to navigate.  “Make it as simple as possible,” Yalom says.

Vendors and Technology

Hosting – Zing Studios
http://zingstudios.com/

Video Streaming – Limelight
http://limelight.com

Transcription and Script Syncing – 3 Play Media
http://3playmedia.com

Email Newsletter – Zing Studios
http://zingstudios.com/

CRM – Salesforce
http://www.salesforce.com/

Analytics – Google Analytics
http://www.google.com/analytics/

Payment Processing – Authorize.net
http://www.authorize.net/

 

Insider Analysis:

We loved this case study because it demonstrates how subscription companies that truly know their market and that can adapt to their market’s needs can be incredibly successful.

Three lessons we can learn from Pscyhotherapy.net’s success:

Staying ahead of and evolving with sophisticated video technology is a smart move. As VHS technology was overtaken by DVDs, Psychotherapy.net quickly jumped on the bandwagon, offering their videos in the latest format available. Now that streaming video is available, Pscyhotherapy.net added that to its offerings for individuals and institutions that prefer that format, but DVDs are still available for those who want them. In addition, the company has leveraged its use of technology to maximize the effectiveness of its videos for both students and teachers. With captioning and written transcripts synched with each video, customers can easily jump to the desired section of a video to review an important lesson or make a clip for class to highlight a technique.

Understanding its target markets is critical to success. With two distinct target markets, Psychotherapy.net has a good understanding of what its individual and institutional markets want – good, quality products at affordable price points with flexibility. The 50/50 split on the individual plans is a perfect example. Half of the company’s individual customers want flexibility! They want to be able to watch any video at their convenience. The other half knows it won’t be able to watch more than two per month, so they go with the more economical plan. For the institutional plans, the video selections are customized to meet a particular university or clinic’s needs, and pricing is flexible, based on the number of potential users (e.g., a class of 15) instead of price per seat which we typically see.

Keeping it simple benefits customers and the company. Psychotherapy.net understands that technology must be easy to use, so they’ve set up their video menu in a design similar to Netflix, so its customers can easily navigate to find the desired videos. The company has kept the business model simple for itself – offering a balanced mix of products with an emphasis on the videos. While it receives minimal revenue from affiliate commissions and book sales, the company focuses its energy where it will yield the greatest benefit.

The main area of improvement for the site would be its conversion pages. As we’ve mentioned in our Paywall Optimization Toolkit, the site would likely see higher conversion rates with a more optimized page. When prospects click to subscribe, you should make sure the only button to click closes the sale; that’s why it’s important to remove the navigation bar and all other distracting links that can lead prospects away from this one task.

However, having a phone number listed above the navigation bar is a great engagement and conversion tactic, especially for a site getting a significant chunk of revenue from group subscriptions. We suspect there might be room to grow in the institutional subscription market as well, especially by pursuing a deal with university library services companies like EBSCOhost, as World Politics Review did.

But overall, we commend the company for providing unique products not available anywhere else, and for providing the right product and pricing mix for its target markets. Psychotherapy.net stays on the cutting edge of technology, and from marketing, conversion and retention perspectives, they know what works for them.

 

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