IdentityForce Sells 1 Million Subscriptions across B2C and 4 Different B2B Niches

When providing data monitoring and concierge services online, it’s easy to stick to one niche market. But IdentityForce has been able to sell one

Quick Overview

When providing data monitoring and concierge services online, it’s easy to stick to one niche market. But IdentityForce has been able to sell one million subscriptions to both B2C and B2B audiences, with 40 groups accounting for half of their subscribers. CEO Steve Bearak spoke to us about how the company generates and closes group sales, as well as how it optimized its conversion pages for trial offers. Plenty of actual data in this case study, including affiliate commission fees and conversion percentages when partnering with other sites. Also, great Web design tips to optimize your conversion pages!

Company Profile

Founded: Site launched in 2005, Bearak Reports (parent company) founded in 1978.
Employees: 40 (20 full-time, 20 freelancers)
Business Model: 100% subscription-based
Paying Subscribers: Just under million (50% individual subscriptions, 50% group subscriptions)
Location:Framingham, MA with a satellite office in Washington, DC.
Website:www.identityforce.com

Target Market

IdentityForce has two primary markets:

B2C: Any individual U.S. consumer (or family) who’s interested in identity and financial protection. Many of these people have either known victims of identity theft or been victims themselves in the past.
B2B: U.S. companies, organizations and government agencies that need to be in compliance with various identity protection laws, as well as have a system in place to deal with security breaches. This market can be further broken down into four separate verticals:

Healthcare organizations
Businesses and merchants
Colleges and Universitites (Higher Ed)
Government agencies.

Overall, the five verticals (the four above plus the B2C vertical) offer slightly different protection packages, and in some cases, are marketed differently.

Content

IdentityForce provides its clients with identity, privacy, and financial monitoring and protection services. These services include online tools, concierge services by phone and email, and some SaaS and downloadable widgets.

Monitoring: Through its individual and family plan, IdentityForce provides credit card monitoring, social security number monitoring, three-bureau credit monitoring, three-bureau credit scores and reports, identity threat alerts, and more. They also provide alerts via email or phone (email is more popular). IdentityForce requires customers provide a name, email and physical address, but can provide more in-depth monitoring and reports if customers submit their date of birth, phone number, social security number, credit card numbers and other information.

Protection: IdentityForce is able to protect its users from identity theft, invasions of privacy, and financial fraud through both downloadable software and cloud-based computing. The site also provides downloadable widgets to protect computers and mobile devices.

Problem-Solving Tools and Services: As Bearak says “Most people don’t need technical support so much as help with stopping identity theft, since it can be such a time consuming process.” Therefore, the site will communicate via email and phone to help customers get their credit cards cancelled, deal with collection agencies, or other issues related to identity, privacy, and financial protection. Sometimes this means guiding customers to the online dashboard, which has the tools they need, but many times, IdentityForce will do it for them — making calls, writing letters and working on their behalf.

Basic Services for Groups: IdentityForce’s B2B services were launched in response to client requests to help manage and reduce identity theft on an organization, its employees and business partners. Therefore it provides software and consulting/concierge services to help organizations and companies protect sensitive information, deal with security breaches, and access to a toll-free, fraud specialist help line in order to resolve any hacking/security breach problems.

It markets to four separate B2B verticals:

The Healthcare Industry: In addition to the basic services, IdentityForce provides risk assessments and regulatory update alerts on changes to state and federal laws. Subscribers also get customized Web-based training for an unlimited number of staff to help reduce the accidental exposure of personally identifiable information.
Businesses and Merchants: The basic service package, plus PCI compliance tools, and identity theft protection for customers of the business or merchant.
Higher Education: The basic service package, as well financial literacy tools to help educate students on paying off loans, getting a job, what a bad credit score does to you, etc.
Government Agencies: The basic service package, but expressed in different wording (more on this in Marketing Tactics).

The site adds new features on a quarterly basis. Bearak says IdentityForce considers itself a technology aggregator, and therefore, does licensing agreements with innovative technology companies in order to add their features to their service.

In terms of help line services, IdentityForce uses a call center where they “own the seats” of the individuals working for their company. The call center is domestically-located; Bareak says international call centers are ill-advised as members feel more comfortable with speaking to someone U.S.-based because of the sensitive nature of the information being given and monitored on the clients behalf. Bearak estimates that 1% of their total subscription base will call anytime during the course of the month. Many more get answers through the web-based platform.

IdentityForce has found that it needs about one seat for every 30,000 subscribers. Bearak says the initial training was done on-site, and the company continues to go on site once a year, but continual training is provided on a quarterly basis through Webinars and PowerPoint presentations.

Revenue Streams

IdentityForce generates more than $10 million a year, solely through subscriptions. Bearak says that 70% of their revenues are generated through individual subscriptions (B2C), and 30% through group sales (B2B). Even though 50% of the number of subscribers are individual and 50% are from groups, there is a greater difference in revenue split because of the discount given to groups.

IdentityForce offers the both monthly and annual pricing options within their subscription plan for individuals and families:

Individual package = $17.95/month ($169.95/year)
Childwatch package (1 adult + up to 5 kids) =$24.95/month ($249.95/year)
Spouse package (2 adults, no kids) = $27.95/month ($269.95/year)
Family package (2 adults + kids) = $34.95/month ($349.95/year)

Bearak says that the most popular plan is an individual package on a monthly payment basis. The least popular option is the family plan. The fastest-growing option is the Childwatch package.

Bearak says that IdentityForce is quite fond of pricing tests, the majority of which have been conducted for the individual and family plan. They found that they have a much higher take-rate when they offer a monthly option (in addition to an annual plan), but they also have a higher churn rate with the monthly option.

In addition, IdentityForce’s has 40 group subscribers, and pricing can vary from $20 to $50 per year per person. Their groups also vary in size, with the smallest containing 20 people and the largest 65,000.

Marketing Tactics

Unlike most online businesses, IdentityForce has chosen to forego SEM and PPC marketing in favor of deals and affiliate agreements with other online businesses.

Post-transaction Marketing
IdentityForce works with other sites that get mass amounts of traffic and ecommerce. After providing a credit card and completing a transaction, consumers are given the opportunity to subscribe to IdentityForce. (Note: Consumers choose to sign up for IdentityForce; there is no data pass involved.)

IdentityForce has found that the partnering site doesn’t have to be in the security industry. In fact, it doesn’t matter what these sites are selling or how much — a steady 4-10% of people will buy their service. Sites then receive a 50-70% revenue share of the monthly subscribers acquired for the lifetime of the account. Each partner has an ASID code, and a cookie gets installed on the end-user’s browser, which makes it easy to track where a customer came from for the lifetime of their account, especially since IdentityForce’s services are computer-specific.

Affiliate Marketing
IdentityForce has an affiliate program whereby they pay a flat fee (averaging $35) for every customer an affiliate acquires for them. The sites usually place a banner ad for IdentityForce with a link to the site. An acquisition is defined as any customer signing up for a free trial (more on that below).

Email Marketing
IdentityForce does market itself with opt-in email lists. They neither rent nor have an in-house list, but rather use email marketing companies that own lists of people who have opted-in to learn more about online security, financial services, insurance, etc. They do the creative and then work with a third-party vendor who does the mailing. The email marketing company then gets either a revenue share of 50-70% for the lifetime of the account, or a flat fee (averaging $35) for every conversion.

Other Marketing Tactics
IdentityForce engages in some PR by issuing routine press releases. They do not use social media or direct mail. The site had a blog at one point with 100,000 registrants (non-paying), but they didn’t get great feedback or conversion from this after two and a half years, so they stopped blogging about a year ago.

Conversion Tactics

In order to convert visitors, IdentityForce has undergone extensive testing. Two tactics have been especially helpful:

Providing a free trial (with credit card) for visitors
Providing a 30-day money-back guarantee

Bearak says that 65% of visitors that sign up for a free trial stay on as paying subscribers. Their only point of contact at the free trial stage is a welcome email, unless the customer gets an alert for some reason.

IdentityForce has extensively A/B tested its conversion pages and found that less text and more visuals seem to work best (especially the inclusion of the Better Business Bureau icon, which Bearak says resulted in a spike in conversion rates because it conveys “trust and confidence”). Even though IdentityForce offers some pretty sophisticated services, the text on the homepage and initial conversion page is pretty simple — visitors can then click for more in-depth information.

Bearak says that their conversions also increased when they asked for less information up front. They used to ask for a name and email on the first page, and then a password and credit card information, but A/B tests confirmed that its best when they don’t ask for anything at all on the first page and let interested visitors click through to the second page in order to enter their information.

IdentityForce also makes sure to include a toll-free number at the top of each conversion page for each of its five verticals so that visitors can talk to someone live. On the consumer side, the toll-free number is preceded with a line of text saying “Questions? Call us now,” but for group subscriptions for healthcare, business, higher education and government agencies, the text reads “Had a Breach? Call our Hotline.”

Group Sales

Bearak says that most of its group sales leads are generated by inbound inquiries. Usually, an employee at a company or organization is an individual subscriber to IdentityForce and then provides word-of-mouth endorsement to his/her managers. IdentityForce also speaks at trade shows for its B2B verticals, such as the American Hospital Association conference, which generates some leads. However, IdentityForce is also in the process of hiring a VP of business development in order to increase their group sales marketing.

Once a lead is generated, there is one person at IdentityForce who handles all group sales — the director of strategic programs — which Bearak says is helpful since groups clients often have multiple decision-makers involved in the process. IdentityForce has standard collateral on agreements, templates, pricing and how to explain the service to other people in the company, which are usually sent via email. IdentityForce closes 70% of its group sales leads.

Government Sales
IdentityForce acquires its government subscribers by being listed as an approved vendor by the Government Service Administration (GSA). They also use more government-friendly marketing lingo (i.e., “Immediate Breach Containment” instead of “Turnkey Breach Management”). In fact, this is a tactic they use across all their separate B2B verticals and an important lesson to any other sites marketing B2B services across different industries.

Bearak says the GSA-approval process is long — 6 months to a year — but once you complete the open enrollment form and are approved, you can get 5-year contracts fairly easily. After being approached by an agency, some will ask for an RFP, while others will simply award IdentityForce the contract. (For more information on becoming a GSA-approved vendor, see our How-to article.)

Retention Tactics

Individual account lifetimes tend to average between 5 and 22 months with auto-renewal, while group subscriptions usually have 2-year contracts with auto-renewal.

Bearak says their best retention tactic is adding new features, which they do on a quarterly basis, and at no extra cost to the subscriber. They also contact all of their customers once a month with a “report card” and other notifications

Group retention is augmented with a monthly report sent to management, letting them know how many employees used IdentityForce’s services, how many alerts were issued, how many calls were made to the call center, etc.

Cross-Sales & Upsales

As part of its terms of service, IdentityForce promises its customers that they will not try to sell them another third-party service. They do try to upsell an individual to a spouse or family plan. They usually approach these prospects through email marketing, but their percentage of sales from these efforts remains in the single digits.

About Steve Bearak

Steve Bearak’s father started Bearak Reports as a family business in 1978. Bearak says he launched Identity Force in response to client requests to help manage and reduce the adverse financial and reputational impact of identity theft on an organization, its employees and business partners.

Bearak says his biggest lesson and best advice is to test often and fail fast. “So many people do a feasibility study in a boardroom, but have no idea how successful a project will be until they launch a product. Most of what we do doesn’t work, but we figure it out fast.”

Vendors & Technology

Hosting — HostWay
http://www.hostway.com

Payment processing — Chase Payment Tech
http://www.chasepaymentech.com

Email management — Use an in-house tool and UnSubCentral for compliance (unsubscribe functionality)
http://www.unsubcentral.com

Call Center — RDI Outsourcing and Marketing
http://www.rdioutsourcing.com

Content creation (marketing copy, press releases, announcements, editing) — The Hired Pens
http://www.thehiredpens.com

Webinar Software (for call center trainings) — WebEx
http://www.webex.com

Insider Analysis

IdentityForce provides some very useful lessons on how online consulting and concierge services can market themselves to both B2C and B2B audiences, as well as across industries through various verticals. IdentityForce’s A/B testing also illustrates the importance of graphics and succinct text for conversions. And we really like how much time they’ve taken to learn about their customers — from different marketing lingo for healthcare v. government organizations, to adding a BBB icon to instill consumer confidence.

They definitely have their marketing metrics down in ways that other sites don’t, but we suspect a little SEM and PPC could help them grow. We also think they have a lot of room to grow in B2B/group subscriptions, and glad they’re staffing up to do so. They may want to employ some postal direct mail campaigns to engage the decision-makers at organizations, as well as keep one point of contact for each vertical. And given that their consumer audience usually knows someone who’s been a victim of identity theft, they could benefit from an aggressive tell-a-friend campaign, especially if the request is timed right after a client has been helped. Social media, especially a presence on Facebook (and perhaps some Facebook ads) would also help their tell-a-friend campaign and referral traffic.