Structured Credit Investor (SCI) launched just two years before the global financial meltdown shrunk their industry by 75%. Managing Director John-Owen Waller tells us how subscriptions made it possible for the site to continue to thrive despite their reduced growth. Plus, discover the site’s seven conversion tactics, its two methods for acquiring group subscriptions, and one great SEO trick to make featured content stand out in search results.
Company Profile
Founded: August 2006
No. of Publications: Had 3, but folded the other two into the SCI brand since they were related.
Employees: 7 full-time
Business Model: Hybrid — subscriptions, events, sponsorships/advertising
Paying Subscribers: Many hundreds
Location: London, UK
Website: http://structuredcreditinvestor.com/
Target Market
Structured Credit Investor targets individuals working at financial institutions, including investment banks, brokers and hedge funds that trade structured credit products. SCI’s audience is based primarily in New York and London, but they also have subscribers in Europe and around the world.
Content
SCI primarily informs its audience about asset-backed securities and structured credit markets so that they can make informed investment decisions in a timely fashion.
The site mainly consists of articles and data, and has a very hard paywall — only the “SCI Start of the Week” brief is free to view. SCI conducts occasional Webinars, mostly free and sponsored by outside advertisers.
The site is pay-worthy because it covers an opaque and high-value topic that’s difficult to understand, with little free competition (if any, frankly). “Our biggest competitor, certainly for our clients’ attention, is probably Bloomberg,” says Waller. Bloomberg has a distinct advantage by providing its audience with terminals, but its content is not as specialized as SCI.
SCI also has a data portal, providing subscribers with information on deals, pricing, market reports, loan and other events related to the industry.
Updates are added on a daily basis — usually 8 to 15 stories a day. These stories are emailed to subscribers around lunchtime in the UK, which is around the start of the workday for Stateside subscribers.
SCI has four journalists in house. These reporters don’t have beats, although the site is news-driven and doesn’t do features. Instead, story assignments are divvied up so that reporters get experience writing about all topics relevant to the structured credit market.
Revenues
SCI is projected to earn 7-figure revenues in 2013.
Subscriptions and data products make up 80% of company revenues (40% from subscription content, 40% from data product subscriptions), events account for 15% of revenues, and advertising and sponsorships only 5%.
Subscription plans are for one- or two-years (there are no monthly plans), and prices are presented in pounds, dollars and euros. The site also has a “desk subscription” offer that allows subscribers to sign-up three users for the price of two.
SCI’s most popular subscription option is for an individual for one year. It’s least popular is the Desk subscription for two years.
Group Subscriptions
SCI usually mines its database for multiple users from the same organization (some of these users can be spread around the globe). This is done fairly easily by tagging individual subscribers’ company name and looking at login times and frequencies. SCI will then approach a bank to let them know they have multiple users and can receive a percentage discount. However, hedge funds are given a set subscription price, such as $10,000/year for 20 logins.
The site’s premium data portal is currently being re-designed, but already accounts for 50% of subscription sales. Waller told us that the starting subscription price for their new data portal will be around $20,000 a year for up to three logins.
Events
SCI hosts about four trade shows a year. Tickets are priced around $1000, but hedge fund professionals and traders attend free, since once they’re in attendance, others follow. Each event hosts about 150 people, and approximately two-thirds are comped attendees.
VAT
Because SCI is based in the UK, it is required to pay VAT on all subscribers. However, since most of its subscribers are professionals, the site is able to ask for a business VAT number, in which case the business is responsible for paying the VAT tax (See our Laws & Regs Briefing on Selling Subscriptions in the UK and Europe for more information). When handled this way, US subscribers don’t have to pay a VAT tax, since US businesses don’t have a VAT ID — unless they’re international organizations with a UK/EU presence.
Notes on Surviving a Financial Meltdown
There’s likely no publication that could have been more threatened by the global financial meltdown in 2008 than SCI. The structured credit market shrunk by 75% that year, just two years after SCI launched.
However, SCI was able to stay afloat mainly because they were not an ad-supported model. Advertisers basically cleared out since some holdings were valued at $0, but subscriptions increased as professionals were in need of quality information.
Obviously, the site’s growth had to be re-adjusted from pre-2008 estimates, and SCI lost some accounts because some companies ceased to exist, but SCI’s overall retention rate remained around 80%. Thus, subscriptions allowed SCI to capitalize on a major industry disruption instead of being waylaid by it.
Marketing Tactics
SCI derives most of its site traffic through organic search and Twitter. The site also uses PR and postal direct mail to acquire new subscribers.
SEO
SCI has some solid SEO given the high-degree of specialization of its content. The site used a freelancer to initially set up its SEO-ed pages, but all four of the journalists on staff are also trained in SEO best practices. **Note: Despite some misconceptions in the industry, you can SEO paywalled content and have it show in organic search rankings, as shown in the screenshot below. When you click on the link, you are taken to SCI’s paywall that repeats the specific headline up top.
The site also uses the Standout HTML tag, which indicates to Google crawlers if a story is featured prominently on a site. Publishers can’t use it for every story, but SCI uses in seven to eight times a week in order to highlight stories particularly important to its target market. (The tag should be placed in thesection of the source code on the page, and the syntax is )
Social Media
Waller said the site gets a significant amount of traffic from its Twitter account, which has a modest following nearing 700 (the site’s traffic is not huge compared to other sites, given its small niche). The site posts every headline daily on Twitter, along with announcements of its new offerings (i.e., the data portal).
PR
SCI creates quarterly league tables with deals by banks in the industry to get accurate picture of deal flow, and will then publish press releases promoting those tables. Press releases are distributed to an in-house list of business journalists in the industry. They plan to increase their PR efforts this year with media interviews.
Postal Direct Mail & Trade Shows
SCI’s postal mail pieces are mainly confined to announcements of events and a magazine it prints for its industry conference. It will drop a couple thousand pieces before an event, and then look to use the magazine as a handout when manning a booth at other industry trade show.
Conversion Tactics
SCI has a number of tactics to help convert visitors to paying subscribers:
- The site requires email registration to view free content, but will not accept gmail, yahoo or Hotmail email addresses, directing visitors to give business email addresses. The site’s Start of the Week newsletter is very popular, says Waller, acting as a loss leader to attract new subscribers. The site validates all email addresses using a double opt-in system (prospects who enter an email address are sent a link that they must click to “validate” their email address). This tends to avoid email being delivered to spam filters.
- The header lists a phone number for prospects to call in order to subscribe. This seems to be a popular conversion tactic with UK audiences (The Week, on which we’ll soon have a Case Study, also does this.) However, Waller told us most conversions for SCI are made by outbound calling.
- Their conversion page has no navigation bar (Best Practice Alert!). It also allows prospects to see and purchase a subscription in dollars, pounds or euros. (However, the form does break our one-column suggestion in some places, which we advise against. Also it’s worth noting that while the pricing fields look like they can be edited, they cannot.)
- Site visitors can get a sense of SCI’s breadth and depth of data by typing in search parameters into the data portal. However, after clicking through to search, prospects are taken to a generic paywall and asked to subscriber in order to see the results. While the ability to test database parameters is a good conversion tactic, SCI would be better served by creating a specific paywall for each database search. See our Case Study on ContactAnyCelebrity for how to do this.
- The site has a free 14-day trial (no credit card or bank information required, unfortunately), and has split their conversion funnel by asking for a prospect’s email through a display ad on the homepage.
- SCI then has a sophisticated method of converting trial subscribers. On the second part of its conversion funnels, it asks for prospects’ preferred means of contact. The site then initiates heavy customer engagement, usually through telesales, in order to understand what their business motivations and goals are and how SCI can help them. The telesales calls are handled in house by sales staff, which will walk prospects through the site and do some live demos of the data product. **NOTE: SCI never cold-calls prospects, only those who have signed up for a trial.
- The site maintains a multi-seat trial offer through its Desk subscription, but Waller says there have been fewer takers since the recession.
Group Subscription Conversion
As we mentioned, SCI mines its data to find individuals working for the same organization and then works to offer a discount to the organization.
“If Bank of America has subscribers in New York, London and Singapore, we tell them, and then present a savings offer,” says Waller.
He says it hasn’t worked to present an organization with a certain number of logins for a certain price; rather getting individuals to convert and then going to the organization with a discount has been more effective. When asked why offer a discount at all then, Waller explained that the retention rate is often higher on a group subscription. While there’s no internal champion, Waller says it’s often not that hard to find a point of contact because the initial subscription will be paid by a central data office/ subscription management department within a bank or company, who will also handle any group subscription sales.
Leads are also generated through the site’s multi-seat trial, and handled in a similar manner as individual subscriptions: Prospects are contacted (usually by phone) after conversion and asked for one or two co-workers names and email addresses. But if a prospect is looking for three or more people to join in his trial, SCI will introduce the idea of a site license or group discount.
Retention Tactics
SCI’s retention rate is around 80% across individual and group subscriptions.
The site tracks user usage, and if anyone hasn’t logged in in three months, an internal alert is triggered to find out why. SCI sales staff will then call the individual to encourage them to re-engage with the site. If the person has left his position, SCI will allow the subscription to be transferred to a new person within the same organization.
Cross-Sales & Upsales
SCI cross-sells its events and data products to its subscribers. They reach out to their best prospects by mining their database of existing subscribers, paying close attention to job titles.
About John Owen Waller
John Own Waller has worked in media and software for 18 years, initially with Metal Bulletin, EMAP, FOW and City Networks . He also ran sales for Euromoney until 2001. He then got an MBA from at Edinburgh University in 2004 and started SCI in 2006 with his business partner, who was a “star” reporter with a history of covering the structured credit market.
His best advice for others in the online subscription content industry is to “find the most opaque part of your industry and start digging — that’s how you’ll add value.”
Vendors and Technology
SCI manages a number of functions in house, such as Web design and content creation, but also uses third-party vendors for the following functions:
Hosting — Catalyst2, Belfast
http://www.catalyst2.com/
Payment processing — Barclaycard
http://www.barclaycard.com/
Email management — Newsweaver.ie, Ireland
http://www.newsweaver.com/
Web development — BeFound.ie, Dublin, Ireland
http://www.befound.ie/
Creative/Editing– Andy Peat Design, UK
http://www.andypeatdesign.co.uk/
Analytics — In-house and Google Analytics
http://www.google.com/analytics/
Subscription Site Insider Analysis
Structured Credit Investor’s subscription-based model allowed them to survive an opaque and volatile market’s downturn, which is a testimony to the importance of selling online subscriptions for content and news. We applaud SCI for employing a number of conversion best practices –from splitting its conversion funnel and requiring business-specific email addresses (which lets it mine for multiple users and upsell group subscriptions) to simulating specific paywalls for a database by allowing prospects to type in search parameters. We also like how they’ve limiting their telemarketing to prospects who have opted-in to try their site and not wasting precious man hours on cold-calling.
SCI could afford to beef up their online acquisition tactics, perhaps by featuring their free Webinars more prominently, using affiliates, or boosting their PR efforts. The latter is likely the best suggestion since mainstream news is clearly lacking a knowledgeable source — placing an SCI reporter or Editor-in-Chief prominently on the cable news shows could help SCI build its brand among target audiences. In addition, the site should start A/B testing its conversion pages, especially its order form.
