Case Study #3

Magazine Subscriptions Through the Apple app store

The Ipad has revolutionized the world of print media. Magazines and newspapers have started to make their publications available in a digital format in order to adapt to the current technological trends. Until very recently digital versions of magazines/newspapers were only available through the publishers website. Now, publishers have the chance to offer digital versions of their publications through the apple app store. This allows Ipad users to pay for magazine subscriptions in the same place that they buy all of the other apps for their Ipad.

Integrating magazine subscriptions into the apple app store has both advantages and disadvantages for the publisher.  According to the apple press release “Publishers set the price and length of subscription (weekly, monthly, bi-monthly, quarterly, bi-yearly or yearly). Then with one-click, customers pick the length of subscription and are automatically charged based on their chosen length of commitment (weekly, monthly, etc.)” While selling subscriptions through the app store provides publishers with a certain degree of flexibility there are some drawbacks to partnering with the apple app store as well. Apple stated in the press release “when Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple earns nothing.”  Partnering with apple also means that subscribers have the opportunity to opt out of providing publishers with their name, e-mail address and zip code when they subscribe. This makes it hard for magazines to analyze their core demographic, which is information publishers need in order to attract advertisers.  While there are definitely some disadvantages to partnering with apple, according to the article “Popular Science Finds Success With Apple’s App Store Subscriptions” the magazine Popular Science sold its 10,00^th digital subscription as a result of making the magazine available through the apple app store.

The target audience for this marketing strategy is individuals who enjoy reading print publications, but are also technologically savvy and want to be able to read their favorite print publication in a more accessible digital format. The target market consists of people who live an active lifestyle and are constantly on the go and want to be able to have an easy and convenient way to read their e-mail, check their facebook page/twitter account, and also quickly read a magazine/newspaper.  This target audience also chooses to purchase a digital magazine subscription because they want a more personal and interactive experience with their favorite publications.  For example, the Elle magazine app that is available through the apple app store allows subscribers to upload their image to the app and then “try on” outfits that are featured in the magazine. The subscribers can also take their favorite looks from the magazine and create a style collage.  These unique and interactive features provide digital magazine subscribers with an experience that they cannot get from just reading a print version of  the magazine/newspaper and therefore, they are getting more value for their money.

Partnering with the apple app store is a very effective marketing technique for publishers. Ipad users are very familiar with the apple app store and they are more likely to purchase a digital subscription for a magazine if they are able to view the app and pay for the app in the same place that they buy all of their other apps. Ipad users feel that the app store gives them a sense of control and privacy, which means that consumers are more comfortable with purchasing a digital magazine subscription from the apple app store than from another less reputable website. From reading consumer reviews it is clear that having the option of purchasing a monthly or yearly magazine/newspaper subscription is very important to consumers.  Therefore, while some publishers may be unhappy about some of the apple app store subscription terms, ultimately, partnering with the apple app store is the only way for publishers to create a strong digital readership for their magazines/newspapers, which allows the publishers to continue to keep their advertisers happy, which then means that the publication is able to stay in business.

Sources:

http://www.apple.com/pr/library/2011/02/15appstore.html

http://www.theatlantic.com/technology/archive/2011/03/popular-science-finds-success-with-apples-app-store-subscriptions/73296/

http://itunes.apple.com/us/app/elle-us/id394838174?mt=8

Mobile phone market

This is an interesting article from USA Today about the droid and its expected growth in the smart phone market.

Apr 07, 2011

Study: Android will rule

 half of smartphone 

market by next year

By Stan Schroeder, Mashable

CAPTION

By Justin Sullivan, Getty Images

Following a similar recent prediction by IDC, market research firm Gartner has predicted big growth in the smartphone market in the next couple of years, with Symbian all but disappearing and Android leading the way.

This is where we get skeptical about predictions such as this one. Yes, based on Android's track record it's fairly safe to say that it will grow significantly in the next year or two, but we'd stop shy of saying that it will actually lose some of its projected market share three years later.

Symbian, now more or less abandoned by everyone, will lose a tremendous amount of market share in the next two years, ending with a meager 0.1% in 2015, Gartner predicts. Windows Phone 7, largely due to Microsoft's partnership with Nokia, is predicted to grow to 10.8% market share in 2012 and should further increase to 19.5% in 2015.

Apple's iOS is predicted to have a 17.2% market share in 2015, followed by BlackBerry with 11.1% and other platforms are predicted to have 3.3% market share.

Again — just like in IDC's prediction — this positions Windows Phone 7 as the number two platform on the smartphone market, and again, we think that this is a very bold prediction. A lot can go wrong with Microsoft and Nokia's partnership in the next couple of years, and Apple has been doing almost everything right when it comes to the iPhone and other iOS devices.