The Network Model

Subscription Models – The Network Model

In our line of articles about subscription models, the time has come to the Network Model. Using the Network Model, the value of the subscription goes up, the more people that subscribe to your product or service. Your product or service simply becomes more valuable when its popularity increases. By promoting your product, your subscribers will optimize their subscription and this is beneficiary for you in creating engagement.  
An example of the network model:
You can explain The Network Model very easily using a product as simple as the good old telephone. Before everyone started using the phone as a tool that connects, there were only a few people having a phone – which means, only a few people to call. As more people started investing in telephones the product became more valuable for everyone. In other words, the people that used the telephone, was interested in more people using it. A more contemporary example of the Network Model subscription is gaming services or other similar services. The more people that join, the better. An example could be the message platform, WhatsApp. This is a service, where you pay a low amount of money a year to have free and unlimited messages to send. The subscription is very cheap because it uses the internet to send the messages. Another example is the World of Warcraft multi-user video game or any other video game where you play against other users. It is necessary that your friends join you in cyber-universe, before its any fun for you to play.  
Who should use this kind of subscription model?
This kind of subscription model should be considered by subscription businesses that
  • If you have a product or service where the utility goes up, the more people that subscribe.
  • Have a product or service that addresses socially connected customers, interested in a larger network.
  • Or if your product or service provides the opportunity to be shared. You need to have a product or service that provides a certain “feeling” with your customers, so they want to share it.
 
What to ‘keep in mind’ when using this subscription model…
With this model, it becomes vital that your subscribers have the opportunity to build a network and a society using your product. Your job is to attract these subscribers. Especially, if you have limited resources and decide to use this model, you should focus on defining a smaller defined group of so-called “early adopters” who are vested in sharing your product or service to build density within that market. This model will probably work best for companies with a larger capital and/or experience with the entrepreneurial business.