Common Craft, probably the best-known creators of cartoons to explain the Internet ("In Plain English"), have adopted a number of different business models over the years - including producing demonstration videos for some of the biggest companies on the Web (like Google, LinkedIn, MeetUp).
Three years ago, we wrote here about how the two person team quit doing client work and moved into a model based entirely on licensing rights to the educational videos they produced. Their videos were available for free online, but corporate customers happily pay to have the rights to show the content to their employees. This week, Common Craft changed models again. From an iTunes model to a Rhapsody model, co-founder Lee LeFever says. Customers will now buy subscriptions and have access to all the videos Common Craft produces. It's an interesting twist in a story that any independent content producer online could find inspiring.
"We are a two person company and don't plan to have an HR department," Lee LeFever told me. "Because we do everything related to the business, we can't devote all our attention to production. However, we're confident that we can publish at least one video a month over the long term. But in terms of our business capacity, we've designed Common Craft to scale such that [co-founder] Sachi [LeFever] and I can remain the only employees as the membership grows."
The new pricing model offers subscriptions ranging from $159 per year up to $5000 per year for large business customers.
I asked LeFever a few questions about the change.
Marshall: Are you changing models because the old model didn't work well enough?
Lee: Like a lot of what we do, the new model is a reflection of the feedback we heard from customers. We used to license the videos one-by-one via digital downloads, iTunes style. Our customers started to ask for access to the entire library for one price and we thought that made a lot of sense. So we created a subscription model that does just that.
Marshall: What % of your viewership is mobile & why is that such a big part of the offering?
Lee: In our case, mobile is part of an overall strategy to make our videos available when and where they are needed. For example, part of our target market is educators, and iPads and other mobile devices are becoming a bigger part of classrooms and teaching in general. We believe this trend will increase, and we want our members to see that we're a step ahead. This goes for our website, too. It's designed to work on small screens, because that's how more and more people will access it in the future.
Marshall: What advice can you offer other content producers wrestling with these kinds of business model options?
Lee: We've always believed that people will gladly pay for content that helps them solve a problem. That's what our videos do - they're useful to professionals. But that's not enough. We're in a unique position because we've spent years developing our video library and brand. I don't think we could have pulled off a subscription service as well in the past, but today we have the library and brand recognition to make it work.
My advice is this: develop your brand and make it visible in everything you do. Also, make creating your own intellectual property your 20% project. Build a library or database of work you own and look for ways to make it a product. It may take a while, but it can pay off in the form of scalable, sustainable business models.