Consumer Reports looks for paid member growth with new payment options

Consumer Reports has about 6 million paying members. To add new members and to grow revenue per person, the nonprofit membership organization in February introduced new membership tiers to retain existing members and free services to bring in new ones.

Now, Consumer Reports offers various membership options, from a free one that requires only an email address to an “All-Access” plan at $55 per year that includes an ability to chat with a reviewer.

“Free reviews and ratings, people leveraging social media, and asking friends and family — that, of course, is having an impact on our business,” said Kim Stehle, vp and chief marketing officer at Consumer Reports. “The competition has spurred us to create new digital products. It’s pushing us to innovate.”

People can still get free advice on the site for buying household products like gas grills and washing machines. The next level up is a free membership that requires people to sign up with their email, in exchange for online tools like a car recall tracker and personalized content.

The paid tiers start at $30, which gets people the print magazine plus the recall tracker and another tool that tells you how to set up your TV to get the best picture. (Consumer Reports’ older audience isn’t cutting the cord in droves, apparently.) A $35-per-year digital membership gets you those online tools plus detailed product ratings and reviews.

At the high end is the $55-a-year All Access plan that includes those benefits plus the print magazine and a personalized online chat service with people who can make product recommendations that are more detailed than what’s available on the site. One user was looking for a microwave oven that vented in the front rather than the back, and the reviewer was able to find one, for instance.

Stehle said eight weeks into the new membership tiers, results have been better than expected, with 111,000 new members signed up. She said 10,000 chats have been conducted since the service launched in February, lasting an average of 12 minutes each. Overall, the company forecasts 10 percent growth in paid members by mid 2020.

Diversifying the older, male-skewing readership was another goal, so the publisher has been producing more reviews aimed at women. In the past year, the readership has swung from being 56 percent male with an average age of 52, to 55 percent female with an average age of 49, she said.

Memberships provide the vast majority of its revenue, but Consumer Reports also is seeing significant revenue growth from a small but growing affiliate commerce business when people click to buy one of its recommended products. The publication is also seeing a lot of growth from one-off donations, which a handful of publishers like the Guardian have pursued. (Consumer Reports wouldn’t give a breakdown by revenue type.)

Publishers that are new to subscriptions and memberships have to shift to a reader-driven culture. Consumer Reports hired an eight-person team to conduct the online chats, but otherwise, since it’s always been driven by reader revenue, it’s mostly business as usual, as everyone from customer service to digital product development to content to product testing is focused on readership in some way.

Like other publishers, Consumer Reports is also focusing more on retaining members. To that end, it started sending weekly member emails that are personalized based on people’s behavior on the site. These emails go to about 65 percent of all 6 million paying members and have an open rate of 27 percent, Stehle said. The publisher is also engaging people with a test it promotes a few times a month to let people gauge their knowledge of products.

“One of the big lessons is, you do have to listen to consumers,” Stehle said. “The traditional model of just pushing out what you have — that’s not how consumers expect companies to work today. And you have to embrace the technology that’s available to interact with consumers. That chat concierge is successful because people do expect immediate gratification these days.”

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