Introduction

About Medium

Medium is an American online publishing platform for bloggers, professional and citizen journalists, thought leaders, and academics. It provide ready-built theme, huge audience, and high domain authority score to the amateur to professional bloggers through their partner program. It's privately held company stared by Evan Williams who also happened to be co-founder of Twitter. Twitter has 140-character limit, and Medium was created so that the platform doesn't have 140-character limit for bloggers and story writers.

Medium is the internet’s encyclopedia of expertise. Read millions of long-form stories from insiders and thought leaders, deepen your knowledge of the subjects that matter most to you, and harness the power of the written word to spark new ideas, answer big questions, and fuel bold ambitions.

Explore millions of ad-free stories from a global community of expert writers and independent voices.

💪🏽 Core Value Proposition:

❇️ Write and Read stories from thought leaders and amateur writers

Other advantages:

❇️ Build Your Personal Brand by Blogging without owning a site

❇️ Explore millions of ad-free stories from global community of experts and independent voices

❇️ Highlight passages, bookmark stories, and create lists to build personal knowledge base

❇️ Follow favourite writers/publications, and get personalized recommendations based on the interest

❇️ Connect with writers and readers, clap for stories you love, engage in comment

❇️ Listen to audio version of any stories

❇️ Distraction free reading of quality content

❇️ Light mode and Dark Mode support

❇️ Access from any device

✅ Facts and Numbers

Litmus Test

1️⃣ Retention

Let's understand retention by some metrics as follows:

I don't have data to build the Retention cohort graph, but I am assuming that, medium has a decent smile graph, since, the founder is claiming that by 2024, medium would become profitable.

The graph is shown for illustration only, it is not accurate.

2️⃣ Deeper Engagement

Based on user interviews, it's identified that most of the users are casual users, and core users. But, Core and Power user comprises of most of the user. Hence, it shows a good sign.

3️⃣ Willingness to Pay

Focused Group Survey Result

Rank Features

💡 Users were given $10 to associate to each features, to identify most valued features

Substitute Pricing

Following are 3 signals to arrive at pricing:

Core Problems solved by Medium?

❇️ No need to create your own blogging website

❇️ No need to find Audience for blogs

❇️ Write anytime, anywhere, from any device

❇️ Create your personal brand by blogging

❇️ Spread content to large audience base

❇️ Very user friendly

❇️ No content formatting hassle

❇️ Monetization opportunity from day 1

❇️ High quality content gets better rewards; pays bloggers based on average time reader spends on the article

❇️ Bloggers own the content

What are alternatives to fulfill the use case?

Validating what users are buying into

1️⃣ Users are subscribing Medium due to easy to write and to read stories from anywhere, anytime

2️⃣ Medium offers monetization opportunity to thought leaders and amateur writers

3️⃣ Writers often spends most time in formatting and beautifying content; while Medium saves lot of time of writers and let them focus on writing more instead of wasting time on formatting

4️⃣ Charges fairly low $5 a month to $50 a year; which is 1 Starbucks coffee a month

5️⃣ Medium's recommendation engine is so smart that user's don't even need to search; it keeps user engaged with stories one after another

Monetization Framework

1️⃣ Who do you charge?

1. 1. RFM Grid: [Recency, Frequency, Monetary]

Medium targets Champions, Loyalist and Potential Loyalist to become a subscribers since, they are accessing the platform and these users are looking to read more stories, and they are perfect fit to become a paid subscribers.

Research shows that, Medium has more of potential loyalist and Loyalist, and they have more users at risk and hibernating, which completely aligns with Medium's recent growth in last 2 years, where CEO has claimed they have more churn and they revisited onboarding flow recently.

Medium should target New customers up front to move them to Potential Loyalist and further.

2️⃣ When to charge?

Perceived value for Medium is increasing productivity for ICP-2 writers; hence perceived value for Medium is Efficiency and Money (Save money and earn money). For ICP-1 Reader, it's when they read a complete story, and learn skills and improve their knowledge, which in turn goes towards increasing efficiency.

📕 ICP-1 [Reader]: When a user has completed reading story, receives perceived value, and attempts to access the member-only stories, that's the time we should bring pricing page and that's the time Medium should charge users. When user reaches the threshold of reading stories, and can't access more stories, that's the time Medium should expose pricing page and convert the user into paid subscriber.

✍🏻 ICP-2 [Writer]: When user writes their first blog and enjoys the core value proposition of Medium, it should be leveraged to charge them.

In the below mentioned scenarios, Medium should consider charging users and convert them to subscribers:

✅ When user tries to engage with Member-only contents frequently

✅ When user engages with pricing page couple of times, well timed prompt could lead to subscription

✅ Frequent user interaction with Medium

3️⃣ What to charge them for?

⛔️ Access by Time: Based on the framework, and Medium pricing page, it's clearly charges it's user for Access by time [Monthly/Yearly], it has nothing to do with output, share-ability. However, medium pays writer based on the time spent by readers on their blogs.

By default, reader can access just a few stories, but to continue reading and getting access to member only stories, Medium is charging Power User or Core Users. That's a right strategy. ✅

4️⃣ How much to charge?

Based on above conclusion;

❇️ For ICP-1 [Reader] -> $5 USD/ Month or $50 USD/ Year; seems reasonable due to low perceived value.

❇️ For ICP-2 [Writer] -> $5 USD/ Month or $50 USD/ Year; seems to low for Writer, since Perceived value is much higher, while perceived price is relatively too low.

5️⃣ How to show pricing?

Here, it clearly shows that the 68% writers earns from the platform back in 2019 when Medium introduces partner program. This should have been even higher by now.

Also, more than 8% earns more than $100 a month from the platform. Hence, to support my observation, Medium can charge Writer users more.

New Pricing Plan:

This can really help Medium growth, eventually lead to more earnings to Writers, that will increase popularity of Medium in writers community.

Reference:

[1] https://medium.com/illumination/medium-statistic-2023-writers-earning-valuation-and-traffic-data-31d6c7a4be1#:~:text=11.,they%20hit%20725%2C000%20paid%20subscribers.

[2] https://thesmallbusinessblog.net/medium-statistics/