The tiered content system is an approach that you see all over the business world, in multiple different industries. In order to better reach customers of different economic backgrounds, businesses can offer different versions of the same service. At the cheaper end, ads might be present or certain functions might be restricted. Meanwhile, on the other end of the spectrum, customers pay more but are given full access to the full swathe of features.
While this system might feel so ubiquitous, there are pros and cons to consider before implementing it in your own business – even if it just means that you put your own unique spin on it.
Pro – Accessing a Wider Audience
Of course, one of the main reasons that this is done is so that different audience members aren’t discriminated against. While you might have a pretty good idea of what kind of financial background you’re targeting with your audience based on the amount you charge for your services, you still likely don’t want that to be a limiting factor.
After all, you’re not trying to restrict the number of people who are coming to your brand, you’re just trying to present yourself in a certain way. It might be that you’re looking to be the cost-effective alternative, or you might want to appear as the premium, top-shelf option.
With the tiered content system, you can look to reach as many different people as possible. You might make it clear that the most expensive option is the intended way to experience your brand, but that doesn’t make the lower tiers any less valuable, simply an easier way of sampling what’s on offer. This doesn’t even have to solely be about how much people can afford, the lower tiers can be a way of ‘trying before buying’, so to speak.
Pro – Customizable Approach
When it comes to customizing how exactly this system works for your brand, you might have a lot more flexibility than you initially suspect. When you look at streaming services like Netflix, the method is normally done in a way where lower tiers might have less content and usually comes with adverts. Ads being an option tied to price here is valuable because it lets the customer decide how important that is to them.
This is something that you might decide to opt for when you’re considering API monetization, for instance, as it doesn’t restrict your audience’s ability to access the gateway, merely their ability to do so without ads. That being said, you could also employ a freemium approach here, where use is unrestricted up to a point, and then the premium features are locked behind that next tier.
If you follow this latter approach through to its conclusion, you might decide that your tiered system isn’t one of multiple paid options, but two binaries – pay or don’t pay. This means that people can still experience what your brand has to offer without paying, but the hindrances that they do encounter might encourage them to upgrade at one point.
Con – Enough Content to Tier?
While this might be a trend that you’re excited to jump on board with, it’s not something that will fit all businesses equally. Using the prior example of streaming services – that often works because of the sheer amount of content available through their libraries. If your brand is just starting up, you might not find that a tiered content makes any sense due to the different tiers not having enough to distinguish them from one another.
Why would a customer pay so much more when the benefits of doing so are unclear or unworthy?
Okay, you might decide that this is still just for the customer to decide. However, it could lead to a situation where you’re not getting as many subscribers on the higher tiers as you would like, or it might even result in a situation where people are viewing your brand less favorably due to the perception that you’re letting greed drive your decisions.
It could be worth waiting until your business is more established before you roll out this option, or you might think about whether that binary freemium option makes more sense.
Con – Competitor Comparisons
Another reason that you might feel compelled to jump on board with this system could be that you feel as though all of your competitors are doing it, meaning that you might lose out if you don’t. Again, even though you and your competitors share an industry, you are still two distinct brands with different circumstances to consider.
Your competitor might have naturally built up their content to a point where this was a natural evolution, or they could have introduced it in such a way that it felt as though it were less about the money and more about offering the customers a good deal. Even if two executions of the same plan look identical, there are subtle differences that can have a monumental impact on how they’re perceived – especially when you’re the one trailing your competitors.
That’s not to say that you shouldn’t do it, just that there are natural consequences to jumping on a trend. You have to be considered in your approach and looking too reactionary might in itself be something that reflects badly on your business and the integrity you have towards your audience.
The Lay of the Land
As always, with any business decision like this, there are no ways to apply a general ruling to your own brand. Your own circumstances will look a certain way that dictates whether or not this is the right approach for you. Even then, if the writing on the wall tells you that this isn’t a good idea, your own tiered content system might be able to turn itself around in such a way where it becomes advantageous. Alternatively, doing everything right doesn’t guarantee you a success, and either road means that you have to constantly be prepared to adapt to the shifting landscape around you.
