Conversion Rates For Online Paid Subscription Services

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WEBSITE Conversion Rates For Online Paid Subscription Services

In the US, the average website conversion rate of visitors from advertising platforms are Google (8.2%); Bing (7.6%); Facebook (4.7%); Instagram (3.1%); Pinterest (2.9%); Twitter (0.9%); Snapchat (0.6%); and YouTube (0.5%) in 2018. Using this data, we estimated the average website conversion rate in the United States at 3.56%. Also, research by Invespcro showed that the average website conversion rate in the US e-commerce sector was 2.63% in Q2 2018, down from 3.60% in Q4 2014. Unfortunately, no report in the public domain revealed the website conversion rate specific to online paid subscription services in the US. Publicly available info pertinent to this industry showed that 80% of companies in the online paid subscription service sector offer free trials and that 93% of their free trial customers go on to convert into paid subscribers. However, there is no information in the public domain showing the percentage of this conversion on their websites.

Helpful research findings

Website Conversion Rate in the US

  • Using Forbes' website conversion rate data, we calculated the average website conversion rate in the US at 3.56% across all channels (see research strategy).
  • In the US e-commerce sector, website conversion rate went down from 3.6% to 2.63% between Q1 2014 and Q2 2018, respectively, according to a report by Invespcro.
  • In Q2 2018, Invespcro's study revealed that desktop computers and mobile devices had website conversion rates of 3.83% and 2.03% in the US e-commerce sector, respectively.

Findings Relevant to US Online Paid Subscription Conversion

  • According to a report by CNET, over a fourth of broadband households in the US try at least one online video through a free trial.
  • Out of all the people that sign up for an online paid subscription service free trial in the United States, 47% of them convert and subscribe to at least one service at the expiration of their free trial period.
  • In the US, 80% of online paid subscription services offer free trials of their services
  • 93% of people in the US who try the free version of online paid subscription services by the most significant players including Netflix, Hulu, and others go on to become paid subscribers.

Research Strategy:

To identify the website conversion rate of online paid subscription services in the US, we started by researching industry reports, studies, and relevant data insights into the website conversion rate of different industries in the US. This investigation produced reports by Smart Insights, CNET, Invespcro, and others. Unfortunately, none of these reports provided information specific to the website conversion rate of online paid subscription services in the US. Publicly available information only revealed the website conversion rate from the most significant advertising platforms in the US, as well as the website conversion rate for the US e-commerce industry.

Therefore, we proceeded to research relevant media and advertising directories including Forbes, PYMNTS, Park Associates, and others. Again, reports by these directories did not provide any information relevant to the website conversion rate of online paid subscription services in the US. Information available in the public domain by these portals only observed that most online paid subscription services converted customers into paid subscribers by offering a free trial of their services. Also, there was no information regarding the website conversion rate of when these subscribers visit the websites of these portals for the first time, neither was there any info on how many of them convert when visiting the website to convert from free trials to paid subscriptions.

Next, we narrowed the research to the most significant online paid subscription services in the US including Netflix, Hulu, Amazon Prime TV, YouTube TV, and others with the hope to locate information relevant to their respective website conversion rates. Still, we did not find any report with insights into the website conversion rate of these online paid subscription services in the US. Although this research yielded a report Bluesnap, which compared the websites of Netflix and Hulu, as well as another report by Comparitech that delved deep into the countries that pay the most for Netflix subscription, there was no information regarding the website conversion of these online paid subscription services in the public domain. We also investigated the websites of Netflix, Hulu, Amazon Prime TV, and other services. Again, there was no report revealing their website conversion rate.

Hence, due to the lack of information in the public domain pertinent to the website conversion rate of online paid subscription services in the US, we estimated the website conversion rate for visitors reaching websites in the US from advertising portals as a proxy for the required information, as follows:
Website conversion from advertising platforms in the US = Google (8.2%); Bing (7.6%); Facebook (4.7%); Instagram (3.1%); Pinterest (2.9%); Twitter (0.9%); Snapchat (0.6%); and YouTube (0.5%)
Average website conversion rate = [(8.2+7.6+4.7+3.1+2.9+0.9+0.6+0.5)/8] = 3.56%.






Sources
Sources

Quotes
  • "Services, such as Hulu, Netflix and live-TV streamers like Sling TV, often offer a free period, one of the consumer-friendly patterns that have become standard for online video competitors -- and have made it easier for people get a sense of life as a cord-cutter. "
  • "Almost one out of three people who use a free trial to try out a streaming video service end up subscribing, researcher Parks Associates said Monday."
  • "According to Parks, more than a fourth of US broadband households tried out at least one online video service in the last six months with a free trial. Of these, 47 percent subscribed to at least one trial service after the free period expired."