Readbug is the Spotify or Netflix for magazines, delivering unlimited newsstand content for a low monthly subscription fee.
Readbug will be available to download via app stores and will give users access to the whole newsstand - rich, premium content delivered straight to their tablet or mobile device, enabling them to read, share and archive magazines seamlessly and immediately all from one app.
We believe that Readbug will change the way digital magazines are consumed, driving deeper user engagement with both editorial and advertising, creating greater perceived consumer value for money and generating new revenue for the publisher.
The magazines you love, in one amazing app.
Readbug - get the bug.
Firstly, publishers have adopted an “analogue” method for selling digital magazines by charging printed magazine cover prices for individual purchases.
Secondly, discoverability of new content is problematic. Magazines are hidden behind cover prices, and buried within container apps that are themselves buried within a newsstand or app store.
For this reason the current newsstand platform diverts many consumers away from digital purchases.
Readbug disrupts this by removing the barrier of a cover price, providing a value for money solution through a simple and seamless platform.
Once subscribed, users would have access to a library of diverse content customised to their own interests and reading habits, discovering magazines and articles that are of interest to them and that they may not traditionally have paid for or read. All for the same price as a couple of magazines.
Features will include:
- What’s new - the latest and best of the newsstand
- Trending - what other people are reading
- “You might like” - suggested reading based on user habits
- Push features / notifications - based on user interests
- Social media linking of reading habits.
This new digital magazine ecosystem would create a much deeper level of reader engagement and interaction than the current newsstand model allows, tapping into user habits and social media virality, and shifting the focus from the cover price to the quality of the content contained within the magazine.
Substantial accomplishments to date
Over the course of a six month first round seed stage we have invested £22,000 of cash, time and other resources into Readbug, working with senior and established business people at the highest levels of the publishing industry. We have conducted an extensive feasibility and viability study and analysis of competition globally as well as building relationships with key publishing and development partners.
Key achievements include:
- Design and wire framing of interface and working prototype.
- Partnering with an established app development company.
- Incorporation and applications made for trademarks.
- Development of branding and identity, including consumer market research.
- Acquisition of the .co.uk and .com domain names.
- Face to face meetings with leading publishers.
With our experience in the publishing industry we have witnessed first-hand the shifting tide in consumer habits and the move from print to digital formats.
We believe that, in conjunction with growing the potential revenue available from £36 per person per annum to £120 through the Readbug subscription model, there is also potential for rapid growth of the digital magazine consumer base on the back of increased tablet and smartphone adoption. We aim to capitalise on this digital growth by delivering exceptional value, unlimited content and unbeatable convenience.
We plan to offer a two tier subscription service for accessing the magazine newsstand with a feature dependent pricing structure, similar to the business model used by Spotify and Netflix. This should generate a recurring monthly revenue stream.
The pricing structure is expected to be as follows:
- £6.99 per month
- access to all current issues.
Back issues will be available to purchase as digital downloads at standard cover price.
- £9.99 per month
- unlimited access to all current and back issue content.
Growth areas would include the potential addition of magazines available to read through a free subscription tier that will be paid for through targeted advertising, as well as the potential addition of targeted advertising to the other subscription tiers to supplement revenues.
Use of proceeds
Readbug intends to use the proceeds of this round as follows over the next 3 months:
- 60% 12 week platform and backend development
- 20% marketing and social drive
- 10% legal and professional fees
- 10% team development
During this 3 months, time will also be spent expanding the team. We are in the process of discussions with potential co-founders and/or technical employees.
At the end of the 3 months, we plan to go for another round of funding to provide us with a 12 month operational runway.
Ultimately Readbug is aimed at everyone, however during the launch stage the platform will be targeted for and used by early tech adopters - working professionals who enjoy premium content.
They will have had subscriptions to print magazines in the past but will have failed to make the leap to digital magazines due to the analogue price point and lack of perceived value for money.
In addition they will have some form of online entertainment subscription like Netflix or Spotify and will be interested in web trends and new technology. They will have a tablet device and/or a smartphone and enjoy rich, immediate content.
By targeting this market we will be able to focus our marketing budget and efforts and tap into cost effective marketing channels like social media and digital advertising.
Launch stage / targeted demographic:
Gender: Male and Female
Age Range: 18 to 45
Geographic Location: UK wide
Occupation: Working Professional, Student
Social Class: C1 to A (supervisory or clerical and junior managerial, administrative or professional to higher managerial, administrative or professional)
Marital Status: Single, cohabiting and married
As the business grows we expect the target market and age range to broaden out and diversify.
Characteristics of target market
The consumer magazine market is worth £2.8bn per annum in the UK and £50.2bn worldwide.
In 2012, digital revenue accounted for just 6% of total magazine revenue but will reach 16% by 2017 on the back of increased smartphone and tablet adoption.
Twenty million people in the UK now use a tablet device on a regular basis and this is set to grow to 34.8 million by 2017, or over 50% of the UK population.
To complement this growth in tablet read time we believe that consumer trends will see a shifting focus of user engagement from short reads through web-scraper services like Flipboard, to longer and deeper engagement with curated and content rich digital magazines.
We believe that Readbug will be ideally placed to capitalise on this shift through our "all you can eat" subscription model.
Our strategy will focus the initial marketing budget on a broad spectrum of channels specifically targeting the "early tech adopter" through platforms they currently engage with.
This will include SEO, Spotify Ads, Facebook Ads, YouTube, and Google Ad campaigns. We will also tap into all areas of social media including Facebook and Twitter campaigns to generate interest and build momentum.
In addition we will engage with consumer, tech and interest blogs as well as media and news websites, using press releases and editorial to drive and build our brand exposure. The above channels will be the most cost effective way to maximise impact as well as ensuring we are focusing our strategy on our key launch phase demographic.
As the platform grows we will look to target a broader market through traditional advertising means where viable, including printed / digital signage, with a new marketing drive and increased budget scheduled for Q1 2015. Our geographical focus will be on cities and areas of dense population to gain as much exposure as possible.
Having conducted an extensive global competition and SWOT analysis we have set out a clear strategy against competitors: Firstly, we believe it is key that we move through a fast development stage and release to market in order to grab and secure a dominant market share.
Our main competitive edge will be a perceived value for money concept with a clean, easy to use platform that encourages the user to pick up their tablet or mobile device and engage with great quality content. This will be through a combination of price point, features and functionality, and attractive interface design.
We anticipate that direct competition from bigger players like Apple Newsstand or Zinio would be limited through fear of cannibalising their current revenue streams. However, we realise that as consumer habits change so can existing businesses.
This is why we believe that for Readbug to be successful against potential competitors it will be vital for a continuous process of feature and platform development to ensure we provide the cutting edge in user experience, design, content engagement and perceived value.