There’s a question we get all the time at Piano from clients launching new subscription services: “What conversion rate can I expect?”

The question presumes the number of subscribers a site will garner is a function of its total number of unique visitors each month. That may seem logical. Some portion of users in the top of the funnel will wind up in the bottom.

But those two numbers are more loosely correlated than one would think. It’s a bit like if you were opening an Italian restaurant in New York City and forecasting revenue by asking, “What percentage of New Yorkers will come to my restaurant every night?”

Sure, there are plenty of New Yorkers in the top of the restaurant funnel, but somehow, 80% of New York restaurants still fail within five years. Lasting restaurants use their relationships with customers to win rather than just assuming they will match a city-wide average. And the same is true with digital subscriptions: There are small sites with a lot of subscribers and big ones that have very few.

The trick, of course, is to be one of the top performers.

I want to dig deeply into our data around what makes subscription businesses succeed. What follows is an overview of some of the factors we see driving conversion.

Factor one: You learn about the market by being in the market.

It may seem obvious, but the leaders in digital media subscription — ranging from The Wall Street Journal, The Financial Times, and The New York Times to Netflix and Amazon — have been in the subscription business for more than 10 years. Those companies have gotten better over time. They hire more marketing people, they get better at connecting with their audiences, and they get tests under their belts to determine what does and doesn’t work for them.

The greatest correlation to success turns out to be time in market. And nine out of 10 Piano customers consistently do better and better at customer acquisition each quarter after launch.

Conversely, the inertia keeping some executives from launching subscription offerings (often years after they have been announced) merely keeps their companies from staring to build their subscription base and institutional knowledge. Deliberating too long about a subscription offering is indistinguishable from failure.

Factor two: Always understand your price curve.

The revenue curve goes up steeply as you charge higher prices, with each penny that doesn’t change your conversion rate falling directly to the bottom line. As you reach higher and higher price points, however, suddenly the price outweighs the demand, the curve falls sharply, and total revenue declines.

Too many publishers assume they’re just like another property in the market and match their low prices. Others price too high. Our philosophy is publishers should never guess, so we deploy several price testing methodologies to ensure the highest possible point on the revenue curve.

Factor three: Master the funnel.

On a user basis, the primary correlator to conversion and retention is the frequency of visits. But too few sites prioritise e-mail newsletter programmes that keep users coming back. And when was the last time you were on a site and were encouraged to return for content or an event later in the week?

Success in subscription isn’t just about making more subscribers — it’s about making more of the people who become subscribers. And it is only by understanding the content preferences, devices, dayparts, behaviours, and attitudes of the loyal audience that publishers become effective at growing their base.

So now that we’ve covered that conversion rate isn’t valuable as a simple, averaged number, your question is probably still, “OK, fine, but what conversion rate can I expect?”

But as the distribution between our client base’s best-performing sites and worst-performing sites is approximately 20X, we still don’t think it makes sense to say. Much like in our New York restaurant analogy, the real question is whether the relationship with the customer is strong.

There is a lot more we have to share, but we’re out of space for now, and the metaphorical waiters are clearing our plates. I’ll look forward to my conversations with you until next month. Feel free to reach out to me at feedback@piano.io.

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