It’s official now; Meta Platforms, Inc. has started looking beyond ad dollars by taking a step closer to a subscription model. The company has made its first move today with the launch of Instagram Subscription.
Instagram Subscription service is a new way for creators to make more money. This feature was first spotted on the App Store in November. It is currently in early testing with a select group of U.S. creators. They will now be able to offer paid access to exclusive Instagram Live videos, Stories, and other content to their followers. Subscribers will be given a badge to help them stand out in the comments and creators’ inboxes.
Meta – formerly known as Facebook – is making every move with utmost precaution. The Instagram subscription model is currently in a very limited testing mode. Only 10 U.S. creators got access to the new feature at launch. Instagram views this as an “alpha” test that allows for feedback from creators and fans. It will continue to iterate on it.
The current list of alpha creators includes @alanchikinchow, actor and influencer; @sedona._ basketball player; @alizakelly astrologer; @kelseylynncook digital creator; @jordanchiles Olympic silver medalist; @jackjerry gymnast and creator; @bunnymichael spiritual coach and artist; @donalleniii XR creator; and @lonnieiiv digital creator
Creators have the option to set their price for exclusive content through the Subscriptions product. They are provided eight options to choose from. Prices range from $0.99 per month to $99.99 per month depending on the creator’s opinion of their content. Creators will start at the lowest price point, which is $0.99, $1.99, and $2.99 respectively. They may then move up to higher pricing, such as $19.99, $4.99, and $99.99 per month.
Subscribers will have early access to content that is only available to subscribers, such as Stories saved as Highlights. Because the audience is smaller, subscribers will be notified about exclusive broadcasts. This will allow them to interact more with creators who can share behind-the-scenes content, polls, and other specials in subscriber-only Stories.
Instagram has also added a feature for subscribers to stand out among followers. Purple subscriber badges will make fans stand out in public comments and help them to be identified in creators’ message request folders.
There had been reports that Instagram was creating technology to prevent creators’ exclusive content from being taken screenshots, but Instagram said that such technology is not available in the initial testing phase. Resharing content is against its terms. Creators are encouraged to report anyone who captures or records their content.
During the initial tests, there was no section dedicated to Subscriptions in the creators’ analytics dashboards. Creators will still be able to access their Subscriptions Settings to view their estimated earnings from subscriptions, total subscriptions, new subscribers, and cancellations. Instagram, as of now, doesn’t allow them to export subscriber lists or other data. However, it plans to develop tools that will allow creators to communicate with subscribers “off-platform”.
Instagram fans can sign up for a subscription by making traditional in-app purchases on both iOS and Android. Instagram has decided not to take a cut of creators’ revenue at this time.
Ashley Yuki, co-head of Product at Instagram, stated that “We are the same as all of Meta — we’re not taking any rev share until at least 2023. Our primary goal is to help creators make money…We are trying to think of all possible ways we can create monetization products wherever that’s possible.”
Instagram doesn’t just want to make it easier for creators to make a living. It is also trying to protect its platform from the threat of competition. This includes TikTok which has attracted more creators who want to reach a younger generation of Gen Z users. Other tech giants like Snapchat and YouTube have also tried to lure TikTok users by offering products/features similar to Instagram Reels – a clone of TikTok. Twitter launched its own creator platform with Super Follow, while many startups are developing services that will allow creators to track, consolidate and monetize their followers in new ways.
This space is reflective of the market’s size. The creator economy is estimated at just over $100 billion dollars and growing. Meta considers this a small investment to ensure a bigger share of the creator transaction pie in the future, even if Instagram and Facebook defer collecting their share for a year.
“One of the biggest differentiators here for creators and for fans is just the convenience of the fact that you actually know how to use all these things already. You’re already on Instagram. And we hear a lot [about] the friction of having to do the ‘click out.’ It might seem like a small thing. But in those moments, it can be the difference between having someone jump over your subscription or not,” explained Yuki. “The convenience of just having it all where the conversation and connection is already happening, we think is going to be one of the strongest points of this for both creators and for fans,” she said.
Meta is working in many ways to help creators monetize their reach and presence. Instagram Subscriptions is just one example of how Meta has been slowly but steadily moving closer to the Subscription model. Facebook changed the name of Facebook Fan Subscribers to “Subscriptions” last year. This allowed creators to access their subscribers’ email addresses. To promote their subscriptions, Facebook creators have the option to use personal links. Meta’s $1 Billion Bonus Program is available to creators on both Facebook and Instagram.
Facebook has, of course, started looking beyond ad dollars. In mid-June 2020, when reported about Facebook working on the Subscription model dig deep to understand what was Facebook up to with its subscription business, and if there is any potential in ‘premium’ business model that could be offered by Facebook in the future.
It is possible that Instagram Subscriptions and Facebook will merge in the future. Fans would be able to sign up via Facebook and Instagram if that happens. There would be no App Store commissions to pay. These subscriptions could also be transferred to the respective mobile applications. When Yuki was asked about the possibility she didn’t say much but didn’t discount the idea.