Fostering Passionate, Curious Learners, by Subscription

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SubscriptionTrends-Green.png“To the red country and part of the gray country of Oklahoma, the last rains came gently, and they did not cut the scarred earth.”

Thus begins Grapes of Wrath, an oft-assigned classic of American Literature that has been challenging and confounding students for decades. Fortunately, there were CliffsNotes to help perplexed readers discern the symbols and themes that make the book a Pulitzer Prize-winning epic of human drama. A mainstay resource of high school and college students for decades, CliffsNotes has unfortunately faced some difficult years—its parent company, Houghton Mifflin Harcourt (HMH), recently reported a $28 million loss for the third quarter of 2016. But one need not fear for the future scholars of America, the subscription model may be the company’s salvation.

In August, HMH and digital learning platform BenchPrep announced that they have partnered to add a set of new digital features to the CliffsNotes study guide series. These new guides are subscription-based and include both web and mobile capabilities. According to the press release, “the CliffsNotes digital learning solution will deliver a compelling, personalized learning experience wrapped around best-in-class content … and redefine how millions of students engage with their favorite content.”

This isn’t HMH’s first subscription endeavor. Last October, they launched a subscription-based collection of games, videos and e-books for children, called Curious World, which earlier this year achieved one million downloads. Along with this impressive achievement, HMH reported total net sales of $392 million (an increase of $12 million year-over-year).

As noted in Subscription Insider, the success of Curious World likely influenced HMH’s decision to partner with a digital platform to make their offering more dynamic and customizable, with a subscription model to provide predictable, recurring revenue. Testing initially on a few popular subjects, evaluating the results, and then iterating based on those results—as HMH is doing with the new digital CliffsNotes— is a smart way to transition to a subscription model. As HMH President and CEO Linda K. Zecher said, “we remain confident about our growth strategy as we move into 2017 and beyond.” A growth strategy based on a subscription model has proven, time and time again, to be a good one.


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