Digital subscriptions for online content have maybe just reached the tipping point. Free content, ad-funded business models are struggling, and traditional print publishers are now focussing on building a compelling digital subs proposition.
A growing number of publishers are refocussing their business model towards subscriptions. The New Yorker now has 65% of its revenues coming from readers, and paid circulation is growing at a rate of 12.3%. The Economist is now financially sustainable on subscriptions alone. BILD has grown from zero to over 300k digital subs in 8 years.
Digital subscriptions were a hot topic of conversation at the Digital Innovators Summit in Berlin, organised by FIPP and VDZ. I chaired a panel discussion on reader revenues and there were multiple presentations from European and North American publishers on their subscription strategy.
Why are readers now becoming more receptive to subs? The consensus is that the spread of services like Netflix and Spotify have accustomed people to making small monthly payments for digitally delivered content.
A reasonable benchmark for converting unique visitors to paid subscribers is around 3%, although niche markets can get closer to 9%, according to the FIPP Innovations report.
From all the presentations and debates I have picked out eight successful strategies that should help publishers power up their digital subscriptions:
1.Segmenting audiences and testing different offers and prices
It’s not surprising that since Jeff Bezos, founder of Amazon, acquired the Washington Post, he has put the emphasis on a culture of testing. But since they have almost tripled their online audience in the last four years and focussed increasingly on digital subscriptions, now standing at over 1 million, maybe we should all do more testing.
WashPo experiment with different price promotions, such as 4 weeks for $1, 12 weeks at 50% off etc.
The NY Times, another digital subs pioneer, with 2.5 million digital only subs, started with 20 articles free on its metered model, then reduced to just 10. They build on their loyal customer base by encouraging existing subscribers to share a free trial offer with 5 friends. They also test out different pricing levels for US and international subs.
BILD started out with six subs propositions, all at different prices, but have now streamlined to just two.
2. Bundling different services/products
When publishers have several related brands it is certainly worth exploring bundles to upsell subscribers to multiple products.
The New York Times include their digital crosswords and cooking publications in their digital subs bundle.
Subscribers to Dennis’s The Week can add in The Week Junior and/or Money Week for an additional charge.
Law.com offers an all access pass for briefings on key topics.
Longer term, perhaps there is a role for a Netflix style single subscription providing digital access to a wide range of content from different media brands.
3. Adding in experiences and services, developing a membership proposition
Increasingly, media brands are adding in experiences, events and services to digital content subscriptions, fostering a greater sense of community and membership among their audience. Here, consumer publishers are probably being led by specialist B2B media, who have long understood the value of peer networking.
German news weekly BILD offer their subscribers exclusive access to events and concerts, and also bundle content from partners such as Eurosport.
The Week curate a range of offers on books, wine and events that they know will appeal to their audience.
A number of European news media have learnt that services like commenting and sharing articles are highly valued and can be included in premium subs packages.
4. Reducing friction to subscribe
Again, no big surprise that the Washington Post is focussed on making it easy to become a paid digital subscriber. They include a single button to sign up for a $1 trial sub at the foot of articles; and provide mobile friendly payment options such as apple pay.
5. Testing dynamic and personalised paywalls
Metered models which allow readers access to a number of free articles before a subscription sign-up appears are increasingly popular, with The Economist using this as a core acquisition approach, and The Times recently introducing a softer free email registration to view a couple of articles.
The Wall Street Journal has gone a step further and introduced a flexible paywall that adapts the access level according to reader behaviour.
European publisher Schibsted also use dynamic paywalls and can reach 22% conversion of free web visitors to paying subscribers.
6. Tracking what content triggers subscription
As analytics become more sophisticated, some publishers are diving deeper into understanding the type of content that triggers a new subscription.
The Globe & Mail in Canada are tracking this, according to Nikolay Malyarov of PressReader.
And in Slovakia a digital news start-up DennikN built its whole business model around being able to track what content causes readers to subscribe. Their conclusion was that deeper, investigative articles of 6000 words performed best in generating new subscribers. Journalists are rewarded based on the subscription revenue generated by the articles they write.
7. Engaging mindfully with platforms
Platforms like Facebook, Google, Apple, Readly are useful for acquiring new subscribers, and Google is now being more open with publishers to support a subscription model, but the ultimate goal of subscriptions is a one to one direct relationship, so they need to be approached with care.
8. Establishing a subs-led organisation
Pivoting from a print subs and digital ad-led business model to a wholehearted focus on digital subscriptions means a big organisational and cultural shift. Stefan Betzold, MD of Digital for BILD, expressed it rather well: “It’s a marathon. I wish we had started 8 years ago not 5 years ago. We have hired in experts from different sectors, such as e-commerce, gaming and telecoms.” Stefan also emphasised that it was better to go ahead and start testing alternative subs models than spend too long debating them in theory. And editorial teams have to become comfortable with data and measures to understand the impact of their content on subs performance.
So it appears that there is a good deal more experimentation on subscription pricing models and different bundles and packages, tailoring propositions to different markets and streamlining the process from reader to paying customer. And reader analytics are helping publishers understand better what content is most likely to tempt users to sign up.
If you have the stamina, here’s the video recording of the panel discussion I chaired at Digital Innovators Summit with Dennis, BILD and RISJ. (30 mins)
This article is part of a series based on speakers and panels at the Digital Innovators Summit: you might also want to read:
Seven new digital business models for media owners
The new digital storytelling rules: how journalism is changing
How publishers should engage with social platforms
New thinking on digital subscriptions: 8 successful strategies
Five future tech trends that publishers need to watch
If you’d like to talk further about how to take the next step in your digital subscriptions journey, you’re welcome to get in touch to have a chat over the phone or over a coffee.
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About the author:
Carolyn Morgan has over twenty years experience launching, growing, buying and selling specialist media businesses across print, digital and live events. Carolyn now advises publishers large and small on their digital strategy and writes and speaks on digital publishing strategy.