By Tarmo van de Goot, VP EMEA, Chargebee
The last 20 years have seen a plethora of publications that were unable to make the shift from physical sales to online publishing, with unfortunate results. But even those that did transition their content online faced new challenges, such as how to monetise their content. Many sought to rectify this through ads or paywalls, and for some time, it seemed as if an ad-based approach was the logical next step towards reviving fortunes.
However, consumers are notoriously good at finding ways of circumventing ads, whether that’s through ad-blocking tools or voting with their fingertips. The result is stark: according to PwC, global newspaper ad revenue is expected to decline from $49.2 billion in 2019 to $36 billion by 2024. Without a new approach, publishers are facing a tough road ahead.
Recognising the need for alternatives to ads, savvy publishers have gone a step further, building paywalls to keep the revenue flowing in. However, now that consumers are accustomed to accessing content for free, they are highly resistant to paying for it.
So, what are the great publisher success stories, and how can other such businesses thrive moving forward?
Monetise. Retain. Grow.
If a paywall or subscription model is your preferred method as a publisher, the three key words to focus on are: monetise, retain, grow. These three steps mean not just targeting one-off purchases or short-lived wins here and there, but actively convincing readers to sign up to a service you provide, before keeping them hooked and then turning your eye to enticing even more readers to subscribe. Although controversial at first, the New York Times’s move to paid digital subscriptions led to operating profits jumping 28% and a doubling of its revenues after going subscription-led.
Monetise – get pricing right
One of the factors which determines whether you can entice and retain readers comes fundamentally down to your price point, and while it might seem daunting to predict what that correct price is, it isn’t a matter of the right guess. Experimentation is key to determining what readers would be willing to spend to access content, and this matters, because readers are price-sensitive and well aware of the comparative price of the paywalls being erected around them.
Retain – take heed of subscriber fatigue
Consumers are experiencing what could be termed ‘subscriber fatigue’, as they might already subscribe to a number of services, some of which they’ve completely forgotten about, making it harder to persuade more to sign up to a new subscription. Scaling in the newspaper industry is especially hard in the UK market, as big publications such as the Times, the Guardian and the Telegraph have the highest readerships, giving them the visibility needed to attract the bulk of willing subscribers in the market. This leaves thousands of smaller publications scrambling to win over the remaining minority of readers looking for something engaging to subscribe to.
How do publishers overcome this fatigue consumers may be feeling, and grab a slice of that marketing share before it’s snapped up by someone else? Not only does there need to be experimentation with price, but publishers need to think long and hard about what content they give away for free and what they prioritise as exclusive. It’s not a one-size-fits-all game at all, with ideas to consider including a metered approach, with access limited to only so many articles per week, or a premium model, limiting access to so many articles on a daily basis.
A dynamic pricing model is yet another idea: ascertaining the most popular articles and placing them behind the paywall, while ensuring low-traffic content remains available to anyone for free. This way, you lure readers with the prospect of juicier content, but only if they make that leap to sign up.
Grow – stay for the long haul
Adopting a subscription model should change how you view customers, as not just the means to secure revenue right now, but valued users who you should aim to build a strong long-term relationship with. What enticements can you offer consumers to reward them for their custom? The offer of a free device (e.g. an e-book) as a reward for loyalty as a subscriber could go a long way, or even the offer of vouchers.
You can’t expect to retain or attract fresh readers to sign up to your service if the user experience is full of glitches, such as the inability to access content when switching between devices, or worse still, the platform fails to offer something they are actively looking for.
If you get a sense that users are wavering or considering cancelling subscriptions altogether, it pays to win them back. A win-back campaign, executed through carefully-composed automated emails, for example could do much to reduce those churn rates, as customers might think twice about jumping ship.
Going down the path of a subscription model through paywalls can be a phenomenal success, but its implementation needs to be fine-tuned. The user experience must spot-on, and you have to have an offering behind the paywall that people will actually pay to keep coming back to.