What Paid Subscriptions tell us about the Future of Publishing
The coronavirus pandemic has impacted every sphere of life in most countries around the world. Medical and scientific information on its management, its impact on the economy and work, its cultural and social consequences…the ramifications are many.
There is widespread anxiety, exacerbated by the spreading of fake news through user-led channels like Whatsapp. There is also the fact that with lockdowns restricting movement outside the home, people simply have more time to read. Our need for authentic, detailed, reliable, up-to-date and timely content has never been greater.
All of this has given a boost to the publishing industry. Overall traffic to websites has gone up by as much as 50% compared to previous years—but readers are coming not just for coronavirus coverage. Even after keeping coronavirus coverage free and outside their paywall, Bloomberg got a record number of subscribers and The Atlantic saw its single biggest week of subscriber growth.
Photo by Martin Sanchez on Unsplash
The truth is that the publishing industry has been witnessing slow and steady changes even before the pandemic hit. Here are some of them.
Going beyond page views
In the early days of going the paid route, publishers relied on their content to attract readers, and put up paywalls to convert them into paid subscribers. Some followed a metered system that prompted readers with a message when they exceeded the number of free articles they could access for the month. Others had hard paywalls that would let readers access a few paragraphs of an article for free before nudging them to subscribe to read the rest.
Today, there’s a lot more experimentation happening with this model. The metrics tracked go beyond page views and measure reader engagement. The fundamental idea is to segment the audience based on their behaviour and show them tailored paywalls. For instance, someone who views more than five articles of a publication in a month is clearly a more engaged reader with a higher likelihood of converting to a paid subscription.
Matt Skibinski, reader revenue specialist at the Philadelphia-based Lenfest Institute, says that page views may drive advertising revenue, but engagement is a better measure of digital subscription success. It lets publishers make the right decisions about what kind of content to invest in and what kind of promotions and marketing to pursue.
Repeat visits is another interesting metric that indicates the likelihood of a reader subscribing. A study conducted by the American Press Institute (API) reveals that nearly 50% of paid subscribers had visited the publication’s website regularly for nearly a year before paying up.
Moving readers from free to paid
A typical promotional tactic of publishers is to offer free, full access to their content for a limited period of time. However, the old adage that you value what you pay for seems to be true. The same API study shows that less than 25% of free trial readers converted to paid subscribers. On the other hand, discounted subscription offers showed much better results, with more than 75% of discounted trial readers becoming paid subscribers.
This does not mean publishers need to resort to deep discounting. The Minnesota Star Tribune is a classic example of this. They offer an introductory deep-discount offer of 99 cents—but only for a month. After this period, the rate switches to full price. But the Star Tribune has a policy of not trying to woo canceling subscribers with further lower offers. Yet, with a paid digital subscription base of 90,000 and eyeing a goal of 150,000 by 2025, they are doing rather well for themselves.
Photo by Austin Distel on Unsplash
A number of publishers such as Huffington Post and the Guardian have successfully converted loyal readers into paying members through consistently appealing journalism and open requests to readers to support them. The Guardian posted an operating profit for the first time in twenty years, after launching its membership program last year.
Taking print & digital forward together
While many publishers have created pricing models that subtly encourage people to turn away from print to digital, there is merit in holding onto both print and digital for the foreseeable future.
For one, the appeal and the reader base for each is different. Digital has a younger, more educated reader base than print and according to API, they tend to value good coverage of specific topics and interesting content pieces more than print readers do. On the other hand, to the older demographic, the appeal of print newspapers is access to local news, the convenience of home delivery and plain old habit.
The Star Tribune, for example, encourages this behavior by having an affordable pricing model that does not turn readers from print to digital. This works well for their subscribers, many of whom opt for digital, yet subscribe to the print edition of the Sunday paper.
Reader analytics for advertisers
Traditionally, publishers have made money mainly from advertising. The mantra seems to have been: create great content, attract readers, charge advertisers to advertise to them based on page views. For over a decade though, advertising revenues have declined and this has prompted publishers to think of ways to show more value.
Swedish magazine aggregator Readly, hailed as Europe’s fastest growing subscription service, is a good example of this. Through a single app, they give readers access to 5000+ national and international magazines and saw 83 million reads in 2019. One of Readly’s biggest attractions for advertisers is that they share deep metrics on reader behaviour with them. Says CEO Maria Hedengren, “We have a wide range of data on reader behaviour such as what they read, when they read or how long they read for – which is shared with publishers. The 25 billion data points that Readly has enables publishers to [be] data-driven, adapt their content in both print and digital, optimise magazine ads, and develop their insight-based digital strategy.”
Individual creators and the passion economy
Though a good part of publishing comprises news and media companies, there is also a rise in individual content creators. A decade ago, the only avenues available to individual creators were blogs and video sharing platforms where they were dependent on advertising revenues based on content views.
Today, there is a silent revolution happening in this space: to not only allow creators to share exclusive content and engage with fans/subscribers, but also get paid or sponsored by them. Substack, a fast-growing blog/video/podcast platform has 100,000+ paid subscribers and their top writers make more than $160,000 each. Patreon, a creator sponsorship platform has over 4 million paying patrons and gave its creators payouts of $1 billion last year. After the coronavirus lockdown started, Patreon has seen a jump of 30,000 new sign-ups in the first few weeks of March alone.
With macro-level changes in reader behaviour, improved analytics, opening up of newer models of content creation, experimenting with pricing models, and new revenue streams, the future of subscription-based publishing is rife with possibilities.
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