Now that the world has been living with the Covid-19 pandemic for a little over a year, the media industry is reflecting on the events of the past 12 months and the impact the public health crisis has had on publishers large and small. While the advertising side of nearly every media business took a hit in 2020, subscription revenue streams have emerged as the good news story amidst the chaos of the pandemic.
Publishing executives surveyed in our recent Adweek report, Combining Revenue Models Gaining Traction in Media Industry, expect that subscriptions will account for 32% of their revenue within the next year—up from 28% currently. In this article, we’ll explore some recent subscription success stories and share a few thoughts on the future of this revenue model.
4 publishers finding success with subscriptions
Many media organizations have seen the positive impact of subscriptions on their bottom lines in recent months, and have found creative ways to grow their subscriber bases.
To increase its subscriptions, this New York-based digital publication partnered with American Express in late 2020 to target credit cardholders with a special offer. Business Insider ponied up free trials of 6 or 12 months to its publication—an ideal fit for American Express’ customer base of small- and medium-sized business owners.
This daily newspaper headquartered in (you guessed it) Paris grew its digital subscriptions by double last year after gating its highest quality content behind a paywall. This move, in addition to a price hike from 5 to 10 euros per month, enabled the publication to double its subscription revenue in 2020. Le Parisien cited data as the main driver behind this strategy, allowing the newspaper to understand which stories resonate most with readers.
“All journalists at Le Parisien have access to dashboards that show how stories are performing with premium subscribers in real-time,” according to this article by What’s New In Publishing.
Despite The New York Times predicting a 55% decrease in advertising revenue in 2020, other areas of the publication such as NYT Cooking have been thriving. NYT Cooking has amassed 600,000 subscribers, and its newsletter subscriber base is now the second-largest among all of The Times’ newsletters. Part of the publication’s success is due to knowing its target audience well and responding to their needs.
“We’re thinking about how the product can move beyond being a recipe database, and really be with you throughout your entire cooking journey, because we know we have a group of users who are really, really passionate about food—and we want to be the answer to that passion,” Amanda Rottier, general manager and vice-president of NYT Cooking, told The Drum.
U.K. publisher The Guardian’s subscription model has also made great strides over the past year, boosting its digital subscriber base by 43%, which equates to gaining a new subscriber every two minutes. This is especially impressive considering that The Guardian had a mere 12,000 members in 2016 and gained over 250,000 in 2020 alone.
Where to focus your efforts going forward
You don’t need to be a household name in the media industry to build a successful subscription model for your business. Here are a few areas you can focus on as a publisher to grow and maintain your subscriber base in 2021 and beyond.
- Customer data
Gone are the days that publishers had to struggle with legacy data management platforms (DMPs) and their inability to communicate with other systems to share customer data and inform business decisions. New solutions such as Lineup Systems’ Amplio subscription management platform enable media companies to create in-depth customer profiles by communicating with DMPs and leveraging advertising data.
- Product knowledge
Not only do publishers need to know their customers well—they need to know their products well, and support of this fact is growing within the sector. In 2020, the News Product Alliance launched “to empower news product professionals and bolster our industry’s focus on product strategy.” This is a welcome initiative, considering that 93% of media executives believe the product manager role is integral to digital innovation.
- Strategic paywalls
Understanding how to structure your paywall to generate subscription revenue is essential to success with this business model. You can take various approaches to create a paywall that prioritizes your highest quality content for your most loyal audience members. This strategy enables you to focus on solid storytelling rather than chasing down advertising revenue. Most importantly, this approach builds trust with your audience.
- Subscriber engagement
As a publisher, you must fine-tune your subscription funnel to keep your audience engaged and reduce customer churn (subscription lapses or cancellations). Rather than implementing a traditional sales funnel, think of your subscription funnel as an engagement loop. You must nurture your customers consistently so they stay within the loop, helping your media company generate recurring revenue.
Bolster your subscription business
While it’s safe to say subscriptions are having their moment in the spotlight, it remains true that almost 40% of subscribers cancel in less than 90 days, so publishers can’t afford to become complacent with this revenue stream. An intelligent technology solution like the Amplio subscription management platform can help you strengthen your subscription business.