Publishers worldwide are working to bolster their media organizations’ bottom lines by establishing multiple revenue streams. It’s clear that relying solely on advertising dollars is a risky move in today’s economic climate, especially as the Covid-19 pandemic continues to affect numerous industries, tightening the purse strings on many companies’ marketing budgets.
Research shows that 56% of publishers are unsure how to reconcile what they see as conflicting revenue strategies. Fortunately though, media revenue diversification doesn’t have to mean abandoning your proven business model entirely; it simply requires a shift.
Here, we’ll discuss how to create harmony between advertising and subscription models, as well as print and digital strategies, to position your business to weather lulls in advertising sales.
Advertising and subscription model alignment
When it comes to generating revenue for your media organization, you don’t have to put all of your eggs in one basket. Combined revenue models have been making headlines repeatedly over the past year—and for good reason. Success stories like The New York Times gaining 1 million subscribers between January and May of 2020 are hard to ignore.
Over 70% of publishers say they’re planning to create new products or revenue streams as a result of the pandemic, and many are looking at subscriptions as the way forward.
Subscriptions offer benefits to media companies, audiences, and advertisers, making this business model an extremely attractive option for media revenue diversification. Here’s how those perks typically play out:
- Publishers get an opportunity to build (and monetize) relationships with their audiences by offering personalized ways to engage with their content.
- Audiences get to decide which content they’re willing to pay for, ensuring they have access to more of what they love to read, listen to, or watch.
- Advertisers get better offerings from publishers thanks to the first-party data that those media companies can now leverage from their subscriber databases to build advertising packages and optimize targeting.
Building brand trust
The era of disinformation has reached a fever pitch within society. It may not seem obvious, but subscription offerings can become part of the solution to this grave problem.
Subscriber data goes beyond simply enabling publishers to create content that their audiences find interesting. When examined strategically, this data can foster a deeper understanding of the values that matter to audiences. Media organizations can use this information to reflect those values and build trust, as long as they do so in an authentic way.
Illustrating product value
In the case of the media industry, content is the product in the audience’s eyes. Market psychology tells us that products with a price tag are viewed as more valuable than those without, so it makes sense to charge for quality content.
“[A] lack of trust has resulted in more people seeking a reliable source of information,” according to this article by MarketingWeek. “When consumers pay to read news, it has an affect on the trust that readers place on the content.”
Amidst the Covid-19 pandemic, media conglomerates and local news outlets alike have become well positioned to establish their brands as credible sources for information, especially in contrast to social media platforms; and gating content behind paywalls has been a key part of this strategy for many.
Pairing print and digital offerings
Old becomes new again every few decades in the world of fashion, and this cycle is now playing out in the media industry as well. For over 10 years now, publishers have lamented “the death of print” and painted a picture of a future where clickbait content reigns supreme. And although print media has faced significant challenges (including many jobs lost) and there has been legitimate cause for concern, there’s still more to the story.
“A funny thing happened: younger readers found that they liked…reading stories without autoplay videos and full-screen takeovers interrupting their immersive experience. For Gen Z, the first generation to fully grow up in a digital world, to develop a fondness for print was an unexpected plot twist,” according to this article by Folio:.
It’s fair to say that print media will always have a place in our culture. As more of our day-to-day activities shift online (especially during the public health crisis), growing numbers of people are seeking time away from their screens in the form of tactile experiences like reading printed magazines and newspapers.
New print media titles have also been popping up on the industry landscape. In 2018, The New York Times reported a trend of emerging food publications founded by publishers in their 20s and 30s. More niche publications followed suit and were embraced by young readers as well.
Print media offers transparency
Subscription models aren’t the only avenue for media companies to build trust with audiences (and leverage that good standing to attract advertisers). Print media also offers a sense of credibility that digital content can’t always deliver.
“Post after post in [social media] feeds feature wholly inaccurate memes disguised as fact or even ‘deepfakes.’ These notoriously skeptical generations are smart enough to realize that social media is not a reliable source for important information, and they instead turn to more established outlets,” said Folio.
Digital media complements its print counterpart
So, where does online content fit into this picture of print and digital offerings working together to drive revenue? In this case, you can think of your digital channels as places to deliver content extras to a highly engaged segment of your audience—a loyal group who wants to dig deeper and be a part of your publication’s community. These content extras can look like videos, surveys, and even virtual events.
Not only can virtual events complement your print strategy by offering your audience another way to interact with you, but they can also help build your subscriber base, like British publisher Tortoise Media has done with its Tortoise ThinkIn events. Only Tortoise Media subscribers can participate in ThinkIns, which means these events are a key part of the publishers’ audience development strategy. And that, friends, is a cohesive approach to revenue diversification.
Research shows consensus among media executives that creating multiple revenue streams is a wise pursuit for publishers to explore. You’ve now learned about a few ways that various revenue streams can complement one another.
To dig deeper into the topic of media revenue diversification and get insights from over 100 industry leaders, download our new report Combined Revenue Models Gaining Traction in Media Industry, created with NAPCO Research and Adweek.