Back in 2013, the publishing industry was abuzz over Time Inc.’s decision to test a new subscriber model. At the time, it made good sense. Consumer magazine ad revenue was expected to fall off over the next couple of years (it did), so publishers like Time Inc., Hearst and Conde Nast started looking for ways to boost revenues from subscribers.
For a while it was like swimming upstream against a rising chorus of “if it’s online it must be free,” but publishers persevered and we began to see more publishers innovating with paywall strategies and being more creative with subscription offerings.
Fast forward to 2018, and we see more evidence of publishers getting paid content right. The once heavily ad-based publishing model is being driven more by subscription goals than clicks.
According to Krish Subramanian writing in Publishing Executive, publishers are getting more nuanced with their subscription management programs, and it’s paying off in customer growth.
“One of the unintended consequences of shifting to the subscription model is the flip in company culture that many publishing companies experience by having to focus on writing for the reader, as opposed to optimizing for clicks,” Subramanian writes. “This shift is fundamental in the media industry where clickbait headlines hidden behind paywalls add to the noise, making it harder to send readers the signal that publishers care about the quality of content. Offering flexible plans under a subscription model means publishers must focus on producing content that brings readers back for a longer term relationship.”
Subramanian sees some key trends happening now, as publishers get savvier with leveraging user behavior data in the sales process. Testing pricing models and tailoring subscription plans to user behavior are key elements of successful paid content plans. And once they’ve acquired those readers, they are working hard to retain them by understanding them.
“To achieve insights on how price changes and shifts in reader behavior are reflected in growth metrics such as recurring revenue, customer acquisition costs and churn, publishers must be able to easily harness data from their billing systems, and these insights need to be accessible across all teams, from finance to sales and content,” Subramanian writes. “In the subscription model, billing and subscription management solutions become central data sources for this kind of revenue-driving information and behavioral insight including churn rates, plan adoption and monthly recurring revenue.”
In our industry we see a few things coming together to create a solid base on which publishers can grow – rampant mistrust of social media, more willingness to pay for quality content, and the ability to leverage first-party data in new ways.
“The way people consume media continues to evolve, and it is incumbent upon publishers that they keep up with these changes,” Subramanian concludes. “As readers become increasingly wary of data privacy infringements and abuses, ad-based models offering unlimited consumption are not sustainable and moving to flexible subscription models is vital for sustainability and growth. The shift to subscriptions will most importantly help publishers focus resources on high-quality content which help build brand, retention and loyalty.”
This is the new golden age for publishing.