To fuel digital subscription growth, you must know what’s blocking your path. During the European Media Subscriptions Town Hall on Thursday, Lou Gautier, principal at FT Strategies, explained that even though each publisher is different, the four main obstacles to digital subscription growth are the same.
As a new boutique consultancy within Financial Times, FT Strategies helps companies build profitable digital relationships with their audiences — something they see as key to future-proofing news media companies today. In her work with publishers, regardless of size, Gautier said she has found that the same roadblocks appear for each.
“For them to grow, they have to identify the blockers to success,” she said. “These are the four that are critical to address.”
Although companies might agree on a strategic plan in theory, acting on those plans often creates tension between advertising and subscriptions.
“Frankly, this is quite common. When you decide to go on the road to subscription, I think everyone recognises you have to bring value to the reader,” she said. However, the way to provide that value and create a compelling experience that makes them subscribe may be seen differently by different departments.
“So, you have to ask the question, who is the main customer? Is it the advertiser or the reader? If you don’t make that choice, it’s hard to stand out.”
When approaching the problem from a subscription standpoint, Gautier said your competition changes.
“You are not competing with news publishers anymore. You are competing with every other subscription business.” That’s because customers “only have one wallet,” so a product must stand out from other subscription offerings to entice them to buy. It’s critical that advertising and subscriptions align and share a common approach, because “… advertising can flourish on highly engaged subscribers and readers. The other way around has not been demonstrated.”
2. Customer knowledge
Knowing your reader is key to success in subscriptions, but Gautier said she would not be surprised if a majority of publishers said they didn’t know much about their customers. In most cases, publishers wish they could know more about their readers, but feel they don’t have the time or money to invest in research and analysis to acquire that information.
To find out if you know your readers, she suggested asking two questions:
- Do you know who you’re working for? Knowing your target segment is key, she said, and it’s something most publishers can’t answer that question. In her work, she’s found that less mature publications tend to work for “everybody,” while more mature publications have an established, core reader that they understand. However, that core reader has already been converted, so it’s critical to identify growth opportunities within your target segment.
- Do you know how to measure the value you create for readers? Although many publishers hunger for more data, the problem is usually too much data, she said. “There are too many ways to measure success, such as frequency and click-throughs, but as a result, there’s no common measurement. If you’re not able to measure it, it’s hard to know what value they are creating for the reader.” And, without that critical information, it’s almost impossible to know how to grow value and attract subscribers.
3. Experimental mindset
Experimenting with testing and taking a scientific approach is an often-overlooked element that can help drive subscriptions. But taking time to first develop the right methodology and know what problem you’re solving is the horse that must come before the cart.
“Make sure you’re picking up the experimentation that is solving a critical problem for the business,” she said — and then, make sure the problem you’re solving is one of your key priorities. A second thing to focus on is becoming hypothesis-driven in your testing.
“If you can formulate hypothesis, you’ll be able to design the right experience and give them results.”
4. Data and tech
The final block to subscription growth is a challenge for nearly all publishers, she said. Companies are dealing with legacy systems, third-party systems, or their own systems, and in many cases, that leaves the data siloed and prevents publishers from creating a reader-centric experience. It has made experimentation and testing difficult and resolving the data and tech issue plays a significant role in an organisation’s success.
“If you want to empower your organisation and give them the data to make the best choices, our recommendation is to start small but start fast,” Gautier said. Rather than trying to bring all the data together, look at what data is critical to improve retention and provide information crucial to making change.
Then, “start building the process. It takes time to build an experimentation mindset. But that helps build your roadmap. Then you’ll understand the next phase of development, the next data you need for your platforms.”