With all of the conferences, reports, and case studies on digital subscriptions by INMA in the past year, I am struck by how similar the story arc of our industry remains:
- There is no progress on digital subscriptions without a total organisational commitment, from the board room to the newsroom.
- The seduction of acquiring subscribers culturally blinds media executives to a focus on retaining subscribers.
- There will be a ceiling for digital subscriptions, even if retention holes are plugged and everything is executed perfectly.
- We need to find the ceiling of “news subscriptions” in the next year and create a subscription stack beyond if we are serious about replacing print advertising revenue with digital reader revenue.
In working with INMA’s new Researcher-In-Residence Grzegorz Piechota, I’m struck by another truism: Literally nobody has all the answers. Greg should know, given his extensive global research at Oxford.
Notably in Europe and North America, the big names you would expect to have solved all issues are running into churn walls and cultural walls.
“Maybe we need to hire someone to focus on churn,” reported a leading subscription executive at a major metro American newspaper.
“I can’t fight this cultural battle at every one of my titles,” exclaimed another executive, navigating through different editorial cultures.
I worry that some big enough “name” companies that have found the subscription ceiling already are confronting a similar issue as five to seven years ago: Because they can’t write enough new orders to keep up with churn, they are beginning to doubt their future in the subscription space.
Publishers have to culturally push through this crisis in confidence.
How many publishers have gone through two or three iterations of paywall models? If we’ve learned anything from the past decade, it is that those first “failed” models weren’t so bad after all. They needed to adjust tactics. They needed to get smarter about content economics. They needed to improve their sign-up experience. They needed to address churn through much smarter reader engagement. They needed to understand the behaviours of subscribers vs. non-subscribers. They needed to rally the entire company behind the effort vs. ghettoizing the effort.
But they didn’t do that. They hit a low ceiling on their first iteration, far lower than expectations, and then pulled the plug. We were convinced as an industry that a pay model was a plug-and-play decision, and we now know that was silly.
My read is paywall models depend on the totality of a company’s commitment to subscriptions. If you don’t have a newsroom that can maximise the data at its disposal, go with a metered model and optimise that. If you’ve got a data-focused newsroom, go with a freemium model. It’s the equivalent of driving a stick shift vs. an automatic car. If you don’t have the right data and have an idea what to do with it, it’s the equivalent of not having a car engine.
Why is the American metropolitan media ceiling around 35,000+ subscribers while some European publishers are pushing 100,000 and beyond? There may be gaps in best practices, but my best guess is it has to do with each news brand’s relationship with its reader base dating back decades. To say the least: It’s complicated.
Starting this week with INMA’s Readers First initiative and a members-only newsletter from Greg Piechota, we are going to go deeper into subscriptions than any association serving the media industry. INMA’s Consumer Engagement Summit in November in Miami will aim to capture what the best and brightest in the news industry are doing to reduce churn with smart engagement.
What has been built by many companies over the past three years can be the new base of a journalism business in the long run. What we have built is, in many cases, amazing. Newsrooms are changing as they embrace content economics and are having a major impact on the business — in many cases, for the first time. We are far too late in confronting churn, but that conversation is quickly rising. That voice will be loud by November.
The gaps between digital pure-plays and legacy media companies are collapsing. Facebook and Google have injected themselves into the evolution of media companies as subscription generators.
Yet I have a feeling when the history of this period is written, we will discover that — in a range of kindergarten to a doctorate — we in 2018 are entering second grade. By embracing content economics, peeling back mysteries that have been buried in print for centuries, we are committing to getting smarter and better.