The news industry embrace of digital subscriptions and the need to reduce churn to maintain a growth path is driving publishers worldwide to re-think how they communicate core value propositions to ensure long-term relationships, according to a new report released today by INMA.
“Nurturing Value for News Consumers” is the first of four pillars to be announced by INMA as part of its Readers First Initiative, which aims to surface best practices in the art and science behind digital subscriptions and create a road map toward the next generation of consumer monetization through 2020. INMA leads the news media industry in the emerging fields of content economics and digital subscriptions.
INMA Researcher-in-Residence Grzegorz (Greg) Piechota heads the Readers First Initiative and is the author of the new 53-page report.
Key findings of the report include:
- Why retention is key: Retention, not acquisition, is the key to extending the digital subscription growth runway as acquiring a new customer is up to 25% more expensive than retaining an existing one.
- Lifetime relationship: Purchase is not the end game of the value nurturing funnel. A lifetime relationship is.
- Convenience and personalisation: Convenience is more important than content in the subscription economy, and personalisation is a key convenience factor.
- Follow the data: Intimately follow what audience data suggests. Consider discontinuing content that has no business objectives and complicates the content ecosystem. Be willing and able to react to changing subscriber behaviours.
- How to differentiate product via brand and segmentation: Product differentiation by brand positioning and market segmentation is the marketing strategy of the future.
The INMA report focuses on the differences between reader engagement and value nurturing. Both are separately important in subscriber retention, yet Piechota treats them as separate but equal functions. Reader engagement is mostly a newsroom function, while value nurturing is mostly a marketing function. Inside today’s news media company, organisational lines are blurred.
“Relationships that aren’t nurtured fall apart,” Piechota writes in the report’s executive summary. “That truth is no different in your home than it is at your news media company. A monthly subscription is nice. A lifelong relationship is what sustains us.”
The report leans heavily into value propositions and nurturing strategies at Amazon, Netflix, and Spotify with Piechota’s research at Oxford University’s Reuters Institute creating intersections with news media companies.
Drawing on research from media companies worldwide, the INMA report looks at:
- How Netflix and Spotify raise the bar for news media.
- How to differentiate your brand from free alternatives.
- How to manage your content portfolio to maximise value.
- How to nurture value with news products.
- How to add value with convenience.
“The seismic shift toward consumer revenue in the media company’s business model is forcing a re-think in content economics,” said Earl J. Wilkinson, executive director and CEO of INMA. “This new INMA report looks at the post-purchase customer journey in ways no report has previously done in the media industry.
“Much of this is strategic marketing through the prism of digital subscriptions, yet make no mistake that value nurturing is a high-level discussion about news brands that is long overdue: differentiation, identifying perceived value, figuring out ‘jobs to be done,’ and focusing on ‘winning every session’ and ‘forming a daily news habit.’”
Piechota announced the customer value nurturing results during a Webinar this week with INMA members, which can be viewed here. INMA members may also download Piechota’s presentation, which was part of the Webinar.
The four pillars of the Readers First Initiative, to be released over the next nine months, are:
- Customer value nurturing, originally announced at the November 2018 INMA Consumer Engagement Summit in Miami.
- Consumer business innovation, to be announced at the March 2019 INMA Media Subscriptions Summit in Stockholm.
- Newsroom transformation 2.0, to be announced at the May 2019 INMA World Congress of News Media in New York.
- Local media and subscriptions, to be announced at the September 2019 INMA Media Innovation Week in Hamburg.
“Nurturing Value for News Consumers” is available for free to INMA members and available to non-members for US$795 – which includes one year of association membership, all strategic reports, Webinars, and access to all INMA content and peer connection tools.
INMA members may download the report, and non-members may order the report by going to www.inma.org/reports.