Group subscribers to the Financial Times pay only for users who read the newspaper frequently. It sounds fair, but is it smart?
Similarly to many business news brands, a high proportion of FT subscribers — two thirds of 1.1 million — get access thanks to a group plan, as employees of firms, governments, or academic institutions. What’s unique is how the FT charges their employers.
- For an average consumer, FT content is, in practice, hard-paywalled.
- On the other hand, group account users enjoy a metered access — limited by the number of articles they can read for free.
“We believe the engagement-based pricing model is a very fair way to price the value that our customers derive from our journalism,” said Tom Betts, chief data officer at the FT, in an interview with INMA.
The common approach among news publishers is to sell groups access in bulk, while applying a volume discount. One rarely reports the actual engagement with the site, let alone charges accordingly.
How does the FT engagement-based pricing model work?
- The FT grants access to all registered team members or employees, and it doesn’t charge as long as they read eight or fewer articles a month.
- The FT charges only so called “core readers,” or those who read nine or more articles a month.
- The number of “core readers” is set initially based on an estimate of how many people require frequent access to the FT and then adjusted every year based on usage reports. The volume discount is applied based on the number of “core readers.” For example, an average annual price per reader can drop from £392 for a group of eight “core readers” to £319 pounds for 128 “core readers.”
- Administrators of group accounts get access to dashboards tracking the user behaviours. They can also manage users, select topics for them to follow, set up industry or company alerts, etc.
Why did the FT choose this model?
“When we first discuss subscription options for an organisation. it is very difficult to know, on both sides, how many people are likely to use a subscription and whether or not they will use it often,” explained Betts. “Our engagement-based pricing model allows us to make an estimate up front, and then over time we learn more about the demand within that account and can adjust the price they pay accordingly.”
Another reason is sampling in the search for potential upgrade. “Using this engagement-based pricing model we don’t tend to limit access to only those who have paid,” Betts said. “At the end of their annual subscription, we can negotiate the price for the next year using the engagement as evidence of demand.”
Engagement-based pricing mobilises the publisher to monitor and actively stimulate engagement of group account users.
For example, the newsroom of the FT tracks so called Quality Reads rather than pageviews. This metric shows the percentage of pageviews where a reader has read at least half of the article, estimated by time on page, scroll depth.
Product teams evaluate the performance of new features based on the impact on the engagement score called RFV, as it measures Recency and Frequency of visits, and the Volume of articles read.
The customer success team monitors the usage levels of readers and tries to ensure they get enough from the subscription to stay happy. As an Oxford academic, once I got a nudge from my FT guardian: “Our automated system has flagged that you may not be making as much use of FT.com as other readers at the university.”
The newspaper representative offered a free consultation about how to set an app, newsletters and alerts to “maximise the value” I get from the FT.
Share your case study with INMA peers: What are you experimenting with? What have you learnt so far?E-mail me at: firstname.lastname@example.org
Banner image courtesy of Raunak Jha from Unsplash/Financial Times.