While it’s common to look at internal factors as part of strategic planning, too few media companies incorporate external factors into that process. That means looking at how other companies are leveraging subscriptions and seeing how that creates competition for news media.
“Although 2020 was a hard year in many ways, it was a really great year to be in the subscription business,” said Sam Guzik, a journalist, strategist, futurist and contributing author for the Future Today Institute Tech Trends Report.
The number of service-based subscriptions that consumers used increased during the pandemic year, Guzik said to INMA members on the first day of the World Congress of News Media. According to research from Barclaycard, spending on digital and subscription services increased consistently every month during 2020 and jumped 39.4% YOY by July.
Most of those subscriptions are for retail products, and more than half of all retailers now have a subscription option. While publishers may think of news media products when they think of subscriptions, news subscriptions failed to crack the top 10 subscription services in the UK, Barclaycard research shows.
“This specific data is from the UK, but we’ve seen this trend in market after market across the world,” Guzik said. “Across the economy, all things that you would once buy as physical objects are now coming with some kind of service contracts, some kind of fee.
“Subscription revenue is much more predictable, much more stable than relying on one transaction.”
Although publishers enjoyed record growth in 2020, they now have to look at how to compete in the new subscription-based economy: “We can’t forget the context that we’re operating in. We’re just one drop in a small bucket of subscriptions for those consumers.”
Consumers will compare their media subscriptions to other services such as food boxes, subscription pet boxes, etc. — not to other media subscriptions.
“You’re going to be compared to the other subscriptions that are in consumers’ wallets.”
To compete, Guzik shared questions they need to ask themselves about subscription strategies, as well as how personalisation plays into those strategies.
In today’s world, personalisation goes beyond a tailored headline round-up or using algorithms to recommend stories: “I’m talking about seizing upon the kind of technologies that allow us to have a one-to-one offering and incorporate that into our world.”
The World Congress continues Tuesdays and Thursdays through May. Register here for future and recordings of past sessions.