Subscription revenue is on the rise at online news outlets across the country, so why are local publishers still feeling the financial pinch?
Readers are flocking to online news outlets, and there’s been a renewed interest in supporting local journalism over the past few years, but publishers still need to optimize their subscription programs if they want to make up for declining online advertising rates.
Simply adding a “subscribe now” button to a homepage isn’t enough to make a financial impact. To increase their subscription revenue, publishers have to go further.
The Subscription-First Model
Subscription revenue at major news outlets like the New York Times and the Washington Post is on the rise. The New York Times added 132,000 subscribers in just the first 18 days after the 2016 presidential election, and new subscriptions at the Post have grown by 75%. Local publishers are experiencing similar successes, but subscription rates and subscription revenue are two very different beasts.
The increases publishers are seeing in subscription revenue are being negated by decreases in advertising rates. To that end, some local publishers are going with a subscription-first model that does away with advertising altogether and focuses on increasing the appeal to readers with VIP experiences. These publishers are finding that readers are more apt to subscribe when they get access to an ad-free publication. That means no pop-ups covering their screens or filling up their browsers.
Local publishers who aren’t quite ready to do away with ads altogether are taking a hybrid approach, allowing paying subscribers to enjoy an ad-free experience while non-paying readers still see ads alongside most website content.
Understanding the Audience
Subscription revenue is tied to subscription rates, so how does a publication get more readers to subscribe? If only there was a magic solution. The truth is that the most successful local publications rely on analytics to understand what their readers want to see. Catering to the audience is always important, but especially so in a time when publishers are trying to increase subscription revenue.
Using analytics tools, publishers should segment their audiences by loyalty and the likelihood that they will pay for access. That’s the group that publishers should be catering to. In addition to tracking which pages these readers view, publishers should be keeping tabs on engagement.
Drilling down in this way, publishers may discover that the readers who are likely to pay for access care about different topics than the public at large. They may also discover that members of this group are more likely to click on coupons or arrive at their sites through social media.
In a series of studies looking at what moves readers to subscribe to news publications, the Media Insight Project found that quality and accuracy matter to almost every subscriber group, and regardless of their underlying motivations, many subscribers are triggered by well-times subscription discounts.
The Media Insight Project found that market size matters, too. New subscribers at smaller news outlets are more likely to subscribe after moving into town than those at larger outlets.
Other factors that drive readers to subscribe have to do with an interest in news, having noticed interesting articles, or being concerned about the accuracy of other news sources in their communities. Local publishers can focus on these factors as they look for ways to drive subscription revenue.
Closing the Deal
We know what types of subscription programs drive revenue for local publications, and what factors make readers to want to subscribe. So how do successful local publishers close the deal and turn readers’ interest in their websites into subscription revenue.
Conversion requires a trigger, and the most successful trigger in this case is a price reduction.
According to the Media Insight Project’s research, discounted subscription pricing is the most effective trigger, with 45% of recent news subscribers citing that as a reason for subscribing. Twenty-one percent of readers subscribe to local news sites as a way to get coupons from ads, and 16% say paywalls are a motivating factor. A recent move into the area, or a lifestyle change, can also lead readers to subscribe to a local news site.
Timing is everything here. When readers hit paywalls, they should see a quick way to subscribe for immediate access. When they click onto pages designed for new residents, they should see ads encouraging them to subscribe. And when readers have visited a website a certain number of times in a month, pop-ups should start appearing with discounted subscription prices. These are all conversion tactics that will increase subscription revenue, with minimal work on the publisher’s part.
Increasing subscription revenue isn’t a one step process, but simple tweaks can add up to major changes in subscription patterns.