When we talk with many digital publishers, they often tell us about their desire to increase website traffic. When asked why website traffic is important, the answer is usually that they need to compete with other publications. What this really means is that publishers want more traffic so they can generate more revenue. They’re looking to make publishing pay, and getting more clicks seems like the best way to achieve that goal.
While there is no denying that display advertising is an important revenue stream, it’s far from the only revenue stream that today’s digital publishers have at their disposal. According to eMarketer, digital ad spending in the U.S. is anticipated to increase 25.5% this year. During that same time, display advertising revenue is expected to fall. How can that be?
Advertisers are getting savvier. As they learn more about viewable impressions and active view reporting metrics, advertisers are less willing to pay a premium for things like programmatic advertising. Instead, many advertisers have begun to pivot and invest more heavily in opportunities like newsletter sponsorships and native advertising.
Categories of Monetization
The majority of strategies that make publishing pay for online magazines and news outlets fall into one of three categories: advertising, commerce, or data. Below, we’ll go further into detail about what each of these categories entails.
The monetization category that comes up most frequently when we talk about making publishing pay is advertising. From display advertising to native content, and everything in between, publishers can make substantial revenue in this category. Although the average cost-per-click (CPC) on digital media sites is dropping, there will always be opportunities for online magazine publishers to generate revenue through advertising.
The commerce category has been less explored by independent news websites, but the opportunities for revenue generation are no less robust. The most common examples of monetization through commerce involve using embedded affiliate links and selling branded merchandise through an online store.
Large media organizations are seeing incredible earning potential by selling, or otherwise monetizing, their website data. Businesses in many different verticals are interested in purchasing data, not just about subscribers, but also about the publication itself. Using data to diversify revenue is an untapped and potentially lucrative approach to making publishing pay in 2022.
5 Ways to Make Publishing Pay
Now that we have covered the three primary categories of monetization, we can dig deeper into the specific opportunities that digital publishers have available to them within each of those categories.
1. Reader Subscriptions
Subscriptions are not a panacea for publishers, however the opportunity to generate revenue through subscription sales is still one of the most lucrative for most online magazines and digital news sites. Subscription sales should ideally be one part of a broad basket of revenue streams for media businesses.
2. Direct Digital Ad Sales
Direct digital ad sales involves selling online advertising directly to local businesses. With direct digital ad sales, publishers don’t need to share advertising revenue with a third-party network or a technology platform like Google. This approach also gives publishers complete freedom to sell the types of ad products they want to the businesses they want to work with. However, success in direct digital ad sales hinges on your ability to form relationships with local businesses and effectively communicate your publication’s value proposition.
3. Partnerships with Third-Party Sites
More publishers are partnering with competing publications to sell bundled memberships and subscription packages. In the television world, this is seen when a company like Hulu partners with a network like Showtime to sell a bundled streaming package. The idea is that consumers are getting a slight discount for signing up for a subscription bundle, and publishers are getting the opportunity to onboard new users who might not otherwise have purchased a subscription. Success with a bundled subscription program hinges on a publication’s ability to align itself with the right partners.
4. Programmatic Advertising
Programmatic advertising grew at double-digital rates during the pandemic. The publishers who do best with programmatic advertising are those that have the highest traffic volumes. Programmatic advertising is a numbers game, and smaller niche magazines and local news sites usually aren’t going to generate as much revenue using this method. Regardless, programmatic advertising is usually easy for publishers to manage and it can become a beneficial stream of income.
5. Paid Newsletters
Some call it “generation Substack,” others just call it good business. Exponential growth in the newsletter space is leading more publishers to sell subscriptions to their email products. Newsletter subscriptions usually cost less than website subscriptions, but they also come with fewer benefits. A low price tag of just $3.99 to $5.99 per month is often enough to win over new readers, who could eventually become website subscribers, as well.
To learn more about how top magazine publishers are generating revenue and growing their businesses, contact Web Publisher PRO.