Long before COVID-19 hit, publishers were focused firmly on digital subscriptions to reduce their reliance on ad income. Successes reported by a variety of publishers throughout the pandemic reinforce the importance of reader revenues, but also highlight that there’s no one-size fits all subscription strategy.
- For two or three years, limited returns from social distribution, downward pressure on advertising CPMs and the inexorable shift of budgets to Facebook, Google and even Amazon, have pushed publishers to develop reader revenue strategies.
- The evaporation of advertising budgets through 2020 alongside the collapse of retail sales and in-person events reinforced the belief that developing diversified revenue streams is the only sure way to survive.
- Reader revenues, primarily digital subscriptions, took centre stage with publishers trying to make up losses to retail and advertising sales. Publications from news dailies to children’s titles have all reported success in building direct revenue.
Subscriptions, subscriptions subscriptions
There are three important things being discussed in publishing right now: subscriptions, subscriptions and subscriptions. But how the quest for subscriber acquisition and retention is played out depends on the content publishers produce and the audiences they serve.
- The New York Times leads the world in reader revenue development efforts – it now has 7.5 million subscribers. Developed over almost a decade, its subscription strategy has moved far beyond simply charging people to read the news.
- In pursuit of further growth, the paper is targeting readers of its daily email newsletter The Morning. The newsletter has scored 1 billion opens since it launched in May 2020.
- The Times’ consumer reviews site Wirecutter is also testing a subscription product with the goal of expanding current reliance on ecommerce affiliate revenue.
- A third of the NYT’s 2.3 million digital-only subscribers signed up for its cooking, games and audio apps. The management team is now investing heavily to develop this type of added-value, non-news content.
The next generation
- The New York Times is in the early stages of developing a digital subscription product for families called NYT kids. But this market is already being served in the US and the UK by The Week Junior.
- The Week Junior US, a weekly current affairs magazine for children aged 8 to 14 launched at the start of the pandemic. It’s UK equivalent, now five years old, grew its subscriptions by 35%, year-on-year.
- Editor in chief Anna Bassi puts the title’s subscription success down to delivering trusted and inspiring content at a time when parents were forced to homeschool. “It seems obvious in retrospect, that parents were looking for something to keep their children occupied and engaged.”
- Bloomberg media is targeting subscription revenues of $100 million. This represents 400,000 consumer subscriptions for 2021, up from 250,000 last year.
- The company’s subscription strategy hinges on the development of niche verticals for individual rather than the corporate subscribers that have traditionally been its focus. Target niches include personal finance, health care, cars, climate, cities and the business of entertainment.
- Bloomberg has bundled its subscriptions with other niche media outlets including tech-news publisher The Information and sports website The Athletic to add value for the subscriber.
Looking to the future, publishers are likely to focus on developing ways to add value beyond core content. Leading movie magazine Empire has bundled elements of its portfolio to bring readers a membership offer that covers the print magazine, exclusive podcasts and cinema discounts.
For an annual fee of £85, Empire’s VIP Club promises subscribers:
- 13 issues of the magazine in print
- Two exclusive ‘Spoiler Specials’ podcasts a month, plus archive access to 100+ episodes
- Six member-only events a year
Empire has also partnered with a cinema chain to give members free and discounted movie tickets, discounts on food and drink, priority booking and invites preview screenings.