May 10, 2016 | Authored by: Vindicia Team Blogs
Reaching consumers beyond subscription billing
The publishing industry has long recognized the need for innovative ways of reaching consumers. When readers shifted from printed to digital content, publishers faced the challenge of monetizing this new landscape. Some try to subsist solely on ads while others use subscription billing practices to provide consistent revenue. Often, businesses employing the latter method establish a paywall on their websites that prevents or limits access to nonsubscribers.
This presents a challenge as these organizations essentially cut off a large portion of potential readers. Those that completely restrict access to nonsubscribers ask new customers to take a huge gamble. These users are required sign up before experiencing the content in question, and they have no idea if what they'll receive provides enough value for the monthly cost.
Even with a healthy number of subscribers, a strict paywall method does poorly for many publications. Despite industry belief that its subscription revenue and coverage of financial news would protect it, the Financial Times is taking some extreme cost-saving measures, Fortune reported. Current job openings will be placed on hold, part-time staff members won't be hired as frequently, travel and entertainment costs will be slashed and the entire print edition will be streamlined. Yet in 2013, the newspaper was one of the first to receive over half its revenue from digital subscriptions and other offers. To see how the Financial Times fell from a leader to its position today, one must understand that print advertising is far more profitable than digital.
Essentially, advertisers act in line with the belief that the print industry is dying and digital will take its place. They're flocking to the cheaper online media, leaving print editions of publications struggling to replace the revenue they once had. Therefore, even though the Financial Times has a large number of digital subscribers, it still struggles from a shrinking number of traditional ads.
Still, as Fortune acknowledged, having a healthy amount of subscribers is definitely a benefit. The question now becomes one of whether or not the Financial Times can acquire enough new subscribers to compensate for the loss of print advertising.
"How can publishers maximize subscriber revenue and increase customer acquisition rates?"
The dilemma in such cases is simple to grasp: How can publishers maximize subscriber revenue with practices that also increase customer acquisition rates? Some organizations offer a select few free articles, but The Sunday Times has a different answer. According to DigiDay, the publishing company is attempting to reach - and eventually convert - new audiences beyond its current readers on platforms other than its website.
"There are ways of speaking through the paywall to beckon readers to our content," Eleanor Mills, The Sunday Times' editorial director, said to DigiDay. "We're trying different kinds of approaches to get more of a digital audience."
The Sunday Times attempts to increase its followers on social media and through its other brands. The food print supplement Dish is a favorite among millennials, Mills said, and the publisher is launching a separate travel site as well. Interestingly, The Sunday Times is also publishing content on separate media sites like Apple News. In addition, subscribers can share articles with their friends through Facebook and Twitter, enabling those without a subscription to read the articles.
"Our readers are our best advocates," the publication's head of digital Alan Hunter told DigiDay.
Hunter believes The Sunday Times' current readers are a key link to acquiring new subscribers. He admitted convincing consumers to switch from one free article to paying a subscription fee for unlimited access is a long journey.
"We, like others, are constantly looking to find the pieces of the jigsaw and how to optimize it," he further explained to DigiDay.
Customer acquisition on their terms
The Sunday Times uses an important concept that can help businesses on a recurring billing model succeed in increasing their subscribers. Instead of fighting against readers - both current and future - it is working with them by providing access to trial content on their terms. Letting current customers share content through social media is a great way to reach new readers in an environment they are comfortable with.
"Listening to customer wants is essential for retention."
The Sunday Times also did something essential for retaining current customers: It listened to what they wanted. As Hunter noted, satisfying current customers is a great way to get them to mention the publication to friends and family. Subscribers to The Sunday Times asked the publisher to allow them to share articles on social media, and the company complied. Other businesses should try a similar approach to acquire and retain customers. Their satisfaction is important to success using a subscription management model.
While The Sunday Times understands the current struggles of the publishing industry, it also knows it needs to take action to remain relevant and keep readership levels. The publication is approaching new readers on their terms, which is key to obtaining new subscribers.
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