The shift to subscription revenue has gained serious momentum.
The Q3 2020 Digital Publishers Revenue Index (DPRI) from the Association of Online Publishers (AOP) and Deloitte, shows that the shift to subscription revenue amongst UK publishers has gained serious momentum.
The DPRI report aims to provide an overview of revenue levels across multiple channels and platforms – as well as insight into publisher sentiment – and to benchmark these findings against previous quarters.
The latest figures, released this week, have found that between Q3 2019 and Q3 2020, subscription revenue amongst publishers included in the AOP’s survey (comprising 14 B2C publishers and four B2B publishers) increased by more than 51%.
On an equally positive note, a majority (53%) of digital publishers witnessed positive revenue growth in Q3 2020, more than double that of the previous quarter (22%).
The latest report, for Q3 2020, also found that 78% of UK publishers are re-prioritizing ad revenue growth, possibly as a result of high subscriptions levels allowing publishers to focus their attention on other revenue streams.
Richard Reeves, Managing Director, AOP, comments, “As the publishing industry starts to recover from the impact of the global pandemic, it is promising to see optimism continue to rise. While digital advertising remains the largest income stream for publishers, the positive growth of subscription revenue demonstrates how the industry has adapted to be stronger and more resilient in the face of the challenges posed by last year.
“However, it is interesting to note a returned focus on advertising revenue growth as a high strategic priority in the year ahead. Since the outbreak of Covid-19, news sites and premium publishers have attracted greater readerships with their trusted content; fresh opportunities to leverage this will no doubt arise as publishers make smarter decisions to support their bottom lines.”
In the B2B sector, overall revenue experienced an increase of 4.1% in Q3 2020 compared to Q3 2019, fuelled by an uptick in display advertising (15.2%), and subscription (5%) revenues. B2C publisher revenue, meanwhile, witnessed a decrease of 1.6%, but continues to be buoyed by a 68.3% rise in subscription revenue.
According to the AOP, confidence in the publishing industry has risen considerably since Q2 2020, mirroring broader economic optimism regarding publishers’ financial outlooks. However, tempering the optimism is the AOP’s finding that cost reduction remains a high priority for 56% of publishers as they concentrate on driving efficiency following a turbulent 2020.