This article is an excerpt from our special insight report, Paywalls for Publishers. This free-to-download report aims to help you formulate an effective paywall strategy via insights and examples that have worked well for other publishers. The guide also examines how you can leverage your first-party data and build a supportive organizational culture to boost your paywall strategy.
Paywalls are just one element of the subscription strategy. They’re not going to work if not backed by high-quality content and effective user acquisition and retention plan. “It isn’t just about putting a paywall up,” says Lindsay Horrigan, GM, Consumer Subscriptions, Bloomberg Media.
“It’s about building a consumer operation and speaking to your audience and your readers. How do you reach consumers? Where do you reach them? How do you make a high-quality value proposition? Those are all great fundamentals of a consumer operation.”
“Foundation for years of recurring revenues”
There is a direct correlation between reader-focus and subscription growth, according to FT Strategies’ Towards your North Star report. It is based on findings from the GNI Subscriptions Lab, a collaborative program by Google, INMA and FT Strategies in 2020. It had eight publishers participating from different European countries.
The report recommends publishers set a ‘North Star’ goal—a single, shared objective across an organization—that demonstrates a clear priority of subscription over other revenue lines. “Engaging readers in a long-term relationship is a very different task compared to generating traffic, and requires full commitment,” the authors note. “Rarely have organizations succeeded without shifting their mindset and focus to creating value for readers.”
At the heart of every perfectly executed paywall plan lies the most intimate of audience relationships, a relationship that requires your readers to hand over their credit card details. Treat it right and that intimacy can be the foundation for years of recurring revenues.Peter Houston, Author, 6 Publishing Technologies That Will Make A Difference To Your Business
As mentioned earlier, publishers who were able to stop 6% of their most engaged users with a paywall reported having “thriving” digital subscription businesses.
Matt Skibinski, Reader Revenue Advisor at the Lenfest Institute for Journalism recommends publishers to focus on converting readers who visit the site regularly, frequently open newsletters, and access content on multiple platforms. These behaviors indicate engagement which is more important than the size of the audience itself, according to Skibinski.
“There are cases where smaller, niche publishers have a really high conversion rate and have enough of a digital subscription business to be meaningful,” he explains. “Even though their overall audience pales in comparison to larger brands the people who access their content use it in their everyday lives, consider it valuable, and feel a strong affinity to it.”
“Give the customer many reasons to come back”
Whether a user subscribes after hitting a paywall or exits your site depends upon his/her perception of the content’s value and loyalty to your brand. Growing a subscription business successfully requires understanding that you’re never going to be able to convert every user.
“Instead, look at what you do best,” suggests Paul Jowdy, Chief Business Officer and Publisher, Women’s Wear Daily. “See what content you deliver that’s valuable and unique and that no one else is doing and cut that piece out of the pie and make a subscription out of it.”
“Give the customer many reasons to come back on a daily and weekly basis,” says Martha Williams, Author, Paywalls: How to start your subscription strategy (FIPP).
“Delight them with surprises and help make their lives frictionless and fun. Anticipate and solve life’s niggling problems for them. Feed their passions. Transport them to content, advertising, shopping and entertaining places created just for them, made possible by data and artificial intelligence that enables personalization.”
Remind and educate your readers
While paywalls put a price on your content you must also continue to remind and educate your readers about its value via on-site messages or email newsletters.
“Our most valuable asset is the content that we produce,” says Jason Sylva, Head of Consumer Revenue at New York Magazine. “We see our role in consumer revenue as helping people understand that this is valuable and worth paying for.”
The Guardian has messages at the end of articles underlining the value of their journalism and asking readers’ support. The strategy has worked spectacularly for the publisher, bringing it back from the brink of bankruptcy.
“We have to be absolute about it,” says Howard Saltz, Knight Foundation Innovator-in-Residence, Florida International University. You can’t pussyfoot around, you’ve got to say, ‘We are a product. And you just can’t expect something for free.’”
Originally published in What’s New in Publishing earlier. While some of the data points may have evolved, the analysis and conclusion remain highly relevant.