The subscription business model has been touted as the saviour of digital news media, a way to financially sustain journalism in the face of declining ad revenues and increasing competition. However, recent years have seen a growing number of media companies struggle to meet their subscriber goals and retain their audience, leading to questions about the viability of this model.
One of the biggest challenges of the subscription business model is acquiring and retaining subscribers. This requires media companies to offer compelling content that distinguishes them from the free news sources available online. However, as the number of media companies adopting the subscription model has grown, so has the difficulty of standing out in an increasingly crowded market. This has led many media companies to resort to clickbait headlines, sensationalist reporting, and other tactics that undermine the credibility of journalism.
Moreover, the subscription business model can also have a negative impact on the diversity of news and perspectives available to the public. As media companies compete for subscribers, they may prioritise popular, mass-appealing content over more niche or specialised reporting, limiting the range of perspectives and experiences that are represented in the media. Additionally, the focus on subscriber acquisition can lead to sensationalist reporting as media companies attempt to capture the attention of as many people as possible.
The subscription business model has been promoted as a solution to digital news media's financial challenges, in a constrained and volatile market. It has also created new challenges that threaten the viability of the model. Certain changes can be made to make the subscription business model work for digital newspapers.
- The first suggested change is a shift in focus from acquiring subscribers to retaining them. This means that media companies must offer high-quality content that keeps readers engaged and invested in the publication. This can be achieved by investing in original reporting, in-depth analysis, and investigative journalism that provides value to the reader. Churn is not largely related to barriers to entry but usually because a user does not feel like they are gaining value for money.
- Secondly adopt a more strategic approach to pricing. Digital news media companies need to consider the market for their content and set competitive yet sustainable prices. This requires a deep understanding of the target audience and what they are willing to pay for and an assessment of the costs associated with producing and delivering the content. By finding the right balance between price and value, media companies can increase the likelihood of attracting and retaining subscribers.
- Another area that could help is the successful delivery of content. Digital news media companies should ensure that their content is easily accessible and user-friendly, regardless of the device being used. This means investing in mobile-friendly websites, apps, and other technical platforms that make it easy for readers to access and consume content. Publishers can also use personalised recommendations, push notifications, and other engagement tools to increase reader engagement and loyalty.
- A data-driven approach seems to be paying dividends. Use data to understand better and serve customers. Collect information on what people read, how they access content, and what they like and dislike. First Party data can be used to improve user acquisition, the subscription model and the overall experience for subscribers.
To know more about this approach click here
- The subscription business model needs to evolve better to accommodate different types of content and revenue streams. Consider alternative forms of revenue, such as Affiliate Marketing, Content Licensing and NFTs. By diversifying revenue streams, media companies can reduce their reliance on subscriptions and increase their overall financial sustainability.
To know more how publishers can use NFT to boost revenue click here
In summary, the subscription model has the potential to be an additional business model and revenue stream for the news media groups. Focus needs to be placed on the overall digital strategy and business objectives. Publishers can’t ignore the potential and function of data and how it helps to drive loyalty, relationships, conversions and revenue. It is the marriage of the publisher as the data keeper and the right technical tool at the right time that can enable a successful subscription model.
Evolok helps online publishers increase their revenues and drive audience engagement using Evolok’s end-to-end SaaS solution, which provides paywalls, subscription management, user segmentation and identity management. Evolok delivers a selective ecosystem to drive user engagement and mobilization. Evolok helps its clients increase readership and revenue by engaging and personalizing content, protecting valuable content through paywalls, utilizing login and social data to incrementally know customers and finally targeting products and pricing to boost subscriptions.
If you need any help with your subscription journey or you are thinking of migrating your publishing business to the subscription business model contact us today.