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The Media Subscriptions BlueprintA report from INMA Media Subscriptions Summit London, April 2018

May 2018

INMA | THE MEDIA SUBSCRIPTIONS BLUEPRINT 2

The Media Subscriptions BlueprintA report from INMA Media Subscriptions SummiLondon, April 2018

May 2018

About the Authors 3

Executive Summary 4

Introduction 8

Part 1: Strategies 11

Chapter 1: The big picture 12

Chapter 2: Data and technology 21

Chapter 3: Paywall models 24

Chapter 4: Acquisition and retention 28

Chapter 5: Content that works 36

Chapter 6: Emerging models 38

Chapter 7: Subscription models benefit by treating

audiences like members 42

Part 2: Case Studies 47

Chapter 8: New York Times, Times of London 48

Chapter 9: Economist, Wall Street Journal 52

Chapter 10: Schibsted, NZZ 57

Chapter 11: Fairfax, Politiken 61

Chapter 12: BILDplus, Dennik N 66

Chapter 13: Dagens Nyheter, Helsingin Sanomat 71

Chapter 14: Boston Globe, Amedia 75

Chapter 15: Google, Facebook 79

Part 3: Perspectives + Conclusions 86

Chapter 16: There is no silver bullet for smart subscription

strategies 87

Chapter 17: Could subscription strategy boil down to audience

feelings? 93

Chapter 18: Product innovation, data-based acquisition will

transform news industry 97

Chapter 19: Conclusions 100

Authors

Robert WhiteheadEarl J. WilkinsonThe Newsplexer Projects

Contributors

Siri Holstad JohannessenMatt Lindsay

Editors

Dawn McMullanCarly Price

Photographer

Luke MacGregor

Summit Committee

Grzegorz PiechotaSuzi WatfordMark Challinor

About the International News Media Association (INMA)

The International News Media Association (INMA) is a global community of market-leading news

media companies reinventing how they engage audiences and grow revenue in a multi-media

environment. The INMA community consists of 8,888 members at 701 news media companies in 68

countries. Headquartered in Dallas, INMA has offices in San Salvador, Antwerp, and New Delhi.

© INMA 2018 The

contents contained

within this report are

the exclusive domain of

INMA and may not be

reproduced without the

express written consent.


The INMA Media Subscriptions Blueprint is the product of a team of contributors:

Part One/Strategies: INMA Media Subscriptions Week

moderator Robert Whitehead of McPherson Media in

Australia and INMA CEO Earl J. Wilkinson wrote the

strategy section from London study tour and summit

materials, the INMA benchmark survey of participants,

a summit-ending town hall meeting, and post-summit

interviews. They collaborated to synthesise a lot of

complexity.

Part Two/Case Studies: The editorial team from The

Newsplexer Projects — Kerry Northrup, Brie Logsdon,

and Nicole Coomer — covered all four days of Media

Subscriptions Week and pieced together complete

coverage. The Newsplexer Projects is an experimental news studio committing noticeable

journalism while prototyping new ways of doing news

and training people for the new mainstream media.

Part Three/Perspectives: Schibsted’s Siri Holstad

Johannessen, Mather Economics’ Matt Lindsay, and

INMA’s Wilkinson looked back on Media Subscriptions

Week and provided context and conclusions.

Meanwhile, INMA Senior Editor Dawn McMullan worked

with INMA editor Carly Price and the design team at

Arizona-based Drawbackwards to bring all of this

coverage together.

About the authors

Editorial coverage of the INMA Media Subscriptions Week was conducted by The Newsplexer Projects. The London team consisted of Nicole Coomer, Kerry Northrup, and Brie Logsdon.

Media Subscriptions Week organisers from top left, moderator Robert Whitehead and INMA CEO Earl J. Wilkinson; from bottom left, University of Oxford’s Grzegorz Piechota, Wall Street Journal’s Suzi Watford, and Media Futures Ltd.’s Mark Challinor.


Executive summary

Digital subscriptions represent the news industry’s best hope to replace the

deteriorating print advertising business model with a reader-focused model that

can sustain journalism at scale. This was the focus of the recent INMA Media

Subscriptions Summit in London in April, 2018.

Presentations during the summit shined a light on 25 media companies recreating

their value propositions around content, community, cause, and convenience.

Overarching themes from the week-long event focused on a growth mission, a total

company approach, deeper audience knowledge, culture change, and a membership

mindset. Key lessons included having confidence on pricing and pay gate settings

and setting basic data foundations first. Most importantly: Just ask people to pay.

In the search for pay models, more publishers are settling on the freemium model

over the metered model, as data options and data familiarity empower a publisher

ecosystem designed to optimise content creation and discovery aimed at core

subscribers.

A focus on the art and science behind digital subscriptions is jolting the publishing

culture into rethinking the news brand’s relationship with the consuming public.

While today’s strategic focus is digital subscriptions, the success factors are

management basics:

l What is your value proposition?

l Who should your target audience be?


The case studies in Part 2 of this report reveal how many leading news media

companies around the world are working to answer these questions — and how

the answers are influencing their strategies. The case studies, as presented at our

London summit, delve into best practices from The New York Times, Times of

London, The Economist, The Wall Street Journal, Schibsted, NZZ, Fairfax, Politiken,

BILDplus, Dennik N, Dagens Nyheter, Helsingin Sanomat, Boston Globe, Amedia,

Google, and Facebook.

Across the board, one thing that remains clear is data and technology are still

the foundations for digital subscription success. This can be daunting, so INMA

reached out to a Swiss media leader, Steven Neubauer of NZZ, to go through the

prerequisites of data and how they lead back to subscriptions.

An INMA survey of Media Subscriptions Summit delegates, the presentations, and the

association’s own insights indicate a worldwide shift away from the metered model

toward a freemium model. It also is clear there is an aspiration for smarter systems

such as the dynamic pay gate and hybrid models.

The three core pay models are meter, freemium, and hard:

l Meter: The metered model works best for brands with a high amount of

content and whose content is consistently of high quality, even as the model

converts subscribers at lower rates and longer periods of time.

l Freemium: The freemium model offers the most flexibility and upside if the

proper data analytics can be brought to bear.

l Hard: The hard pay model works best when a brand has an extreme

connection to its community.

Three augmentation models are emerging that build atop the three core pay models:

l Hybrid: Scandinavian publishers are mastering a freemium-meter hybrid

model.

l What are the ultimate end products?

l What content supports those end products?


Free registrations are re-emerging in the acquisition funnel after a few years in

which publishers either gave away content or required payment. The Telegraph in

London and the Sydney Morning Herald have given great thought to the value of free

registered users.

Various case studies from the summit also put forth best practices and metrics in

pricing, payment methods, and what’s working with social and search. Start sources

are multiplying dramatically, far beyond what a pay gate yields.

Reducing churn was a rampant topic. Strategically, next-generation publishers

suggested that their next stage of growth likely will come from smarter retention and

engagement efforts more than harder sales efforts — though for some that has been

a point of pride. Most of the retention recommendations are logical, yet it is good to

have a checklist.

While several media companies shared story genres and stories that triggered digital

subscriptions, the INMA benchmark survey broke down what is working across 35

publications. Standouts for local/regional publications were investigative journalism,

crime/police/legal, accidents, health care, and opinion. For national/international

publications, the top 5 were investigative journalism, opinion pieces, national

policies, health care, and opinion by guest writers.

While these were mostly unsurprising, The Telegraph and Amedia shared examples of

high-volume/high-trigger content as well as low-volume/high-trigger content.

A recurring theme hinted at during the summit was that content subscriptions have a

ceiling. Most companies have not reached that ceiling. Yet for publishers looking for

a business model replacement with reader revenue, the bigger play likely tilts toward

“community” and “membership.”

In this strategy, subscriptions are a subset of a bigger membership model. Yet this

l Dynamic: Several elite publishers are implementing a dynamic model based

on a high degree of personalisation that indicates reader behaviours and

willingness to pay.

l Sponspored: A less talked-about model involved sponsorship of a pay gate by a

third party which can be effective at targeting a reader segment like students.


requires a sense of purpose and community that most publishers don’t regularly

consider. Nearly half of INMA survey respondents have flirted with a membership

model, and among the prominent benefits are exclusive talks, retailer discounts, live

entertainment, movie tickets, and free small electronic devices.

Other pay models touched on during the INMA event include “pay for a purpose”

such as donations and philanthropy. Corporate and student subscriptions also

were discussed.

Meanwhile, convenience benefits emerging as basic include offering digital access

across devices, multi-user accounts, and empowering subscribers to be able to s

hare content.

The case studies presented throughout the week-long summit were varied and

exciting, and left industry experts with new perspectives, several of which are

shared in Part 3 of this report. With all the emphasis on smart use of technology and

analytics, we are still a content-centered industry, built around human hearts and

minds. No matter how you measure it, audience feelings are always at the core of

any subscription strategy.

Yet a scientific approach is also needed to make sense of what we know about those

audience feelings — their wants, needs, preferences, habits, and all of the related

data we gather. Without getting scientific, how would we translate it all into product

innovation, subscriber growth, and ultimately revenue?

Through sharing of experiences like those presented during the summit, we gain

deeper understanding. One hard realisation we must accept is that there are dozens

of variations on subscription models, and there is no one road to success.

Without a silver bullet, we are left to explore and experiment and to ponder hard

questions about whether the underlying business strategy, internal structure, and

company culture can be changed to better support the subscription model that

works for your organisation. n


Introduction

Digital subscriptions are again the hottest topic in news media today. It is the

most comprehensive answer yet to the question of how to replace declining print

advertising and print reader revenues. Yet to succeed requires much more than

building up or tearing down a paywall. To maximise success requires a top-to-

bottom review of who and what your company stands for and then rallying the entire

company behind execution.

Across the news media industry worldwide, tremendous energies are being spent on

figuring out the correct formula. Especially when newsrooms are plugged into the

efforts, digital subscriptions are proving to be the ultimate corporate galvaniser.

Yet despite these efforts, most of the fledgling best practices and lessons are buried

inside each media company.

In visits with dozens of media companies on five continents in the past 10 months,

INMA began compiling anecdotes and data to capture the digital reader revenue

revolution. It became clear that companies were smart and unique in some areas and

reinventing the wheel in others — even if the differing discovery processes that make

up “digital subscriptions” were healthy exercises.

INMA began prioritising the subject at conferences, in Webinars, in reports, in blog

posts. It wasn’t enough.

Sparked by University of Oxford senior research fellow Grzegorz Piechota, the INMA

Board of Directors set in motion the idea of a summit in London on the subject of

digital subscriptions. Piechota, a member of the INMA Board, was joined by fellow


Board member Suzi Watford, executive vice president and chief marketing officer of

the Wall Street Journal, as co-chair of the event. INMA Past President Mark Challinor,

based in London, joined the event’s committee to assist with various activities across

the week.

The event came together late, helped along by Reuters offering their conference

facilities in Canary Wharf. Yet with a lot of knowledge possessed by the INMA

committee, the agenda came together within eight weeks. A study

tour of London media houses was added. Moderator Robert Whitehead of

McPherson Media in Australia, with unique knowledge and expertise in this space,

joined the programme.

The view from the stage when a slide of high interest is flashed on the screen at the Media Subscriptions Summit.

Rarely do the assets put forward at an event add up to something actionable for an

entire industry.

Yet the INMA Media Subscriptions Summit April 16-19, 2018, in London was no

ordinary gathering. Across four days, INMA:

l Heard case studies and keynotes from 23 speakers at a summit spanning a

wide range of paid content models and methods of execution.


INMA succeeded in surfacing more anecdotes and more data about digital subscriptions.

Yet pulled together, what does it all mean? Where does it point the news industry?

In this report, INMA aims to:

l Distill and prioritise the key learnings across the INMA Media Subscriptions Summit.

l Relive the presentations.

l Provide expert perspectives.

As this report rapidly came together in the days immediately after the London

summit, we began to realise we were sitting on a gold mine of knowledge —

something publishers likely wished they had over the past decade as many of the

paid content experiments failed for reasons that were not immediately clear.

In any endeavour like this, doubts are aplenty. Is this concept really a trend or a smart

outlier? Are we really qualified to make a declaration?

Our answer to these doubts is this: We represent the nearly 9,000 members of the

International News Media Association (INMA). We have uniquely broad, first-hand

knowledge on the subject. We have a unique repository of content on the subject.

We have vetted much of this blueprint with the INMA Media Subscriptions Summit

committee and participants. We have augmented that vetting further by sharing

these conclusions with companies that specialise in paid content.

In other words, this a good start.

With this background, let INMA share with you a media subscriptions blueprint from

which you can benchmark, pivot, and improve. n

l Released a benchmark survey of representatives from 35 media companies

represented at the summit.

l Conducted an interactive town hall discussion on issues facing summit

participants.

l Visited five London media houses intimately involved with differing paid

content models and business objectives, punctuated by three keynotes.

PART 1:STRATEGIES


The big pictureCHAPTER 1

The emerging value proposition that news brands offer readers centres on

four exchanges:

l Content

l Community

l Cause

l Convenience

A. Overview

Content and convenience existed in the print world in abundance, even if these were

one-way transactions. Publishers produced content of their choosing, prioritised

and packaged the content in print, and delivered it to doorsteps or newsstands.

Community was sometimes a soft brand benefit as a reader wanted to be affiliated

with certain newspapers or magazines. News brands that resonated were rare.

We didn’t appreciate at the time how much the convenience of print factored in the

reader’s mind — editors serving as our gatekeepers and anonymously prioritising

and designing for us, pressmen quietly obsessed with printing quality, and agents

meticulously fanning out to deliver printed newspapers like a room service order.

Take away the convenience values of print as we began doing two decades ago,

and publishers quickly discovered readers hadn’t much thought about the content

outside that convenience bundle. When publishers put the print newspaper online

for free, readers put virtually no commercial value on it. That publishers lacked the


confidence to charge online created two decades of consumers who assumed

journalism must be free if it’s outside the convenience bundle of print.

This was the “original sin” of news publishers in the Digital Age. We continue to try

and put the genie back in the bottle.

INMA Media Subscriptions Study Tour participants gather for a group photo outside of The Guardian in London on April 16, 2018. The study tour visited Telegraph Media Group, Immediate Media, The Guardian, News UK, and the Financial Times.

Fast-forward to 2018.

Content remains the overwhelming driver of publisher efforts to buy a digital

subscription. Yet while there is plenty of headroom to grow reader revenue based

on optimising journalism and best practices to connect with readers, publishers

are discovering there is a ceiling to content-only subscriptions. To get a sufficient

number of subscribers to support scalable journalism and meet financial goals in

the coming years will require a reader strategy beyond content triggers. People

buy into what the news brand stands for (The Guardian). People buy into a sense

of community (The Wall Street Journal). People buy to feel empowered to share

(Slovakia’s Denník N). There are many reasons people “subscribe” besides raw content.


The INMA Media Subscriptions Summit in London in April 2018 cut across all of

these themes and brought clarity to where media fits in the emerging subscription

economy.

Moving beyond the strategic to the tactical, London summit attendees learned

something else: As publishers increasingly embrace the art and science behind

the economics of content, the freemium model for digital subscriptions is clearly

emerging as the most popular choice for publishers. This was a key conclusion from

the summit, punctuated by a survey of participants. In London, we moved beyond

the anecdotes behind this shift to a repetitious “why?”

Meanwhile, what was reinforced at the London summit is that there is no single

digital subscription model that matches the context across all media companies

serving all markets. There may be three core pay models as we currently understand

them today, yet among 25 case studies presented at the summit there were 25

variations on pay model implementation — with no two alike. As publishers get

smarter about content economics, we now see that was a flaw from the past two

decades: the belief in a silver bullet. Instead, careful thought needs to be given to

publication genre, content quantity and quality depth, brand strengths, corporate

and people assets, and much more.

A packed house at Reuters in Canary Wharf listens to 23 sessions over two days at the INMA Media Subscriptions Summit April 18-19, 2018.


Why is the freemium model rising at the expense of the metered model?

First, the metered model turned out not to be the panacea that many hoped. It

worked in particular situations with particular brands. The metered model is an

educated blind guess at consumer demand that treats all content the same — as

much a publisher expression of confidence as a consumer expression of demand.

It works well with high-volume, high-quality content and matching high-esteem

brands with high-demand audiences. It works well at companies not asking much of

newsrooms in terms of content economics knowledge.

Peter Macinga of Slovakia’s Petit Press asks a question of summit panelists at McPherson Media’s Damian Trezise looks on.

Second, the rise of the freemium model coincides with the rise of data in the

everyday conduct of business at media companies. It coincides with the embrace of

data by newsrooms more and more interested in metrics. So not only did the meter

not work well enough for community, regional, metropolitan, and some national

publications, a data-friendly and culture-friendly model emerged. The freemium

model provides more levers to optimise consumer behaviour.

Third, these models are highly likely to evolve into smarter hybrid models

(Aftenposten, Dagens Nyheter), dynamic models (NZZ, The Wall Street Journal),


and models we can’t yet imagine or define. So don’t get too comfortable with

2018 definitions.

There is an art and science behind setting a meter and managing within a freemium

model. There are simply more options and complexity in a freemium model.

Culture plays a huge role in the freemium model’s rise. Piano CEO Trevor Kaufmann

said that “the act of launching a hardwall makes our client think about product

development in a different way than launching a meter.”

It forces a cultural discussion about the reasons behind producing content: Does it

trigger a subscription? Does it get shared a lot on Facebook? Does it add to brand

foundations? Most newsrooms have never gone through the exercise of questioning

the reasons behind why content gets produced. A trigger-based paid content model

forces that discussion and focus.

In the closing town hall discussion, diehard delegates helped crowdsource takeaways, conclusions, and benchmarks used in this report — including an ad hoc panel put together by moderator Robert Whitehead who had not yet introduced a pay gateway. From left, Murray Kirkness from The New Zealand Herald/NZME, Guido Pinto from Global Media Group in Portugal, and Emre Kizilkaya from Hürriyet in Turkey.


Across the INMA Media Subscriptions Summit, we found five over-arching themes

that separate media companies that are performing better than others:

B. Over-arching themes

Adoption of a clear growth mission.

Adoption of a unified, all-of-company approach.

Success requires a deep knowledge or strong hypothesis about your valuable

audience segments.

Implementation needs a complete transformation to focus a core value

proposition, brand, communications, effective content, products, payment

methods, and customer excellence.

A membership mindset is the foundation on which subscriptions need to

be built.

1.

2.

3.

4.

5.

Among the key lessons derived from the summit, six stood out:

C. Key lessons

Hold your nerve on subscription pricing. Focus on building better value for

readers.

Hold your nerve on pay gate settings. Move tighter — never looser — and

build value.

Prioritise your subscriptions effort based on where consumer revenue fits in

your overall revenue mix.

Track only a few key data measures to drive subscriptions profit growth.

1.

2.

3.

4.


“Just ask people to pay.” Your first effort doesn’t have to be a full paywall

deployment.

Get your basic data foundations in order in a single system before you start.

5.

6.

What we were struck by in London was that while the subject is “digital

subscriptions,” much of the strategy behind this is Management 101 or Journalism

101 or Marketing 101. Talk of the strategy behind brand, audience, and product could

have happened in 2018, 2008, 1998, or 1988.

For example, here were some strategy takeaways from the London summit:

D. Strategy

Value proposition/brand1.

Determine your value proposition to your audience.

You need a strong value proposition based on something authentic and

meaningful — something that matters.

You need to align every part of the business to one unified proposition

such as the New York Times and Politiken.

Execute that strong brand proposition in all communications, marketing,

and content.

a.

b.

c.

d.

Audience2.

Make sure you are targeting the most valuable customer that also fits the

mission.

Research the lifetime value (LTV) to your business of readers to know

whom to chase.

Focus your main efforts on acquiring, growing, and retaining your “super

users” who deliver most of the digital value to advertisers and/or most of

your subscription revenue.

a.

b.

c.


Ensure they want to belong to your purpose.d.

Product3.

Test subscription features, terms, and tools such as family log-ins and

multi-device.

Analyse content data to determine what best to publish when and in what

format.

Allocate topics and product features to the relevant platform to support

the value proposition.

Choose and mandate the resulting product formula. For example:

a.

b.

c.

d.

i. Audience first: publish online and in print around what and when

readers like it.

Digital first: publish everything as soon as it’s received.

Editions first: publish digitally to set edition times around

reader visitation.

ii.

iii.

Edition best-practice: What differentiates The Times and Sunday Times

in London from others is this piece of reader feedback: They value the

brands for authoritative reporting, analysis, and opinion — not breaking

news. Armed with that feedback, The Times conducts “edition-based

publishing” on its Web site. In lieu of a real-time Web site, they create

an overnight edition, then update it three times daily at fixed times: 9:00

a.m., 12:00 noon, and 5:00 p.m.

e.

Content4.

Put editorial at the centre of the membership/subscription project.

Create a content checklist of stories that best acquire, engage, and

retain subscribers.

a.

b.


Share story performance data in the newsroom for acquisitions and

engagement success.

Use data to work out what not to do (topics, writing style,

presentation style). n

c.

d.

Torstar’s Anna Marie Menezes asks of questions of panelists during the Media Subscriptions Summit.


Data and technology

CHAPTER 2

A. Data

There is no effective digital subscription effort without data. So even if the subject

wasn’t on the London event’s marquee, data advice was everywhere.

Unify and cleanse data before you start.

Collect only one or two data points on acquisition to reduce friction. Add to

it over time.

Only track and report a handful of key drivers for your strategy.

Find a simple, cloud-based, off-the-shelf solution for storing and analysing.

Don’t build.

Use automated, easy-to-use tools for marketing communications and

running acquisition, engagement, renewal, and upsells.

Track key metrics: acquisition of target audiences into the funnel,

registration, content which is effective for registration, acquisition,

engagement, renewal, lifetime value.

Operationalise by embedding a small number of data gurus within the

business.

1.

2.

3.

4.

5.

6.

7.


B. Technology

Buy cloud-based technology for a pay gate unless you have vast resources to

build in-house.

Seek lightweight or open-source where you can so you can keep upgrading

and adapting.

1.

2.

Data and tech foundations

After the summit, INMA asked Neue Zürcher Zeitung (NZZ) Managing Director

Steven Neubauer — whose data-infused dynamic pay gate model outlined in

London was among the highest-rated presentations — to put into context some

data starting points.

A media company won’t survive in the long run without a mastery of data. Yet not

everyone will have the resources or the starting position to do branding like some

of the major global brands.

Instead, Neubauer suggests identifying “must-have” prerequisites that everyone

Summit delegates had many unique ways of capturing the proceedings, including this coverage of NZZ’s Steven Neubauer.


l Data consolidation/data engineering: Ideally complemented by your own

data science team, be prepared to spend up to US$1.5 million per year for 2-3

years to get you to this.

l Establish central, scalable, and agile-ready technology platforms for product

and marketing: This can be very expensive depending on your starting basis.

Leverage standardised, open source-tools where you can.

This is a great area for industry collaboration within each country.

l Experimentation: While you do the heavy groundwork of data and

technology, start small experiments in parallel — ideally in all areas, but

start with colleagues that are willing to follow down this path. This way you

start building up the necessary culture of experimentation and continuous

improvement, Neubauer said. This is the toughest part as it requires

leadership and the willingness to admit mistakes, which is painful. n

needs and can be achieved with a reasonable budget. For example, build up a data

team within the business and provide it with the power to consolidate all data.

A publisher doesn’t have to do everything themselves in data science as there

are service providers emerging. But no one will do the hard data consolidation

and engineering:


Paywall modelsCHAPTER 3

There are three core paywall models, and each has its pros and cons:

A. Core models

Meter model1.

Strength: Works for brands with strong identities and a focused purpose

and if you have a high volume of content. The model retains subscribers

well, as readers who do buy are usually more familiar with the brand and

are more active. The meter results improve over time and if tightened.

Weakness: It is impossible to monitor usage across devices for readers

who are not registered. Conversion rates are lower than other models.

The time to convert is much longer.

Opportunity: Improve effectiveness by unifying and tightly focusing the

product, brand offering, and communications.

a.

b.

c.

Freemium model2.

Strength: Works for brands with unique content. Effectiveness improves

over time, often as more content is locked. It is the best model for

conversion of readers to purchase, offers the most flexible approach

for groups with multiple brands with different positioning which need

different lockdown policies.

a.


Weakness: You can lock the wrong content if editors decide rather than

using data to analyse stories which trigger subscription acquisitions and

engagement.

Opportunity: Use this approach as a catalyst to strengthen the content

offering around the main value proposition.

b.

c.

Hard pay model3.

Strength: Works when brands have an extreme connection to their

community. Also works when most of the content is aimed specifically at

that community’s key reader needs. Requires extensive communication

pre- and post-launch to explain the value. It works with publishers who

set mid-range to high-range prices.

Weakness: Potential new readers cannot sample content easily. The

model is not suitable if digital advertising revenue is the main priority or

where publishers over-state the relevance of their content.

a.

b.

Three augmentations to meter, freemium, and hard pay gates are emerging:

B. Augmentation models

Hybrid: This model is, as the name suggests, a hybrid of freemium and

meter. It is based on the freemium model, usually with a medium to high

number of articles locked down and the remainder of content metered.

There is little to no free content.

Dynamic pay gate: This refers to a personalised approach that can be

used with meter, freemium, and hard pay models. It involves personalised

communications, pricing, and content. Use technology to create a highly

personalised entry through the paywall based on reader behaviours and

willingness to pay. This likely will be the dominant model soon.

Sponsored pay gate: This refers to the sponsorship of metered, freemium, or

hard pay gate access by a third party to provide subscriptions to strategically

important reader segments, including students.

1.

2.

3.


According to an INMA survey of 35 companies participating in the London Media

Subscriptions Summit:

C. Deployment snapshot

31% had a freemium model with a minor lockdown of content.

23% had a freemium model with a major lockdown of content.

22% had a porous meter model, meaning a high number of free articles.

12% had a meter model with a major lockdown of articles.

9% had no subscription model.

With the main hall at Reuters Canary Wharf sold out, 50+ delegates watched the Media Subscriptions Summit from two video simulcast lounges.

Freemium and hard paywall publishers reported the highest levels of satisfaction

with performance. Meter paywall publishers report the most dissatisfaction with

performance. Many publishers are expecting they will move towards a dynamic

model shortly. The survey unveiled a lot of fluidity with paid content models.

D. Satisfaction

l

l

l

l

l


Looking to change models: Roughly 41% of survey participants are

unhappy with their paid content model, while 34% say their model has met

expectations and 25% say it has exceeded expectations. Two-thirds of survey

participants are looking to switch models, while 76% are looking to add

new features to their pay model. Personalisation across both freemium and

metered models represents a rising focus, with market leaders being Neue

Zürcher Zeitung (NZZ) in Switzerland and Aftenposten in Norway.

Freemium satisfaction: The freemium model represented 54% of paid

models among survey participants — and the highest levels of satisfaction,

with 80% and 82% of minor and major freemium lockdown model

participants, respectively, reporting freemium either met or exceeded

expections.

Metered dissatisfaction: Few publishers are reporting satisfaction with

meters. While 34% of survey participants use a metered model, the

performance of that model falls below expectations both for porous

meter users (57%) and strict meter users (75%). The porous metered model

represents the most chaotic responses: Some 29% of survey respondents

said their porous metered model has exceeded expectations, while 57% said

it performed below expectations. Overall, it is emerging that those publishers

who are reporting success with metered access are those specialised or

highly focused brands. n

1.

2.

3.

The survey of summit participants unveiled clear directions by publishers:


Acquisition and retention

CHAPTER 4

There emerged across presentations in London some commonalities in best

practices in the acquisition funnel: registration, payment, pricing, social/search,

conversions, and onboarding.

A. Acquisition

Registration1.

Seek registration from target audience to fill the purchase funnel.

Sign-ups for specialist newsletters are an effective way to drive

registration.

Give something in return. For example, limited article access and

newsletters.

Simplify registration forms. Social sign-in, for example, works best for

registration.

a.

b.

c.

d.

Many publishers in the digital subscription era are so focused on the

bifurcated universe of free visitors and paid subscribers that they have largely

abandoned the bucket of free registered users. Yet as one speaker put it,

there is no greater indicator of interest to pay than volunteering your e-mail

address. But what benefits accrue to free registered users?


For the Sydney Morning Herald, the answers to drive registration and

authentication are:

Newsletters.

Access to top stories.

Commenting on articles.

The ability to “shortlist” an article for future reading

•

•

•

•

In the case of The Telegraph in London, which aspires to acquire 10 million

free registered users, the registration-first freemium model softens the hit

with an offer to register for free in exchange for:

One Telegraph Premium article per week.

The ability to comment on articles.

A choice of newsletters.

Telegraph Premium news, offers, and updates.

•

•

•

•

Pricing and packages2.

Optimise everything to fine-tune targeting, methods, and offers (Wall

Street Journal).

Do price-choice modeling work to set the right starting price. Don’t

guess.

Personalise the initial price/offer term and renewal price.

Combine with other partners, including cable TV (Newsday).

Open the pay gate for a limited number of special news events and close

it the next day, presenting the right sign-up offer to the right people.

a.

b.

c.

d.

e.

Payment3.

Offer a range of payment types, including one-click and no-click

sign-ups.

a.

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Automated direct debits from bank accounts or credit/debit cards are

best.

No-click option includes selling via a telco (Spotify) or via a cable TV

provider (Newsday).

Apple subscriptions convert well (BILD). No data yet available on Google/

Facebook trials.

PayPal one-click, in countries where offered, performs well for purchase.

ApplePay, where offered, as a browser payment type converts well, but

churn can be high and needs work on retention.

Payment by SMS: good to generate new market, bad for churn, but you

do have their mobile numbers.

Note: social sign-ins can make people less likely to want to pay via credit

card.

Do not send invoices, a surprising tactic still around in 2018.

b.

c.

d.

e.

f.

g.

h.

i.

According to the INMA benchmark survey, the best performing payment types for

retention are pre-paid yearly or more (32%), open-ended auto-debit (25%), in arrears

auto-debit (21%), and pre-paid monthly (18%).

Conversion benchmarks4.

Meter: conversion rate 0.36%, time to convert 11.65 days.

Hard/freemium: conversion rate 4.33%, time to convert 3.65 days.

a.

These conversion benchmarks were provided by Piano during the summit

and study tour:

b.


Social/search5.

Social works well for subscription acquisitions.

Use data to ensure you are only targeting your key audience segments.

Test opening limited access to articles for conversion, then monitor

retention (Financial Times, The Wall Street Journal).

a.

b.

c.

Onboarding6.

Create templates for an outstanding customer experience (Economist,

BILDPlus).

The purchase decision continues during onboarding. Help people validate

their decision.

Automate the e-mail and newsletter process, fine-tune by segment.

Personalise the onboarding communications as your technology

becomes sophisticated.

a.

b.

c.

d.

Facebook’s cocktail reception included this international network: Mira Pasveer of NRC Media, Armand Francois Kasselman of Media24, Hanne Hendrikx of Mediahuis, Jan Meischein of Verlang Lensing-Wolff, and Steve Immelman of Media 24.


Start sources multiplying7.

Over the past two years, Norway’s Aftenposten has seen a steady rise of

subscription starts being triggered from its hard-locked articles (freemium) —

more than its meter. Aftenposten runs a freemium/meter hybrid paid model.

Yet it is a dramatic increase in subscription starts from campaign sources

in the past four months that is jolting. Whereas Aftenposten start sources

once were its meter and e-mail marketing campaigns, today there are at

least 10 sources of regular sales sources: in content, newsletter, touchpoints,

retargeting, in-feed, programmatic, social media, and more. Over time,

Aftenposten ramps up its subscription campaigns when big events like a

parliamentary election aren’t automatically boosting traffic.

B. Retention

The Media Subscriptions Summit in London focused a lot on strategies and hard

tactics to acquire and retain paying customers. The summit mainly took a helicopter

view of engagement — the subject of the INMA Consumer Engagement Summit

November 8-9, 2018, in Miami.

Churn and retention

Sverre Johnsen of Schibsted and Kari Lindoe of Aftenposten share a mobile moment during Media Subscriptions Summit sessions.


Yet there were plenty of clues that publishers realise that the growth path moving

forward is increasingly about retention. Despite reaching 101,000 digital-only

subscribers, Aftenposten executives are convinced that sales prowess alone will not

get them their next 100,000 digital subscribers. That will require a mindset shift to

“lasting relationships.”

News UK’s Alan Hunter finds a slide worth a snap during a Media Subscriptions Summit session.

Here were key lessons learned in churn and retention at the London summit:

Churn1.

INMA survey: Digital subscriber churn remains a challenge for publishers.

Some 46% of INMA survey participants said that digital subscriber churn

is higher than print subscriber churn — with 19% saying it is much higher.

Among common themes to reduce churn include acquiring subscribers

the right way the first time, discontinuing discounting, improving

engagement, enhancing the brand proposition, and removing credit card

renewal friction.

a.


Best practice: Sweden’s Dagens Nyheter saw people subscribing because

of content yet leaving because of something else in the customer

journey. They implemented an all-of-company retention project which

cut churn by nearly one-third in six months to an average 10.35%

monthly. Key was to focus on churn drivers which include time as a

subscriber, the acquisition channel, frequency of visits, whether the

customer is paying via paper invoice or auto-pay, and the type of product

they are consuming. The company created a real-time dashboard to keep

management updated on these churn drivers, and Dagens Nyheter now

knows within 86% accuracy who will churn.

c.

Meter: one month, 5.6%; three months, 15.5%; six months, 26.3%

Hard/freemium: one month, 7.8%; three months, 20.3%; six

months, 31.3%.

b. Piano data around subscriber churn emerged, namely

these averages:

The Media Subscriptions Summit in London attracted 230 delegates from 33 countries.

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Retention2.

Choose low-friction renewals.

Adopt open-ended contract terms where possible and auto-pay.

Don’t send out bills.

Acquire the right customer in the right target segment in the first

instance.

Don’t acquire on discounts and expect them to stay.

Do pricing work to set personalised yield maximising price.

Have detailed save strategies (various cases, including Sky TV) against

customer data.

Standardise all offers and eliminate customer frustration with what they

have seen elsewhere.

Where possible, schedule a rollout of new product features to help with

retention (Netflix).

Match service agent profiles to reader segments to better engage. n

a.

b.

c.

d.

e.

f.

g.

h.

i.

j.


Content that works

CHAPTER 5

While several speakers shared their experiences with article topics that triggered

subscriptions, the INMA survey of summit participants represented one of the

first-ever broad-based attempts to capture this. What INMA did was break down

responses from local/regional publications and national/global publications.

With weighted scores, here is what local/regional publications said were the biggest

acquisition triggers:

A. Genres that trigger subscriptions

Investigative journalism (20.93)

Crime/police/legal (19.85)

Accidents (18.00)

Health care (18.00)

Opinion (17.67)

Local business (16.70)

Opinion by star guest writers (16.00)

National politics (14.78)

Stories that improve your life (14.23)

Live stream local football (13.90)

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.


For national/international publications, the top acquisition triggers were:

Investigative journalism (21.08)

Opinion pieces (21.00)

National politics (20.91)

Health care (18.14)

Opinion by star guest writers (17.90)

Business (17.50)

Curiosities (16.00)

World politics (15.71)

Crime/legal (15.50)

Topics to improve your life (15.00)

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

B. Publisher lessons

The INMA survey results reminded us of The Telegraph’s “superstar” content vs.

“community drivers” paradigm shared on the London study tour. An obvious macro-

trend to cut through all of this is that original content with an authentic voice

triggers more subscriptions than commodity content. That also reminds us of how

Norwegian community publisher Amedia learned to “cut out the content noise”

when optimising for subscriptions. Why would a publisher pollute their digital

content ecosystem with commodity content that stands in the way of high-value,

subscription-triggering, authentic voice content?

While The Telegraph’s model for “community drivers” — content that had low page

views yet drove high registration conversion — seemed to skew toward content for

older readers, surely Amedia’s single-camera video coverage of Norwegian football and

youth sports would fall under this header, too. The traditional pageview view of success

would never hold youth sports video or nostalgia content as paragons of virtue — yet

they now are vitally important if a subscription is the new definition of success.

A common theme throughout: Align the core product to subscribers — not visitors.

This is the new content economics lexicon that must become “normal” in

newsrooms and boardrooms. n


Emerging models

CHAPTER 6

Many of the initial publisher efforts to generate subscriber revenue were based on

the rational idea of paying for content. Yet there are more emotional, value-added

concepts such as “community” and “membership” that, combined with content

subscription, can prove powerful.

For example, U.K. magazine publisher Immediate Media says “community” is just

as important as content in the subscriber relationship. The Wall Street Journal is

establishing membership as the core to its reader relationship strategy, with content

subscriptions being a part of that bigger relationship.

Key lessons on membership include:

A. Membership

Have a strong sense of purpose and sense of community to which people

want to belong.

Create a “forever proposition” so people never want to think of leaving you.

Loyalty, like subscriptions, is a subset of a membership framework.

1.

2.

3.

Membership benefits beyond content subscriptions were offered by 47% of INMA

survey participants with the most prominent being (with weighted scores):

Exclusive talks (9.08)1.


Discounts at retailers (9.00)

Live entertainment (9.00)

Movie tickets (8.00)

Free small electronic devices (7.40)

Sports tickets (6.80)

Discounts at publisher e-store (6.38)

Video streaming (5.40)

Music streaming (5.30)

Paid TV access (3.50)

2.

3.

4.

5.

6.

7.

8.

9.

10.

From the survey, summit, and study tour, we thought these ideas were outliers even

if they were not the most utilised:

Unlock articles for friends.

Travel discounts.

Free e-books.

Subscriber-only competitions.

Meet the journalists.

Visit the newsroom.

Partner with third parties that fit your brand.

B. Pay for a purpose

Ask people to pay more than the subscription price to support your cause

(Denník N, The Guardian).

1.

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Ask people to donate to a trust that employs investigative reporters or

the newsroom.

Use philanthropy efforts to ask people to gift money from their wills/cultural

institutions.

2.

3.

C. Corporate and student subscriptions

Know where corporate subscriptions add the most value and target

company-by-company.

Corporate digital subscriptions are mandatory for specialist publications.

Use student subscriptions to add to your future paying audience with a long-

term view.

Market student subscriptions within a wider message of helping educate,

inform, and socialise.

Test gifting and sponsorship models to improve yield and smooth acquisition.

1.

2.

3.

4.

5.

Newsday’s Patrick Tornabene talks shop with the Boston Globe’s Peter Doucette during a break at the INMA Media Subscriptions Summit.


Multi-user accounts: Only 15% of paid news offers include multi-user

accounts, Piechota said.

Sharing intrinsic to engagement: For engaged music platform users,

sharing and creating playlists is a crucial value. For Slovakia’s Deník N, letting

subscribers share paid content has become the most valuable feature of its

premium tier. n

•

•

D. Convenience basics emerging

Cutting across Reuters Institute and his personal research, the University of

Oxford’s Grzegorz Piechota painted a picture where convenience is more “king”

than content.

Access across devices: While 82% of paid news offers in North America,

Australia, and the top European Union countries are based on differentiated

access by devices and channels, access across all devices has become part

of the basic packages of Netflix and the New York Times. When asked why

people buy access to digital video and audio, a Fluent study showed the

second-most cited reason (23%) was the convenience of streaming to any

device.

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Subscription models benefit by treating audiences like members

CHAPTER 7

Audiences have shown they are willing to pay for subscriptions across many

industries. But as news media continue to grapple with pricing models, customer

trust should remain at the forefront.

News media is not the only industry playing with subscription models, according to

Robbie Kellman Baxter, author of The Membership Economy.

“Virtually every kind of industry is moving toward a subscription model,” Baxter said.

This goes beyond media companies like Netflix and Spotify, she said. A 3-D printer

company requires users to rent its product and send data back to the manufacturer.

Even unexpected industries, like dental pain management companies, are exploring

membership and subscription models.

It all comes down to relationships, Baxter said. “I would say that the main reason

membership is becoming so important is that technology is extending the

infrastructure that enables trusted relationships.”

These relationships are a long-term investment.

While subscriptions are currently a hot topic, the freemium model is not a new

concept, according to Gzregorz Piechota, senior research fellow at the University of

Oxford, who has been studying business model innovation and digital disruption.

“I believe that the freemium model started many, many, many decades before the

Internet,” Piechota said. Just look at the September 13, 1987, issue of the daily New


Robbie Kellman Baxter, author of The Membership Economy, explains that many industries — including the news media industry — are moving to a membership model.

York Times, which contained more than 1,000 pages of content and advertisements.

The newspaper only cost US$1.25.

“We’re giving away our newspapers almost for free just to get more reach for

our advertisers,” Piechota said. This still happens with publishers’ current

freemium models.

“They want to maximise penetration in the cheapest way possible, and the cheapest

way possible is to give away access to a stripped-down product, basically,” he said.

As publishers redefine their business models, they also reconsider their

pricing models.

Pricing and trust are closely connected, Baxter said. With dynamic pricing that

changes on tiered levels, or is negotiable on a retention basis, audiences have less

trust in a company.

“As your pricing gets more complex, your trust goes down,” Baxter said. Audiences

do not want to feel like they have to be experts in your pricing. “Subscription is a

pricing decision. It’s a tactic. It is not a strategy.”

Simplifying the path to subscriptions is just one aspect publishers must consider as


Grzegorz Piechota, senior research fellow at the University of Oxford, shares subscription lessons learned from his research into business model innovation and digital disruption.

they rethink their business models. Membership is a mindset, and it may be linked to

a redefinition of how publishers understand their own value in the lives of their users.

Piechota said he recognises a shift in how news media companies talk about their

product as they pivot toward audience revenue models: “Basically they sounded like

people from a political movement, a church.”

Changes in perception go beyond talking points publishers use to communicate

value to potential subscribers. They can have real impact on the actual structure and

strategy of a company.

And an organisation can change dramatically when it stops viewing members as

customers. “When you’re focused on serving the most loyal people in the best way,

you’re kind of flipping things on their head,” Baxter said.

Focusing on the most engaged users, which Baxter and Piechota both refer to as

“super users,” does not only change an organisation, but it can also have an impact

on a product.


“Suddenly you may realise that your product becomes very different from other

products on the market,” Piechota said.

Serving member needs is one way publishers can drive changes to their business

models, as well as in their audience relationships. Baxter referenced Maxlow's

hierarchy of needs, pointing out that, as people have basic needs met, like housing

and food, they have the capability to reach for more personally fulfilling needs, such

as social, self-esteem, and self-actualisation.

“And organisations that can tap into these timeless needs are the organisations that

are going to get the greatest loyalty from the people they serve,” Baxter said. Long-

term success is anchored to this loyalty. Publishers must continuously demonstrate

sustainable value for their members.

The road to a long-term subscriptions strategy is a long and challenging one,

Piechota said, but there is hope. Each year, more people pay for news than in the

previous year. It may be a steep learning curve, Piechota said, but it’s well worth

the effort. n

http://www.inma.org/worldcongress

PART 2:CASE STUDIES


While The New York Times and The Times of London differ on their fundamental

paywall strategies, both have succeeded in building revenue brands in the digital

realm and serve as industry models.

Charlotte Gordon, vice president for international consumer marketing at The

New York Times, shared an approach that was all about seizing every opportunity

to become more relatable and emotionally connected to millions of new younger

readers.

“In a sense, messaging becomes slightly less important,” she said. “It’s a hard thing for

me to say out loud as a data marketer, but it seems that as exposure to the paywall

and to the gateway becomes more frequent, then you don’t necessarily need to be

bombarding people morning and night with offers.”

While The New York Times goes out of its way to sample and respond to market

feedback, the digital story of The Times of London, as told by Head of Digital Alan

Hunter, is one of often bucking industry and even reader criticism to pursue the

newsroom’s standards and instincts as a financially successful 21st century news

source.

CHAPTER 8

New York Times, Times of London share revenue successes


Charlotte Gordon, vice president for international consumer marketing at The New York Times, explained a strategy rooted in market feedback and a paywall that works because the company adjusts access and offers in response to audiences.

“I do think that being radical can be as much about what you don’t do as what you

do do,” Hunter said. “We are very much the establishment paper.”

“But we do do innovation and have done, throughout our history,” he quickly added,

citing as an example the Times of London’s first adoption of a steam-driven printing

press in 1812.

More recently, the two Times have been notable in their very differing philosophies

on putting high-value content online behind paywalls.

New York’s wall has adjusted repeatedly over the years to become more concrete

and then more porous. It also has been routinely buttressed with special offers to

new and potential subscribers in an effort to cement their fledgling interest.

“Of course, we’re still making offers,” Gordon said. “But we’re making it more about

journalism and what you’re paying for. Yes, there’s an offer, but we’re leading with

the value.”


When asked about the inconsistency between staking out a premiere value position

versus continually discounting the price of subscribing, Gordon said, “In an ideal

world, we wouldn’t. In an ideal world, we’d all be like Apple or Netflix and have one

price. But that hasn’t driven the optimum performance for us at this stage.”

The New York Times Vice President for Subscription Growth and Planning David

Gurian-Peck said, “We’ve tried to test our way with different things. And we

constantly test different offers optimising for that trade-off between short and long

term. And anytime we’ve tried to move away from having discounts, it’s simply not

effective.”

In contrast, The Times and its separate Sunday Times in London have taken a much

harder line on paying for content online ever since 2010 when the daily became the

first general-interest newspaper to go behind a paywall.

“It is fair to say that it wasn’t received rapturously across media land, where it was

declared that we didn’t understand the Internet — particularly that the proprietor

[Rupert Murdoch] didn’t understand the Internet, where content wanted to be free,”

Alan Hunter, head of digital for The Times in London, shared a digital success story that began with a hardline approach to the company’s paywall, which was one of the first in the industry. Over the years, the paywall softened somewhat without compromising the digital value proposition.


Hunter said. “Our model was really the hardest of hard paywalls. You couldn’t read

anything unless you paid.”

And The Times also kept raising its digital prices.

When online subscription growth stalled in mid-2016, however, The Times started

its own recasting of the digital value proposition, while “in no way compromising our

commitment to paid content,” Hunter said.

“I think it’s fair to say that, when we look at our past paywall, it was probably too

hard, though it did establish in readers’ minds that you need to pay to read quality

content from The Times and Sunday Times,” Hunter said. “But then we also ...

realised that there were some meters that were too generous. It seems clear the

answer is in the middle. So, the paywall has given us profitability, but also given us

the freedom to be different, to find out and respond to what our subscribers want.

We don’t follow fashions or respond to what everyone else is doing.” n


Deeper audience understanding is a common thread shared by subscription

strategies of The Wall Street Journal and The Economist. Each company has

followed a different path for leveraging their audience relationships to build reader

revenue.

When The Economist's advertising revenue began to drop significantly in 2012, a lean

and creative new strategy emerged, said Marina Haydn, managing director of global

circulation. “It was about really working with as little money as possible in the most

effective way.”

At the same time, The Economist also made reader revenue a priority. With a three-

article metered paywall and its editorial asset of a global perspective, the company

already had a significant number of digital subscribers.

In 2013, they had undergone a thorough and significant price increase process,

Haydn said, and the investment payed off. Circulation revenues outperformed

the market. The shift in reader revenue also had an impact on the company’s

marketing strategy.

CHAPTER 9

Economist, Wall Street Journal understand their audiences


Gaining new subscribers requires creativity and a clear understanding of the target

audience. Haydn described a recent campaign designed to reach the curious

consumer with a surprising, intriguing experience they’ll never forget. People were

invited to London’s Canary Wharf to try ice cream covered in bugs and food-waste

smoothies, both linked to content in The Economist.

This culture change around audience has pushed The Economist into a journey, and

these actions are the first in a long future of experimentation.

“We are really hardwired in this learning loop, while we are working on insuring that

we evolve our marketing mix,” Haydn said.

For The Wall Street Journal, a paywall is nothing new, but related challenges

still arise.

“You think that the Wall Street Journal, having the first paywall over 20 years ago,

that we’d be in a really good place, but we weren’t,” said Suzi Watford, executive vice

The Economist Managing Director of Global Circulation Marina Haydn said connecting with target audiences in creative ways has helped make it possible to increase pricing and circulation at The Economist.

“One of the key drivers behind that growth was a strategic decision in investing more

to acquiring new subscribers of the globally curious,” she said.


president and chief marketing officer.

The original strategy had been about print protection, Watford said, and not a focus

on the customer. Despite this, the company doubled digital membership.

“Now we have customer revenue that is bigger than advertising,” Watford said.

“And digital customer revenue has gone from being the smallest revenue line to

the biggest.”

Suzi Watford, executive vice president and chief marketing officer for The Wall Street Journal, explained how the company’s membership model brought a focus on readers to the forefront and increased customer revenue.

Watford shared 10 steps crucial to this revenue shift:

State your mission. The company set an internal goal to reach three million

subscribers in three years. “I think for us it’s safe to say that was absolutely

instrumental,” Watford said. “It became a chant: the three million in three

years. It became the thing we all talked about it.” Part of working toward

that goal was letting customers create their own relationship to the brand.

1.


“It meant that we had to be happy with customer choice … and if they want

digital that’s fine by us.”

Know your customer and brand; know your ambition. The company

identified 10 audience segments; six were key. By creating a campaign

centred around the ambition of its members, the company was able to

increase subscribers and lower the average member age. “We saw that The

Wall Street Journal had a role to play in what was going on in the world,”

Watford said.

Create a clear vision: membership matters. “I know there’s been a debate

about whether membership is the cherry on top or the foundation on the

bottom,” Watford said. “For us it was absolutely foundational.” The company

wanted members to become advocates for the brand and wanted to create

personal relationships with subscribers. “We wanted to create a membership

that felt connected, personal, and exclusive.”

Structure for growth: the membership model. “If we had been thinking only

about subscriptions, I think we would have only been thinking about the

middle or maybe the bottom,” Watford said. By widening its offerings with

student and professional memberships, The Wall Street Journal was able to

increase the flow into the top of its subscriptions funnel. This is changing the

fundamental membership makeup. The average subscriber age is now three

years younger, and its student audience is 53% female, compared to 80%

male audience average.

Think customer first: the paywall and machine learning. Knowing they

were offering too much free content, Watford said the company was able

to switch its mindset around the value of its content. While staff previously

believed their arts and culture content was not important, they learned it was

one of the top five drivers on conversion. “We really went after understanding

how much content our members need to see before we ask them to

subscribe,” Watford said.

Create demand: acquisition funnel and how to use content. When

addressing the marketing funnel, The Wall Street journal wanted to

move people who were cold prospects at top of the funnel down to

warm prospects at the bottom. So, the team drove people to sample

2.

3.

4.

5.

6.


valuable content, which resulted in growth around staples that drive print

subscriptions as well. “A lot of the things we used to see in print are still

driving subscriptions in digital,” Watford said.

Optimise everything: subscriptions as a science. By focusing on a mixture

of data and product, the company is able to get people to read more by

showing more content on the page.

Focus on engagement: the key to reducing churn. Reducing churn is the

biggest area that needed collaboration across the business. The Wall Street

Journal relocated all of its staff to New York City to create a more fluid

connection. Collaboration should also occur across product, marketing, and

news, Watford said.

Know the value of your members. Deeply understanding customer activity

can move them up the value chain. It also helps the staff better serve

customers on an individual basis. “I can look at any member now and know

what their total customer value is,” Watford said.

Diversify your revenue. Professional memberships sit at the top of the

pyramid for The Wall Street Journal. “It’s where we bring together live

journalism and membership,” Watford said. Professional memberships are

by invitation only and offer special access to conferences, dinners, and

networking at more than 200 events a year.

Watson said the biggest challenge these kinds of changes is deeper than finances

or membership; it has to do with the culture: “We keep talking about newsroom

transformation or marketing transformation, and yesterday we heard about whole

company transformations. I think that’s quite rare. I think that’s the thing we need to

be able to do.” n

7.

8.

9.

10.


For many news media organisations, subscription conversion strategies are now

entering the realms of emerging technology: machine learning, random forest

methodology, pattern recognition, data visualisation, and Artificial Intelligence.

Schibsted in Norway and NZZ in Switzerland each have implemented new systems

and technology to drive their growth and influencing their subscription sales and

retention strategies. Each company has enjoyed its successes thus far, and they’re

learning a lot along the way.

“One key prerequisite to apply Artificial Intelligence or machine learning

methodology to your business is a unified data warehouse,” said Steven Neubauer,

managing director of NZZ. “If you don’t have your data in one place so you can

use it in those processes, if it’s not accessible. If it’s spread across systems and silos

and functions, or different companies if you’re a large company, you won’t make

progress there. You need to have it in one place. It’s an effort. It takes time. But you

need to go through that process if you really want to have good results out of it.”

Neubauer also recommended having data science experts reside on the business

side, not in the technology division where they won’t be immersed in a business

mindset or see the immediate results of their efforts.

CHAPTER 10

Schibsted, NZZ use technology to boost subscriptions


“No. 1 for us is to build scalable platforms, central platforms, and that infrastructure

that allows for experimentation, and to accelerate those learning cycles,” said

Neubauer. “In the last months, we’ve really exponentially increased the learning

cycles that we’re going through. In the beginning we were making, I don’t know,

maybe one or two A/B tests per month, if we were good. Now we’re doing dozens

each day. It really helps to go out and test to see what’s working and what’s not.”

Schibsted’s Johannessen also emphasised that data collection is only the start.

“Data is super important,” said Siri Holstad Johannessen, Schibsted’s publisher’s

head of sales and marketing. “And data is increasingly more used in Aftenposten,

and we’re trying to use data for every decision we make. But we still consider it early

days and we’re not done. We’re just seeing the start of how you can use data to grow

subscription sales.”

One recent area of focus for Schibsted has been data visualisation, made accessible

to the whole organisation. Johannessen explained that their data tool, called Insight,

is visible for every employee. “All the journalists, all the business side, can see this.

And that really makes us move in the same direction, making good choices, working

with optimisation in the right way.”

Steven Neubauer, managing director of NZZ, believes it is critical to maintain a close connection between the business and data science teams.


“Once we have all this data, we need some analytics to make it even more useful,”

she said. “We’re doing a lot of data modeling and predictive analytics support to

support all our teams. Algorithms give us insights into patterns for those who convert

and those who don’t — combining subscription data with visitor data or log-in data

and telling us who we should target. It’s working really, really well.”

“So, we are using algorithms now. And the data team has made a tool so that every

time a subscriber calls the service centre, the subscriber will have a red or green or

yellow light showing [customer service if the caller is] likely to churn or not. This is

a very useful tool helping them to personalise the conversation. If [the caller is] not

likely to churn, you can upsell or you can help them do other things. If they are likely

to churn, OK then, you need to give them some kind of price reduction or a long

subscription period or something like that.”

Neubauer agreed that such tools are the key to effective subscriber interactions and

explained that NZZ introduced more flexible dimensions to its “paygate system” (NZZ

eschews the term paywall).

Siri Holstad Johannessen, head of sales and marketing at Schibsted, described how the company developed a data visualisation tool utilised across departments to keep every team aligned.


“We started to be able to change the call to action, the format, colour, personal

greetings, price communication,” Neubauer explained. “We do it depending on the

time of the day, the device, the reading behaviour, all those things. And we do it

on the registration prompt, as well on the order prompt and also on landing pages.

Starting to experiment with those dimensions, we have already more than doubled

the conversion rate on the paygate.”

Having a concrete goal is important when experimenting with this type of

technology, Johannessen said.

“We strongly believe that we need to change our mindsets and we need to work on

retaining these customers that we actually have,” she explained. “I was talking about

the 100,000 [new subscribers] goal. I think the next 100,000 digital subscribers will

not come from sales. It’s going to come from keeping the customers we actually

have.”

These responsive, data-driven technologies also present new challenges. And news

media companies must be willing to experiment a lot, fail sometimes, and adapt

quickly to what they learn.

“We did a lot of things wrong,” Neubauer said. “One, in the beginning, was not

enough focus on core products. We also fell into the acceleration track — ‘Oh no!

We need to be first mover on Instant Articles in Switzerland! And we need to be first-

mover on the next thing, and, and, and, and ….’

“But in the end, when you look at what’s going to be the outcome of those initiatives

… being the first-mover on those things didn’t really pay off. What matters is that you

have an app and a Web site that’s scalable where you can run experiments, and that

you improve for your subscribers in order that they stay with you.” n


Though more than 16,000 kilometers apart, news executives in Sydney and

Copenhagen faced the same existential crisis in mid-2016: a drastic drop in

digital revenue.

In response, Fairfax Media in Australia and Politiken in Denmark created pricing

strategies based on different customer models, but with a common denominator: an

emphasis on product value to build subscriptions.

“For at least the last 18 months, there has been a growing certainty that subscriptions

would be not where some of our future growth would come from, but where all of

our future growth would come from,” said Jess Ross, chief product officer at Fairfax

Media. “From a product perspective, that has really meant a growing obsession with

the understanding of the value of news.”

With a similar message, Astrid Jørgensen, head of sales and marketing at Politiken

said, “I cannot emphasise enough how big a difference and how important it is, that

when you talk internally about value proposition, this is not your strategy. This is not

your vision. This is not your mission. It’s all of those things — inside out. You have to

force yourself: You have to figure out what kind of value do we add to our end users.

So, it’s about their needs. It’s not about yours/our needs as a media business.”

CHAPTER 11

Fairfax, Politiken focus digital strategies on product value


For the Danish publisher, this led to a sobering self-appraisal to identify exactly what

it is that anyone anymore would value about a newspaper, and then to promulgate

that new self-image across the entire enterprise.

“I think we’ve forgotten as an industry — just taking for granted the value we

represent,” Jørgensen told the global audience assembled at Reuters headquarters

in London. She encouraged them, like she encouraged Politiken staff, to develop

what she termed a “brand asset valuator,” grading the enterprise on its brand

differentiation, esteem, relevance, and knowledge.

“This is very difficult,” she said. “And it is very difficult also to communicate in a

publishing house where great journalism, the fight for democracy, the power-

criticism, being a strong publishing house with strong traditions and having 134 years

of history — having to say, ‘That’s fine.’ But if you’re going to ask someone on the

street, in their home, at the coffee table somewhere, they will not give you the same

interpretation of what your value represents.

“A value proposition on top is worth zip if you your editorial newsroom cannot

resonate with it. It’s worth nothing if you acquire a lot of new customers and you tell

them how fantastic your brand is and how much value they get, and when they kind

of get the final product, they’re not satisfied because they cannot see themselves

in it.”

When someone calls the customer service centre, they need to be met with an

approach that matches the value proposition, Jørgensen added. “So, you need the

entire organisation here. And you need it to ensure that you have clear ways of

communicating with your users.”

With a strong value proposition, she said the news media company can then price

its digital, as well as print, products heavily with a confident case that they are worth

paying for: “You actually support the perception in users that it’s worth what they’re

paying for it.”

At Fairfax, the approach has focused on evolving pricing for the Sydney Morning

Herald and The Age in Melbourne around a newly developed reader assistance

technology called Shortlist.

Fairfax realised its digital products weren’t really built for subscriptions. “They were

meant to distribute information, but they weren’t being used to deliver or to talk

exclusively about customer value,” Ross said. “At Fairfax, we have identified a number


of key motivations that lead to news-seeking behaviours. They range from things like

mastery, to inspiration and escape, to belonging.

“But I think all of them lead to one key outcome and that key outcome really does

constitute the value of news: That’s that feeling that you get with you read the paper,

which is you feel up to date and you feel ready to face the world. You’ve kind of had

your little taste of what the world has to share with you today. It’s about making you

feel like you’re ready for anything.”

Ross also pointed out the disconnect between the propensity to pay for online and

for print. With online news, you are never done or up to date, she said, “Online news

is effectively infinite and it doesn’t make you feel confident about going off to face

the world.”

Developed by an in-house start-up, Shortlist is a technology feature designed to

deal with that problem, Ross said, “to put you in the driver’s seat of how much and

what you consume, and to reduce what I call cognitive load. So, it’s the hassle that

you have to choose what to read. And it helps you feel more productive by always

getting you to ‘done’ at the end of every session.”

Astrid Jørgensen, head of sales and marketing at Politiken, said the company’s leadership took a hard look at its value proposition and came up with a “brand asset valuator.”


scale, we have about 40% of our market that is prepared to pay even more for a

news app that they want to spend time with every day. In both cases, though, what

they’re valuing ... is a finite news experience, not an endless one.”

She reported the early results of the tech and two-tier pricing: a 100% increase

in online registrations, a 50% increase in user authentication, and a 4x increase in

registration-to-subscription conversions. n

Fairfax Media Chief Product Officer Jess Ross talks about her company’s growing obsession with the value of news.

Describing it as a sort of playlist for news, Ross said the feature has been made freely

available, outside of the paywall, to deliver a distinctive news experience and give

people a reason to get out of their Facebook feed.

“At the one end, we have about 60% of our target market that will pay for a high-

utility news experience that helps them to find what they need with a minimum

amount of investment of time and effort,” Ross said. “But at the other end of the

http://www.cobalt-cmf.com


Conventional print wisdom isn’t holding back Slovakia’s Denník N and Germany’s

BILDplus — two unconventional digital news outlets established on very different

foundations, yet having success with similar strategies.

Three-year-old Denník N was started by a group of journalists who quit a national

newspaper in protest. Their story is one of contrary editorial metrics, open-source

software, admittedly empty subscriber offers, and basically working without a

net. But as of 2017, this daily news magazine and Internet portal is making its first

€20,000 profit.

“Now the hard part is how we can actually create something from scratch,” said

Tomáš Bella, Denník N’s head of digital. “As an industry, we have a credibility

problem. So much more people believe in experts than in journalists. So, if you are

buying reportage, you have to believe in the paper. If you are buying our interview,

though, you can actually hate the paper, but you are only buying it because you want

to hear the opinion of the respondent.”

CHAPTER 12

BILDplus, Denník N invest in digital-only content, editorial metrics


Tomáš Bella, Denník N’s head of digital, explains how a team of dedicated journalists barely scraping by built an established digital news outlet with support from a hybrid subscription-membership strategy.

Operating at the other end of the resource spectrum is 5-year-old BILDplus, the

holistic digital offspring of Axel Springer’s BILD tabloid, which once had the largest

circulation in all of Europe and still ranks highly in Germany.

While BILDplus isn’t at all worried about not making a profit, it is still trying to find a

foothold in the challenging digital revenue environment.

“If we think about making a sustainable business for the future,” said Tobias Henning,

general manager premium of BILD, “we have to look into the younger generation as

well. And you see we are present on Facebook. We are on Snapchat Discovery. And

we do have Instagram stories. But so far, we have no real strategy to monetise those

people [except with advertising]. We have to learn how to bring those people into

paid content.”

Whereas much of the conference was consumed with the search for ways to convert

readers of declining print products into money-generating subscribers of online and

mobile offspring, Henning said BILDplus has taken a different approach.

“Some of you are trying to make print users digital users or these hybrid users,”

Henning said. “We don’t do that because we see hardly any cross usage. Only 5%,


maybe 10%, of print readers are also using digital. So we are not anymore focusing

with paid content on the print user and trying to make the print user somehow

digital. We used to do that. We had a super-ticket in the print paper, with which every

print user can access our paid model as well. But nobody uses it. And we don’t sell

a combined [print-digital] subscription anymore ... We are totally focusing on the

digital channel when it comes to paid content.”

And in regard to that content, they have stumbled on some unexpected success

areas, such as crime documentaries and video.

“In a nutshell, content is the most important to make BILDplus a success, and every

kind of content does work if it is the best content, which only we can provide with

the tonality which BILD has,” Henning said.

At the same time, he noted it is important for the newsroom to know what content

is selling and what is not selling. “We have dashboards showing conversion rates and

paid impressions behind the paywall. This is the easiest way for any editor to know

what is working,” Henning explained.

Denník N shares editorial metrics too, but differently. An e-mail each morning tells

the staff which stories had the most sales and which led to the largest number of

subscriptions.

“I will never give reporters numbers on the pageviews because sometimes the

relationship is almost the reverse where you have clickbait,” Bella said. “Any idiot can

get a lot of clicks, right? You can easily cheat the system in the papers. Here, you

can’t so easily cheat the readers because they only are going to pay for something

that actually has a value.”

Often journalists are surprised that editorial content outside of their core area of

focus performs better.


Tobias Henning, general manager premium of BILD, said monetising content for the younger generation is an important challenge for news media companies.

“For example, we have a domestic-views opinion writer,” Bella said. “His job is to

write opinions. But whenever he writes about one of his hobbies, which is actually

with airplanes and Second World War, his conversions, the number of sales on the

articles, do very well. We’re not telling him to start writing about airplanes. But this

is something he will see in the e-mail, and you can do whatever you want with the

information.”

Denník N makes most of its income directly from reader support, and it uses a

combination subscription and membership model. The news media company started

with a subscription offer for €5 and membership for €9.

“We did one thing at the beginning that I still can’t believe we got the benefit,” he

said with a chuckle. “We had the €9 membership from the beginning, but we didn’t

have anything in it. So we just said, ‘Please, if you want to be a member of our club,

pay €9 instead of €5. And what is in the club? Well, nothing now. But we promise you

that we will think about this in the future and will actually bring something into it.

But you can pay now, and in half a year we will actually give you something. We just

don’t know what it is yet.’

“Surprisingly, a lot of people actually paid for the membership, mostly because the


situation was emotional and they knew we were struggling for our lives. So they just

paid extra. But now, finally, we actually put something in the package.”

Bella said their intention is to turn their experience with starting Denník N into

“kind of an ecosystem for the smaller guys” by sharing the free and open-source

publishing software they have developed, as well as ideas and best practices.

Meanwhile, BILDplus has set out to be an example of the contrary view to many

industry leaders about how to successfully relate to paid subscriptions.

“The most important thing for us, of course, is to get subscribers,” Henning said. “A

lot of other people would say, ‘Yeah, we don’t want to have just the subscriber, we

also want to have the data.’ That’s sometimes a trade-off.”

Apple iTunes is infamous for not sharing subscriber data with content owners,

including publishers, but “it’s one of our most important channels to sell our

subscriptions,” Henning said. “We see an extremely high conversion rate. We applied

that last year to Google as well. And we are seeing so far good success, I mean

tremendous success. Subscriptions are going up by 20% to 30%. But nonetheless we

have to see if, after maybe half year or so, if we are happy with that. Because we are

not getting the data of the user. We don’t know the user.” n


Dagens Nyheter and Helsingin Sanomat both each faced a moment of realisation

that their company culture was not a subscription culture — and in each case, that

realisation led to complete transformation.

Evolving a media company’s subscription strategy can have an unexpected impact

on internal culture. For many media companies, it is an accepted fact that change is

needed to stop the revenue loss from the decline of advertising revenue.

This is what led Dagens Nyheter to reach out to venture capitalist Michael Moritz for

advice. When Editor-in-Chief Peter Wolodarski first met with Moritz, he said Moritz

looked bored as they outlined the company’s issues, and upon asking Moritz his

thoughts about the situation, “He said: ‘I can hear you’re busy dying.’”

Hearing their situation phrased so bluntly was the push needed to make dramatic

changes. Moritz recommended they meet with Klarna, a Swedish bank that provides

online financial services in Stockholm to evaluate subscription strategy.

CHAPTER 13

Dagens Nyheter, Helsingin Sanomat share subscription culture transition


The Klarna team evaluated their log-in process and pointed out the inherent barrier

it created for potential customers. They told Wolodarski that hurdles in the sign-

up process were causing them to lose man potential subs. Creating a friction-free

subscription process became a high priority at Dagens Nyheter.

For Helsingin Sanomat, the catalyst for change was just as jarring. The company

examined its situation after a restructuring in 2015, Petteri Putkiranta, president of

the company, told the London audience. In the previous two years, its core audience

had aged three years. This was the wake-up call the company needed.

“And clearly it called for a completely different strategy,” Putkiranta said.

It was clear the company needed a business model change. The first step in this

change was research on what younger audiences find valuable so they can attract

the next generation of readers — without offering a discount. Encouraging digital

activity was another major goal for long-term success.

“It really didn’t make sense to get the sort of subscribers who didn’t use the content,”

Putkiranta said.

Peter Wolodarski, editor-in-chief at Dagens Nyheter, describes the process that led the company to focus on a friction-free subscription process for its audience.


Part of the company’s efforts to increase value is a focus on its premium content,

marked by a diamond symbol to represent subscriber-only content. The decision

to use a diamond symbol came from the need to embody value in a quickly

recognisable way.

“It’s because we couldn’t invent a short word for quality journalism,” Putkiranta said.

Marking premium content gave the company create more specific understanding of

how users interact with content. Understanding digital activity is crucial, Putkiranta

said, because digital activity is closely linked with churn. Creating goals and targets

around digital activity was actually challenging, he added.

“It was actually quite painful to figure out simple measurable targets,” he said.

After a lot of iteration, the team chose to use audience conversion to trial and the

number of digital active subscriptions as two common goals for both the editorial

and commercial teams.

Creating these goals became a crucial tool for culture change, Putkiranta said.

Suddenly, the editorial and commercial teams were interested in how they could

change their strategies to meet these goals.

Petteri Putkiranta, president of Helsingin Sanomat, explained how the news media company identified subscriber-only content with a diamond symbol.


“Strategy doesn’t work if you don’t execute it and execute throughout the

organisation,” Putkiranta said.

For Dagens Nyheter, the first effort to creating change was redesigning a one-click

subscription solution with Klarna lead to a significant increase in members, but this

brought more churn as well.

“In the spring of 2017 it actually reached 15%, which is not a sustainable level,”

Wolodarski said.

The company partnered with Israeli technology company Spark Beyond to hold an

internal hackathon and address the churn issue.

The result was a research engine that identified more than 200 features that explain

the company’s churn. With this data, Dagens Nyheter was able to create a churn

model that predicts potential churn with up to 86% accuracy. The model offers

actionable changes the team can make every day to lower churn.

What followed were internal changes to support the model. Short daily stand-up

check-in meetings helped the company create a “cross-functional war room” and a

mode of continuous problem-solving.

At first, the staff viewed this as a short-term project and asked when they would

return to “normal,” Wolodarski said.

“We are not ‘returning to normal’” he said. “This is normal. This is the new normal.

This is how we are going to develop our subscription business.”

This “data project” really became an organisational project, Wolodarski said: “And

I think this change in the organisation was probably the most important thing that

came out of the project with the Israelis.”

To date, the company has seen a churn reduction of more than 28%. It is a complete

turn-around from the beginning of the company’s journey. “I think it’s fair to say we

are busy growing,” Wolodarski said. n


Data pays off. From informing pricing decisions to content strategies, data gives

publishers the ability to respond flexibly based on users’ consumption habits. The

Boston Globe and Amedia both are embracing data-driven strategies for pricing and

content, and their new approaches are beginning to yield results.

When launching its digital subscription business in 2011, Boston Globe Media did

extensive research to determine the price of its offering, said Peter Doucette, the

company’s chief consumer revenue officer.

“We thought we did a very thorough job of determining the price through the

research channels that were available at the time,” he said.

After two years of a US$3.99 price point, the team experimented with five price

points — three lower and one higher.

Their initial price was right.

CHAPTER 14

Boston Globe, Amedia use data to drive pricing, content strategy


“The US$3.99 price point, studied over a one-year period, was the revenue

maximising price,” Doucette said, adding that they were glad their pricing was

validated, though this created a challenge for their goal to raise reader revenue.

Next Doucette and his team identified their most loyal subscribers and experimented

with raising the price after one year of membership. They saw an initial volume

impact of 5% loss, but the 74% growth in revenue outweighed the cost. The company

then raised the price for all of its subscribers to US$6.99, Doucette said.

The result? That 5% volume impact stayed consistent, even for those who have been

subscribed less than one year.

“We’re basically trading 5% volume loss for 74% revenue gain,” Doucette said, adding

that engaged users are a key area for revenue growth.

The company’s newsletter programme is another strong source of conversion and

engagement. Having a relationship with newsletter subscribers is lucrative.

“The power of the e-mail address, the power of the known user, is 10 times

compared to an anonymous user,” Doucette said.

Peter Doucette, chief consumer revenue officer at Boston Globe Media, shared the company’s experiences with the use of research to determine the right price point for digital subscribers.


Data powers the Globe’s decision to prioritise its newsletter audience. E-mail is the

largest driver of users with the highest lifetime value.

“Someone who comes to the site by being a newsletter subscriber has 7% better

retention than non-newsletter subscribers,” Doucette said.

Data also informed one of the company’s biggest findings: extending the sampling

period of its metered paywall from 30 to 45 days led to a 40% increase in starts from

those hitting the paywall.

Amedia Executive Vice President Pål Nedregotten told audiences at the INMA Media Subscriptions Summit in London how the company used data to guide a broad content strategy shift.

Before this, only 59% of users even hit the paywall. By increasing the sampling

period and lowering the number of free articles, The Boston Globe saw a significant

increase in new digital subscriptions, Doucette said: “I would encourage you guys to

think about time as a variable you can experiment with.”

Content is one of the most clear areas where data can inform news media

company strategies.

At Norway’s Amedia, data revealed that only 2.6% of subscribers were reading

culture content, but they were producing more of it than any other subject area.


The problem, according to Executive Vice President Pål Nedregotten, was a

disconnection between the newsroom and readers.

“Culture [content] wasn’t unimportant [to readers],” he said. “It’s just that we were

doing it wrong.”

Most of this culture content was produced for the print edition, which features six

pages of it every Thursday. Realising that, Nedregotten said the solution was simple:

Stop letting a print mentality lead decisions about what kinds of stories to produce.

This shift in strategy has had a significant impact internally.

“We don’t talk about the printed paper anymore,” he said. “We talk about the

journalism. The print paper is just a delivery vehicle for the journalism.”

By using more rigorous content standards, rethinking its headline strategy, and

improving the visuals with stories, Amedia saw readership of culture content double

in the past two years.

Refocusing its content strategy, partnered with a live sports video component,

has led to 5.6% subscriber growth in one year. The data-led content changes also

reduced the number of “fly-by” users, Nedregotten says. But despite being heavily

informed by data, numbers alone can not create change: “And the kicker: Better

journalism leads to better results.” n


Though Facebook and Google are often simply dropped under the same tech-

related umbrella, they differ in their strategies for supporting news media

organisations, like The Financial Times, in their quest to drive subscriptions.

As a point of engagement on the platform, Facebook has identified two out of

three groups that are valuable to publishers, said Peter Elkins-Williams, who works

with global media partnerships at Facebook. Out of subscribers, followers, and

consumers, he said that consumers will always be the biggest group, and this is

where Facebook's Instant Articles is useful to publishers, though it is just one piece

of the puzzle to help publishers support their subscription acquisition and retention

strategies.

“We launched Instant Articles three years ago, and since then we have made a lot of

improvements,” Elkins-Williams said, acknowledging they did not initially realise the

importance of retention to the overall subscriptions game. “When a tech developer

says they’ve made a lot of improvements, it really means we didn’t do very well with

the launch.”

Google, Facebook share acquisition, retention strategies

CHAPTER 15


Facebook Analytics is also a useful tool for publishers, Elkins-Williams said, though it

was not originally designed for them. “But we started talking about subscriptions and

what it can do for publishers, and it just sort of fit.”

By looking across verticals, this stand-alone product can help publishers better

understand their customers by using Facebook log-in or Facebook Connect to

measure conversion down the line.

“Facebook isn’t just a single distribution point or contact point from your main page,”

Elkins-Williams said. “The engagement and connection can begin in a lot of different

places, and it’s important to think about where those can be.”

Peter Elkins-Williams, who works with news partnerships at Facebook, shared that some tools like Facebook Analytics weren’t originally designed for publishers. Yet they have proven beneficial for tracking subscriptions.

Currently, Instant Articles has 10 beta partners to test subscriptions within the tool.

Facebook is optimistic but still unclear of the results, Elkins-Williams said, because

the company is still processing data from this experiment: “We’re focused on making

this product something that makes your business better mathematically. We’re

changing calls to action designed to improve performance.”


The process to help publishers increase their subscriptions goals is ongoing, he

added, but it may take time due to the individual nature of publishers: “I’m optimistic,

but we know there’s not a single solution that fits every publisher. There’s not a

single solution for every scenario.”

Facebook isn’t the only tech industry leader recognising the critical role

of publishers.

Luca Forlin, Google’s head of partnerships, play books, and Newsstand said a thriving

news media market is important to the future. “The context behind our subscriptions

initiative is that we do care,” he said. “We care about news. We care about the world

of digital content.”

One of the most important tools to sell digital subscriptions is the Google Play

Newsstand. When deciding how to help publishers sell subscriptions within Google

Play, Forlin said the company realised it had a major asset it could share with

news media.

“We thought, what can we do to take that data and actually bring it to publishers so

that they can reduce the friction in the subscription tunnel?” he said.

When users are presented with a paywall, they have an option to subscribe through

Google Play. This creates a more friction-free subscription option. “And this is when

it gets actually super interesting,” Forlin said. “It’s not just a subscriptions conversion

tool. It’s also a retention tool.”

While subscribers surf the Internet, they carry that subscription with them. If they

search for news, they will see results at the top of their feed from publishers to which

they subscribe. This is not an algorithm change, Forlin said, but it is a prioritisation

of publishers.

Serving users content from the news brands they subscribe to creates daily contact

between the user and the brand. It also emphasises the value subscriptions can bring

to a user’s life in a seamless way.

“We believe that’s going to be a big positive impact on churn,” Forlin said, adding

that another positive impact on churn could lie in data. Data is the Google’s DNA,

and this partnered with the company’s machine-learning capability, creates a perfect

partnership for publishers.


It is early days in this regard, Forlin said, but the company hopes to eventually

provide publishers the data to understand a person’s propensity to subscribe.

“This is something we are really pinning a lot of resources to,” he said, “and hopefully

it will bring results in the next few quarters.”

Financial Times is one publication already partnering with Google to improve its

digital subscriptions strategy. A successful digital subscription strategy is all about

habit forming, said Gadi Weiszlovits Lahav, head of product at FT.com.

“So, the right way of looking at it is first form the habit, then enhance the habit, then

ask people to pay for the habit,” he said.

The company’s subscriptions strategy is focused on two halves: acquisition and

retention. Free content plays a major role in acquisition, Lahav said. Increasing the

amount of free content can bring more people into the conversion tunnel, but lower

Luca Forlin, Google’s head of partnerships, play books, and Newsstand, describes how the company is using data to reduce friction in the subscription funnel.

“Google has been at the forefront of innovation in regard to machine learning and

AI,” Forlin said. “So the thinking is, we want to take something that we know how to

do and make it available to publishers.”


With the help of Google, The Financial Times experimented with the number of free

articles it offered. There was no change at the top of the funnel when it lowered

the number from three free articles per day to two. The company saw a small lift in

conversion rates when it lowered it again to one free article per day.

Real change happened when it lowered the number to three free articles per month,

Lahav said. “We saw a double-digit uplift. We saw the potential was there.”

Then the company blocked access completely. It was shocked to see a triple-digit

uplift, Lahav said, but it was not a permanent strategy: “This is unsustainable. You

can’t just dry up your funnel.”

The current iteration of the experiment is a more personalised approach. The

number of times users visit the Web site and user data determine how many articles

they can view before they are prompted to subscribe.

The Financial Times worked with Google to create the most effective conversion funnel, said Gadi Weiszlovits Lahav, head of product.

conversions. Lowering the amount of free content can limit the number of people at

the top of the funnel, but may hurt habit-forming efforts.


The goal is to minimise impact on the top of the funnel and maximise impact on the

bottom of the funnel. This allows users to form a habit and pushes those who have

formed the habit to subscribe.

Though it has only been up for two months, the strategy is a step in the right

direction, Lahav said. “This is completely aligned with the funnel we want people to

go through.”

For other publishers in the middle of subscription strategy experiments, Google’s

Forlin has one piece of encouragement for publishers. “Be more bullish. Be more

optimistic. Be more enthusiastic about your own subscriptions, your own brand, and

the subscription offers that you bring.” n

http://www.protecmedia.com

PART 3:PERSPECTIVES + CONCLUSIONS


There is no silver bullet for smart subscription strategies

CHAPTER 16

The 2018 INMA Media Subscriptions Summit in London confirmed for me two things:

There is genuine passion rising for understanding the new economics of content, yet

there are dozens of ways paid models can be structured and implemented.

In other words, there is no silver bullet.

That’s tough medicine in an industry that loves copy-and-paste, follow-the-leader

silver bullets.

I have been accused of having a fondness for the freemium model over the metered

model. Sorry, I have no affection for pay models! I can report that in the past three

years, there has been a shift in Europe and the South Pacific from metered models to

freemium or metered/freemium hybrid models.

What I learned at the INMA Media Subscriptions Summit was why that is happening.

By Earl J. Wilkinson


In a presentation, Piano CEO Trevor Kaufmann outlined conversion data between

Piano clients operating a metered model vs. a hard/freemium model:

Metered clients report an average conversion rate of 0.08% vs. 2.56% for

hard/freemium clients.

The metered average conversion rate is 0.36% vs. 4.33% for hard/freemium.

Time to convert among metered clients of Piano is 11.65 days vs. 3.64 days

for hard/freemium clients.

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Piano is quick to note that there is a huge range of performance from publisher to

publisher across every stage of the funnel — with some promoting more aggressively

and some operating with various levels of meter height, which impact conversion

results.

Yet Kaufmann said that “the act of launching a hard paywall makes our client think

about product development in a different way than launching a meter,” which is best

used in a mass-audience scenario.

My read on this last point is that a freemium model forces a cultural discussion about

the values behind content: propensity to trigger a subscription, propensity to be

shared on social media, propensity to add brand equity. Not every piece of content is

designed to generate a subscription, yet there needs to be a smart discussion about

your content universe to put that into context.

Either a human makes the decision to lock or a human writes the algorithms to lock.

One way or the other, data mostly informs today’s freemium model in a way it didn’t

seven years ago as the “gut instinct” method was so poor in triggering subscriptions.

By contrast, a meter is an educated blind guess. Publishers were less confident about

the meter height in 2012 when the average meter was 13 versus today, when the

average meter height for Piano clients is 5.

A meter can work up to a point.

In fact, I asked panelists Siri Holstad Johannessen of Schibsted and Steven Neubauer

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of Neue Zürcher Zeitung (NZZ) a hypothetical that they answered very slowly: If you

could go back in time and launch a paid content solution from scratch, with which

model would you start?

The short answer was they had no problem starting with the metered model — yet

it could only take them so far. Schibsted’s Aftenposten has evolved to a meter/

freemium hybrid, while NZZ has a dynamic paygate.

Cutting across many presentations in London, we conclude that the metered model

works best for brands with strong identities and a high volume of content — which,

by itself, might explain why local newspapers under-performed so dramatically with

the metered model in recent years.

INMA CEO Earl J. Wilkinson makes a point at the Media Subscriptions Summit at Reuters Canary Wharf.

Freemium works best for brands with unique to highly unique content, offering the

best model for converting readers to purchase. The hard pay model works for brands

with an extreme connection to their community. Yet make no mistake: The hybrid

models of Scandinavia and the dynamic paygate models are coming on fast.

INMA research conducted for the Media Subscriptions Summit confirms many

of these nuances between the meter and freemium models. INMA surveyed 35


news media companies that were represented at the London summit and who are

intimately involved with digital subscriptions:

54% operate freemium models.

34% operate meters.

41% of respondents are unhappy with their model.

67% are looking to switch models.

76% are looking to add new features to their pay model.

Freemium operators were the “happiest” of the publishers surveyed by INMA:

Freemium minor lock down: 80% met or exceeded expectations.

Freemium major lock down: 72% met or exceeded expectations.

Porous meter: 43% met or exceeded expectations.

Strict meter: 25% met expectations (none exceeded).

Hard paywall: While a small percentage, 100% exceeded expectations.

The unhappiest of publishers operate a strict meter, with 75% saying performance

was below expectations, according to INMA survey data. This was followed by 57%

for the porous meter, 29% for freemium major lock down, and 20% for freemium

minor lock down.

Now, for silver-bullet lovers out there, it sounds like the freemium minor lock down

model might be the model for you. Most content is free, yet a minority of content

is locked.

Yet Kaufmann warned — and summit case studies reinforced over and over — that

success is about optimising whatever model you choose.

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Whether meter, freemium, or hybrid, you will under-perform if you don’t adopt a

clear growth mission. You will under-perform if your effort is not a unified, total

company approach. You will under-perform if this effort does not give thought to

value proposition, brand, communications, content, products, payment methods,

and customer excellence. You will under-perform if you are not committed to total

marketing and making reader revenue central to marketing efforts.

To be blunt, even the best paid content model will under-perform if it is poorly

promoted. It might take an army of consultants retroactively to discover that the

model was correct, the pricing was correct, engagement was correct — yet the

publisher got the marketing wrong.

This lack of total commitment was the whisper in London. While Sweden’s Dagens

Nyheter and Norway’s Aftenposten have pushed the economics of content deep into

their newsrooms, others resist — each in their own way. In the process, they hold

back the optimisation of subscription success. It’s doable without the newsroom up

to a point. But it’s damned difficult.

Then there are nuances within nuances. A senior editor with the Financial Times

told INMA he didn’t want his reporters “writing to the KPI” (key performance

indicators). They should be informed about broad trends in content economics, but

they shouldn’t be living and breathing the details like (presumably) editors. Other

publishers at the London summit confirmed a similar thought process.

Now I will veer into dangerous territory: A meter might work best for companies

whose newsrooms want little or nothing to do with being involved in content

economics. There are newsrooms that resist the trends of KPIs, content scoring,

and algorithms. I know of high-end newspapers in Latin America and Europe who

fit this bill.

How can you smartly lock content (freemium model) without the total commitment

of the newsroom?

This is such a pity. As many executives tiptoe around newsrooms that want to remain

an island, other newsrooms are embracing digital subscriptions with gusto as they

realise this is the power play of a generation. This is an opportunity for editors to

own the brand value funnel and not just a piece of the funnel.


Piano’s Kaufmann gently chastised me for going too far with editors owning all of

the paid content reins — notably marketing. Yet I don’t sense newsrooms are looking

for operational control so much as moral leadership.

The INMA Media Subscriptions Summit in London was transformational. It was

the beginning of a grand industry conversation about our heart and soul: how to

measure it, how to manage it, and how to get paid for it. n

Earl J. Wilkinson is executive director and CEO of the International News Media Association (INMA).


By Siri Holstad Johannessen

Could subscription strategy boil down to audience feelings?

CHAPTER 17

During the 2018 INMA Subscriptions Summit in London, news media companies

presented many fantastic examples of high converting content, customer journeys,

activities to motivate log-in, use of data, and so on.

Myriad approaches, viewpoints, and philosophies were shared, yet one common

theme seemed to connect them all: Activities and content that are personal and elicit

emotions sell subscriptions and keep subscribers.

So maybe our industry should talk more about feelings?

Marina Haydn, managing director of global circulation at The Economist, drove

home this point during her talk with a famous quote from Maya Angelou: “I’ve

learned that people will forget what you said. People will forget what you did, but

people will never forget how you made them feel.”


Echoes of this theme reverberated throughout the full week of presentations,

sometimes ringing loud and clear and at other times as a background tune.

Customer-driven decisions, super users, membership thinking, and relationship

building obviously all are part of our industry’s new way of thinking.

Robbie Kellman Baxter, author of The Membership Economy, said we should move

from focusing on the transaction to caring about building a relationship with the

member or subscriber: “What’s in it for the customer? What’s in it for the business?

In between you will find the trusted relationship.” Ultimately the goal is to reach the

point of where the customer stop looking for other options.

For every piece of content, Amedia is asking the important question: “How many

of our readers can relate to the story?” The answer is driving them to change

accordingly and discover new areas of content, such as broadcasting ultra-local

children’s soccer matches. As Amedia Executive Vice President Pål Nedregotten said:

“We produce content for the fans instead of the flybys.”

The New York Times and The Times/Sunday Times in London both are using digital

platforms for great additions to their main products, thus aligning them to fit super

users instead of everybody else. By aligning with the super user, the product will

Schibsted’s Siri Holstad Johannessen makes a point during her presentation at the Media Subscriptions Summit. Cutting through the full summit, she is struck by the emotional aspect of creating value through subscriptions.


experience a distinct differentiation that will both convert and retain: reading =

usage = revenue. The path to creating a super user is long, and every super user has

had a first encounter with the brand.

Registrations and log-in were also well documented during the London Summit. All

in all, most media houses recognise the importance of registered users, but there are

some “best in class” examples.

Fairfax Media is motivating users to register with the ultimate goal of converting

them by finding pathways to habitual engagement, and readers’ feelings are at the

centre of this focus. And Financial Times is giving away free content, allowing users

to form a habit, and then motivating them to pay to keep the habit.

Another theme that emerged frequently during the summit goes hand-in-hand with

understanding readers’ habits, motivations, and feelings — effective use of data.

News organisations must learn how to gather the right user data, analyse and

interpret it, and leverage it in the best way to improve products, and to effectively

tailor everything from personalised content to membership benefits. As the industry

prepares for the GDPR (General Data Protection Regulation), which kicks in next

month, sharing how we use data is more relevant than ever.

Dagens Nyheter in Sweden has created amazing results by reorganising their use

of data, once they acknowledged that rapid growth increases churn. They realised

subscribers were joining because of content, but leaving because of something else.

So, the company restructured and began using data to optimise customer journeys

with impressive results.

Politiken has used customer data and insight to successfully communicate and

justify a major price increase, according to Head of Sales and Marketing Astrid

Jorgensen.

The subscription economy is growing nine times faster than the Standard & Poor’s

500 Index, and many media houses are among the most successful companies in

the subscription economy.

We always have been a hard-working industry, strategically and systematically

focused on set goals. With more data and analytic tools, we are starting to work from


the outside in, instead of the inside out.

In the process, we are paying closer attention to readers, listening to what they

want, and learning to understand their needs better than ever before. Part of that is

learning how to elicit readers’ feelings — either to motivate them to join or to keep

them using our products.

The part of our brain that controls emotions, the amygdala, doesn’t have language,

so it will be interesting to see what communication develops to trigger feelings

in the future. The Economist’s decision to serve insect ice cream and food-waste

smoothies during an event certainly generated big feelings.

That’s just one of many intriguing ideas shared during the INMA Subscription Summit.

We all can learn from each other’s discoveries, experiments, and innovations. So, let’s

keep sharing them. Bring it on! n

Siri Holstad Johannessen is head of sales and marketing at Schibsted in Oslo, Norway.


By Matt Lindsay

Product innovation, data-based acquisition will transform news industry

CHAPTER 18

At the INMA Media Subscriptions Summit in London, there were two themes that

appeared in many of the presentations:

Using machine learning, testing, and other analysis to drive

product development.

Subscriber acquisition.

Ironically, in many cases, the opportunities for studying customer consumption

behaviour enabled by digital platforms is improving print product quality, too.

Using data, the staff at Amedia identified the type of content its readers wanted most.

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Pål Nedregotten of Amedia discussed how his company has increased print

subscriptions by focusing on the content its readers wanted and giving them

more. The result was growing digital and print subscriptions. An inspiring result was

many of the titles were very local publications for small communities — the types of

markets most challenged by digital subscriptions.

The key insight for Amedia was to identify — after removing fly-bys from the data

— what most subscribers were reading, which happened to be what the firm was

producing the least of. Allocating resources to develop stories most in demand by

the readers has improved engagement, increased sales, and grown revenue.

Jess Ross of Fairfax described how Fairfax developed products designed for different

types of readers: those interested in news you can use and those interested in news

you enjoy. The results have been impressive, with significant subscriber and revenue

growth.

There are many other examples of how product innovation and improvement

have led to subscriber growth and digital revenue. What was striking is there is

so much more that can be done with product packaging and content bundling,

particularly across platforms. The sense that the platform — digital, print, or mobile

Mather Economics’ Matt Lindsay asks a question during the Media Subscriptions Summit. Upon reflection of the summit, his eye is on the combination of product innovation and scientific acquisition strategies.


— is secondary to the relationship the customer has with the content was reinforced

throughout this event.

On the customer acquisition front, there are many publishers using machine learning

and propensity scoring to sort the best potential subscribers from the vast number of

anonymous visitors.

Steven Neubauer of NZZ discussed how the company used machine learning to

improve conversions.

One of the best presentations in this area was delivered by Steven Neubauer of NZZ

in Zurich. This company uses the term “pay gate” instead of paywall. It also has a

“registration gate” that moves candidates from anonymous leads into identified leads.

Knowing who the reader is enables NZZ to use personalised greetings in its offers.

The truly impressive innovation is a rules engine that learns from prior experience via

machine-learning pattern recognition to improve conversion performance.

Another presentation on experimentation with customer acquisition by a

representative from Financial Times showed how varying the first-click free

permissions balanced the need for customers to sample the content while not giving

away too much.

The combination of product innovation and scientific acquisition strategies is

where the industry is headed. Just as dynamic pricing and product innovation have

transformed many industries, the news media industry will be very different five years

from now due to these developments. Interestingly, I believe these innovations will

not only grow digital subscriptions but preserve the life of printed products too, and

what an ironic outcome that will be. n

Matt Lindsay is president of Mather Economics, based in Atlanta, Georgia, USA.


ConclusionsCHAPTER 19

Cutting across 25 case studies, seven keynotes, a 40-question benchmark survey,

a town hall, and hundreds of questions and comments from participants in-person

and online during the INMA Media Subscriptions Summit in London, what did we

ultimately learn?

Here are INMA’s distilled conclusions:

Value proposition: The emerging subscriber value proposition for media

companies centres on content, community, cause, and convenience.

Freemium: There is a shift to the freemium model today because the

adoption of data at media companies provides more and smarter paths to

trigger subscriptions.

Moving to dynamic: Publishers may be settling on freemium as the best

model for optimising reader revenue this year, yet this is moving quickly to a

personalised dynamic pay model and/or more complex hybrid models in the

long-term.

Cultural galvaniser: The companies performing best with digital

subscriptions are those that have a clear growth mission and a total-

company approach. It is a cultural galvaniser.

Where newsrooms fit: Newsroom participation in digital subscriptions is

crucial to maximising success — at maximum, leading; at minimum, buy-in.

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Improving retention through engagement: Beyond building the first-

generation subscriber base, the next growth layer will likely come from

improving retention rates through smarter engagement and standardising

best practices up and down the retention funnel.

Authentic voice content: The content that triggers subscriptions tends to

be genres and stories told through an authentic voice, some of which is

governed by traditional journalism rules — some not.

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7.

Succeeding in digital subscriptions is hard work. It is not a switch to be turned on

and off. It is not a responsibility of a department. It is a total-company effort that cuts

to the core of news media’s reason for being.

We believe the INMA Media Subscriptions Summit in London elevated the knowledge

base for media companies looking to transform. Hopefully, this report does justice to

the important conversations that took place. n

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