Latest insights to combat economic pressures and subscription fatigue in 2023

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We're almost a month into 2023 and we continue to see challenges in our industry with macroeconomic conditions impacting consumers and the media businesses which serve them.  To turn these challenges into opportunities, businesses are experimenting with products, pricing and value propositions, looking to reduce risk and unlock growth. 

Aptitude, formerly MPP Global, has been supporting publishers for over 20 years with innovative ideas to identify, engage and monetize audiences. Aptitude has developed a robust subscription management platform, eSuite, which supports promotions and incentives for acquisition and retention.

In this article, we give our insights into what we believe will impact media businesses in 2023 and how organizations can use them to their advantage.  The full blog post “Monetization in Media, five key trends and predictions for 2023” can be accessed here.

The key topics covered in the blog are summarized below:

  1. Increased attention on economic pressures & subscription fatigue

Forecasts indicate subscription revenues will continue to grow in 2023, albeit slower as consumers will evaluate their wants versus their needs as businesses double down on retention strategies in response.  

To combat churn, media businesses should seek to place emphasis on: 

  • The effective use of churn management tools, particularly those designed to counter voluntary churn.
  • An increased focus on operational cost reductions and tech-enabled automation to bring down TCO (total cost of ownership) across the tech stack.   
  • Experimenting with various pricing strategies to protect subscription revenues, including employing dynamic pricing models to maximize renewals, particularly for those customers identified as most at risk. 
  1. The continued rise of the Chief Subscription Officer (CSO)

2023 will see an increase in roles such as Chief Subscription Officer.  In 2022, Gannett, The Washington Post, Dow Jones, and streaming platform, DAZN, all hired Chief Subscriptions Officers — or slight variations on the title — showing the critical nature of subscriber revenue. This shakeup of senior and executive leadership teams places increased importance on recurring revenue and puts cross-product adoption on the boardroom agenda.

  1. The final [cookie] countdown will force businesses to act in 2023

The sunsetting of third-party cookies by Google in 2024 presents an opportunity for publishers to act in 2023 on the vital importance of first-party data, both on advertising and subscription revenues.   

Publishers can form more meaningful relationships with their subscribers and tailor products and advertisements like never before.  2023 will likely see mass adoption of first-party data harvesting as media businesses brace themselves for the final cookie countdown. To capitalize, businesses will need the technology to both harvest  first-party data through various registration funnels, surveys and progressive profiling, as well as act  on this data, with the tools to access and interrogate this information to inform strategies across the business.

  1. Growing revenue beyond core propositions paves the way to increased bundling

Swapping a transactional consumption model for a recurring-based consumption model was the entry point for many media businesses as they jumped on the subscription bandwagon.  This year, we’re likely to see an increasing focus on product development and diversification across media, as businesses rethink their value propositions.

Brands will think carefully about how they bring these products together to form a more enticing proposition for the consumer through clever bundling and packaging, with video for example, as well as a hybrid approach to recurring and transactional subscription and advertising revenues. More than video streaming services, puzzles and games can be included as demonstrated when The New York Times acquired Wordle in 2022. A single core offering isn’t enough to engage existing subscribers, nor is it enough to tempt new audiences from alternative demographics to the brand.

  1. Industry consolidation & convergence will continue despite economic climate

In an industry driven by global giants, this consolidation will continue in 2023, triggered by evolving consumer trends, technological disruption and the macroeconomic downturn. 

In summary: 

2023 will not be without its challenges for media organizations, but it does present opportunities for innovation and the formation of deeper relationships with subscribers. As we move into the new year, media companies should: 

  • Put the processes, technology and people in place to drive innovation across pricing, product and data. 
  • Prioritize subscriber personalization and relationships when designing offers, product bundles and even the unsubscribe process, using data-driven insights. 
  • With the COVID subscription boom fading and economic headwinds ahead, media companies should fight for every subscriber dollar. This means trimming churn wherever possible, reducing costs through automation and diversifying offerings to address risk in the market. 

Aptitude’s eSuite subscription platform provides the flexibility and customization on these capabilities to grow subscriber acquisition throughout the year. 

To learn more visit: https://www.aptitudesoftware.com/industry/publishing/

James Vallance is senior product marketing manager with Aptitude Software - Subscriptions.

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