The latest trends and tactics in digital subscriptions are helping many publishers grow their subscriptions through increased acquisitions and lower churn rates. Analytics to identify subscription propensity, churn risk and price elasticity can help optimize these tactics. Testing of price points, offer design and targeting can further improve performance.
This is a summary of the latest trends and tactics in digital subscriptions Mather Economics is observing in the market.
Less free content: More publishers are lowering their meters or increasing the percentage of content designated as premium to grow the “meter stop rate” or the share of digital readers who are presented with a subscription offer. Several publishers have raised this share of premium content to 35% or more.
Lower prices: Introductory offers are getting more generous. This is in part to offset the decline in conversion rates that are expected from lowering the meter. Readers who hit a paywall trying to access a premium article are less likely to convert than readers who hit the paywall after their fifth article. Dropping the price offsets this effect to some extent.
Longer promotional periods: Longer promotional periods help with the retention of new subscribers. A publisher in the United States recently changed its acquisition offer to a one-time payment of $0.99 for six months of digital access. The longer time period offset the high churn that would normally result from a low acquisition price.
Onboarding journeys: Many publishers are introducing user journeys designed to increase their engagement and begin the habit of reading content. A few tactics, such as offering newsletter opt-ins on the subscription check-out page, are effective. Personalized welcome e-mails are another tactic that helps with new reader retention.
Content promotion: Highlighting content unique to the publication is effective in raising conversion rates for new subscribers. Readers are more aware of the journalism they are supporting with their loyalty.
Brand promotion: Newspapers have enormous brand equity in their markets, but these brands are less valuable than they used to be given the decline in print circulation. Brand promotion can complement acquisition campaigns to increase conversion rates, and these brand campaigns also help to retain current subscribers.
Value letters: Placing a letter from the editor on the site promoting a subscription’s value is an effective acquisition tool. These value letters can also be used as retention tools, particularly when they are sent to high-churn-risk subscribers.
Targeted average return per user (ARPU) increases: Changing the pace of planned increases for customer segments or individual customers can improve retention. If publishers have a standard promotional offer followed by increases to the full price, they can elect to extend the promotional offer for customers they believe are likely to churn. Conversely, they can move them to an intermediate price point instead of the full price.
These and other tactics are helping publishers convert higher percentages of their digital audience into paying subscribers and retain them for longer periods of time. Undoubtedly, future innovations in the areas of acquisition and retention and optimization of these tactics will enable publishers to achieve sustainable digital subscription-supported business models.
For more information, reach out to Matt Lindsay, president, at firstname.lastname@example.org.