Toolkits asked a selection of publishing leaders what trends and challenges they believe will shape the year ahead for content-based subscription businesses.
A handful of key themes emerged, including the prioritization of monetization over subscriber growth, a renewed focus on publishers’ core audiences and subscriber bases, greater emphasis on registration walls, and the inescapable need to create valuable, differentiated content on an ongoing basis.
- Julia Beizer, Bloomberg Media’s chief digital officer
- Michael Ribero, The Washington Post’s chief subscriptions officer
- Selma Stern, Fortune’s chief customer officer
- George Montagu, FT Strategies’ head of insights
- Greg Piechota, Researcher-in-residence at International News Media Association
- David Skok, The Logic’s founder & CEO
- Angus Macaulay, Stat News chief operating officer
- Jason Clampet, Skift co-founder and chief product officer
“Time for publishers to commit to their ‘authentic audiences'”
Julia Beizer, chief digital officer, Bloomberg Media
“For years, we have been intoxicated by the scale game. Reaching audiences everywhere, on every platform, at any time. The appeal is obvious – scale drives our brand’s influence, reaches new audiences and supports our advertising businesses. Scale can also help us drive subscriptions in the long run.
But subscription businesses are built on audiences who deeply care about and value our brands. They’re built on people who get repeated value from the utility we provide and crave a deeper connection with us in order to get it. These authentic audiences are easier to convert, and importantly, more likely to retain their subscriptions than those that don’t.
In 2023, we’ll see smart publishers segment their audiences accordingly – and put their resources and time into learning deeply about the needs of their authentic audiences and being consistently useful to them, day in and day out.”
“A tale of two themes: rationalization and experimentation”
Michael Ribero, chief subscriptions officer, The Washington Post
“2023 will be a tale of two themes – rationalization and experimentation. The macroeconomic climate is uncertain. Customers, both readers and advertisers, will have a higher bar for their dollars. This will require organizations to focus on the customers and products with the highest return on investment to sustain, and those that have invested in data to support this evaluation will make better overall choices for a sustainable future.
I believe there will also be an appetite for experimentation that has not existed before and today’s leaders will be open to rethinking previous assumptions. Whether new products, new partners, or revisiting previously “untouchable” ways of doing business, I hope to see a year full of first-time-ever efforts in the industry.”
“Registration strategies go into overdrive”
George Montagu, head of insights & senior manager, FT Strategies
“Developing direct relationships with readers has always been an important component of a publisher’s strategy. But this year, it’s different. A combination of events: Chrome’s deprecation of third-party cookies, the continued (and growing) popularity of digital subscription models and a wider acknowledgment that reader revenue and advertising can (and should) coexist – has put registration top priority for many.
FT Strategies research, involving over 450 news publishers around the world, helped to evidence the importance of logged-in readers – 68% of “very profitable” publishers recorded logged-in audiences of over 7.5% (the equivalent figure was 12% for loss-making publishers). Predicting how these strategies are executed is more complex and contextual – Registration Walls, whilst effective and popular, can be very damaging for ad impressions and short-term ad revenue – so there is no “one size fits all” approach.”
“Publishers will pay more attention to their price-volume-mix”
Selma Stern, chief customer officer, Fortune
“Subscription publishers will pay more attention to their price-volume-mix in 2023. The pandemic-driven subscription boom has ebbed, and readers are becoming more discerning and willing to pay for quality content. Ultimately, paywall revenue will become more important than subscriber numbers.”
“A slowdown in individual subscription growth”
David Skok, founder & CEO, The Logic
“2023 will see a slowdown in individual subscription growth for publishers as a result of downward pressure on discretionary spending due to sustained inflation. This won’t be the end of subscriptions, as some predict, but it will put pressure on newsrooms to reliably produce indispensable need-to-know reporting that their readers cannot get anywhere else. We may also see pricing increases in both print and digital as publishers look to make up for reduced growth by increasing their average revenue per user. “
“Economic uncertainty will continue to have an enormous impact”
Angus Macaulay, chief operating officer, STAT News
“In business media, the impact of inflation and overall economic uncertainty will continue to have an enormous impact on the subscription model. Media organizations will continue to see ongoing cost pressures to maintain their current offerings. And that same inflationary pressure will push readers (individual or enterprise) to re-evaluate their subscriptions – and certainly apply extra scrutiny if publishers push through price increases. It will be harder to maintain and grow a subscription business, and media brands will need to continue to diversify revenue streams.
Diversification: Given the inflation pressures plus the competitive pressures for reader dollars, there will be a continued emphasis on diversifying revenue streams. That emphasis will have a particularly sharp focus on live events. Not only are people eager to get back out IRL to do business, but with hybrid or complete remote operations the new normal, events will become even more central as an opportunity to engage with employees and customers.
Subscriber engagement: A high-quality product is more important than ever and new editorial/creative initiatives will get less runway to find their footing (see Netflix for examples of both) than in the past. But critical to that is the user experience – quality journalism doesn’t matter if the subscriber doesn’t see it. That puts the pressure in 2023 squarely on the audience engagement team (SEO, social, newsletter editors, product, etc.) to ensure the content gets in front of the right audience, at the right time, when and where they want it, and the UX encourages deeper engagement.”
“Live events will help the subscription stack”
Jason Clampet, co-founder and chief product officer, Skift
“The return of live events will help out media groups that have greatly relied on subscriptions and paid partner content as their main source of revenue since March 2020. Some media groups got back into events in late 2021 and then did a bit more throughout 2022. But nobody really knew what to expect. What many learned was that people were reluctant to pay what they paid in 2019, but sponsors were ready to pick up the slack as long as there were people filling the seats.
Online attendance will likely remain in 2023 as a perk for paid subscribers, but screen fatigue means attendance for anything other than short sessions will be minimal and should likely be rolled into a mandatory subscription rather than a standalone virtual ticket. Event planners should think of ways to engage paid subscribers at in-person events and show the value of a subscription to non-subscribers. “
“Shifting focus away from growing market share and instead focusing on value”
Greg Piechota, researcher-in-residence, International News Media Association
“In the digital news subscription business, marketers are shifting their focus away from growing market share and instead focusing on value. Rising costs and a slowdown in advertising in 2022 have caused overall profitability to decline, leading boards to put subscription teams under pressure to show the money.
With consumers’ budgets tight, publishers must be mindful when increasing subscription prices in 2023. One approach that is often discussed at INMA events is to personalize acquisition and retention offers based on tenure and engagement, as a proxy for the value readers get from the subscription. This requires fluency in data analytics and the appropriate technology to target readers with different offers.
Retaining subscribers can be a challenge when news cycles are low and some readers feel overwhelmed with news, yet adding non-news content and non-content services can help keep subscribers from canceling. Bundling may also create a more diverse subscriber base, with larger publishers being able to build or buy products to bundle, while others might wish to partner more.
Surveys have led INMA to coin 2023 as the Year of Retention, but reaching and habituating new audiences remains essential for scaling digital subscriptions in the long term. In most markets, this product category is still in its nascent stage.
To expand demographically, geographically, and even across political, societal or economic divisions, news publishers may wish to understand non-subscribers and find new ways to engage them. This could include leveraging research and data analytics, personalizing the user experience, investing in new formats such as audio and video, and capitalizing on mobile.
In general, INMA subscription benchmarks link performance to long-term strategy, internal alignment, operational excellence, and a readers-first culture. The market headwinds do not change the business fundamentals, but may inspire a review of priorities and costs to ensure financial sustainability, as well as cash for selected growth initiatives.”