This week’s guest on the Subscription Publishing Show is Angus Macaulay, chief operating officer at STAT, a digital publication covering biotech, pharma and the life sciences.
Angus discussed the company’s push into high-priced data products, why it opted to build much of its subscription technology in-house, and whether economic instability could present an opportunity for publishers that deliver indispensable content for professional audiences.
Economic instability presents opportunities for business publishers
If business publishers are doing their jobs well, audiences should turn to them for help understanding and navigating periods of economic instability. That presents an opportunity for publishers with genuinely valuable and differentiated products, Angus said.
“One of the core tenets we try to focus on is whether we are the best product of the myriad of products that a person is subscribing to. We’re not certainly the only thing people read in healthcare or life sciences, but are we indispensable? Do they consider us one of the must-reads in their mix? Do they feel that they’re getting value out of it? If you’ve got a high-quality product – or at least high quality relative to what you’re charging for it – then you stand a much better chance of not only renewing subscribers but growing those relationships.”
Subscriptions as a base for advertising and events
Stat launched in 2015 and rolled out its first subscription product a year later. Today, subscriptions account for 40% of its revenues, but its advertising and events businesses are growing nicely too.
“Advertising and especially events, ironically, just exploded for us in 2020, 2021 and 2022. We’ve been seeing every segment of our audience grow, but advertising and events just grew faster… But whenever we talk about our longer-term strategic initiatives, it always starts with subscriptions first. How are we going to double our subscription base or triple our subscription base? And how far can we push it in terms of the total number of subscribers and at the same time be thinking about share of wallet with those individual subscribers.”
Building and maintaining subscription technology in-house
Stat opted to build much of its subscription technology in-house rather than buying an off-the-shelf solution. To a large degree that was out of necessity, because the technology it required wasn’t being offered by third-party technology vendors in 2015. But ultimately the upside of building a custom solution has outweighed the downsides and the hard work, Angus said.
“Our subscription business started in 2016, which in the subscription landscape is like a lifetime ago… If you look at some of the software platforms and features that exist now for subscriptions, they just didn’t exist in 2016. And so we started down a path, and once you’re down the path there’s no going back at that point. But also we’ve gotten to the point where we have things the way we like them and we see our users responding positively to them and in many cases. A lof of the work is already done so we intend to refine what we have.”
The benefits of being part of a larger organization
Stat is owned by Boston Globe Media but operates as a standalone subsidiary. That allows it to be nimble while tapping into the expertise and heft of a “legacy” news organization.
“We were huge beneficiaries of being within an organization that not only believed in digital subscriptions but was already down the path of phenomenal success in digital subscriptions,” Angus said. “There were folks in-house who had already been doing a lot of experimenting to bounce things off of as we were trying to think through decisions… There are some fundamentals around subscription, marketing and conversion that, and that helped us cut some corners. To this day we both swap notes and bounce ideas off each other. And we definitely still lean into them to see what’s working.”
Transcript of full conversation:
(Audio was transcribed using an automated service. Please excuse mistakes and typos.)
Jack Marshall 1:46
So for those who aren’t familiar with Stat, maybe just start by giving us an overview of the publication. You know, what audience does it serve, generally? But then on the subscription side? What subscription products are you offering currently? What needs do they address for subscribers?
Angus Macaulay 2:01
Sure. So stat is a news organization that was founded in 2015. We are a part of Boston Globe media. And the origins are that our owners had a couple years prior to that purchased the Boston Globe and started to dive into the media world. And if you live up in the Boston area, you can’t help but having to have seen the entire city, especially but also the region just completely transformed by life sciences. And, you know, there was this question around, it’s completely transformed Boston. But the work that’s happening in Kendall Square in in Boston is having a global impact. And what is the news organization that is reporting on at a high quality level of reporting on these important stories? And so that was the original question. And with that stat was launched with the mission of being first and foremost a high quality news journalism product, the owners firmly believe in high quality journalism. And we see it time and time again. And what the Boston Globe does in their day to day reporting, and in spotlight, especially so high quality journalism was sort of pillar number one. And number two was Rick Burke, the executive editor, and my boss and I were charged with building a sustainable news business. And again, in the sort of vision of the company overall, subscriptions are absolutely core to long term sustainability. And then if you build a high quality product, you should ask leaders to pay for it. And the hypothesis is that they will. And so we launched in 2015, November 2015, we did launch at first with just advertising because we did want to build up an early audience and just get people engaged with the kind of quality reporting we were doing and the mix of reporting we were doing. But then a year in in December of 2016, we put up our paywall, again, with the idea that we were always going to have a mix of revenue. And we do now we have subscriptions. We have advertising, we have events, sponsorships, event ticket sales, but our number one gauge of our success is are we acquiring new subscribers, are we engaging them and are we retaining them? And so we’ve spent December 2016, then building the subscription business, along with the ad business and the event business and continuing to think about the product overall in terms of how it serves our waiters, we cover health and medicine. We do right for the people in the health and life science and healthcare ecosystem. So it’s biotech executives starting here or here in Boston. It’s pharma executives, it’s folks on the provider side on the payer side, but the ecosystem touching healthcare also includes obviously folks down in Capitol Hill and the FDA and NIH, but it is also one of those ecosystems where there’s a big piece in academia a big bunch of our readership in academia, a lot of sort of side ecosystems of professional services, whether it’s lawyers, consultants, communications, folks, and finally you have patient advocacy groups where especially in in rare diseases in the light, you have patient advocacy group groups who are very keen to keep up on the news on scientific and medical breakthroughs and have obviously a lot of stake in the game. So it’s a niche media business, but with a significant sized audience of people in it, and it’s growing. And that’s sort of the domestic audience. And the last piece of it is, there are elements as we all have experience with COVID. There are elements of it. That’s global, you know, not everything transfers. Globally, obviously, the delivery of healthcare systems are different around the world, but some pieces like drug development do.
Jack Marshall 5:31
So do you sort of consider yourself a quote unquote, b2b Publisher, I mean, I know this is sort of semantics to some degree, but we hear a lot of publishers sort of increasingly talking about themselves as sort of prosumer, which I do think there’s some validity to right, there’s sort of a sweet spot between somewhere in between b2b and quote, unquote, consumer. So I mean, I guess, how do you think about that, and is that different today than it was, you know, when you launched back in 2015,
Angus Macaulay 5:57
it’s not different. And I would say, it’s, when you say, b2b, it has connotations, also of being, you know, not necessarily the best quality journalism from, in many cases. And I would say more, when we were thinking about where is the gap, when we did the market assessment before launching stat and trying to find out where the gap is, like every industry, there are a lot of very niche, traditional b2b media brands in healthcare and life sciences. And then you have larger business media brands. And I would use the Wall Street Journal is a great example where it’s high quality journalism, but it is a business publication, or you have politico on the sort of policy side and I would say, we absolutely cover a niche, like a b2b brand, but with the journalistic ambition of a brand, like the Wall Street Journal, or the Washington Post, for example. So that was the original sort of idea that let’s absolutely hone in on a niche, that’s incredibly important. But let’s have that journalistic ambition. And part of journalistic ambition for us includes investigative reporting, which is not something you typically find in b2b journalism. But I think looking back over the last almost eight years, where we’ve had the most impact in our coverage on the world in general as our investigative reporting, but also in terms of building our brand, and building our credibility with an audience very quickly, wieder saw that we were not afraid to take on organizations, institutions, individuals, and hold people accountable and hold institutions accountable. And in every industry that’s necessary, but particularly in healthcare, where I mean, literally lives are on the line and not being afraid to put a spotlight on those things and report on them. And in some cases, it affects advertising. But for a subscription based business, that’s where the business model enabled us to be a very journalistically ambitious business media organization, it hasn’t changed in the sense that that’s been the case since day one. And if you look at some of the reporters we have on our team, we’ve hired them from the Wall Street Journal from Bloomberg from Forbes from Axios, from Politico, we have hired some from other niche b2b brands are sort of neuroscientific brands, but a lot of sort of some of those larger publishers, when COVID happened, you could certainly say that maybe there was a temptation to become a little bit more consumer, because it was going to be a significant increase in public interest and consumer interest in health. But and we saw it in traffic, for sure I’m in traffic went literally through the roof. But there was also a belief on our end that this is it was a short term thing. And once people were done with COVID, they were going to want to move on with their lives.
Jack Marshall 8:35
Yeah, it’s kind of drive by audience to a degree. Yeah, it’s
Angus Macaulay 8:39
like, once the problem is solved. It’s like, okay, that’s gone. Now I don’t have to worry about it and read about it anymore. And I can move on. And God knows people have shown that both in terms of wearing a mask or reading about it. So they’re certainly you could say maybe there was a temptation to think about consumers there. But for us, we stuck to our knitting, we obviously covered COVID extensively, and we’re one of the first to do so. But we stuck to what our core mission was. And, you know, even during the entire period of COVID, obviously, you know, you still had things moving forward in Alzheimer’s, in cancer in heart disease, and so forth. And we needed to report on those just as much as we needed to report on COVID Because those weren’t slowing down as diseases and the development of treatments was getting impacted, but needed to be covered as well through that time.
Jack Marshall 9:25
So just from a business model standpoint, I mean, it sounds like you didn’t obviously launch with subscriptions on day one, but it seems like that was always part of the roadmap. And you know, it sounds like that was always intended to be sort of the the core of the revenue model and the company to some degree. Why was that and at their dynamics sort of for your audience or subject matter that you think lend themselves particularly well to a subscription model.
Angus Macaulay 9:49
It definitely started from or owned by a large organization that the ethos is very much around high quality journalism and subscriptions. First, make leaders pay ask leaders to pay And so, you know, it was absolutely part of why the owners invested in it and would continue to invest in it if they saw it was a genuinely self sustaining business and sustainable on its own in the best way. And I agree with it, the best way to that is having leaders paying. And I think, you know, the other thing being reader first allows you to do is really focus on the best quality product you are, you know, I go back to that investigative journalism, we, you know, we’ve written some really tough pieces about companies that could have been very big advertisers. But the business wasn’t built expecting that company or companies like that to be an advertiser or certainly have a risk element allowed in for the model to not get every piece of ad business, because some of them reporting is going to scare away some advertisers or tick them off. And so it enabled us from day one to be thinking about the best reporting for the reader. And I think in the case of our particular vertical, I mean, first of all, I think, for subscriptions for b2b versus b2c, it is a different value proposition. And there’s a lot of different factors going into the readers willingness to pay, and it certainly plays out in terms of who’s paying for it. Because if it’s b2b, oftentimes, your company’s paying for it. So the friction, right, there is a little bit less, we also see a high propensity, a high percentage of our subscribers, subscribing annually. And, you know, anecdotally, it’s, you know, you felt the expense report once, not 12 times or two times. And we also have built up you can also go after enterprise subscriptions, where a company has a Knowledge Center or corporate librarian, where, you know, that’s their job is to secure larger subscriptions for hundreds or 1000s of folks in the company. So I think for b2b, it’s definitely an a model that works well, if the content is worth it, you know, there is, and that goes back to the quality, you know, is it original reporting? Or is it reporting that I can just google quickly and read in five different places for free, or is the editorial team taking the time and the longer view of finding stories where maybe people didn’t know that it was a story, and do original reporting that somebody literally can’t find anywhere else. And so that’s where for us, it worked. And I think also for, again, for the space between healthcare and life sciences, it is one of those space I mean, I guess you could probably say that about a lot of industries. But it really feels particularly important that there is an element of our focus of our business is about the readers and not being afraid to take on, you know, whether it’s a company or it’s the FDA and and holding them accountable, it just feels like one of those topics hit. As we saw with Theranos, things can go really sideways really fast with a lot of money and again, people’s lives at stake.
Jack Marshall 12:59
This podcast is presented alongside our friends at member fool which provides best in class tools, enabling independent publishers and media companies to build successful subscription and membership businesses. One of the reasons I frequently recommend member filter publishers is the flexibility and customization it allows for every audience is unique and publishers are increasingly recognizing the importance of working with tools and technologies that can adapt to their unique needs, as their businesses evolve and grow when paired with a content management system such as WordPress. Membership allows publishers to retain complete ownership and control over their content, their brands, their websites and their data, enabling them to focus on how best to serve their audiences. Without the interests of middlemen or third party platforms getting in the way, go to a member fool.com/toolkits To learn more, or drop me a note at Jack app toolkits.com. And I’ll be happy to connect you with somebody on the team. Now back to the conversation. Talk me through so obviously you have stat plus, which is sort of your core subscriber subscription product. But then you also have a couple of data products as well, which I assume is sort of priced at a slightly higher price point. So just kind of talk me through the the thinking behind, you know those two products.
Angus Macaulay 14:12
So stat plus is the core sort of main product, and that is our content product. And right now about 55% Plus, sometimes 60% of our content is behind the stat plus paywall and the balance is free. Some stories might start out free and then within three days, if it’s a biotech story, for example, it will then go behind the paywall. But if we don’t feel like it’s really something that’s exclusive or unique, we’ll keep it as a free story. A lot of our public health stuff we kept free the entire time and still do. What step plus is really it’s really the content for people who are in the industry and in the weeds. And you know, we have some reporters, for example, who report on these companies from a Wall Street perspective and a lot of the reporting they do a lot of the reporting the others do behind step plus there’s a high value Due to the content and the insights we’re providing in that. And so that’s where those stories will end up behind the paywall. It is a hard paywall. It’s not a meter. And again, because we felt that we have stories that individually will have and can have and have had a significant impact. And we have some reporters who week in week out are delivering just a lot of value with every story they do. And so that’s the route we chose seven years ago, six and half years ago. And that’s served us quite well. It’s mentioned we are launching data products, we launched our first one last year, actually in partnership with a company called a startup called applied Excel. And we’ve been working with them for a few years, their New York based or partner with them, we’ve also invested in them. And it was started by a couple of folks who came from the Wall Street Journal, and a lot of experience in r&d and machine learning and artificial intelligence and so forth. And the first product they built for us was our COVID Tracker, which was a really sophisticated tracker at the time to sort of map what was happening across the country across the globe and state by state, etc. What we’ve launched with them is a subscription data product. It’s called stat trials pulse, it’s specifically focused on clinical trials. And so it’s for a very niche subset of our audience, it’s for the primary sort of audiences, or the investor community and within pharma companies to business development community, you know, folks who are really paying attention to clinical trials, but are also looking to understand changes in clinical trials, because the changes that might happen in the clinical trial can obviously have a substantial impact on whether or not the trial succeeds. And if trial succeeds or fails, that can have a huge impact on the value and survivability or success of a biotech. And so this product uses machine learning to basically scan clinical trials.gov press releases, and PubMed, which is academic journals to look for signals of changes that the logarithm detects are of significance out of millions, about 8%, or significant, it’s a very sophisticated tool for a very unique subset that subscriptions $1,500 a year for an individual, and again, serves a very high value, high return role, so that for those individuals, and so those are two core products, we are starting to experiment within those. So you know, we talked about enterprise subscriptions, we launched last year a self service portion of that. So for subscriptions that are anywhere from two to 10 people, you can do it yourself. And the idea was, the price point is still one where it can stand or $1,000. If somebody has a limit on a credit card, they can transact with a credit card, we can also transact with an invoice. But it enables us to try to scale those smaller lower price point group deals. So the team we have can focus more on the larger enterprise. And then last piece is as we’re experimenting with bundling some of our stuff with a stat Plus subscription or stat plus with an event ticket purchase. So that’s where we are now. We have other things that could be ripe to be added into bundles to you know, offer people all access, whether it’s access to some of our events, or we do a number of deep dive sort of PDF reports that we sell as one off products, those we are looking to eventually bundle in within sort of all access subscription. So that’s where we are. And that’s a little bit of some of the stuff we’re experimenting with now.
Jack Marshall 18:35
So how does the business break down currently, from a revenue standpoint, I mean, obviously, as you mentioned that in addition to subscriptions, you work with advertisers, you have an events business, and then you know reports, and I think other bits and pieces. So it gives me a sense of what percentage of revenue is coming from subscriptions at this point, or, you know, I don’t know how you bucket the different channels, but
Angus Macaulay 18:55
it’s about 40%. It was an interesting time from 2019, to the end of 2020, to where we’ve seen every segment of our business grow advertising events and subscriptions every year, even events through COVID. And it was an instance where they all grew, advertising and events just grew faster. So we are really pleased and we’ve beat our subscription budget each year. But advertising and especially events, ironically, just exploded for us in 2020 2021 and 2022. Even as we went to virtual events, you know, again, as we look out the next three to five years, we start to think ambitiously about a subscription number as being the North Star. And whenever we talk about our longer term strategic initiatives, it always starts with subscriptions first in terms of okay, how are we going to double our subscription base or triple our subscription base and you know, how far can we push it in terms of the total number of subscribers and then obviously at the same time, be thinking about share of wallet with those individual subscribers.
Jack Marshall 20:03
I do sort of buy into the argument that if b2b publishers are doing their jobs, Well, now’s the time where subscribers, in theory should be relying on sort of subscription products more than ever, especially in the b2b space. So, you know, I don’t want to say, cut people and keep business information. But I don’t know, is there an element of that? Like, can this play into into your hands to some degree, do you think?
Angus Macaulay 20:25
Yeah, absolutely. But I think it also goes back to the one of the core tenants that we try to focus on, which is, Are you the best product of the myriad of products that The subscriber is subscribing to? And, you know, we’re not certainly the only thing people read in healthcare or life sciences, you know, I know that they read a myriad of other things.
Jack Marshall 20:45
But are you indispensable?
Angus Macaulay 20:47
Are you indispensable? Do they consider you one of the must reads in their sort of mix of things? Do they feel that they’re getting value out of it, and I think if you get always goes back to, if you’ve got a high quality product, or at least a high quality relative to what you’re charging for it, you know, then you stand a much better chance of not only renewing the subscription. But as we see with enterprise subscriptions, you know, we see growth with enterprise, not just in getting new accounts. But every single week when I see the report on Okay, here’s the new accounts we got here, the renewals we did this week. And then here are the accounts that added a person here a person there, well, those plus ones plus twos plus threes, you know, over the course of 52 weeks really add up. And it also reaffirms that, not only are you going to renew that account, but that account without you even having to sell them grew because they grew within their own company. But it again, it goes back to are you indispensable? Are you giving them something they can’t get somewhere else? And within the context of that, are you charging a fair price? Or do they look at it and say, you know, yeah, it’s important, but it’s also incredibly, it’s overpriced, you know, or it’s a good value. And I also get exclusive stuff. And that’s, you know, that always challenging balancing act of pricing, as well as the pressure to push the price up. But at the same time recognizing, you need to make sure that the price satisfies, or the value satisfies a broad enough mix of your subscribers, so you don’t start inducing high churn.
Jack Marshall 22:21
And of course, you know, you’re always going to be there as well. That’s the other thing. Right? So, I mean, I think some publishers are looking at higher churn numbers. But, you know, I’m thinking, are you then seeing that in new conversions the next month when people say to themselves, you know, maybe we can do without this for a month? And then the next month? They’re like, No, you know what, I miss having that as part of my media diet. So I think maybe there’s some, some nuance there as well, just to come back to pricing, which you touched on a couple of times. I mean, it seems like you have a very straightforward approach in place, at least on the site, you know, you have monthly and annual, it seems like every new Plus subscription begins with a 30 day free trial, correct me if I’m wrong here. And then you renew into Yeah, either a monthly or annual plan. Why that approach? I mean, we get asked all the time about sort of term lengths. And I know a lot of b2b publishers go with quarterly. So yeah, why that sort of structure? And also, how did you arrive at your your current price point? I think you’re at 399. Currently, I believe you’re at 349, maybe even 299? Going back a few years. So yeah, just talk me through that.
Angus Macaulay 23:23
You’ve got your notes? Well, we asked, we started at 299. Yeah, and then 349, I think after two or three years, and then just this year, we bumped up to 399. And actually, if you look at our checkout flow, right now, the you have three choices, like everybody does. The first one far left is individual, there’s a toggle on there to go between monthly or annual, it’s, you know, pre clicked annual, but it’s either individual. And then we put that self service group front and center at $300 per user, and then enterprise to click that to connect with the team. And I’ll start there, we moved. That was also a new shift last year, once we have the self serve piece for the smaller groups, we wanted to make that a front and center offer. And so we very visibly show you 399 For an individual 300 for two to 10. And that’s whether it’s two people or it’s 10 people, so you know, 10 people $3,000 versus 399 per person. And obviously, the math for two people is advantageous as well, right away. It’s, you know, it’s $600 for two versus 400. For one, so right away, we wanted to try to give people an opportunity to upsell themselves, frankly, and oftentimes when somebody is subscribing, they do have team members or colleagues that, you know, it’s easy enough for them to quickly add them. In terms of the pricing. It was, you know, when we first launched back in 2016, there weren’t as many paywalls I mean, that’s one thing that’s been interesting to see evolve over the last seven years is six years is the You know, when we launched the big ones, Wall Street Journal, Washington Post, New York Times had paywalls. But a lot of the sub stacks of the world weren’t a thing, people weren’t subscribing and paying for individual newsletters quite like they are today. And just the number of subscriptions, whether it’s your own TV consuming habits, or your business needs just weren’t as prolific back then we had done some reader surveys to see what else people read. And no surprise, New York Times Wall Street Journal, Washington Post were very prominent, as was politico and a few other things that we knew had paywalls. So we had started to have a threshold of, okay, here are instances where these readers where our readers are bumping into paywalls. And they are okay with paying for those subscriptions. To start with somebody’s willingness to pay is just getting a sense of where else they see value and are willing to pay and what they’re being charged for that and what they’re getting. And then we also looked that was it sort of at one end. And the other end for us, for example, was England Journal of Medicine, and those types of journals where there’s a paid subscription. And in some, it’s, it’s still a print product. And so it was a lot of looking at what competitive offerings were and where readers were already demonstrating willingness to pay and sort of what the thresholds might be. And so for us, you know, 299, at the time, was on the higher end, it was a lot more than exam, for example, the New England Journal of Medicine, but we felt like better to push the price higher, a little bit out of the gate, then try to raise it a year later. And so we launched with 299. And that was 29 for monthlies. And then, you know, over time, as we built up the team, and significantly expanded the coverage, we bumped it up to 349. And with each jump, it has come with us having invested a lot in building up the team and the coverage. So, you know, for us, it was always about asking what we think is a fair price for what we’re delivering. But as we get to price increases, being confident in, we’ve invested a lot in expanding the product. And now we need to ask the readers to pay more,
Jack Marshall 27:12
do you draw attention to that when you do increase prices? You know, is it a clear you know, we have added this value or this feature, therefore, we are increasing pricing. And we we
Angus Macaulay 27:22
have regular like everybody does regular member benefit emails, and we continually spotlight what’s new, or what else they’re getting or additions to the team or additions to the reporting. So for an existing subscriber, it’s ongoing communications for new subscribers. And when we did when we raised our price, last year, we did it in sort of different phases. The first phase was on site for new subscribers. And there was no feeling for them of they’ve just raised my price, it was just okay, this is the price. And we saw no slowdown and acquisition or conversion rates, that was our first indicator of okay, we’re still charging a fair price for the value we’re delivering. And then since the fall, we have been implementing increases, people come up against our renewals. But at the same time, we also then, you know, when we increase the price this year, we also added that smaller group element. So, you know, if you want to stay at $300 299 300, just add another person, and you both now actually keep your price the same. So we all offered an alternative right away that gave them you know, obviously asked them to bring the second person along. But the price per person enabled them to stay where they were
Jack Marshall 28:30
you touched on the technology piece. It sounds like you know, you have built a meaningful amount of your current stack sort of in house. But I’m just curious, you know, what does that stack look like currently? And what did you buy off the shelf? And what did you build in house and why? So when
Angus Macaulay 28:46
you come to our site, and you interact with the paywall, and go through the checkout flow that was all built by our team, and you know, when you sign up for an enterprise subscription, what when you sign up for the self serve, you get on the page, and then there’s you can enter in up to five or up to 10 names and email addresses and titles. That whole all the forms, the checkout flow, the whatnot was all built by our team. And a lot of it was a result of the fact that again, back in 2016, when we were we committed to doing it and then we said, Okay, go, let’s let’s do it. There were some big enterprise platforms that we were just too small for. And there were some other platforms, we just, we knew we were going to have a lot of these different pieces. And we thought, you know, let’s build it ourselves. I mean, it’s definitely a lot of work to build it yourself for sure. In terms of when somebody engages with stat. We were on MailChimp for our free newsletters until actually last week. And that served us quite well for when we were young and growing. We use HubSpot for our CRM and we were using HubSpot for our subscriber only newsletters and so we’ve now consolidated so All of our newsletters are now served out of HubSpot. And it’s obviously centralized, not just our paying subscribers in the CRM, but all of our free subscribers. So we now are getting a much clearer picture of our subscribers, whether they’re free or paid, if they’re paid, if they’re on free newsletters, if they’re opening them if they’re not opening them, and which clusters of newsletters to run, which will then now inform how important those are in nurturing them. It’ll inform and change our onboarding process so that when you’re, you know, if you subscribe to stat, and you’re only on one free newsletter, but based on your industry sector, we know people like you tend to also like these other two newsletters, now we can recommend them and get you on those and try to keep you, you know, more engaged. So consolidating, that will certainly help with just a clearer picture. But also, you know, tweak some of our ways of getting people on boarded engaged, but also monitoring how they’re engaged in and we use stripe to transact for some of our stuff like our reports, which is a standalone business where we sell sort of deep dive reports on topics, that is an area we’re still experimenting with. That’s the other thing I see other b2b or industry focused publications, having success with whether it’s, you know, skift, and travel or Business Insider or others, and we’re still, you know, figuring that out. Those are individual purchases. And that’s a simple Shopify store, we spun up again, because it was it made it easier to frankly, build it and launch it and experiment. But that’s the kind of thing we would want to ultimately integrate those purchases into a subscription and bundle it. But that gets added to a product roadmap. You know, for us, what’s been great is it, building it ourselves has been a lot of work, but we have a phenomenal engineering team. And it allows us to customize things like we have, the way we want them, like the self serve thing is an example. But also for our enterprise subscribers. Now, the administrator has a dashboard where they can go in on their own and change people add people delete people, and obviously, as they add people, it also not obviously, but when they add people, it will automatically invoice them. If they’re over there, number of BLSA they subscribed for 50 people and they add five more, the system will automatically invoice them a prorated amount based on how much of their contract is left that in the in the 12 months. So it just enables all of a sudden the idea of like, okay, you get a company on board for 10 people, they can start adding people on their own and the invoicing the adding the people and getting them started can be entirely done by the client administrator versus two years ago, we had to manually do that for them and manually calculate the price and manually send the invoice. Now they’ve got that dashboard. And they can do that, especially if people leave the company or whatnot. They can swap out names and so forth. So all those kinds of pieces have been great to the business. But also were able to build them the way we exactly the way we wanted them. And, and frankly, we did them on the timelines that we wanted versus suggesting them to a platform we use and hope that it makes it into their into their queue.
Jack Marshall 33:13
Yeah. So in hindsight, you know, you think the upside of building in house has sort of outweighed the downsides and the hard work. And I mean, obviously, it depends, every publisher has different access to resources. And as you say, you know, building and I guess more importantly, maintaining technology is a nightmare. And publishers don’t exactly have a great track record of doing so. But it sounds like you know, it’s worked for you guys it has. But
Angus Macaulay 33:35
it’s also I think it is one of the things whenever I talk about our subscription business, it’s also a bit with the caveat of the work for our subscription business started in 2016, which in the subscription landscape is like a lifetime ago, because even if you look at, you know how people are launching or experimenting with ideas on substack, which can give you the full suite of transactions, or even some of the software platforms that exist now, for subscriptions that just didn’t exist to the extent that they do now or with the, with the features that they have now, they weren’t there in 2016. And so we also started down a path. And once you’re down the path,
it’s there’s no going back at that point. Yeah, any kind of shift is,
I mean, even the shift we just did with our email service provider, it’s still a lot of work and shifting, you know, a paywall would be an all of our, the whole ecosystem and user experience becomes an enormous lift. But also we’ve gotten to the point where we have things we have the way we like them and the way we see our users responding to them and in many cases, that we still see opportunities to make them even better. So it’s intended to refine what we have and and the works already a lot of the work in the works done. I mean, we built it so at this point, you know, it’s it’s leverage what we have.
Jack Marshall 34:57
Yeah, I mean, it sounds like sort of the best of both worlds right? So you can tap into sort of the institutional knowledge and, you know, sort of experience of a bigger subscription based organization. But it sounds like you’ve been given the bandwidth to, I think put in place systems that are going to enable you to be a little bit more nimble than, you know, perhaps they could be.
Angus Macaulay 35:17
Well, yeah, exactly. And that, you know, it’s, you know, essentially what you say tap into it, because it’s also, we were also huge beneficiaries of being within an organization that not only believed in digital subscriptions, and that being critical in the North Star. But the globe, when we launched, they were already down the path of phenomenal success in digital subscriptions. So there were folks in house who had already been doing a lot of experimenting, and testing and growing and building a very robust digital subscription business that, you know, we could bounce things off of as we were trying to think through decisions, like meter or hard paywall, or what are some bench line metrics we should be thinking about? Or even with that hard paywall? How much should we put behind the paywall on day one, or the first six months we had the white folks internally, I could go to who, you know, again, the globe and said Are people read them and buy them for different reasons. But there are some fundamentals around subscription, marketing and conversion that, you know, helped us cut some corners, and still to this day, I mean, we both swap notes and bounce ideas off each other. And we definitely still lean into them to see what’s working, because they’ve, they’ve had a phenomenally successful digital subscription ran themselves.
Jack Marshall 36:33
Yeah. And at this point, it’s probably a two way street, I’m guessing as well, I’m sure there’s plenty they can learn from you. And thanks to your ability to be a little bit more nimble, I’m sure you can experiment with things that maybe they don’t have the opportunity to. So what’s one piece of sort of conventional wisdom about subscription models or businesses that you see people talking about online? And you know, to be false or disagree with?
Angus Macaulay 36:55
I think it’s a case, one of the things that’s been interesting to see is that in the last sort of five years, is this rush to subscriptions. And sometimes there’s sort of offhanded comments of like, you just need to put a subscription wall up and all your problems will go away. And it’s not that easy. For the limited team we had we did a fair amount of analysis before we put especially a hard paywall thinking through like, Okay, what stuff are we actually did a block and why and why do we think this is a value and, and every time we’ve added, you know, reporters, but even beats, there’s a lot of thought that goes into why it’s valuable subscription product, it wasn’t just a okay, we’re one year and let’s add a paywall, and it’ll take care of itself. Yeah, it definitely felt like a lot of that like, sort of, and again, this is sort of a lot, the lighter business model talk was just around. Oh, well, the answer to news media just put up a paywall, it’s like, well, that not if the product isn’t any good or not, if the product isn’t engaging people more than you know, once a month or less frequently, or most of your visitors fly by it’s like it’s, I don’t wanna say nuanced, but it definitely doesn’t fit everywhere. It is, I think, extremely valuable in terms of a brand, being able to really establish itself and establish its connection with readers, because now they’re definitely more, they’ve got more in the game, so to speak, because now they do really want something great from you, you know, that was thrown around a lot. And obviously, a lot of paywalls have gone up in the last five years, and some have succeeded, and others, not so much. And I think the other piece is that it’s, and this is coming from somebody who spent most of their career on the advertising side of the business, is that it is great to see the charts that show that recurring revenue and the growth as you add subscribers, and it’s very stable. And if you’re delivering and you have good retention, there’s this compounding effect that is just beautiful, which is very different than the advertising business where it can be a little bit looks a little bit more like an EKG at times. And so I guess one of things just sort of has struck me again, from my most of my life being in the advertising background was think things could come in quickly and accelerate the bottom line quickly. Subscriptions build it, especially if they’re you doing full price, you don’t get these huge, you know, often you get, you know, three or four huge sponsorship deals that hit next month and advertising and all of a sudden, you absolutely crush, you know, your number, those kinds of, I hate to say it feast or famine times don’t exist in a good way. But also, if you’re looking to accelerate your revenue to hit your number for the year, there are products you can build to get a sponsor, or an advertiser that can change the trajectory on your on your revenue projections in a shorter period of time. Whereas, you know, with subscriptions, we’re selling subscriptions now for February that are 12 months meaning some of that revenue is showing up in 2024. And you know by When we get to the second half of the year, you’re really building your revenue for next year, it’s hard to move the needle in q3 or q4 as much as you can with something like advertising. So for me, that was, it wasn’t something anybody told me that was false. It was just a difference in the revenue growth in revenue attribution, then, you know, more traditional advertising or event sponsorships?
Jack Marshall 40:23
Yeah, it’s a completely different model. Right, has completely different dynamics. And I think, you know, to your first point, like, I think we saw a lot of people just throwing up paywalls without really thinking, you know, did they really have the product to support it? And then I think, you know, you’ve seen a lot of publishers then kind of won those back over the past couple of years. Because, you know, the answer was no. So yeah, you know, I think, I don’t know, I see people saying, you know, subscription models are flawed, or, you know, you can ramp up revenue quicker with advertising. And, you know, I think it’s more about how it’s applied on both sides really?
Angus Macaulay 40:54
Well. And the other thing, too, is there’s a lot of, and this, maybe it’s now getting off your question, but there’s a lot of, and I even catch myself always thinking about, what kind of content are we producing, that’s going to convert people, and which, you know, you obviously need to think about and what kind of mechanisms we’re doing to convert people. But then there’s the other side, entire other side of that, which is okay, you sign up to stat today. And you’ve just given us $399, we actually haven’t delivered anything for you. Yes, we had a story that converted you. So you got one, sorry, but we now owe you 12 months of really phenomenal content, and so much, and we’re, I’m guilty of it, so much of the focus is on like, okay, what are we doing, to attract and engage and convert people, but there is that piece of engagement and retention of like, okay, now we we want to keep them, we owe them, they’ve paid us we owe them a product, we haven’t even given them the product yet. And it’s got to be as good or better than what was sort of teasing them and ultimately getting them to convert. And, you know, that’s the other sort of half of it always, it always gets wrapped up in, you know, the words of engagement or retention or whatever. But it really is, you know, we’ve just got for the next 12 months for that person, make a product that’s better than as good or better than what they were seeing right up until the moment they said, Okay, I’ll pay you now. Okay, now give me something. And it definitely keeps me going. That’s for sure. But it is that other half of it where the retention is, you know, as important or more critical, because it’s as we all know, it’s easier to keep somebody than to go get a new customer what regardless of what piece of business it
Jack Marshall 42:34
is, yeah. And I also think you know, what the type of content that converts people isn’t necessarily going to be the same types of content that’s going to convince them to stick around for a second year. So if you start following the data, purely on conversions, you’re going to end up in a in a weird place pretty quickly, I think. And again, I think we’ve seen publishers do this, where it’s like, your identity just has disappeared, because you’re just constantly chasing a number as opposed to, you know, having a sort of a clear editorial vision or whatever it is.
Angus Macaulay 43:04
Exactly, exactly. Yeah, it’s, you know, we actually even see it where, you know, we see really great subscriber engagement, for example, with our opinion pieces. And it also makes you realize, especially with a brand like ours, where it’s a fixed pay, while we’re half the cut, you know, 55% is behind the paywall. 45% is free, but the reality is, you know, as far as I know, subscribers, once they’ve subscribed, they’re not counting or watching, like, you know, am I reading only plus stories? Or am I getting my value out of my plus stories? It’s, are they getting their value out of the brand overall? And are we making sure that and that’s where for us, regardless of whether story is plus or free, it has to be to the same standard, because the subscriber wants to have subscribed. They’re just reading stat. And they know their stats website over there. They know they’re paying for it. But the question is, are they engaged and whether or not it’s plus or free story, they’re not keeping a score sheet to see like, have they read enough plus stuff to validate their renewals? Have they read enough from stat? And so it’s, again, just because something’s free? You know, for us doesn’t mean like, let’s just write free stuff that we’re writing for search. It’s now let’s make really high quality content that for a variety reasons we might decided should be free. But it’s to that same standard.
Jack Marshall 44:26
Yeah, it’s a reflection of your brand. It’s not a means to an end. Exactly. All right, well, we’ll leave it there. And Angus thank you so much for really appreciate this.
Angus Macaulay 44:35
Always an interesting conversation and and great to catch up with you. And congratulations on toolkits. By the way, it’s been really great watching what you guys have produced and it’s nice to see some of these were validated by reading that you’re what you guys are writing about saying this is the way people are thinking and this is what we’re you guys are seeing in the broader marketplace. So great work so far.
Jack Marshall 44:55
That’s great to hear. Thank you so much.