The dual-revenue strategy successfully employed by newspapers of print advertising and home delivery subscriptions is no longer a viable method to keep newspapers afloat. Digital advertising is dominated by two of the biggest names Facebook and Google and local newspapers have struggled to attract or sustain the subscription success enjoyed by publications such as The New York Times and Financial Times, with their national and international audiences.
The American Press Institute examined US digital newspaper subscriptions to understand subscription costs and strategies, assessing subscription pricing by evaluating market size, circulation, and newspaper ownership. It is important to remember that digital content includes but is not limited to websites, mobile apps, print copies, or e-editions. The results of the study are based on 100 US-based legacy newspapers; each based in one of Nielsens 100 largest designated market areas (DMA).
Key findings:
- The median weekly price is $2.31 or $10 per month and $120 per year for a digital news subscription. Most subscriptions fall between $1 and $3 per week.
- The new median weekly price of $2.31 is 83% higher ($1.05 more per week) than what was reported in the 2012 Reynolds Journalism Institute research. The median weekly price is also 221% higher ($1.59 more per week) than respondents stated they were willing to pay in the same Reynolds Journalism Institute research.
- Four key factors in setting digital subscription pricing include market testing, corporate set price, industry norms and competitor pricing.
- Market size and circulation do not show a correlation to subscription price. However, ownership does, as prices are often standardised across some companies media properties.
- Discounted trial subscriptions result in higher conversion rates than do free trial subscriptions. It appears that some sort of initial payment information entry is helpful in converting discounted trials to paid subscriptions.
- Subscriptions offer include an array of perks from access to comments and fewer advertisements to improved browsing experiences and rewards programs. There are also offerings that include insider-only perks such as newsroom tours, movie screenings and exclusive giveaways. Partnerships offerings are also popular. The Washington Post partners with Hulu to offer combined digital access to The Post and Hulu for $99 a year. The New York Times has a partnership with Spotify Premium for combined access for $203.88 for the year.
Once publishers have captured the most loyal readers who are readily willing to pay for digital access, they need to secure the users who are not so easily convinced. At this stage consumers need to actively and individually converted to paying for digital content. Organisations must continually test innovative and unique offers to draw in new subscribers.
Written by Rande Price, 21 February 2018, published on Digital Context Next. Read the full article here
