Last month, I had the honor of sharing the stage at WAN-IFRA’s World News Media Congress 2022 with Nancy Lane, CEO of Local Media Association, and Alan Fisco, president of The Seattle Times, discussing our top reader revenue strategies. Lane recently wrote about her top takeaways from the Congress and the following is a recap of our session.
Lane opened up the session by highlighting the top revenue trends in North America:
- Reader revenue, which is paying for 70%-100% of newsroom costs for some newspapers and digital sites.
- Journalism funded by philanthropy, which is paying for up to one-third of newsroom costs for some local news outlets.
- Branded content, which is the most successful digital advertising strategy. Some smaller local media organizations have up to 25% of their total revenue coming in from branded and sponsored content.
- Industry collaboration, which is really starting to take off and pay off.
The four keys to reader revenue growth, she said, are:
- Buy-in at the top, where the CEO must make it a top priority.
- Assembling the right tech stack, which remains challenging.
- Pricing, where you have the confidence to charge enough for your product.
- Strong journalism, which is where investment is needed.
Fisco reiterated the last point succinctly. “If you are gutting your newsroom and producing lesser quality content, don’t bother with your retention strategy because you will fail.” Invest in content and newsroom staffing, because the best retention tool is quality, local content and an engaged local audience.
The Seattle Times, which launched its audience-first strategy in 2013, now has 70% of its revenue from audience. Building audience loyalty starts with content and the newsroom, and a collaboration between the audience and news teams helps align news coverage with key business drivers. This includes regular actionable data reviews – daily, weekly and monthly – and prioritizing key coverage areas, including local news, politics, local columnists and football.
Having an effective credit card management program is critical to subscription success, Fisco said. A focus on this optimization has helped The Seattle Times reduce churn rate from nearly 7% to just over 3%.
Fisco also discussed the importance of building an audience-first culture in the organization, stressing the importance of corporate and leadership alignment. I also stressed the importance of creating a culture of retention, something we are doing at Star Tribune. We’ve established the importance of subscriber retention across the company, and we regularly review key retention indicators, as retention is hard to measure quickly. These include metrics such as digital activation, digital engagement, subscriber tenure, digital inactive revenue and more.
More importantly, we talk about how retention is everyone’s role, and how getting that first renewal payment from a subscriber is key. Once a subscriber makes that first regular-priced renewal payment, we are far more likely to retain that person as a paying subscriber. The team gets involved in many ways, from our customer service team interacting directly with our subscribers, to the news content team featuring content that is relevant and interesting to our subscribers, to our home delivery team making sure the paper gets out every day.
At Star Tribune, email is a key contact method with our subscribers. We have several examples of high-impact changes:
- Digital welcome series: Adding an explicit welcome from the editor and the editorial pages editor, which made the series longer, resulted in lift of three percentage points in open rates across the entire series. Of note: The email from the editorial pages editor, which is last in the series, has one of the highest engagement rates in the series.
- Delivery service feedback: Asking for feedback rather than waiting for feedback to come to us has reduced the number of service-related stops.
- Content-driven emails: Using content to get unengaged subscribers back to our digital platforms.
- Explicit click buttons: Adding these where it makes sense has always improved click rates for us.
Another retention focus at Star Tribune has been implementing the ability for users to cancel their subscriptions online. More importantly, that functionality has given us the opportunity to save that stop. Our online cancel interventions have a save rate of 8%-39%, depending on the offer, and the overall online save rate is 18.5%, compared to our call center save rate of 8.8%. Note that we do not use The Mather Economics pricing model and we historically have not negotiated on rate when a user has called trying to cancel. This has given us the ability to easily experiment with rate and other levers, and to move the more successful tests into our call centers as well.