Challenges for content monetization
In the previous post, we discussed 3 inevitable trends (Adblock growth, declining CTR, and general dislike of ads) which change the way online content is monetized. We made a set of specific predictions for both online publishers and readers. In this post, we want to share what learned about paid content, in particular about challenges faced by online publishers and individual content creators who have decided to charge for content.
In describing the challenges, we want to structure the post with the steps to take in considering whether to sell your content and how. We’ve listed the steps below, loosely in chronological order.
Step 1. Research if you can charge for your content. Research if internet users would pay for your content. Understand if the content you create is unique, engaging and provides enough value to the reader so that they are willing to pay for it. Make sure your content is not repeated somewhere else online for free, or your readers will surely find it.
As an example — if you are a news website, you may be publishing short, reporter-style stories about local events but your audience discovers and consumes similar stories on Facebook. In that case, monetizing online content via direct payments will have limited success. From what we learned, the average internet consumer is smart and understands quickly whether content is unique and valuable enough to pay for.
On the other hand, if your content is unique, time-sensitive, entertaining, educational, or helps your readers to get an edge over others, it can sell well. Does your content save readers’ time or money? Does it intrigue them? From what we’ve seen, good examples of content which can be sold successfully (and may not be so obvious) are fitness videos, financial advice, freemium games, fantasy sports advice, and long-form analysis.
- Fitness video content helps your readers become healthier and achieve personal goals. It’s educational and entertaining as well. Check up Fitness Blender.
- Financial advice gives you an advantage to make more money. Often this content is time-sensitive. Check up WSJ.
- Freemium games are entertaining and addictive. When a paywall is implemented to slow down a game’s progress, conversions are high. Last year, the freemium game industry was estimated to be $26B. Check up Clash of Clans.
- Fantasy sports advice is time-sensitive, and gives you and “edge” to outwit your opponents and win money. Check up fantasypros.com
- Long-form analysis is educational and makes you feel more informed than others, especially if the content is unique. Check up theinformation.com
Step 2. Compare your subscription options: site-wide, a premium-only section, premium features, metered access. The next step is to decide which approach you’ll take sell your content and encourage your readers to pay. There are plenty of options, but only some of them will be appropriate for what you‘re selling.
First you should consider that any online publisher has both (1) casual readers who visit the website a few times a month or less, and (2) frequent readers who come to consume content at least every few days. The majority of a typical publisher’s audience is casual visitors. For instance in our surveys, 70% of visitors on a typical news websites are casual.
It’s important to realize that casual readers on your website would likely never pay for content. When you add a paywall, casual visitors won’t feel that they would get enough value from the paid content, so they will probably search elsewhere. If your casual visitors are using Adblock, you might be able to convince them to whitelist your site to see your content…but you won’t be able to convince them to pay (we discuss Adblock detectors in a separate post).
Adding a site-wide paywall is an easy option but it’s usually not the best idea considering how much of your audience is casual. You take a huge risk and will completely prevent casual users from accessing your content. They will eventually stop coming, and if you rely on advertising in any way, your ad revenue will plummet.
The key here is that you don’t want to focus on the non-paying majority. You want to focus on your frequent content consumers, those who see your value and have developed a strong habit of consuming your content. Here you have 3 distinct options:
- Premium-only section. You can make, say, 20% of your best content accessible to paying, premium members only.
- Premium features. You can keep all of your content accessible to all users but create a set of new paid features that are highly valuable to frequent visitors. Those frequent visitors will pay for the features, although your content is still free to access. Think about Spotify. Any song can be played with a free plan, but you can only remove ads and get unlimited skips with the paid plan.
- Metered access. You can keep all of your content accessible to all users but you meter their access to differentiate between casual and frequent visitors. Visitors who consume content very frequently would eventually be restricted and offered to pay to continue reading more. The classic example here is the New York Times. It’s important to remember that’s it’s technologically impossible to meter guest visitors, since guest visitors can always clear cookies and localStorage (you’ve probably heard of many hacks to get around the NYT paywall). But it is fairly straightforward to meter registered users.
To select any of these 4 paywall options above, the choice will strongly depend on the type and quality of a publisher’s content, the ratio between casual/frequent visitors, and finally goals. The goal to diversify revenue sources does not have to be aggressive. For example, 5% of revenue can come from subscribers and 95% from ads. In this case, a site-wide paywall is not a good idea. You might want to go with a premium-only section or a metered paywall.
We’ve learned that the way you implement paywalled access matters. Multiple considerations, such as SEO and UX, must be accounted for. All 4 options we described above can be implemented differently, with different consequences for your visitors’ experience and your site’s search rank. One of the non-obvious (but we’ve found to be important) things to consider is a “teaser” effect.
Step 3. Decide on “teaser” effect. A teaser effect is a simple way to increase conversions. The way it works — a publisher lets visitors read the first half of an article but places a paywall over the second half and asks visitors to register/subscribe here. The reason a teaser effect works is simple: the reader already engages with the content and wants to keep reading. They see your value and knows there’s more behind the paywall. We usually see at least 100% higher conversions if only half of the content is paywalled instead of the entire content. In almost all cases — site-wide, premium-only, premium features and metered paywall — we recommend paywalling individual pages only partially by using teaser effect.
Step 4. Decide about googlebots. One important consideration is to decide about the paywall technology. There 2 ways to hide access to content, client-side and server-side paywalling. The simplest way to paywall is to deliver content to the browser (client) and hide it on the browser by using JS and CSS. In this case, googlebots will be able to access your content and that’s good for your SEO, but if your audience is tech-savvy, your hidden premium content will be consumed for free via Google cached pages or Chrome Dev Tools. Alternatively, you can implement server-side paywalling, where content is not sent to the browser unless it is confirmed that the user is a premium member. Even a tech-savvy audience would not be able to access your premium content for free, but neither will the googlebots. We recommend using your best judgment. Make a decision based on your audience and content type. Also consider using server-side paywalling together with the teaser effect. That way googlebots crawl your pages partially and index it, but the visitor still has to pay to access the rest of the content.
My name is Tima, Kelly and I build tools for website owners to monetize their online content in the most user-friendly way. We’ve open-source code for both Adblock detection and a paywall/premium membership. Check up Drizzle.