Recently at the GEN Summit, I saw so much positive awareness about how different monetization models can complement subscriptions. Just like at INMA earlier this year, people are paying attention, listening to the arguments being made, and building their own opinions. It is incredibly gratifying to see, and it made me want to share with you my own contribution to the debate.
Last week I had the opportunity to attend the GEN Summit 2019. Held at The Stavros Niarchos Foundation Cultural Center in Athens, home to the Greek National Opera, some of the top minds in the industry met together to discuss the challenges our business faces, and the future direction for media and publishing as a whole. I myself was fortunate to participate in a panel on the future of publishing and paywalls, where we discussed the need to find better ways to engage with users and to monetize visitors who might never subscribe.
News vs. Music and Film
Published only a few days earlier, and officially presented at the Summit, the Reuters Institute Digital News Report 2019 was top of mind for panelists and audiences alike, with everyone focusing on the report’s finding that “subscription fatigue” is growing, and that most readers would not pay for online news. A third finding saw less publicity — that many users would rather subscribe to music and film services than for news. When we look at those platforms, we learn more about what users expect from online subscriptions.
The key takeaway here is that we already live in a world where you get a huge amount of value for little money. Disney has one of the best brands in the world- with perhaps the best single movie catalogue in the world, covering Lucasfilm, Marvel, Disney and Pixar and a ton of other stuff. They are universally popular but, despite this, they still feel that they can’t charge more than $6.99 a month for their upcoming streaming platform. And they’re in good company — Hulu charges $5.99 a month and Netflix starts at $8.99.
That is what the publishing industry is up against. Users compare and judge — and they see publishing as a part of their media consumption, not something that comes with its own budget. Being in an environment like this means that you need every tool you can get to be competitive and secure users’ attention and money.
For Me to Win, You Have to Lose
With users increasingly proving unwilling to pay for multiple subscriptions each month — and if the trend of having one news subscription persists — the industry finds itself in a dangerous position. If a reader is only going to pay for a subscription to their favorite news publication, that means precisely zero revenue is available for anyone else, if all they are offering are subscriptions. Publication A gets everything, and Publications B through Z get nothing. As it stands, every publisher is vying with every other publisher out there to capture each user’s revenue — this means that for one publication to win, everyone else has to lose.
This is not only dangerous, it makes the case for why we need to provide different ways for people to contribute to multiple publications each month — through donations, contributions, and the ability to purchase individual articles or memberships. This democratization of media spend will not only prove more sustainable but it will also help expand revenues in the future: low friction models make it very easy for users to take that first step from being a reader to being a first-time paying customer.
Monetization Is Like a Mango
What does a Mango have to do with any of this? Well, as you’ll see below, it’s actually an uncannily accurate representation of where the industry finds itself today — and where we need to go in the future!
As we can see, with subscriptions — the top part of the mango — publishers get an initial burst of revenue, but then the rates start to plateau as subscriptions capture all the loyal audience available. Low-friction models like Time Passes, Contributions, Donations and Single Purchases, in contrast, may be slow to start but they build over time as they continue to engage new customers. As a result they build an additional revenue stream that, once it ramps up, keeps on coming.
There is no catch-all solution. We need this combination of various models precisely in order to address the various segments of our audience. They are effectively two sides of the same coin and publishers should employ them together in order to engage and monetize both loyal users and new users.
It’s Time to Look Under the Hood
Because of the increased awareness we saw at GEN — both the way people interacted with us and wanted to learn more and also everyone’s reaction to the Reuters Institute report — I’ve determined that the best way to lead this movement is to share our experience, our metrics and our evidence that low-friction models and conversion funnels work.
Put another way, we should offer ourselves as proof to support the cause.
That’s why I’m excited to announce that, starting in the next few weeks, we are going to offer everyone a peek behind the curtain at LaterPay! We plan to regularly publish results that our real-world customers are seeing as they implement our solutions and begin to address both sides of the mango.
Watch this space for more news shortly!