Trying to Grow Subscriptions With a Hard Paywall

When The Information launched, many in mainstream media looked at what the team were doing and scoffed. There was no way a hard paywall could work, they said. And yet, it did.

Simon Owens published a piece on What’s New In Publishing last week that did a deep dive into what The Information did well. In it, he touched on the five aspects that made the business successful. He wrote:

Because The Information doesn’t monetize with ads and charges so much for a subscription (more on both of those points in a moment), it can’t get away with churning out commodity news that can be found on every other website. “You can’t put a paywall on a pig,” Lessen explained at a media bootcamp. If a story isn’t truly original, The Information doesn’t consider it worth publishing.

And it isn’t merely settling for small scoops. It aims for impact, the kind that results in executive firings or moves a company’s stock price. Its extensive reporting on sexual harassment allegations at a prominent venture capital firm, for instance, led to a partner’s resignation. It broke the news that eBay would spin PayPal off into its separate company. 

At a recent event about media monetization, Jarrod Dicker from The Washington Post said, “I’m very concerned by every single media company thinking that there’s this huge consumer revenue pie that they’re all of a sudden going to be able to flock to—I think that’s extremely dangerous.”

Dicker is right. Every media company is attempting to earn subscription dollars from their audience and they’re going to realize that it just doesn’t work. Not all content is created equal and most pubs are doing exactly what Lessin said: putting lipstick on a pig.

For those publishers that do figure out a subscription model that works, it’s likely because they will have moved away from producing a lot of content to creating top quality content. It’s more important to cover the topic with unique information than it is to have every piece of information. Depth is far more important than quantity.

Nevertheless, the big concern with a hard wall is that your ability to share content is drastically reduced and it becomes difficult for new audience to understand what kind of content you’re producing. That’s why the softer walls make a lot of sense. The user can get a taste of the kind of content they’ll receive and then, when they want more, they have to pay.

That’s the model I take here at A Media Operator. Every Tuesday is free and open. Readers get a taste. However, if a reader wants to get the Friday pieces (and access to the community), they then have to become a paid subscriber. I can tell you that since locking content down on A Media Operator, growth has slowed considerably. That’s to be expected. I cut the amount of shareable content by 50%, so of course fewer people are going to find my content.

There’s a natural way around that, though, and I think The Information hints toward a model that could make sense. See the image below:

In the above example, when I drop an email address in, it redirects me to the subscription where I can create a paid account.

However, another tactic would be to treat this like a free registration wall. In exchange for a piece of information—the email address is always most important—the user is able to access the article. This solves two needs for the publisher:

  1. The user is able to get a taste of the content, which might be enough to get the paid conversion

  2. The publisher now has an opportunity to engage with the user and let them know the content they’re missing out on

While both are incredibly important, the second reason gives the most upside because, if deployed correctly, I imagine this list of free sign-ups could wind up being a source of many new paid subscribers as time goes on.

Think back to an early piece I wrote about the stop rate on paywalls. The most successful publishers stopped over 8% of their audience with a paywall resulting in a much higher conversion than those that stopped fewer people. Ultimately, for a user to sign up, they need to be prompted. The more often a user sees the wall, the more likely they are to sign up.

Now factor in that you’re a hard paywalled publication and the user is only going to see the wall. Because you have the user’s email address, you can let them know when one of your best stories gets published with an email blast. If the user tries to read it, they’ll hit the wall.

You could take this a step farther in an attempt to boost conversions… If you’ve got a tagging system in place, keep track of what tag the story belonged to that got the user to give over the email address. Then, if another story pops up from that tag, you can email the user. For example, if the story is tagged to WeWork (in the case of The Information), the next time a WeWork story pops up, then the story would be emailed to all people who had signed up through a story about that company.

One thing that I haven’t tested (and perhaps others have) is whether the unsubscribe rate from this sort of a “free user” newsletter is incredibly high. If the user just wanted to unlock a single piece of content and is never coming back again, it might be a situation where you just gave a free piece of content away and got nothing back.

A tactic that The Information offers for this as a means of getting new people to sign up is the $1 subscription. As a paid subscriber, I can basically give someone access to The Information for only a buck for the first three months. The user then has access to unlimited content. This is another interesting tactic worth exploring because, after three months, is the user hooked enough on the content to not churn?

Ultimately, running a hard paywall media business is about experimenting with different ways to both get people into the funnel and get that first paid conversion. Unlocking a piece of content in exchange for an email address is one tactic worth exploring. And, if nothing else, the $1 conversion is a way to get a credit card on file.

As a final reminder, though, none of this will work if the content isn’t good. All the tactics in the world might help The Information push growth in the business, but without the exceptional reporting, nothing else matters. It’s really that simple.

Moving right along…

Using audio as a retention tool

NiemanReports published a feature about how some publishers are finding success using audio versions of their articles to build loyal audience.

Now, when the magazine’s 14,000 subscribers open the Zetland app, they get a sort of playlist for each day, starting with a conversational podcast and moving into narrated articles. “In a way, it’s very old-fashioned the way members use us,” Mosbech says, comparing it to terrestrial radio. “They open the app in the morning and they just press ‘play’” and listen until they finish their commutes.

Prior to the audio experiment, departing members said they didn’t read enough stories to stay subscribed. But “when people start using us through audio, they use us more and they use us in a more stable way,” Mosbech says. The average completion rate for an audio story is 90% — enviably high for anyone in a newsroom who has watched on a Chartbeat analytics dashboard as users abandon text stories a few paragraphs in.

This is impressive. Unlike with text articles where a user might bounce after a few paragraphs, the user is actually making it through the majority of the pieces that are published. This improves the likelihood that users feel value in the subscription.

What is really interesting about this is it demonstrates a potential use case for a mobile app. I’ve historically been anti-app, not believing that many people would actually use it. That’s not to say we wouldn’t download them—I’ve got The Washington Post and The New York Times apps on my phone—but compared to others, I rarely open them.

This shouldn’t surprise anyone either. NiemanLab wrote a piece about a study from the Reuters Institute for the Study of Journalism. In it, the author summarized:

On those 20 young people’s phones, Instagram was the primary app: Every one of the 20 had it and spent the most time on it daily. News apps, by comparison, received much less usage. Apple News is pre-installed on iPhones, which helps account for its relative prominence here — but “no news app (with the exception of Reddit) was within the top 25 apps used by respondents…For two of the four individuals who had the BBC news app on their phone during the two-week tracking period; the app represented less than 1 percent of usage time for both.

Why should they? For most people, a news app is simply not a destination for people. I know from personal habit, I find most of my news by following specific journalists on Twitter.

Once there is a reason to open the app, though, it becomes more of a destination. In this case, the playlist of all the important stories of the day is the reason to open the application. Forming a habit with the user to continue opening the app day-after-day is a great way to take a paying subscriber and keep them engaged.

There is some work associated with doing audio versions of stories. You can either train your journalists to read the stories or you can partner with one of the companies listed in NiemanReport’s feature: Noa, Audm or Curio. There are obviously trade offs to this. If we think the audio is a great way to get users to engage with a mobile app, sending those audio files to another app doesn’t make the most sense. On the other hand, it could expose your content to a new audience and apparently they all pay some rev-share.

There are other companies that attempt to use an Alexa-like voice to create the audio and I don’t really advise this. While it does convey the news, it’s not as engaging as listening to a real voice. I’ve been pitched by a few companies that offer this and, especially when dealing with more complex topics, it becomes hard to understand and just not worth it.

Last week, Ben Thompson of Stratechery announced that he was going to be releasing a podcast version of his daily update. This Twitter thread by Rameez is worth looking at to understand more about the value of this.

We’ve talked about this before, but the hard work for a publisher comes after the subscription. In this case, the audio version of stories is a great way to help subscribers build a habit with the content. Ultimately, that’s the most important thing you can do.


Thanks for reading today’s piece. Do you have thoughts? Paid subscribers can leave a comment below. Please consider sharing this post with your colleagues who work in media. Finally, subscriptions to A Media Operator are only $100/year, but they’ll jump to $200 on March 12th. Join the fun and become a paid subscriber. See you on Friday!

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Oh Look, A Platform is Preparing to Dupe Pubs

Plus looking at how we can form habits with our readers

It appears that European publishers are finally going to get their wish. According to The Wall Street Journal:

Google is in talks with publishers about paying a licensing fee for content in a news product, according to people familiar with the matter, a move that would mark a shift in the search giant’s relationship with news organizations.

Talks are early, and it isn’t known if agreements will be reached, the people said. Most of the publishers in talks with Google are outside the U.S., including in France and elsewhere in Europe, one of the people said.

Although we’re not sure how much money Google is offering and it’s only referred to as “a news product,” this is exactly what many larger publishers have been fighting Google on for a long time.

There are a couple things worth discussing here…

First, this is obviously in response to Article 11 in the European Union’s Copyright directive of late 2018. According to Wired:

The article intends to get news aggregator sites, such as Google News, to pay publishers for using snippets of their articles on their platforms. Press publications “may obtain fair and proportionate remuneration for the digital use of their press publications by information society service providers,” the Directive states.

No one is really sure how this one would work either. How much of an article has to be shared before a platform has to pay the publisher? The Directive states that platforms won’t have to pay if they’re sharing “mere hyperlinks which are accompanied by individual words,” but since most links are accompanied by more than a couple of words it seems that many platforms and news aggregators would fall foul of this rule.

Essentially, if Google wanted to link to a publisher’s website and include a short description of that story, Google would have to pay the publishers. For a long time, Google was adamantly against doing this. They even showed samples of what the SERPs would look like if publishers kept demanding money—they were completely bare and likely would have resulted in a drop in traffic because of clickthroughs plummeting.

If Google has changed its tune and is now starting to offer some money to publishers that want to be included in a news product, this must be grounds for celebration… Right?

Google might be offering money to publishers, but this is not something that should fundamentally alter the strategy of any publisher. The money, if there really is any money, will only come once and then it will never come again.

And here’s where the real risk lies for these publishers. Easy money, like the kind of money that platforms offer, is addictive. Publishers have been doing it for years. So, when a platform comes along and says that it’s going to pay for something, I get a little nervous.

But it’s more than just nervousness about the easy money. It’s also stupid money in that publishers start making really dumb mistakes when that money comes in.

Back in September, Cheddar’s Jon Steinberg did a fireside chat with Jessica Lessin of The Information. When discussing the Facebook News Tab, he said:

Always take the check. But you are never getting another check, so you either take the check and staff it in a way that you can do it and shut it down without hurting your people, or you figure out a way to make it self-sustainable.

Here’s what typically happens when a platform gives money. The media company takes that money and staffs up. Then, a couple years later, the money dries up because the platform got bored and, suddenly, the media company has a large team it can’t support, so it doesn’t the only thing it can: fires people.

Having watched my fair share of layoffs, let me tell you, there is nothing worse for morale than people thinking their jobs are at risk. Want to lose your absolute best talent? Have a bunch of layoffs because you thought the platforms were going to fund your operation for life.

But here’s the real reason this sort of a thing irritates me. Easy, stupid money is the kind of money that helps publishers get complacent.

Think about how lazy many of us got with programmatic advertising funding our lives. We didn’t need to own the monetization engine because ad tech would do it for us. Then that got yanked out from under us and we’ve started learning how to do it ourselves.

This is the same thing except with a different source of cash. I know publishers have been wanting to get paid from the platforms for a long time, but it won’t last forever. And in a few years, when Google gets bored, what will the publisher do then?

So, for those publishers that do get offered money for content, be very mindful of this. Don’t suddenly add a bunch of staff and do not get complacent. Keep the cash in a strategic reserve versus using it for operational reasons. And let’s come back to this in a few years. Once the “Google is evil” PR disaster ebbs, the money will dry up. The outcome will be publishers getting duped once again by the easy, stupid and lazy money from the platforms.

For those that don’t get picked, continue building your business the right way. Speaking of which…

Forming habits with your readers

There’s a good report out from Twipe about creating habit forming news products. The authors wrote:

  • Understanding habits and adapting product offerings accordingly is now a key priority at all of the leading news organisations we interviewed.

  • Habit formation takes time: on average 66 days before an automatic behaviour is ingrained in our brain.

  • Habits can be formed through carefully designed Habit Loops: an iterative process requiring triggers, cues, actions, investment, craving and variable reward.

  • Studies across the industry show that three reading activities per week is the tipping point where occasional engagement turns into predictable, habitual behaviour.

  • Successful news organisations focus on understanding patterns and adapting content to fit readers’ daily lives.

Those fourth and fifth bullets are especially important to call out because I think they’re the key to successfully building a habit with your reader. Let’s tackle them independently…

There are a couple tactics—both long-term and short-term—that can help get users to go from passive to habitual.

Your trusty newsletter is a huge engagement tool. In this instance, we want to remind the reader on a regular basis that there is something worth reading on your site. You want to start getting them used to using your site for information. It starts slow, but as time goes on, readers start seeking out the newsletter. When that happens, you’ve formed a habit.

Paid advertising is also worth looking at. In this instance, we want to target readers who are dangling on the edge of conversion—or who have recently converted—and remind them about you. This is especially useful if you’ve just converted someone because the user is brought back to the site over and over, converting them to a long-term loyal reader.

The fifth bullet is really important and something that so many people get wrong. When we start building products, we tend to think about what we want versus what the user actually wants or needs. “Adapting content to fit readers’ daily lives” means building products for where the reader actually exists. We need to go where the reader is.

This can be difficult to figure out because it takes time. But it’s so important because it can be the difference between a successful or failing product launch. This means taking the time to talk to the reader. Do progressive polling and focus groups with your readers. Have conversations. Learn about what their needs are. From there, you can walk away with ideas on the best ways to engage and form habits with them.

In the report, the authors offered a variety of examples where this was done:

I encourage you to read the report to dive deeper into the left column labels.

But as you’re spending time reading the report, ask yourselves three important questions:

  1. Do you know how often your audience comes back to your site? If not, do you have the resources to start tracking that?

  2. Do you know where your audience likes to spend most of its time or what it is hoping to gain from news?

  3. Do you have someone on your team who can own habit-forming? While it is ultimately an organization-wide goal, there always needs to be someone accountable.

If you don’t know the answers to these questions, that’s fine. But start to think about them. For publishers that are not going to get complacent—like those that will get cash from Google—understanding as much about your reader as possible is the difference between failure and success.

Read the report and then let me know your thoughts.


Thanks for reading this week’s piece. Last Friday, I wrote a piece titled “The Most Successful Pubs Have Long Time Horizons and Require Repetitive Focus” for paying subscribers. If you’d like to read this and all future paid essays, consider becoming A Media Operator subscriber. See you all next week!

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Most of These Sports Betting Deals Are Going to Fail

Happy Tuesday! I hope you had a good weekend and your week is off to a good start.

Last Friday, I wrote a piece proposing a new monetization strategy local media could take. It’s controversial, but I also think it makes sense. Paying subscribers get access to the content and are also able to leave comments. Want to join the community? Sign up now.

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Now for the news…

Everyone wants to get into sports betting

According to The Wall Street Journal, William Hill, a bookmaker, and Viacom CBS have reached an agreement on a gambling deal. It stated:

William Hill agreed to pay CBS Sports a fee for access to its audience and sponsorships across CBS Sports content, according to people familiar with the matter. The deal, which includes incentives for hitting certain targets, is aimed at getting CBS Sports users to download the William Hill betting app and put money into their betting accounts, the people said.

CBS Sports plans to boost sports-betting content and data offerings to its 80 million users with the William Hill brand, including through its subscription betting-recommendation service, SportsLine, and database of fantasy sports players.

The idea here is relatively straight forward. William Hill and CBS Sports will work together to create content with the goal of converting CBS Sports’ readers into gamblers.

This isn’t the first deal of this sort and I doubt it’s going to be the last. According to Axios:

While some companies like Fox Sports are actually running their own sports books, most media networks, like CBS Sports and Turner Sports, are taking a more cautious approach — partnering with casinos on the ground in Vegas for content, but not establishing their own books.

ESPN said last year its partnering with Caesars Entertainment. Turner Sports and Bleacher Report announced a similar deal in February, building a branded Bleacher Report studio inside the Caesars Palace Sports Book in Las Vegas.

When everyone in media is looking to do the same kind of deal, it’s likely there is going to be an over-saturation of content and an underwhelming return on investment.

Here’s the problem…

These are really just glorified ad deals. Sure, William Hill is going to have its personalities appear on CBS Sports content. And sure, CBS is going to look at using data from the bookmaker to make in-depth content that entices users to click over. But at the end of the day, this is just William Hill sponsoring CBS Sports. Throw in a little sponsored content when people from William Hill offer their expertise and voila, you’ve got an advertising deal.

There’s nothing really wrong with that, but the results are not going to be as great. The exception is if the media brand builds out their own product, like what Fox did in its partnership with The Stars Group. In that case, you’ve got a tighter integration, the branding is consistent from media platform to sports book and, I’d guess, the audience feels more of a connection.

Penn National, another gambling company, is tackled this need for deeper integration by acquiring a chunk of Barstool Sports with the goal of owning it outright. I wrote when the deal was first announced:

So, what we have is a product company (Penn National) now looking for a way to bring tens of millions of potential customers to those products and realizing that a media company (Barstool) already has those prospective customers. It’s a smart play.

Penn is also going to be integrating the Barstool brand into the experience. In the presentation Penn released to investors about the deal, this slide was included:

The first one is the real trick here. The Barstool audience trusts Barstool; therefore, if the brand is used for actual products, the results should be greater.

On the other hand, these glorified sponsorship/ad deals, such as the ones that CBS Sports and William Hill are doing, will be received like any other advertising deal. Will it work? I’m sure customers will sign up. But if the reason for doing one of these deals is to reduce customer acquisition costs, I can’t see people converting. Color me skeptical, but as we move forward, I expect to see more deep integrations versus surface layer ones.

And, just as importantly, I imagine there will be a deluge of mediocre gambling content across all these sites and the outcome will be another failed attempt at monetization.

Chrome’s unilateral decision about video ads

Last Wednesday, Google Chrome released new guidance on video ads. Jason James, a product manager, wrote:

Today, the group responsible for developing the Better Ads Standards, the Coalition for Better Ads, announced a new set of standards for ads that show during video content, based on research from 45,000 consumers worldwide. 

There are many different types of ads that can run before, during, or after a video but according to the Coalition’s research, there are three ad experiences that people find to be particularly disruptive on video content that is less than 8 minutes long:

  • Long, non-skippable pre-roll ads or groups of ads longer than 31 seconds that appear before a video and that cannot be skipped within the first 5 seconds.

  • Mid-roll ads of any duration that appear in the middle of a video, interrupting the user’s experience.

  • Image or text ads that appear on top of a playing video and are in the middle 1/3 of the video player window or cover more than 20 percent of the video content.

I have two thoughts about this…

First, this is an example of Google deciding what I can do with my business. Google says this is through the Coalition for Better Ads, but as one of the largest video ad sellers in the world, this is clearly coming from Google. That just irks me.

Second, there’s no denying that the behaviors above are incredibly annoying to the average person.

In the event that your site does break one of these rules, starting August 5, 2020, Chrome will automatically block the ads outright. Publishers can now do one of two things. They’ll either lengthen their videos—which probably reduces the quality—just so they can get a longer pre-roll and some mid-rolls or they’ll have to start enforcing a strict no ad over 30-second policy.

One thing I’d be curious about is whether this results in a large enough reduction in inventory across the internet that video CPMs increase. Publishers have seven months to get ready.

Finding a new way to monetize subscriptions

Digiday wrote a story about how Investor’s Business Daily generates 80% of its revenue from subscriptions.

Unlike most publishers that look to create a single subscription product, IBD is focused on building multiple products with different audiences in mind. In the article:

For people interested in knowing which stocks are hot and how best to invest in them, there’s Leaderboard; for people who want a more personal take on the day’s market movements, there’s IBD Live; for hardcore researchers, Investor’s offers MarketSmith.

Today, IBD offers eight different products, each designed with a different investor persona in mind and priced accordingly: Leaderboard costs $69.99 per month, which MarketSmith costs upwards of [$]1,400 per year.

To build these products, IBD needed to dive deep into the various audience personas on its platform and understand what their needs are. This is a lot harder than it seems. This isn’t just an analysis on whether someone will pay. This is about understanding what the individual psychographic actually needs and then creating a product specifically for them. That takes deeper analysis.

But what I find really informative about this story is the tactical breakdown on how IBD takes a customer from one product and starts to funnel them into other products.

They start by focusing on getting the customer really engaged with the product they purchased. IBD president Jerry Ferrara told Digiday that the first 60 days is all about helping new customers get used to the product they purchased.

You’d be surprised how many publishers don’t do any work once someone pays for the product. The most successful publishers guide the user deeper into the product. In November, I wrote about this:

Once a user actually converts, you should automatically add them into a welcome series of emails that walks them through the various content offerings that you’ve got. Here’s a basic flow that could work:

  • Day 0: Thanks for subscribing. Let them know that there are a few more emails coming in the next couple of days.

  • Day 2: Want to stay up to date on our reporting? Here are a few newsletters that you might find interesting. What newsletters should you show? At minimum, one that is related to the piece of content that finally got them to subscribe.

  • Day 7: Here are a few subscriber-only benefits that you may not have known about. The Athletic offers subscriber-only podcasts. The Information does sporadic conference calls. Let people know that these exist.

The number of days between each email is something to test. Perhaps two days between subscription and the first engagement email is too fast. Or, on the other hand, you may find that this email should go immediately.

The point here is to immediately build a rapport with the subscriber by communicating with them.

IBD is basically doing this, but spread it out of 60 days. The important thing here is to keep the user engaged with the product long enough that they get hooked. After a few months, IBD starts to automatically cross-sell other products based on what content the subscriber is consuming. Using analytics to inform cross-selling takes more work, but it’s an important step to generating higher conversions.

This strategy could be deployed across a variety of different niches. One that I think a lot about is how to use a low-cost/high-cost product strategy for a B2B publication. Perhaps it starts with a low-cost newsletter, such as A Media Operator, and then expands to a high-cost research component. Fewer people will convert to the higher-cost product, but the higher revenue per user more than makes up for it.

Another way to do this is with a low-cost subscription/high-cost event. I would be curious to see a publication that is earning a few hundred dollars a year per user from their content and then generate a few grand per attendee at the event.

Although I haven’t tested it yet, I imagine what you’d find in this scenario is that there is a greater conversion from the low-price to the high-price than from someone going directly to the high-priced product. Why? You’ve already convinced a user to pay for something and they are comfortable with you. Therefore, the most loyal are more likely to convert a second time.

If anyone has done a test like the above, I’d love to hear about your results.


That wraps up today’s issue. For those that have a subscription, leave your thoughts in the comments below. For those that haven’t signed up yet, if you’re interested, take advantage of the 50% off for life offer that I have running until March 12th. I look forward to seeing you all in the comments! Thanks and see you Friday!

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