Why publishers are unbundling subscription features

“There are only two ways to make money in business: bundling and unbundling,” former Netscape CEO Jim Barksdale once quipped. It’s an aphorism that’s cited frequently in relation to media, and one that’s often used to explain the rise of streaming services and creator platforms such as Substack and Patreon. 

Now, publishers are exploring how that sentiment might be applied to their subscription products. A growing number are breaking apart and repackaging existing subscription features in an attempt to extract greater revenue from their content and audiences – moving away from broad, catch-all products and instead offering multiple subscriptions designed to service the needs of more targeted and granular audience segments.

The relationship between subscription “features,” “products” and “bundles” is shifting as a result. Various features previously unlocked with subscription purchases are increasingly being positioned as standalone products instead, which enables publishers to lower barriers to entry for users looking for access to specific content while also allowing them to upsell potentially lucrative “bundles” to those who crave access to more.

Publishers such as The New York Times are leading the charge. Once upon a time, news, cooking, crosswords and sports were all features of a broader “product” known as a newspaper, but as it’s shifted to digital, The Times has succeeded in repositioning each of those features as distinct products in consumers’ minds. Suddenly, The Times has gone from selling a single product with multiple features to offering a “bundle” of valuable products it can charge a premium for. It’s done such a good job of repositioning features as products that the company has publicly placed emphasis on bundle sales as a key driver of subscription future growth.

Elsewhere, Axios has taken a similar approach with its Axios Pro subscription product, which invites readers to subscribe for access to M&A news from five industry verticals for $599 per year vertical. And travel industry news site Skift is offering what it describes as “the travel industry’s essential suite of tailored subscriptions”, with four products catering to specific segments of its broader audience.

Operating multiple subscription products is of course more complicated than operating one, but the potential upsides are clear. These include:

More valuable products: Products catering to specific audiences are often deemed more valuable than those catering to general ones. Greater focus means greater clarity and efficiency in terms of meeting audience needs, and less “waste” in terms of content and features that audiences might pay for but rarely access. Focused products often see lower churn rates as well, as audiences find the expense easier to justify for products that solve specific problems and meet specific needs.

Sharper product positioning: Sharper, more focused products are typically far easier to market and sell than those with complicated, vague or broad value propositions. Now more than ever, subscribers are looking for clear and tangible value to justify subscription purchases. Products firmly oriented around solving simple problems or satisfying specific audience needs typically perform far better than those with complicated or vague value propositions that are a “nice to have” or require audiences to work to justify a subscription purchase.

Lower barriers to entry and broader audience monetization: More granular and targeted products can typically be priced more attractively, lowering the barrier to entry for audience members who may not be enticed by broader “bundles” and often enabling publishers to build paying relationships with larger portions of their audiences as a result. 

Bundle upsells: Offering multiple subscription products can enable publishers to charge a premium for “bundles” that provide broader access. Individual products can be used as effective on-ramps from which broader subscriber relationships can be built over time. Bundles can ultimately prove stickier than individual products over the long-term, as well, if priced and positioned effectively.

What’s next: We expect to see a growing number of publishers offering multiple subscription products over the next 12 to 18 months. For some this will mean breaking apart existing subscription features into standalone products, while others will look for opportunities to add targeted subscription products that complement their existing offerings and enable them to appeal to more specific segments of their audiences.