Bundling Products to Boost Subscription Conversions
In an attempt to increase conversions to paid subscriptions, some media companies have been experimenting with offering additional perks outside of the core content offering.
The Washington Post published a story about how the Outside magazine brand is trying to boost its subscription revenue by offering a bundle of adventure products.
Thurston said print publications need to fight declining subscriptions and ad sales, attract younger audiences, and compete against an avalanche of free online content while also remaining authentic.
His solution is bundling digital subscriptions to all of the magazines into a $99-a-year Outside Plus subscription. Members get print subscriptions to Outside and another magazine of their choice, plus perks such as a mapping app, two books a year and reduced entry fees for athletic events.
“I felt like there was an opportunity to bring it all together under a single umbrella and really unify the experience for the consumer,” Thurston said. “When you combine the services like Gaia GPS, and the discounts to events, and you add in video-on-demand courses and all of the premium content, I felt like this was an offering for consumers that truly could be a foundation for their active lifestyle world.”
He has a very good point with this. I like to think about this as sort of coming for the content, but staying for the perks. The foundation of this is obviously the core content that Outside offers. But then, in addition to that, subscribers get access to additional things that an active adventurer might find interesting.
For what it’s worth, TechCrunch does this as well. If you become an Extra Crunch member, you get free AWS credit, discounted Zoom subscriptions, perks from Brex, and the list goes on.
What this does is change the equation. Originally, a user had to decide if they wanted to sign up for a magazine because the content, alone, was good enough. Now, the user has to decide if they want that same content, plus a bunch of other additions. It reduces the pressure for the content to exclusively drive the subscription.
It also builds a deeper relationship between the publisher and the subscriber. In the case of Outside, all of its product offerings are things they own; therefore, this should result in an increase in usage across the network. This will contribute to its goal of better understanding its users. First-party data anyone?
Digiday also wrote about Outside and Melissa Chowning, founder and CEO of Twenty-First Digital, said this:
Chowning also believes this simplifies the subscription offering for Outside. One subscription “is much easier to market, manage, and grow.” However, the challenge for the publisher may be to “convince a Yoga Journal reader that an Outside+ subscription makes sense for them,” she said.
Outside is a typical magazine publisher in that it has 20 different titles. Each is very niche and focused on a specific type of user. The infrastructure to support that—customer service, for example—has to be broad.
Now, though, it can focus almost exclusively on one product: Outside+. Yes, people will still be able to sign up for print/digital subscriptions for one magazine. But my suspicion is that all the other add-ons will make it compelling enough to convert to the more expensive subscription.
The secret here will be convincing the audience from each publication that there is value in the bigger membership specific to their needs. I visited a bunch of the Outside+ landing pages (each publication has its own) and they are subtlety promoting different perks.
For example, on Yoga Journal, there are sequences, workouts, and training plans as well as the ability to connect with the yoga community. If you look at Trail Runner, users get Gaia GPS Premium and FinisherPix, which give you photos from races you finish. And Velo News (cycling) has members-only meet and competes with Olympians. And each landing page’s choice of photos is very specific to that publication’s activity.
It’s subtle, but I think it’ll work. It just won’t work as well as Outside’s CEO thinks. According to WaPo:
Outside still has a loyal base of 530,000 print subscribers, and the other magazines have a combined print circulation of 680,000. Thurston aims to shift revenue from 70 percent ads to 70 percent subscription in just three years. Thurston said converting 10 percent of the free visitors to his website to members will meet this goal.
If he is expecting a 10% conversion rate so he can hit his goal of profitability in a year, he is going to be in for a very rude awakening. The vast majority of paid subscriptions convert at a fraction of that. According to a research deck prepared by Piano back in 2019, the median paid conversion rate across the network of sites it powers is 0.20%.
While I think the Outside+ product is compelling and they are doing a good job with their subtle marketing, 10% just won’t happen. To assume otherwise is to set the company up for failure. Will the team start trying to get aggressive with discounts to get people to convert? That’s an additional risk that can have a negative impact on growth.
Adweek wrote about how The Economist has reduced churn and it’s a good warning to Outside if it starts getting aggressive with its discounting to hit that 10% conversion rate.
Like many publishers, especially during a busy news cycle, The Economist uses discounted trial offers to entice on-the-fence readers to subscribe. While its 12 for £12 product did a wonderful job getting subscribers in the door, too many of them failed to stick around. Overstall attributed much of the problem to sticker shock, as the standard monthly price for an Economist subscription is either £55 ($75.76) or £65 ($89.53), a substantial jump from £12.
The Economist fazed out the 12 for £12 discount by June 2020 and began emphasizing other promotions. In particular, it offers 50% off for subscribers’ first quarter, a deal that runs continuously, and has begun experimenting with limited-time sales that offer 50% off an annual subscription. The Economist has only offered the latter deal three times, all since 2020, but it has shown convincing signs of success, said Deep Bagchee, chief product officer at The Economist.
In many respects, I think what the Outside team is pushing toward is actually a very compelling idea. By uniting everything under a single subscription, the team can focus all its efforts on managing one product. That allows for focus, which is necessary. Additionally, the users will be given access to more of what Outside has to offer. This increases the touchpoints between publisher and user, which is very rarely negative.
Whether it’s TechCrunch offering its startup founder audience perks specific to their business or Outside offering additional products to its active audience, one thing is certain… As more media pivots to subscriptions and memberships, it’ll become harder to get people to sign up. The content may be the core offering, but it may be the secondary features that push the conversion over the finish line.
