Commentary

News Publishers Should Charge More For Digital Offerings

The growing importance of subscription revenue to news publishers calls for greater focus on strategies to retain readers and identify which ones are most profitable. Publishers should charge higher prices for their digital-only products, according to Mather Economics.

The consulting firm this month updated its list of recommended strategies for publishers to reflect the disruptions of the pandemic, which accelerated a longer-term shift to digital distribution. Its tests of digital-only products found that publishers have pricing power that’s comparable to print.

“Many publishers’ digital-only prices are low relative to their print prices, although we are working with many publishers to raise prices to their digital-only subscribers,” according to Mather. “One important benefit of this strategy is that it maintains revenue and margins from subscribers migrating from print to digital platforms.”
The new recommendations also reflect the growing value of data collected directly from readers.
“Publishing has always been a platform business, acquiring an audience to sell advertising, and it will continue to be so in the digital era,” according to the report. “The increasing value of first-party data for advertising makes an audience data strategy imperative.”
That advice is notable as technology companies take steps to limit the sharing of data about their customers. Google eventually will follow through on its plan to phase out support for tracking cookies in its Chrome browser, while Apple has continually updated its software to give customers more tools to protect their online privacy.
Dynamic paywalls that respond to user activity and adjust subscription offers “are helpful but not a critical part” of a subscription acquisition strategy. The more popular strategy is to have a combination of limited access to premium content, a registration wall that offers more features and a metered paywall, according to Mather.
“For publishers with scale, dynamic paywalls can help build your relationship with readers in the middle of your engagement distribution,” its report said. “Anonymous visitors should receive a tight paywall as should readers with very high engagement.”
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