A new study sheds light on finding the sweet spot to convince readers to pay for news.
A research team consisting of Dr. Neil Thurman (City, University of London), Dr. Bartosz Wilczek (Ludwig-Maximilians Universität München) and strategic analyst Ina Schulte-Uentrop showed 815 UK participants 16 versions of an online subscription pitch.
The paper "Subscribe Now: On the Effectiveness of Advertising Messages in Promoting Newspapers' Online Subscriptions" broke down subscription pitches into four main advertising messages: digital (online-only offers), social (community-led), normative (support independence), price transparency (critical state of industry).
These advertising messages were tested alone and in 11 different combinations of two, three and four approaches.
There were two stand-out highly performing combinations. The first was normative and price transparency, i.e. appealing to support independent journalism and why it needs funding to survive. The second was a three-prong combination of digital, social and price transparency, i.e. digital incentives to join a community which shows the harsh economics for journalism.
This was a brand-neutral study, meaning that participants were not exposed to any brand subscription pitches throughout the study. However, two of the leading subscription-led UK news organisations provide interesting comparisons.
The Guardian and The Financial Times both have more than 1m paying digital subscribers, using two different models. The Guardian - as a free to consume, voluntary subscription model - best displays the normative and price transparency approach.
Readers are reminded of what they have already consumed and are compelled to support independent journalism. In other words: 'you have enjoyed all this content for free, but if you want us to survive, we need you to pay'.
The Financial Times, however, is a purely digital approach. Readers will run into constant trial offers, hard paywalls and product plugs on the website. It will also lean on its roster of experts and diversity of coverage to sell the consumer on a subscription.
This is interesting because, generally speaking, single-approach advertising messages were not that effective in the study.
"One argument is not enough. There needs to be a combination of arguments," says co-author Bartosz Wilczek. "Three or four appeals is too complex, though."
Indeed, with the exception of the second-best performing score (digital, social and price transparency), all pitches with three or four combinations did not perform particularly well.
The point is there is a sweet spot for every news organisation and its unique editorial strategy. The top-performing ‘normative plus price transparency’ approach is not a silver bullet for every news outlet. The research simply reflects general audience behaviours and expectations.
Just nine per cent of UK news consumers pay for the news, according to the last Reuters Digital News Report. To get those numbers up, news organisations need to focus tailor their advertising messages to their content and audiences.
UK local news outlets especially are looking at reader revenue strategies with few breakthroughs. For news organisations without a subscription strategy, the advice is this: make a hypothesis on the best pitch, test it and adjust the strategy accordingly.
A safe bet is on price transparency, which scored reasonably well alone or paired with one other approach - except for a social appeal. Remember, three or more approaches tend to be too convoluted.
"Assume that price transparency is needed when introducing a paywall," suggests Wilczek.
Newly launched paywalls will cause readers to question why they need to pay and what they will receive in return. A pitch built on price transparency could overcome those questions in a way that can then promote an editorial mission or a particular set of products.
If it does not work, try a new approach and A/B test that with different paywall types, offers and products. This level of thinking and experimentation also works well around subscription retention strategies.
Finally, consider the typical reader. Audience demographics have little impact on willingness to pay, except for two main groups. Those being older readers and frequent mobile users, who can be convinced more easily.
That is typically because older consumers tend to have more long-standing and specific interests, and more disposable income. Mobile-users are simply more digital savvy.
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