Publishers: Peep over the Paywall!

How can newspapers, magazines and other paid content providers sell their wares to consumers used to paying little or nothing for content?

One suggestion: look beyond slashing prices and building airtight paywalls to other payment models, according to a recent study by Elastic Path on US consumer attitudes towards print and digital media. Download a free copy of the full research report, The Future of Magazines and Newspapers in the Digital Era.

Readers spend little on digital content, so far

For the last decade, publishers have debated whether or not people will pay directly for online newspaper and magazine content. While our research revealed most consumers show willingness to pay for digital access of some type — whether by the article, through all access plans, or for ancillary services – only 16% have paid for standalone digital issues and subscriptions so far.

What can publishers do to get paid?

1. Get intimately familiar with prospects and customers.

A multidimensional understanding of target audiences is needed to craft user experiences that will attract paying customers. User research, surveys, and analytics can help identify who the best prospects are, what content and features they most value, which types of services or products they would pay for, what price points they find attractive, and when they are likely to buy.

2. Create a differentiated experience that rewards interaction.

Most readers won’t pay for static content that rehashes what they can get elsewhere for free. While niche consumer or B2B mags will find this easier to do, every content provider should strive to differentiate their offerings by combining curated content, exclusivity, and community in unique ways to generate interest and compel users to pay for access.

Macworld has pursued this approach with its premium website, Macworld Insider. The service provides an ad-free site layout, back issue access, full-content RSS feeds, a members-only newsletter and forum, plus live chats with writers and editors.

3. Be flexible in your approach to monetization models.

Publishers should explore a variety of business models to find those that resonate best with target audiences and then tweak, tweak, tweak. To be successful over the long haul, strategies that facilitate and reward frequent usage will win out over others like metered billing that penalize the most engaged readers. Every frequent site visitor may eventually subscribe; issuing ultimatums simply chases away future buyers. Instead, embrace these prospects with special deals. And provide different payment options to offer consumers more choice but take care to keep things understandable. Consider the reaction to the New York Times complex subscription plan launched last month.

Three of the more interesting models:

  • Free-mium/tiered subscriptions: Free-mium combines ad-supported content with paid premium services. With Apple and Google both announcing subscription payment services in February, we’ve seen a renewed interest in monetizing digital content using a subscription model. The key is to accommodate different audience segments. Providing a layer of free access can eventually entice readers into subscribing to paid services.
  • Microtransactions: Many publications are considering offering individual articles or features à la carte, while some already allow paid one-day or one-week access. By unbundling their content, publishers let consumers customize and personalize information to make it more valuable to them. Another take on this model is the newspaper and magazine portal. Visitors sign up to a single micropayment system to access a wide selection of publications or content and have the flexibility of paying by the article, by the day etc.
  • Marketplace: With this model, publishers make their content assets available to a developer community to build digital products and applications. By allowing their content to be used in new ways, magazines and newspapers can speed innovation, build partnerships, and potentially monetize their content more easily than they could alone. The UK-based Guardian is the first newspaper to offer a fully open API with tools for using their resources on other platforms and for integrating apps directly within their network.

What do you think is a winning business model for digital content providers?

Leave us a comment below.

Interested in more publishing content?

Watch our on-demand webinar, Winning With Subscribers: Top Trends and Best Practices for Selling and Managing Subscriptions Online, where we analyze the risks and rewards of pursuing the subscription model.

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6 Responses to “Publishers: Peep over the Paywall!”

  1. Alvin Tan says:

    I personally would not pay for digital content; in fact, I found that I have not been paying for physical content as much as I used to in the past. Content is being churned out at an alarming rate, and I doubt that a certain given content could be so rare or valuable that a free alternative does not exist.

    • Amanda says:

      What about ebooks? Would you pay for those? I’m finding that while I get my news for free, I am purchasing ebooks regularly for my Kindle.

  2. I suggested in a post over a year ago that they engage and reward loyal readers – offering badges for frequent commenters, or points for viewing ads (with credit towards access).

    Or, they could offer a paid version with no ads at all, or access to special bonuses (reviews before they’re published, the chance to talk to columnists directly, etc.).

    They could even have different levels of access – higher levels (and subscription costs) got you private tours or priority for Times events.

    They didn’t listen.

    • Amanda says:

      You have some great ideas. Other have suggested news/mags offer subscriptions to special Twitter direct messages or Facebook Q&A sessions with journalists on the frontlines during breaking stories.

      The community model of Quora ( and the community newsrooms of the Journal Register newspaper chain are also worth watching.

  3. Chris says:

    I would say that the key to being able to charge successfully is to closely understand your audience and their interaction with your product. Using behavioural analytics techniques such as clustering can allow you to segment your users and understand what the users are doing who may be willing to pay. This allows companies to employ price discrimination whilst adding true value to their audiences.

    Two companies who do this extremely well are the Financial Times and Spotify here in London.

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