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‘How Do You Achieve the Right Kind of Growth?’ Lessin Talks Newsletter Keys.

During a recent interview with NiemanLabJessica Lessin, founder and editor-in-chief of The Information—an ad-free tech and business publication where subscriptions cost $399/year—spoke about the exact themes that will define our new Associations, Media, and Publishing Network: talent, revenue strategies and technology. And coursing through all that: good content.

“Everybody wants to grow fast,” she said. “That’s expected, but how do you achieve the right kind of growth? Everyone knows you could slash your price and get a boost that day, but what’s the long-term path? Any startup is going to be very focused on the team and getting hiring right. That’s a big focus, as well. How to leverage—or not—the tech platforms is another recurring theme. When do you partner with Google and Facebook and Apple? When do you not? That calculus is very different if you’re a smaller company or a larger company. For me, what’s most exciting is to see the excellence everyone has when it comes to their domain in terms of reporting.”

Lessin spoke at a time when the proliferation of newsletters is one of the biggest stories in publishing. Substack continues to add well-known writers with big followings to their ever-growing newsletter stacks. Twitter just recently purchased Revue, a newsletter platform for writers and publishers. “Facebook is working on newsletter tools for journalists and writers,” the New York Times just wrote, “a move toward offering more services to independent writers as the social network jumps into the fast-growing newsletter space.”

“It’s the calmness of the model that’s the real killer feature,” wrote Substack co-founder Hamish McKenzie on his blog recently. “Perhaps this is giving away too much, but I often find myself telling people: ‘Our real product is our business model.’ There are now more than 500,000 paid subscriptions across Substack, and the top ten writers collectively make more than $15 million a year.”

Whoa. I interviewed McKenzie back in September of 2018. At that time, Shan’t We Tell the Vicar?, The Shatner Chatner, Sinocism and Off the Chain were his biggest titles. And there were a mere 11,000 subscribers. “We strongly believe that in five years there will be a very obvious critical mass of people who will pay for content from writers who they trust,” McKenzie told me, slightly too conservative on his estimate. “And it will be a mainstream, accepted part of the ecosystem… People are learning how good an experience it is to be subscribed to an independent writer you love. We’re really focused on building that relationship—to get people interested in that model.”

Lessin lauds Punchbowl News, a new “membership-based news community” that has—of course—a “flagship morning newsletter” and a daily podcast. While she believes that the journalism still has to be top-notch—“Everything else can be learned and shared,” she says—she is excited about the ways that media companies are exploring monetization.

– Subscriptions.
– Paid memberships—she mentions The 19th, a nonprofit with a booming membership program.
– B2B subscription products—Axios has just launched AxiosHQ, a communications platform that will enable businesses to update their employees—including through internal newsletters—in Axios’s just-the-facts, bullet-point style. It will cost at least $10,000 a year, they say.
– Events, in-person and virtual—Informa Markets has just partnered with the Virtual Events Institute to learn how to do them better.
– Sponsored online communities.

But Lessin does bring it back to content. “Every organization I’ve seen produce really differentiated content is successful. I think it’s really that simple,” she said. “…there’s a huge market for content creators that are doing something original and important. I’ve seen so many businesses that double down on that succeed.”

For his part, McKenzie welcomes Twitter and Facebook to the newsletter party. “I genuinely believe that Twitter and Facebook getting into paid newsletters is good for writers and a positive development for the media ecosystem,” he wrote, before getting more contemplative. “We at Substack have never thought that the solution lies in simply shouting about how engagement-based business models lead to media products that are superficially compelling but underneath are eroding the foundation of society. Instead, we have set out to show that platforms that put writers and readers in charge are just better.

I would stress the reader part there. The idea is to give readers more information, tips and strategies for your arsenal to make beneficial decisions.

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Building a Revenue-Producing Paywall

It was reported this week by The Information that Reuters would become one of the last free news services to implement a paywall. “The current plan… envisions putting all articles coming from specific coverage areas—such as energy, sustainability and its opinion content Breaking Views—behind a paywall by next February,” the site wrote.
Then today Folio: reported that Skift, the B2B media company serving the travel industry, just launched a digital paywall called “Skift Pro,” an annual product priced at $365 per year or $595 for two years.
A report came out last year from the Shorenstein Center at Harvard and Lenfest Institute titled, How Today’s News Publishers Can Use Data, Best Practices, and Test-And-Learn Tactics to Build Better Pay-Meters.
(Matt Skibinski from the Lenfest Institute will be delivering a webinar for us on July 23 titled Understanding Editorial Economics and Turning Content Producers into Revenue Generators. Register here.)
A key takeaway from the report is to craft a better welcome message. It says that 30% “of onsite digital subscriptions originate from ‘welcome’ messages that provide an introduction to new readers and ‘warn’ messages that serve as reminders as the reader approaches the meter limit.” In fact, I just received a welcome message from Jessica Lessin, founder of The Information. It’s well-written and it’s long—SIPA marketers would be proud.
Here are more of the report’s key findings:
Stop more readers to force conversion. The report urges having a high stop rate—that is the percentage of all digital users who are ‘stopped’ by a subscription prompt, a paywall or a meter limit. It is calculated by the number of users stopped by a meter or paywall in a given month over the number of unique visitors during that period. Organizations that are stopping more people have stronger digital businesses.
Test multiple strategies to determine the most effective marketing messages. “Browser overlays and customized warnings have proven effective, particularly those that underscore meter limits for individual users and offer customized options for unique subscriptions based on the reader’s profile and viewing history.” It added that there are no “hard and fast” rules for paywalls. “Instead, ‘intelligent access’ evaluates data continuously to create different access control rules for different behaviors.”
Lower your meter limit. A majority of publishers set their meter limits at 5 articles per month or lower. This number has gone steadily down since 2012. Some publishers used to set the paywall as high as 25 articles a month. “As publishers have experimented, and readers have become accustomed to digital subscriptions, meter limits have tended to decline among the publishers studied and within the industry at large.” Also, readers can often circumvent by using different browsers.
Increase reader opportunities to encounter the meter. Is the meter simply the articles a reader clicks on, or are there more factors involved? You might lower the meter rate for more editorially-intensive content. Their limit might be increased if they do other things with you. For those with an ad blocker, a subscription message might be customized to invite the reader to subscribe or turn your ad blocker off to continue to read content before the average meter stop.
Refresh as much as possible. “Effective publishers tend to help create ‘habit of news’ among readers” and content that readers want to refresh and read regularly. “The most engaged subscribers expect daily and often hourly materials… While wire stories help a publisher furnish regular content, wires tended to leave an audience impression of low quality of content. Publishers should prioritize customized, frequent coverage that address a community’s particular needs, concerns and interests.”
Quicken your load times. “Page load times represent the largest difference between successful publishers in the top percentile and 50th percentile of publishers studied, with a median load times of 5.76 seconds.” Avoid advertising overload—probably easier in 2020—use real estate to drive readers to subscription options, and encourage content discovery through customized recommendations and infinite scrolls.
Be clear and make it easy. “The most effective stop messages include a single clear call to action, offer attractive introductory trial rates and include buttons that make clear the location(s) to click to advance the offer. Others include content-specific messages that link to the specific articles or sections the readers are pursuing.”
Again, you can see the whole report here.