The subscription economy is on the rise and in the digital age everything can be bought at a fixed monthly fee – from streaming media to dog food. This should be old news for many publishers who’ve proudly sold their print editions as subscriptions for many decades. Yet many of them have, surprisingly, not adopted this business model properly to the digital age. If they do, the rewards can be huge, and one solution to the ongoing revenue problem in the industry.
Media houses and publishers live in uncertain times, and the last decade has been particularly rough. Their advertising businesses are being squeezed, readers are abandoning print, and their cost base must constantly be adjusted. The situation means that all sources of new revenue are worth testing and it is up to each company to build their own toolbox of revenue models, depending on what works for their particular properties and audiences. Here, courage, innovation and low time to market are important talents, that all modern organizations must master.
All media houses and publishers must understand if and how digital subscriptions fit into their particular toolbox and their mix of revenue sources. Several companies have successfully demonstrated that digital subscriptions can become a new stable source of revenue and a realistic future alternative to print revenue. However, there are many things to consider.
Regardless of your answer to the questions above, there are likely opportunities for change. If the content is not unique today, then consider how it can be more so in the future. If the numbers do not seem work, then ask what would make them work. But, if digital subscriptions don't seem to be the right choice, then consider the other possible business models for the digital domain.
Several players have shown that digital subscriptions can be a realistic way forward. Those who have come a long way are international big players (like the New York Times) and some national players. Those who need to prove the model now are business media, niche media, magazines, lifestyle and local players. Here lies the current and future battles.
However, it is well worth testing. If successful, new stable revenue streams are created, a closer relationship with readers and improved advertising. Those who have worked with digital subscriptions and paid content can witness about the fantastic alignment of incentives it produces. Everyone suddenly wants the same thing: create value for the readers, so that they stay and pay.