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09/10/2018

Study examines how to adjust paywall to minimize ad revenue loss

From Monday Note

The news media is transitioning to a business model increasingly focused on audience revenue from digital subscription or membership payments, e-commerce, or micro-payments. Subscription or membership revenue currently is the largest of these audience revenue categories. Digital advertising, events, and services revenue are also important, but they are insufficient for many news media publishers to sustain the newsrooms necessary to fulfill the journalistic mission. Non-news media digital publishers also are seeking, or considering the potential for, subscription revenue as they too find digital advertising revenue insufficient for sustaining their operations.

Before committing to a subscription revenue strategy, publishers will need to estimate the potential number of subscribers among their current and future audience. The potential subscriber base will be determined by the nature of their current digital audience, the product offering, the pricing strategy, and alternative products in the market. Analyzing the existing digital audience is a good first step to estimate the addressable market for a publisher. Data on their core audience’s consumption of their content provides insights into who is likely to subscribe and what content will most engage these customers to keep them subscribing.

The potential for lost advertising revenue from reduced site traffic and product design changes is another important consideration of a subscription revenue strategy.

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