With more and more publishers focusing on reader revenue strategies, acquisition has become a major topic in the industry. However it’s retention that’s the real key to profitability. That’s why it’s surprising to see that 59% of publishers spend less on engagement than they do on acquisition. We’ve gathered five innovative case studies to inspire your retention strategy.
1. Dutch newspapers dare to be bold
Matthijs van de Peppel and Xavier Van Leeuwe literally wrote the book on daring to be bold in retention strategies: “How to Succeed in the Relationship Economy.” In it, they explain how they pioneered a new retention strategy while they were at NRC together. They found that long-term reader relationships were the most valuable so they stopped offering anything short-term — no trials, just subscription offers of one, two, or three years.
When Xavier Van Leeuwe later joined Telegraaf Media Groep in the Netherlands, he analysed the churn rate for their different subscription offers as well. The clear takeaway was that shorter subscription offers did not result in long-term relationships while still incurring a high acquisition cost. In a bold move, they stopped offering their short term subscriptions, and focused on only their longer subscriptions. With a 24% decrease in their marketing and acquisition budget, the team at De Telegraaf has seen a year-on-year subscriptions growth of 66%.
To ensure these subscribers are gaining the full value out of their subscriptions, NRC also launched a “Welcome Pilot”. Their team called new subscribers, checking if the delivery of the newspaper was going as planned, and trying to engage them with their digital products. For this pilot program to earn back the cost of these calls, it needed to result in a 2.6% decline in cancellations of subscriptions. The program was clearly successful, resulting in a 3.8% decline in cancellations. Expanding the pilot to their standard operating procedure would mean they would save 1,500 more relationships, which would be a gain of 50,000 euros.
2. Le Parisien knows strong apps are key for retention
We know apps are mostly used by already engaged and loyal subscribers. German daily Bild found that its subscriber lifetime is increased when people subscribe via the app itself, versus the desktop or mobile site. Don’t forget however that loyal subscribers have the highest standards. That’s why Sophie Gourmelen, General Director of Le Parisien advises publishers to prioritise their technical platforms to ensure they’re providing great user experiences. If the UX is poor, retention will be poor — good content is not enough to overcome poor UX.
The team at Le Parisien also found that digital subscribers who make use of their apps see much more value in their digital subscription than users who only use the website. While 70% of Le Parisien’s audience is on mobile, many readers are accessing their content via mobile web browsers, not through Le Parisien’s dedicated apps. Le Parisien found that these apps have much better retention rates and so are focused this year on moving mobile readers to the apps directly.
Other European publishers have turned their attention to improving their digital products as part of their retention efforts as well. Le Figaro also encourages subscribers to download the apps, in addition to offering an ad-free premium experience for digital subscribers. Aftonbladet focuses on apps as well, as consumption across multiple devices reduces the risk of churn.
3. American newspapers prevent involuntary churners
The Washington Post’s Miki Toliver King has highlighted the idea of ‘involuntary churners’ — subscribers who would continue to subscribe but involuntarily churn instead. In 2016, she had a gut feeling that some subscribers were accidentally churning when their credit cards expired so she ran an experiment to test this idea. Instead of simply sending a one-off email reminder, they also ran pop-ups warning subscribers to update their information when they were reading on the website. In the first two years, they were able to increase the amount of saved subscribers by 19%.
Other American newspapers have had success with preventing involuntary churners as well. The Seattle Times found credit card failures to be responsible for 62% of all digital subscription churns, while The Boston Globe started with 50% of churns due to this and have worked to reduce it to 20%. It’s a good reminder to publishers to examine their funnel closely to see if they also have seemingly small leaks that can be easily prevented.
4. There’s life beyond churn for Le Figaro
We know some new subscribers converted only to access a specific article or take advantage of a promotion. However Le Figaro found that these readers can be valuable. They monitor how many subscribers they keep every month, the number of days a subscriber stays with them, and the number of days between two subscriptions. For readers who get into a cycle of subscribing to a promotional offer and then cancelling, over time the period in between the two subscriptions begins to shorten until finally they remain subscribed continuously. They’ve found that four subscriptions is usually the turning point, after which subscribers remain loyal.
Recent research from Notre Dame and Emory shows publishers have to be thoughtful when reacting to subscribers who are likely to churn — not only may they be intending to come back shortly, the offer used to retain them can change how they view the product. Researchers found that subscribers who threaten to quit are actually more likely to renew their subscription, even after a service failure, suggesting such subscribers are simply trying to obtain discounts with their threats. Additionally, offering a discount to retain subscribers can backfire because the subscribers come to view the offering as having the value they pay after the discount, so are less likely to renew again at the regular price.
Knowing that churn isn’t the end of a reader relationship, and investing in understanding who your churners are, can also improve your acquisition strategy. By analysing the reading behaviours of young people, Sweden’s leading local media company, MittMedia, has been able to reach this ever-so elusive cohort by making it easier to unsubscribe. While some have said young people would never pay for digital news, the popularity of Netflix and Spotify have helped developed a habit of paying for content online. But to benefit from this, newspapers need to make it as easy to cancel as Netflix does — no more requiring a phone call!
We make it easy to come and go, which has contributed to us attracting 19-year-olds to pay — audiences who’ve hardly ever been customers of ours.
Robin Govik, Chief Digital Officer at MittMedia
5. News UK focuses on developing habits
Research from the Medill Local News Initiative at Northwestern in the US has found that frequency is the highest predictor for retention. The more often a person returns to your content, the more likely they are to remain subscribed. That’s because they’ve built the news content into their daily routine, so even five minutes every day is more valuable than a one-off hours long session.
Newsletters are an effective way to develop habits, even though until recently they have mainly only offered customisation (the ability for recipients to opt-in to specific topics to follow) rather than true personalisation (newsletters created for readers based on past behaviour). This gap is something we identified with The Times and The Sunday Times, which is why we launched “JAMES, Your Digital Butler“. Using machine learning and AI, JAMES personalises the distribution of the news content, in terms of time, content, format and frequency. With this, they have been able to realise a 49% reduction in churn. We’re excited to release further insights from this year-long experiment soon, subscribe to receive a copy of the report.
It’s important to note that engagement is key from the very beginning of a reader relationship: one study found that a habit is formed in the first 100 days or not at all. We’ll be further exploring this idea of habit formation for news media at the Digital Growth Summit in Berlin later this year.
This article was written by Mary-Katharine Phillips, Media Innovation Analyst at Twipe from 2017 – 2021.