Traditional revenue streams for publishers, particularly print advertising and basic subscriptions, are becoming increasingly unsustainable. As a result, there has been a notable shift towards diversifying revenue sources beyond traditional subscriptions and advertisements.
This revenue diversification is yielding positive results. According to the 2022 WAN-IFRA World Press Trends report, new revenue sources such as events, contract publishing, and e-commerce contribute approximately 17% to publishers’ total earnings, a remarkable 13% growth from 2021. Publishers anticipate that non-reader and non-advertising sources will constitute nearly 24% of their revenue in 2023.
Our latest blog post explores these emerging alternative revenue streams, highlighting how news publishers are adapting in challenging times for the print industry.
Bundling has emerged as an important strategy to increase publishers’ revenue, with The New York Times (NYT) leading the charge. Their bundle offers subscribers the option to group together a subscription package that can be paired across the core news offering, a cooking app, games and puzzles, Wirecutter reviews, and The Athletic sports content. This approach has become a major contributor to the company’s revenue growth, particularly as news fatigue leads to a decline in traffic for breaking news coverage. Currently, approximately 38% of the NYT’s subscribers are bundle subscribers, with access to multiple products. They aim to see this number grow beyond 50% in the coming years.
For the NYT, the financial benefits of bundling are clear. The average monthly revenue per user from bundle subscribers is 44% higher than the one for news-only subscribers. Offering a diverse range of products that surrounds and complements the core news service not only increases subscriber value but also enhances retention over longer periods.
Media conglomerate Schibsted is strategically embracing bundling as a part of its ambitious goal to double its subscription business by 2025. Traditionally, Schibsted’s revenue stemmed from subscriptions to individual titles within its portfolio. However, recognizing the evolving needs of their audience, the company is shifting towards offering bundled packages. This transition aligns with their vision of catering to a broader spectrum of consumer preferences by providing access to multiple titles simultaneously.
With the Reuters Institute reporting a “rapid development” in audio articles and 80% of media leaders planning to increase their digital audio investments, it’s evident that audio formats like podcasts are no longer peripheral but central to news publishing strategies.
While integrating audio content offers numerous benefits, it also presents challenges, such as the need for specialized skills and technology. However, many publishers have overcome these challenges by forming partnerships with audio apps, which allow
Online events have proven to be a successful strategy for publishers for several reasons, most notably:
In fact, over a third of publishers intend to focus more on events as a revenue source in the future.
Outlets like Axios, Bloomberg, and Semafor have incorporated events as a central part of their revenue strategies and observing significant success. Smaller publishers have also seen similar successes, whether it be organising events to showcase homes in Texas or a food festival in Utah.
The British music magazine New Music Express (NME) is another standout example. After discontinuing its 66-year-old print edition in 2018, NME, now under the Caldecott Music Group, has transformed into a ‘next generation media company’, expanding into gaming, events, and films. The launch of NME Screens, a venture into curating preview screenings with various studios and streamers, marks a bold step in their evolution. NME’s focus on events as a revival strategy is a fascinating development, illustrating the potential of this avenue for publishers seeking new revenue streams.
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Native advertising, also known as branded content or advertorials, has emerged as a significant trend. This approach involves the sponsored publication of articles that blend into the style and format of editorially produced content. Major publishers like The Guardian, Forbes, Financial Times, The New York Times, and even the BBC have adopted this strategy. While it can be financially beneficial, the use of native advertising is often hotly debated.
One of the primary concerns with native advertising is the potential confusion it can cause among audiences. Readers might not immediately realize that the article they’re perusing is, in fact, sponsored content. This lack of clarity can lead to a trust deficit between the publication and its audience, as readers may feel misled upon discovering the true nature of the content.
Another contentious aspect of native advertising lies in the internal dynamics of newsrooms. The financial ties to advertising partners can inadvertently lead to self-censorship. This scenario often manifests as a reluctance to publish content that might cast these partners in a negative light. Such a practice not only undermines journalistic integrity but can also inflict reputational damage on the news outlet, casting doubt on its commitment to unbiased reporting.
Despite these challenges, native advertising represents a vital revenue stream for many publishers, especially in an era where traditional sources of media income are dwindling. The key to harnessing this opportunity without compromising ethical standards lies in transparency. Clear labelling of sponsored content and maintaining a strict separation between the editorial and advertising departments can help mitigate the potential pitfalls. By doing so, publications can enjoy the financial benefits of native advertising while upholding the trust and respect of their readership.
A significant portion of publishers are using affiliate marketing to diversify revenue. The growth in publisher revenue from e-commerce is substantial, with major players observing an 80% increase from 2020 to 2022.
Recognized for its “Indy Best” series, The Independent has made e-commerce one of its four priority areas, contributing to around 10% of all revenue. The site’s focus on quality shopping experiences, leveraging its brand relationships, and investing in data analysis for better product understanding has significantly boosted its e-commerce revenue.
With a long-standing authority in men’s fashion, GQ has intuitively integrated shopping into its content strategy. Its e-commerce revenue has grown annually since 2017, leveraging tools like curated shopping guides and GQ Recommends email alerts. GQ’s focus on quality over quantity and expansion into lifestyle categories has further enhanced its e-commerce success.
Hearst has ventured into digital subscriptions with unique products like a $100 per year exercise video service, All/Out Studio. This service, along with other products like the Backslash Fit yoga mat and “Keto for Carb Lovers” cookbook, showcases Hearst’s strategy to diversify revenue and capitalize on their brands’ strengths.
Donations are a significant source of revenue for several publishers. The Guardian and La Presse have notably adopted this approach, each taking a unique path to leverage donations as a sustainable revenue source.
Faced with financial challenges, The Guardian successfully implemented a donation-based model without a paywall. Key to this strategy was its status under the Scott Trust, promoting itself as a public good. Transparent reader engagement strategies and mission-driven messaging supported effective donation drives. This approach, coupled with a soft registration wall for data collection, led to a significant financial turnaround and membership growth.
Transitioning to a nonprofit model, La Presse sought government and philanthropic funding. This shift allowed for a reimagined approach to journalism, focusing on digital platforms like tablets to reach wider audiences. The move to nonprofit status was strategic, aiming to sustain quality journalism through diversified funding sources, including potential government support.
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