“News fatigue and subscription fatigue are both very real, but they point to a clear path forward.”
That’s not a quote culled from the height of the pandemic. It’s a quite telling comment made recently by Julia Beizer, Chief Digital Officer at Bloomberg Media, in an interview with NiemanLab. While the thrust of that piece is on the state of journalism in 2023, there are several takeaway nuggets for everyone in the subscription space.
Some other applicable quotes made by Beizer include, “Every day, and in every department, we need to focus on the value we provide our users. We must learn everything we can about who they are and what they need…once, and only if, we get that user service right, our business models fall into place. We’ll find it easier to convert and retain subscribers if we consistently bring this kind of value every day.”
Although indicators point to the continued growth of digital subscription revenue in 2023, that growth is expected to come at a slower pace due to continued cost-of-living challenges globally. The average double-digit subscription household is becoming more discerning, which puts added pressure on the businesses supplying those products and services.
The benefit to this line of thinking is it’s always better to be working within the reality of the moment with your eyes wide open, rather than a fantastical dreamworld of your own choosing.
A Monetization Future of Choice
As noted recently in a Forbes piece on potential evolution in the art of monetization, a combination of scenarios has produced an environment in which subscribers - and, therefore, providers - are more open to exploring options. Situations such as plan pricing increases and ongoing behavioral changes in our pandemic-transformed world are paving the way for hybrid monetization and other models, as we’ve discussed previously in this space.
“The key lies in observing the ongoing economic momentum and adapting your offerings,” according to Forbes. “Hence, it makes sense to give your target users the flexibility to get what they need without locking them into recurring plans. It’s essential to think about how you can weave one-off purchases into your app’s monetization mix while selling subscriptions.”
Given all this, businesses would be wise to emphasize the following to combat a shrinking audience size:
- An effective use of churn management tools, especially when it comes to voluntary churn.
- More attention paid to tech-enabled automation to help reduce Total Cost of Ownership (TCO) across the tech stack.
- Payment and pricing strategy experimentation, with special consideration given to dynamic pricing models.
Aggregation is the Thing
The real value in bundled offerings paving the way for core products will be realized by aggregation.
So said Kannan Venkateshwar, Barclay’s Group media analyst, as quoted in a piece for NextTV last year, noting that while bundling is more about convenience and adding value to another core service, aggregation is about the core offering and driving more content.
The best aggregators make underlying applications irrelevant, the analyst said, comparing the situation to what Google did with Yahoo, Spotify did with record albums and Netflix did with TV networks.
“Overall, while bundling is easy to do, it is quite anachronistic given content distribution technologies today,” Barclay’s Venkateshwar said. “We believe the real value of bundling will be realized by aggregation, which is still in its very early stages. As this model evolves, content discovery for TV shows may not be very different from, say, Google search, even if the process is more passive for consumers.”
Learn what ideals make the most sense for your own enterprise and the variety of ways you can apply them for your audience. Talk to our team to explore how the Evergent Monetization Platform can help you lean into the reality of today and monetize more creatively.
References
https://www.niemanlab.org/2022/12/news-fatigue-shows-us-a-clear-path-forward/
https://www.inma.org/blogs/reader-revenue/post.cfm/prediction-digital-subscriptions-will-further-grow-in-2023-albeit-more-slowly
https://www.forbes.com/sites/forbestechcouncil/2023/01/02/how-mobile-app-subscription-monetization-will-evolve-in-2023/?sh=4ccc153a12f8
https://www.nexttv.com/news/bundles-are-nice-but-aggregations-where-its-at-for-streamers-analyst-says
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