Digital media publications struggled in 2017. The Facebook-Google Duopoly continued to rake in the lion’s share of advertising dollars. The much-hyped “pivot to video” strategy flopped as ads proved difficult to sell. While several online news companies fell short of their revenue targets, former media darling Mashable was sold for a fifth of the $250 million valuation it received the previous year.
It’s time to revisit revenue approaches once again. To help The Tow Center for Digital Journalism recently released the report “Guide to Audience Revenue and Engagement,” after carrying out hundreds of interviews with people involved with news sites, including their creation, operation, and consumption.
The 105-page report reveals these findings along with strategies that focus on how media organizations and entrepreneurs can develop revenue programs based on strengthening interactions with audiences.
The report’s main findings:
- Digital news publications depend on a combination of revenue strategies, not simply direct revenue from audiences. They include advertising, affiliate programs, syndicated articles, funding from foundations, corporate underwriting, books sales, and merchandise. In some cases, such approaches take the place entirely of direct audience revenue programs.
- Subscription strategies work well for publications that offer highly differentiated reporting as well as those with institutional audiences for which employers will pay for the work-related content.
- A significant hurdle to building a lasting membership program is discovering interactions that benefit both the publication and the members.
- Members want to join programs to become part of a bigger cause or something unique that the publication represents. They aren’t interested in branded merchandise or local discounts.
- To attract members, news organizations must publish compelling “who we are” stories that reflect its mission and give readers a sense of its importance in the community.
- The degree of editorial engagement a publication has with its members can have a significant impact on a revenue program's sustainability.
- Treat your approach to turning people into members as a stage in a conversion funnel: research, expose and attract, engage and deepen, convert and sustain.
- Face-to-face interactions, newsletters, digital product design, and your particular brand of journalism are critical factors in strengthening audience engagement. Use data to influence how you target those in your audience.
- Culture change is hugely important in developing news organizations that are audience and membership driven. Strong leadership is necessary to ensure and sustain two-way engagement between the publication and the audience.
Read the full report here.