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Online news, magazines, and blogs don't have it easy. Making high-quality content that attracts and engages your audience is difficult enough, but monetizing it is tougher still. Just ask the thousands of local and regional newspapers closing shop.
But why is it so tough? There are plenty of ways to monetize all the articles, posts, opeds, long form reads, reports, and digests that people want to consume on a daily basis. So if the content is great, and the demand is there, why is it so hard to raise revenue from it?
Let's do a quick recap on the various monetization methods, then dive into our 3 top causes that make it so difficult to make a success of it, plus 3 top tips on how to solve them.
In the world of publishing there are quite a few ways you could be cashing in on your content creations. Here are the 7 you will be familiar with:
A lot of publishers are turning to paywalls in the hopes of enrolling legions of subscribers, in particular those who built their business around now declining revenue streams, e.g. ad revenue (see below). The likes of Forbes is scheduled to put up a paywall in March 2021, while others have have recently taken the plunge, like Quartz and New York Magazine.
There are a lot of paywall providers out there, and if you have a loyal, dedicated following who would be willing to pay to access your content, then you should definitely consider it as a potential solution.
Just be aware of the downsides. Paywalls are pretty blunt instruments and only really work for a small, core audience. If you're trying to reach the masses, or a wider audience with a different (typically younger) profile, then paywalls tend to have a lower success rate. Sometimes conversion rates can be as low as 1%.
Very similar to subscriptions, but with an added sense of being part of a special group, perhaps with privileged access to certain content, discounts, or other benefits.
This option is popular with non-profits who don't want to appear to be in it for the money. And also with local news outfits that can appeal to a sense of community spirit to convert and keep members.
Works great if you have a strong mission your members are passionate about or you can pull on loyal ties, but difficult to expand beyond this group to others who may like your content but don't feel they are part of the target 'in group'.
Everyone can access your content, but some readers might part with their cash to support you out of the kindness of their hearts. Useful approach for charities and non-profits.
There are a few drawbacks, though. The first is that overly soliciting donations can deter a lot of people, so you tread a fine line between under asking and over annoying.
Most of all, you have to rely on the generosity of your users, which sometimes only kicks in when you are in crisis or demonstrate an urgent need. If they feel like they're going to lose you, then they'll help, but otherwise it's a lot harder to get them to donate when you are in 'normal times'. A strategy of always appearing to be in crisis, however, is exhausting for you and your audience alike, and not sustainable in the long run.
4) Affiliate marketing
This works by dropping links in your content to your affiliate programs (there are lots out there, though Amazon is one of the largest) about products you love (or hate).
This is a great approach for any site that writes about products, whether as direct reviews or tangentially through a related topic. That said, it's a hit and miss system. Sometimes people will click on your link and sometimes they'll just search for the product separately having read your endorsement.
A longer term downside is that it leaves you at the mercy of the affiliate programs. A few, including Amazon, have been known to tweak the formula so you get less for each item. The general trend at the moment seems to be one of diminishing returns.
5) Sponsored content
Better than it sounds, sponsored content can be a genuinely high-quality piece of content that is paid for by an outside party. This isn't your 'I'm an advert disguised as an article' ploy but a well-written, engaging piece that stands on its own merits.
This is a great option for sites with consistent traffic. On the plus side, the more visitors you have the higher sponsored content fees you can command.
The difficulty lies in finding the right sponsor. You have to know your audience inside out and then find a sponsor in a different sector (automotive, beauty products, watches, holidays, etc.) that wants to target your readers. The next challenge is producing the content in a way that balances the needs of your sponsor (promote them) with the sensibilities of your readership (not wanting to be pushed products). It's a fine line, but it can be done!
6) Ad revenue
The classic, old school way of monetizing content. Sell your digital real estate for advertising dollars and let the cash roll in. Well... it used to roll in.
The problem the entire industry is facing is a massive decline in ad revenues. The cause? Facebook and Google, primarily, attracting the majority of ad spend for their highly efficient targeting and tons of data. It is very, very difficult for publishers to provide that kind of insight on ROI.
7) Selling data
A sensitive topic, to be sure, and not one that publishers who engage in this speak about very openly. Data is enormously, enormously valuable. For you it can improve your marketing, your conversion strategies, your audience development, or your editorial decision-making. However, it is also useful to third parties, e.g. for advertising purposes.
There are many data brokers out there who would be interested in purchasing or licensing your data, but they generally go in for high volume data sets, so if you have a lot of traffic, this could be for you, though do consider the ethical implications.
The 3 monetization pain points aka 'why isn't this working'
OK, you have the tools, you've learned how to use them, you've deployed them but... the returns are lacklustre or just not worth it. What is going on?
Pain Point #1: You don't know what your content is actually worth
This may seem counterintuitive, but think about it. You know how much your content is worth to advertisers or sponsors. And you know in aggregate what your whole site its worth to your subscribers and members. But you don't know how much each piece of content is worth, i.e. how much people would pay for it, and you definitely don't know how much it is worth to each individual person, who may value it differently.
What publishers are very, very good at is driving traffic. You have tons of data to know what gets clicks, what makes people read, because there are so many analytics platforms and guides to tell you. This was crucial because it was the model many publishing businesses were built on: getting eyeballs on ads. But with ad revenues declining, that's not the measure of success it used to be.
Where there is almost no data is what content people will pay for, or what part of a piece of content they'll pay for. Even if you could say an article is worth $2, would you know how the value is distributed across the piece? Is $1.50 in the first two paragraphs and the remaining seven is only $0.50? You don't know, and that's because...
Pain Point #2: You're missing a key tool in your monetization toolbox
This is an important realisation: It's not (necessarily) about your content; if you've got good traffic, that's a good indicator. It's also not (necessarily) about your audience's willingness to pay, which by many measures is actually increasing in the market (though see more in Pain Point #3 below).
It's how they pay that is the missing piece of the puzzle.
Right now, the only way to directly charge your audiences is through clunky paywalls. These work great for your dedicated, core audiences - they love your stuff and return regularly to consume it. They feel like they get value for money and have no problem with the monthly charge hitting their credit card.
But paywalls are not strong solutions for everyone else, the massive 'missing middle' who like your content, want to pay you for your content, but are frustrated with having to commit to yet another a subscription. There are lots of reasons why they don't (again, see Pain Point #3 below) but the problem is when you apply a paywall to this type of audience the following things typically happen:
- Your spending goes up to reach these new audiences (i.e. higher customer acquisition cost, CAC)
- You lower prices, offering great discounts, to convince them to convert (i.e lower revenue)
- They churn early right around when the offer ends (i.e. lower lifetime value, LTV)
- This puts a squeeze on revenues as you essentially spend more to get less
So paywalls aren't the answer. What you need is a new type of payment platform, one that can allow your audiences to pay for exactly what they consume. This would give you tremendous data on what they would actually pay for and how the value is distributed within your content, with significant cost-saving implications for your audience growth, lead generation, and editorial strategies.
StreemPay is a tool that does just that. It's a pay-as-you-scroll platform that could help you generate more revenue (and more leads). If you'd like to learn more, you can check us out at streempay.com and book a demo.
Pain Point #3: Customer habits and preferences have changed
The root cause of paywalls failing to convert the majority of audiences beyond your core subscribers, is down to a change in the way people want to consume online content.
Let's look at the online content landscape, especially now in the Time of Covid. The sheer volume of available content has exploded, growing exponentially daily. There is more and more out there for people to consume, whether it's news, magazines, blogs, videos, audiobooks, podcasts, gaming, watching gaming, livestreaming... and more and more of these platforms are turning to subscriptions as a way to monetize content.
But how many subscriptions can a person have?
About 12, according to a recent Deloitte survey, with only 1-2 of those reserved for news and magazines. This has led to 'subscription saturation'. For Millennials, the fatigue is highest, with 40% feeling "overwhelmed" by their subscriptions, and 43% intending to cut back. For Gen Z and Gen X these numbers are also high, at around 30%. The data suggests that churn will continue to be a growing issue for content providers in the near future.
What people are looking for is more flexibility. They want to enjoy the wide range of content out there, but without having to tie themselves down to just a limited number of subscriptions. This is about personalising their content consumption experience and to do that publishers need to provide a personalised payment experience.
The whole history of the Internet has been about ever greater personalisation. We've seen it happen with ads, search, content, and social - but not yet with payments. Even though we all consume content in a unique way, we all still pay the same subscription rates. This doesn't work for the modern consumer who wants to be able to pay a price that reflects what they consumed.
The 3 fixes that will help you get back on Revenue Road
By this point you've figured out where this is going, and transparency is important so let's get to it with the 3 ways you can help solve these pain points.
First: Find a platform that can give you the data to understand how much your content is actually worth
Second: Find a different way to charge your new users that complements and supports your subscription model strategy
Third: Find a payment system that gives your audiences flexibility to pay for what they consume
You've guessed it. StreemPay is specifically designed to solve these 3 pain points for publishers.
At its heart, StreemPay is a way to directly monetize your content without the downsides of paywall or micropayment solutions. With both of these your visitors have to pay upfront to access content. With StreemPay access is free and they only pay as they scroll, i.e. for exactly what they consume.
But it's also a powerful data tool for you to better understand the value of your content. You'll discover how much people will pay for what you produce, and how the value is structured within your content. This is enormously valuable insight for the writers' room.
You'll also be able to identify highly qualified leads to convert to subscriptions. No need for the scatter gun approach, these leads are already paying you so you know they are good prospects.
The best part is, you don't need to abandon your current paywall strategy. StreemPay works best alongside an existing subscription model. So keep that for your core audience and use StreemPay to catch those who churn by giving them an alternative way to pay.
You can also tailor StreemPay to your business model and metrics. If your monthly subscription rate is $19 a month, you can cap StreemPay users to $19 per month as well so they don't pay more than your subscribers. This turns StreemPay into a secondary pathway for your audience to pay subscription level revenues.
A fairer Internet for all
Finding a way to increase access to content for more people and compensate the creators appropriately is not just an industry issue but a societal one. There needs to be a sustainable, flexible, and fair way to monetize content consumption so that information and culture are not siloed, available only to the privileged few.
StreemPay closes the information gap by enabling more individuals to access quality content in an affordable way. The end result is a more open, fairer Internet for all.
Good luck with your mission to monetize your content. If you're interested in learning more about StreemPay, you can sign up to one of our demos at streempay.com!