How to Ease Your Paywall Pains

If you’re in news, magazine or periodical publishing you’re very likely to be operating – or at least planning – a kind of “paywall”, like over 500 dailies in the US and Europe do. Introducing new payment and subscription revenue streams has become mandatory, with digital advertising revenues remaining stubbornly lower than the ad income enjoyed by print. 

Consumers’ pain with “paywalls” is of course that all internet content has been free for decades. So, why pay? What price? Which product bundle? Where and how to buy? Do I get “print value” (whatever that is) in digital - but with internet service benefits like hyperlinks, bookmarks, video and most of all personalized offerings? Are users willing to pay for just a replica of the print content - or a new digital experience?

Paywall Pains

Tough and game-changing questions for the publishing industry, tellingly analyzed as the digital “Newsonomics” by Ken Doctor. But while digital transformation results in structural decline of the print business, there are early signs of success and best practice on how to grow with digital content commerce and marketing. Based on successful customer insights, I’d like to share three lessons-learned on easing the most typical “paywall pains”.  

1. Don’t build a “wall” - build a smart commerce service

There’s only one learning in digital content commerce: nobody knows the best pricing and product formats yet, so business teams want to try, change and adopt in high frequency. Metered paywalls, subscriptions, try-before-buy, article buys, in-content commerce and multi-product bundles? Yes, all of them, today! What does this mean for IT and editorial teams? Don’t hardcode any transaction or commerece solutions into your content management systems, and don’t build IT or editorial dependencies for dynamic price and product changes.

The publishing industry has the chance to learn from telecommunication subscriber management disasters: I have seen teams struggling to maintain literally thousands of hard-coded digital product variations, just after a few years in business. A positive example is Dow Jones and Wall Street Journal, often seen as inventor of the “paywall” in 1997 with over a decade of paywall learnings. In the video linked below, former SVP of Circulation Lynne Brennen outlines how agile her business teams change pricing and bundling options of various Dow Jones products using Oracle Billing and Revenue Management solutions.


Lynne Brennen, SVP of Circulation, Dow Jones

2. Prepare to lose half of your free users - by winning subscribers with modern marketing

Everybody in marketing will agree “walls” in general don’t really help creating a compelling customer experience.  And it’s true that making the barrier as easy to pass as possible is essential.  But pay models can also dramatically change the reader experience. Recent reports on The Sun’s paywall launch in summer 2013 indicate the service lost 60% traffic - but won 340.000 paying subscribers in the same time, which is obviously a great start.  

The good news is that modern marketing already offers mature technical solutions to drive digital revenues. Online retailers like Amazon or Ikea run dozens of different marketing backend services to drive revenue by optimizing a personal customer experience. And similar standard applications are successfully in use in media & entertainment - here with links to customers using Oracle Media & Entertainment solutions:  

3. Digital pennies for analogue dollars - go Cloud to innovate at lower cost

Managing costs is another key challenge of the digital media transformation, as in most cases analogue revenues decline faster than digital increases - the famous "digital pennies for analogue dollars" saying. And at the same time, this financial gap is unfortunately widened by investment needs, as innovating digital content means expensive developing of new product formats, production and commerce platforms - often new IT-centric costs. 

But there's good news again, as the media industry can learn from another industry: nearly all "digital natives" from Amazon, Google, Apple, Facebook to Netflix and Flipboard rely on Cloud infrastructure to address similar challenges. The rational is simple: they can focus on strategic product software development, and use standard cloud software and technology platforms wherever possible - which both saves costs and enables the agile start-small go-global rollout.

The innovation behind is based on similar economies of scales that centralized our energy industry: the IT industry learned to offer super-large data centers, combined with self-service access, instant provisioning and flexible OPEX pricing. As you might have guessed by now, the Oracle Cloud (cloud.oracle.com) makes this possible for publishers, too - increasing ease-of-use (e.g. Oracle Social Cloud video) and simplifying IT (e.g. Oracle Billing and Revenue Management Cloud video).

What it means? Hands free to focus on the real challenges 

Now, digital transformation is that easy? Of course not. But implementing standard technology solutions to drive consumer engagement and transactions will free management, creative and technical resources to focus on the real tough questions: mastering the cultural transformation into a digital B2C product company.   

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