32 | Predictions for 2023

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Welcome to the paywall podcast, episode 32. I'm here with Tyler Channel from Paywall Project. And welcome, Tyler.

Hey, Pete.

We're going to talk about what we think is going to happen in 23 for paid subscriptions. And if you've been listening to us, you know that we like to nerd out about all kinds of things to generate new digital revenues from your audience. And when I was originally thinking about this, it was the end of last year, it was December, but December got really quiet. Everyone, I think, got into holiday mode and the, the sort of frantic pace of, of getting stuff done with new and existing clients got a little quiet. And so we ended up focusing on different things. And then this January, it has just exploded in activity. There's like, now there's like a race to set up subscription systems or replace them and work with. Just got off the call with a news publisher in the Netherlands who's looking to improve free registrations and paid subscriptions. And it's really been crazy and it's been interesting to reflect on. Okay, well, what just happened over the last two weeks? Right. And a lot of that really does lead to our predictions that we're going to talk about. And so the other thing we did is I kind of went away and I said I'm going to pick three things to talk about that I, that I see happening this year. And Tyler, I think you did about the same thing, maybe more. But we'll. Let's see where we overlap. Now. Do you want to start with your first one? I think it might be one that's. Yeah, really what we think is fairly obvious, maybe not what you think. Go ahead, just jump in.

Yeah, so when I think about this stuff, I think about it in terms of local news. That's where my brain is. That's my audience, that's my, those are my clients. And people listening to this podcast might seem like this or feel like this is obvious, but more, just more paid news, paid subscriptions in general, I think is something that we're going to continue to see, whether it's local news or magazines or any journalism related type publication. So just more paid recurring subscriptions are.

You working with publishers that are coming in that don't have, let's say, digital subscriptions set up all the time?

Yep.

Yep. And have you seen. I mean, has there been any trend in terms of the volume of publishers from last year into this year for paid subscriptions?

Oh, yeah, yeah. Just.

I think in.

In general, there's just been the first couple of weeks of 2023, like leaky paywall. I've seen a lot of local news publishers just wanting to get a system up and running ASAP. So 2023 must be the year for them to finally adopt this sustainable method.

So.

Sustainable.

What's the rush? You mentioned asap? Is there a particular pain point or something burning that needs to happen now?

Yeah, I don't know. I think it comes down to revenue streams. They're seeing their peers do it and seeing others have success with it. And especially I talk about the Welch News all the time. They're in a small, teeny, tiny town. It's a very depressed town, and they are still able to make a sizable amount of money from recurring subscriptions. And so I think when other news, Other, smaller news publishers. Most of the publishers I work with are one to four employees total. When they see someone like the Welch News have success in a small town in West Virginia where it should not work, it makes it easier for them to take the leap. And honestly, it's not that expensive to do. It's not. Setting up a paywall is fairly affordable to do. It's just a matter of doing it well.

Yeah. If you work with Tyler at Paywall Project. Right, yeah. Which. Which, you know, that's a compliment to you. You know, you. You know, if you guys don't know what Tyler is doing for us and for Paywall Project, he. He's got it all going. So a whole bunch of local news publishers setting up subscription platforms, having a lot of success. That's Paywall Project. If you're looking for. For a turnkey system, Tyler's your man. And then Tyler's our new CMO here, working on marketing, of course, with the podcast and. And helping publishers succeed. So I think it's been a. Been a fun ride so far. And, you know, we do. We do so much work with news publishers that really. That's what spawned this. This channel.

There's.

There's work, there's work to do, lots of opportunities, and anyway, I kind of lost my train of thought where I was going.

That was a wonderful plug. A plug for Paywall Project and me.

There you go.

Thank you.

Of Course. Well, you're doing it, you're doing it right, having success with it and we're all learning from each other. So yeah, for sure why we do these things. So I'll take a, I'll take the next one. We, you know, the, the, you're totally right. We see the, the lead influx from publishers that don't have any systems actually still very strong, so turning those on. But the thing that I see with publishers that do have some sort of a subscription system set up and, and typically these are larger news and magazine publishers that have a pretty aggressive advertising on their websites is they're coming in and I'm hearing lots of things like things aren't just working right. You know, things are, you know, they're bugs. They're the, and what it boils down to is the experience that the reader gets on the website isn't, isn't what they want. You know, they, you know, publisher's audience is gold. You know, it's something to really be nurtured. And, and unfortunately advertising, which was the original strategy for generating digital revenues, has created lots of pop up wars between readers and the publisher. So where the former strategy was, let's interrupt the reader experience as much as possible in order to get them to look at ads, even just like signing up for newsletters or, or maybe setting up a system where you're sending folks off to a third party for, for payments or it, it's, you know, it's got to the point where almost 40% of, of viewers on the web have ad blockers installed and are really, really tired of it. So the, the experience has not been great is probably a good way to put it. And what, what, what I'm seeing is that public publishers are looking for a more seamless experience, just a better experience for their readership.

So, and as they should be, when you start to charge money for access to content, the last thing you want to do is bombard people with pop ups and slide in ads and just interrupt everything. There's, I think a new focus on the user experience. For sure.

Yeah, I mean it's just, and they're simple things, easily correctable things. You know, like you're going to a registration page and you get a pop up for a newsletter. It's like wait a second or you're, or you're, you're finally at the payment screen and there's an ad that slides in and gets in the way and you're, you know, these things are, are you just can't do it these days. You Lose. You just lose your audience when you do that. We don't, we as a population, we have less time and we're, we expect a better experience. And the right way to build paid subscriptions is to build that revenue. Sorry. To build a relationship. And which is what we talk about all the time. You know, that casual reader, like the hardcore readers will subscribe, then there's a group of readers that'll never subscribe. And then you have everybody in the middle I call super casuals. And they're the ones that are interested, they're just not ready. And so therefore you have to build a relationship. And you can't build a relationship by ticking people off when they come to your website or confusing them or whatever it is. So anyway, so that's my prediction. I see it already cleaning up. One of the things we've been doing lately is getting, we help publishers onboard, get everything set up and get their systems going. But then we always kind of sort of loop back and do a review of what's going on and there's always things to improve. And so, you know, removing, removing the pop ups. And a lot of it is just legacy software that's getting in the way. Yeah. Turning things off and then getting that, that registration flow to, you know, to collect the email addresses. And with this publisher in the Netherlands, you know, we were looking at, if you're looking at my screen now, this new extension we just came out with called Quick Registration. So you can, it's just short code driven. You can drop it in like on the subscription message, which it's, which is here on the T Journey publication where you just like, okay, let's start the relationship by getting an email registration. Okay, well, email address, password, boom, you're done. Hit submit and now you're registered and you get whatever. So these kinds of like details for creating that experience are, are becoming more and more important for publishers and for good reasons. Because it actually works. Yep, actually works. Okay, I think I covered seamless. All right. You want to take another one?

Yeah, I'm actually gonna do my number three option which is, it's kind of a segue to what you're talking about here. And that is more de platforming, de sassifying your paywall experience. And I think part of that is not so much because the SaaS platforms charge a application fee or revenue share, but also because the experience inside of those platforms are not great and they are sometimes riddled with pop ups and they don't function and the login doesn't work and the Subscriptions aren't updating. And then all of, of a sudden the SaaS platform decides that, oh, by the way, we're not really that focused on news publishers anymore. We're gonna, we're gonna go after this different segment. And now here you are left inside of this SaaS monster that you can't get out of. So something I think we will continue to see is publishers that are already tangled up in platforms, SaaS platforms for their paywalls, I think we'll continue to see them migrate out of those systems to a more open source type environment.

So I'm going to sort of define the SaaS platform here. For those who don't know what that is, that's a system where, let's say I subscribe on your website, that data gets sent off to a different software company and then your subscriber information lives in the cloud at a different organization and perhaps your subscriptions as well. And sometimes your pay, your payments.

I see it all the time. I see publishers who are inside of those, those platforms and they don't actually even have their own stripe accounts or PayPal accounts. They're just getting payments from the platform, which is great. I think as a, as a starting point when you're just getting going and you want to dip your toes into subscriptions, but it does become a liability long term when you start to grow, it can, can hinder you in a lot of different ways.

Yeah, I talked to a pretty good sized publisher last Friday and they're, and I'm sorry to say, you know, they're thinking lawsuit. It's, it's, it's, it's gotten that ugly. Yeah, I don't recommend that for anybody, but yeah, yeah, it's.

Yeah, yeah, it's certainly a gray area on trying to get your data out. This is a struggle with a lot of these platforms. It's, you know, okay, I made the decision, I want to go to WordPress and have a more open source experience. I need my subscribers out. But then you go into the back end of that SaaS platform and you export and you don't have much data to work with. You don't have passwords, you don't have usernames, you don't have subscription IDs, you don't have things, things that you need in order to make that migration. So if there is a publisher that's listening to this, I would caution you on starting with a SaaS platform. Maybe it's cheaper in the beginning to start that way, but in the long run it's going to cost you.

Yeah, yeah. Having control over your, your data, your subscribe, your subscribers, your subscriptions. Right. Your audience and your money. Those are, I think those are fairly fundamental.

Yeah. And I think about it, you can think about this in terms of like Twitter audiences, you know, which is more valuable? A Twitter audience that has a million, you know, your, has a million subscribers or followers or whatever they call it on, on your Twitter account or, you know, the same amount of people on your newsletter.

Yeah, for sure. Oh boy. That sort of, that goes into social, right?

Yeah.

Or as what publishers doing with social. I got a comment not that long ago from a publisher who was really all into Facebook and this is a sports, sports publication. And he said, he said, I just can't believe that I haven't focused on building my own email list which I control, you know, like five years ago, you know, and he, at the time we were talking, he wasn't even asking for, for an email address newsletter and he was doing okay. Like it was just amazing. Amazing.

Yeah, yeah. Forget the likes, forget the follows. Get that, get the newsletter. Get the email going.

Absolutely. All right, I'll jump to my number two. And that's. It's subscriber only newsletters. So this is something that, you know, so paid newsletters have been around forever, right? Paper print newsletters, we love packages of information. We're willing to pay for it if it's useful. And email newsletters are very similar. Substack has proven that email newsletters are, are here to stay. You know, they've grown very quickly. They have a whole startup, you know, population of content creators that are using their platform for, for email. And publishers I think have always had that, you know, join our newsletter, the email newsletter pop up and then they send the news off to their audience. And that's good, that's great. Better than nothing. But leaning into that further with subscriber only newsletters is something that I already see happening. Every time I mention it to a publisher, they grab onto it in a heartbeat. And you know, it's just happening everywhere around them. And, and, and there's so many, there's so much opportunity because that newsletter generally is the number one source of paid, you know, subscriber conversions. And what I will just leave this thought with with you. If you offer a free registration, which you absolutely should, and check out our previous podcasts about that, which I think is all of them, because it's that important. But if you have a free registration and you have a paid subsc by, by default, you already Have a, pay a paid or premium or subscriber only newsletter because your free registration should be segmented in let's say mailchimp or whatever you're using to send out your free newsletter which has advertising on it to, to sell your subscription. So if I get my, your free newsletter, you're going to say hey, upgrade for full access and get our subscriber only newsletter. Right. That's what you should be doing and whatever other benefits. And then on the, on the subscriber only newsletter side, you will not have advertising in it because it's, it's going to pay subscribers. And you may do something like just, just publish full text. And that's your, that's your subscriber only newsletter. No ads, full text. You don't have to click anywhere, you don't have to log in anywhere. It's a convenience to your paid subscribers and they'll love it. So paid subscriber only newsletters.

Yeah, yeah. When you were talking about all of this, I was thinking about how newsletters for publishers became sort of this or in the beginning it's just this thing that we were doing and we're sending out information but we're not really, we're not getting much in return. But now it's a newsletter is probably the single most important part of your operation.

So it is the start of the relationship. Yep, absolutely. Well, the website is the start, but this is the newsletter's first conversion point. Yeah. First inflection point.

Yeah.

All right. So that's, that's my, my second. Do you have a third?

I do have a third. And this one kind of is around traffic and like where, where traffic is coming from on local news sites and in general and maybe just news sites, magazine sites across the board. A trend that I was noticing in late last year is a lot of the referring traffic is coming not so much from social media anymore. And all of the publishers I work with publish on Facebook and not all of them do on Twitter, but some of them do. But the vast majority of their traffic is coming direct and through Google and I think that we will continue to see a trend in that direction. Not so much because people aren't getting news on Facebook. I think they still are, but I think social platforms are adjusting their algorithms in a way to deprioritize news. That's true. And so people are finding their, their news. I think it's actually doing local news a favor in that, in news in general and that people are, are going direct to you. They're not sifting through the vortex of social storms to find you. They're there. They know who you are. They're going directly to you. They're cutting through the noise. They're on your newsletter. They're in, in your ecosystem, more so than living on the social platforms.

Interesting. So are you seeing, are you seeing Google with your crew, your local news publishers? Are you seeing Google as the number one source? Are newsletters ranking for you?

It's mainly Google right now, not all of my publishers. That's one of my other points on newsletters. I'm still working with a lot of them to get their newsletter operations in line. But Google and just people searching the sites like Welch News on Google and going direct to the site, that's a very common, common way for folks to find.

Yeah, okay. Which kind of brings up a possible SEO play there. But yeah, I find that with Google and subscriptions, like the more you publish, the more traffic you get from Google. Yeah, the more traffic you get, the more paid subscribers you get. It's like, it's like a formula, easy formula.

Yeah. And these publishers, they're not running Google News. They're not like in partnership with Google. There's no special relationship. It's just, that's what's happening naturally. And you know, I think it's great. The more that publishers take ownership over their audience and build their newsletters and get traffic direct. Yeah. The better off we're going to be in this, in this local news, paid subscription environment.

Yeah. There's a big payoff with, with a, with a solid newsletter. That's work.

Yeah.

And you know, I, even with. So this, just because I had this conversation earlier, this, it's fresh. This, this Netherlands publisher and they're pretty big news publisher. You know, he, he puts out about five articles a day. He's absolutely willing to rejigger his newsletter to provide full text to his paid subscribers. And that's the kind of, that's the kind of effort that pays off because it's automated. Right. Like, and it's so important. So your newsletter is your, your probably your number one conversion tool for paid subscriptions. Get it right. You know, spend time on it and that, that, because once, once you're done spending the time on it and your free newsletter is going out and it's the right messaging and your paid newsletters going on, it's got the right messaging, you can walk away from it for a good amount of time. And, and it'll just, it'll just convert paid, you know, just boom, boom, boom. And he went from before. Well before. Before we helped him configure leaky paywall. He went from about 200 newsletter subscribers coming on board every month to almost 2,000 now when he launched the free registration.

So yeah.

It'S really important to focus on that newsletter.

Yeah. Your newsletter is the new social media. If there's anything that I would, that I would suggest a publisher doing, I would focus more of my time on the newsletter and forget the social media posting. And you know, I'm going to get slammed for saying that. But that's in my perfect world. Your, your newsletter is your social platform. And so that's. And that's all in my perfect universe. That's all that we would participate in.

Yeah, yeah, yeah. Tyler's perfect universe. We all want to live there.

Very happy place. Yeah, it's a wonderful world.

Nice. All right, so my third and last prediction for 23 is something I didn't expect actually, and that's selling ad free plans on your, on your website. So I'm just going to flip over to this Swedish publisher Somnit and they, if you get plus, which is their paid subscription, you'll see that you have your, your ad free. This is just Google Translate changing this and they have, you know, 10% of their subscriber base is now paying more just to, just to hide ads. And it's 40, it's run the numbers, it's 40% more than their regular and it's, it's doing, it's going very, very well. And they've been doing this for over a year. I have talked to several other publishers, some unsolicited, some solicited for me that are app that are now considering hiding ads for, for a premium plus type of a paid subscription. Now if you caught me a year ago, I would, I was banging my head against the wall, you know, saying hey, you know, this is something you guys should do. Nobody wanted to do it. You know, ad revenue is, you know, is so important. We can't, we can't hide the ads. We have to show the ads. But I feel like maybe there's enough pain has now and suffering has, has happened with the lack of ad revenue that publishers are finally ready to explore new, you know, new options. And you know, it's, I think it's like Maslow's hierarchy, right? Like you, you start by setting up paid subscriptions. Okay, so now you get some subscribers rolling in. Well what's next? Okay, well let's, let's, you know, you back up, you set up talk about the Relationship, set up a free registration. Maybe you start working with, you know, getting the newsletter strategy. Right. Okay, great. And now what else? Well, now you start talking about other options. And the thing about advertising that just shocked me is, is it was so it's like the, the, the sacred cow, right? Like don't touch it, you know, send, you know, put, put it everywhere. But it was, it's just killing the experience with pop ups and, and all that, which sort of makes sense right now. Now, okay, I'm selling, I'm selling subscriptions. You know, at some point they probably got hit in the face by subscribers. Like stop with the pop ups or, or, you know, I don't, I hate these ads. Every, we all hate ads. We have ad blockers. We, you know, 40% of us. And so these ad free plans, when I've talked to publishers last year and, and even in the last couple of weeks about it, they're like, yeah, yeah, that's a good idea. Which, that, that sort of surprised me. It really surprised me. So something's changed and I think we're going to see more of it.

Yep. Yeah. And I think the more that publishers see other media platforms like for example, I subscribe to Discovery plus and can't get enough of HGTV, I would not go for their 499 plan that includes ads. I just could not handle that. And so I, so 699 a couple dollars more for no ads. Oh heck yeah. Sign me up for that. So.

Well, time is valuable to you, right? You don't want to waste time being annoyed.

Yeah, for sure.

And that is, I think true for most of us today where that's our, that's the thing we keep running out of as things as the world gets more complicated. We just keep having less time to.

Do the things we want.

So yeah, we're, we're. The motivation is high to, to not be bothered by ads. For sure. All right, that's great. Those are things to think about for this year. I'd say that's, I think that's a pretty good list of priorities for this year if you are especially a news publisher or magazine publisher, to consider those trends that, that are happening and they will, they will pay off in the long run. So thanks, Tyler.

Thank you.

Till next time. We'll catch you later.

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