Welcome back to our content series on metrics that matter. Last time, we wrote about performance metrics for the native advertising business model and you can also check out which metrics matter for growing ad revenue.
Now, we’ll move on to business models that rely on reader revenue.
You’ve guessed correctly: it’s time to talk about subscriptions and memberships, which are currently gaining serious momentum in the publishing world.
Understanding subscriptions and memberships
The way subscriptions work is quite straightforward. Your readers pay to access content. Subscriptions come in the form of:
- Automated payments where readers pay a recurring price at agreed intervals (on a weekly, monthly or annual basis)
- One-off payments for immediate access to certain articles
Micropayments imply readers typically pay a small amount of money (around 1$ or below) to access a single article. While this requires less commitment on the part of the reader compared to recurring subscription plans, skeptics argue that there’s a lot of friction in the approach and readers are likely to find it a bit of a hassle. That said, if publishers manage to deliver value, trigger curiosity and overcome the technological obstacles, there’s still a great deal of potential.
If publishers are hesitant to implement a paywall it’s not hard to understand some of the reasons why:
- It can be quite a challenge to convince your audience that you have something worth paying for, especially considering the overwhelming amount of free content available online
- It’s tricky to determine exactly which content should be placed behind the paywall
- Setting the price just right is a delicate task
- Developing strategies to build your base of loyal readers and finding a way to turn them into subscribers is hard
Memberships are slightly different than subscriptions. While subscriptions imply a transactional relationship (i.e. readers pay for content, which is basically your product), memberships have more in common with donations. This type of bond is somewhat more intimate and it’s as much about supporting the cause (think independent journalism) as it is the journalism itself.
Despite the difficulties of implementing the subscription business model or trying out memberships, it’s worth your efforts. Subscriptions can bring financial stability to your media organization and help you reinforce your integrity as a publisher, and strengthen the relationships you have with your readers. You just need to anchor your assumptions in data to make the most of it.
Of course, that’s easier said than done. However, there is a way to combine data and content insights with strategic steps, grow your base of subscribers, and prevent churn.
1. Loyalty CPI
At Content Insights, we have developed a complex algorithm called Content Performance Indicator (CPI) that recognizes three different behaviors: engagement, exposure, and loyalty. All CPI behaviors are expressed in a score between 0 and 1000, where 500 counts as a baseline. Anything below 500 is considered underperforming, while anything above 900 indicates exceptional performance.
The million dollar question for publishers looking to adopt a subscription business model or make the most of it, is:
How do I define loyal readers and encourage their loyalty?
Naturally, this question is then followed by additional ones, such as:
- Is it possible to determine the degree of reader loyalty?
- What is the importance of having a loyal reader base in terms of subscriptions?
- Is there a correlation between loyalty and subscriptions?
- How do you attribute conversions and understand what drives people to become subscribers?
At Content Insights, we’ve worked extremely hard to understand and describe reader loyalty.
While the industry relies on frequency and recency to define loyalty, we use a more complex calculation. We knew that we could not put an equal sign between loyal readers and returning visitors.
In order to determine if your website is truly a part of visitor’s routine, we have started measuring “Active Days” of each reader. When they have more active than inactive days, we call them “sequential”.
Before applying other complex calculations, our algorithm called Loyalty CPI firstly defines two things:
- The loyal reader base
- The degree of loyalty of each reader on the site
Our definition of the loyal reader as a habitually highly engaged reader has proven to be statistically correct. It’s a visitor that has a routine to read articles on your site and finds them engaging most of the time.
Only when you are part of a person’s routine (and they like it that way) can you truly say that you have a meaningful relationship with them that you can call loyalty. The degree of engagement of this particular reader base is actually a degree of their loyalty.
By measuring things this way, we are actually measuring the momentum of their relationship with your site like never before. We can detect when that momentum is on the rise, and we can detect when a loyal reader is slipping away.
[Check out the video below to understand the changes that came with the third version of our algorithm called Content Performance Indicator]
Tip #1: Look for high Loyalty CPI scores
By looking at articles that have high Loyalty CPI scores, you will be able to identify the type of content your loyal audience likes and finds engaging. This insight is valuable for several reasons. To name a few:
- You can reverse-engineer your success and try to replicate it in new content pieces
- You can treat these articles as most influential for driving subscriptions (check tip #2 to see why)
- Articles with great Loyalty CPI scores can be considered your most valuable assets, which makes them great for initiating relationships with new audiences. Consider promoting these articles to new site visitors to form a great first impression and kick-off a good relationship
High Loyalty CPI scores are always a good sign. In Content Insights, you can see which authors, sections, topics, or articles are the best performing in terms of engaging loyal readers on your website. This type of insight matters for numerous reasons: for instance, you can see which authors are the best for encouraging loyalty and then you can assign them the task of premium content production.
Knowing which content is “safe” to be put behind a paywall is a delicate balancing act. You want to monetize your content, but you don’t want to disenchant your readers or damage the bond you’ve worked so hard to establish.
[Related – See how The Local Sweden looks at the combination of Loyalty CPI and Engagement CPI to convert loyal readers into paying subscribers]
Tip #2: Understand your loyal reader base and optimize your paywalls
As we already mentioned, reader loyalty has always been something we’ve kept in focus at Content Insights. We even did a study to explore a more advanced approach for identifying potential subscribers by looking at the complete reader’s journey.
For this research, we extracted a sample of approximately 20 TB of content performance data. This sample consists of data taken from Content Insights’ users of seven websites (mostly popular local news outlets in Germany and Canada), for a two month period.
Our research has shown several exciting things, but these are the two most important findings:
- There is a precise way to measure reader loyalty, know which content attracts loyal readers, and even understand to what degree specific readers are loyal to different sections of a website
- The persistence of loyal readers selected by our algorithm is significantly higher than the persistence of any single or compound metrics criteria
This means that the loyal reader base as defined by our algorithm, represents the base of readers who have the highest probability of becoming subscribers.
By truly understanding the expectations of your loyal readers base and analyzing content that makes them happy at an article, topic, or section level – you can pinpoint conversion opportunities and introduce a freemium paywall, with minimum risk of churn.
2. Engagement CPI
If you’re planning on implementing subscriptions as a business model or you’re looking for ways to increase your subscription revenue and build your subscriber base – Engagement CPI is a metric to bear in mind.
Measuring engagement has always been tricky for publishers, especially because a lot of analytics solutions on the market still rely on simple metrics that measure only browser events – not the real human behavior hidden behind the screen.
So, how can Engagement CPI help you out here?
Engagement CPI is invaluable to subscription managers and strategists because it actually quantifies real human behavior and expresses the level of engagement in a single number so it’s as simple to look at as a single metric, but has the complexity of big data analysis.
This enables you to easily glance over insights about your content in our analytics, and then dig deeper to identify success patterns you can replicate, or use those results to create a hypothesis about what might work with your audience, and then test it in reality.
Tip #1: Measure engagement levels of your subscribers, registered, and anonymous readers
With advanced segmentation in the Content Insights’ app, you can apply filters to find out the level of engagement of three very important reader groups:
So, why does this segmentation matter?
In other analytics solutions, segmentation enables you to apply filters and switch views to understand, for example, how different traffic sources contribute to the website’s total traffic.
But in the Content Insights app, you get much more. All of the CPI scores are recalculated on the fly, allowing you to determine the exact value of different content distribution channels (through the referrer analysis) or to see the degree of loyalty or level of engagement of different reader groups.
If you manage to keep your loyal reader base highly engaged, it’s a good sign that they won’t mind paying for content once you introduce a paywall. You can also try with memberships: if you continuously provide quality content to your readers, they are likely to support you through donations or recurring membership fees.
Monitoring bad Engagement CPI scores will also help you fine-tune your strategy and see where you’re wasting your resources. For example, if a certain topic is constantly losing engagement, that means that it is no longer hot, relevant, or interesting to your readers, and you should consider dropping it.
Tip #2: Identify possible missed opportunities and adjust your paywall strategy
Our study showed that subscribers are on average 34.5% more engaged compared to occasional readers, and this shouldn’t come as a surprise. Subscribers spend more time reading stories and they read more in a single session. In addition, they are more eager to share stories they’ve read on their social media profiles.
So, the levels of engagement are obviously different for these two different reader groups. But, how can you use this insight to adjust your paywall strategy?
As a publisher, a big portion of your workday comes down to testing your assumptions through that age-old method of trial and error. Your assumptions may be driven by your professional experience or data; maybe even the combination of the two. Alas, you’re still working with real humans and their behavior can sometimes be unpredictable and maybe infallible too.
The role of content intelligence tools is to provide actionable insights and data-empowered guidance. In the context of fine-tuning your paywall strategy, here’s what you can do with Content Insights:
- See which free articles have the highest engagement scores among subscribers and the lowest among non-subscribers, and consider putting them behind the paywall
- Map out articles that have high Engagement CPI scores and experiment with creating a content series that covers the same topic
- Consider using different formats or repurposing premium articles that are performing extremely well in terms of engaging subscribers
Loyalty CPI and Engagement CPI are the most important metrics for publishers operating on subscriptions and memberships.
But there are other useful behavior metrics that also enable you to measure individual article/author/topic/section performance, and manage content performance up close.
[Related – See how Süddeutsche Zeitung uses our Engagement CPI to measure reader’s involvement with content]
3. Article Reads
Article Reads is one of the key engagement metrics found in the Content Insights app. This metric tells you how many times a real person started attentively reading your content.
Here’s an idea how to use this metric if you operate on subscriptions:
- If you’re trying to assess the performance of a specific premium article, you can see how much attention it grabbed by looking at the number of article reads; this is one part of the engagement puzzle, and it also indicates the popularity of the article
- If you see that a certain free article has a high number of article reads and other engagement metrics look outstanding as well, you can consider putting this article behind a paywall or offering a freemium version of it
Pageviews ≠ Article Reads
Pageviews is a metric found in many analytics tools on the market. Many publishers misinterpret it as a metric that shows the number of people who viewed or even read a certain article. This is not true. A pageview (or pageview hit, page tracking hit) is an instance of a page being loaded (or reloaded) in a browser.
So, if a person happens to open an article in the new tab and forgets all about it – a pageview will be triggered.
On the other hand, Article Reads in Content Insights records the number of times a real human being actually started attentively consuming your article. We care about behavior, not just what happens within the browser.
But there’s more to it: you can also explore Read Depth and Page Depth. Both of these metrics are significant for subscription managers; here’s how.
4. Read Depth and Page Depth
Read Depth is another precious metric found in Content Insights. By looking at the combination of Article Reads and Read Depth, you can get a clearer sense of how people begin to interact with your articles and whether or not the introduction, style or formatting could be improved to encourage better reader engagement from the very start.
Simply put, Read Depth is the percentage representing how far readers got through the article published in the selected time period. Our analytics recognizes three different types of readers in this context:
- Left quickly
- Average reading
- Finished reading
It’s also possible to examine the Read Depth Breakdown and see smaller sub-groups of readers, based on how deeply they’ve gone into reading.
Page Depth calculates the average number of pages visited after a reader opens the initial page or article. This can be pretty useful for determining the way subscribers interact with your content and to monitor the level of their engagement. For instance, if you see that subscribers don’t dwell or explore your premium content as much as they did before, it might be a red alert or a sign of subscription fatigue. You should act on these insights fast in order to prevent churn.
Scroll depth ≠ Read Depth
Some publishers use scroll depth in an attempt to measure reader engagement, but this approach is flawed for more than one reason. Firstly, scroll depth tells you nothing about the reader’s activity. If readers scroll through the content, does it mean they’ve actually read it? Were they engaged by it? How engaged were they? You simply cannot know.
Secondly, scroll depth values are highly dependent on the location of the fold or the length of the article. If the reader’s screen is zoomed out and they see the whole article, they might read it without scrolling; or if the article is short, they won’t scroll at all. Scroll depth is simply insufficient to indicate engagement.
It’s important to stress that scroll depth is not the same as Read Depth found in Content Insights. To calculate Read Depth, we take into account a variety of engagement metrics. The metric analyzes only the article content on the page, disregarding all other elements.
5. Attention Time
Last but not least, Attention Time is a precious metric for subscription-based publishing businesses.
In today’s day and age, earning attention from your readers is a difficult task which requires a lot of effort. This is why you should monitor your wins and use data to get to know your audience. Only then can you meet their expectations and offer them something unique and valuable.
Attention Time is our complex metric that shows the amount of time readers spent attentively consuming your content. Since time is everyone’s most precious resource, this metric reveals a lot about the way people perceive your publication and how they connect with it, too.
However, be careful because
Time on Page ≠ Attention Time
Do not mix up Time on Page found in many other analytics tools on the market with Attention Time.
Time on Page is a metric that measures the amount of time a certain page was left open in a browser, regardless of whether or not a real person was behind the screen consuming the content. So, Time on Page actually measures a browser event, not human behavior, which is why you should be very careful if you’re taking this metric in mind when making business decisions regarding your subscription business.
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You’ve made it! Thank you for reading this article from top to bottom. We wanted to point out the key metrics that could help your subscription business bloom. We’ve seen it happen with our clients, so we have real solid proof it’s possible.
Are you a publisher operating on subscriptions? Wondering how Content Insights can help your business? Contact us to find out more about our subscription revenue growth report and other details. We look forward to hearing from you!