NewsBeat

14 NewsBeat June 2018 New study: How to build revenue by connecting with your audience By ELIZABETH HANSEN and EMILY GOLIGOSKI S ocial media has fundamentally changed how publishers reach their readers — and publishers' business models have had to adapt dramatically to that change. With Facebook and Google now controlling the bulk of digital advertising revenue, and Facebook deprioritizing news articles on the News Feed, publishers are once again rethinking how to make publishing a sustainable business. From The New York Times to Honolulu Civil Beat, we see sites large and small pursuing multiple revenue sources. We set out to document this complicated calculus, and, in the process, found reason for hope. Over the last three years, we've interviewed staff from dozens of news organizations that are pursuing direct revenue from audiences in the form of subscriptions, donations, and/or memberships, including ProPublica, The Texas Tribune, De Correspondent, Stratechery, and Slate. These arrangements support a more collaborative vision for the relationship between journalists and the audiences they serve than news organizations have historically engaged in. Many outlets are taking the massive economic and technical changes rocking the news business as a prompt to act differently, and they're finding that audience engagement and audience revenue are two sides of the same coin. Today, in collaboration with the Tow Center for Digital Journalism, the Membership Puzzle Project, and the Institute for Nonprofit News, we're publishing the full findings from our research in a "Guide to Audence Revenue and Engagement." This report is aimed at publications inthe early stages of exploring how to use audience engagement to drive both revenue and loyalty. Could your site be a candidate for this kind of implementation? Here's what you need to know. 3. Are you niche? Subscription revenue works best for highly differentiated news products. For publications with subject-area or region- specific journalism and a strong audience base in their coverage areas, a product-based subscription offering can work. If readers, listeners, and/or viewers see a site's news and analysis as providing enough unique value, subscription might be a viable revenue strategy. A subscription strategy can work especially well for publications with strong institutional audiences in specific industries and when subscribers' employers can pay the cost of work- relevant media. A subscription strategy can work especially well for publications with strong institutional audiences in specific industries. There are a few notable examples of publications that are growing subscription revenue with paid email products on top of free-access membership models. The politics and public policy site The Texas Tribune publishes The Blast, a "premium daily newsletter" that is used by elected officials, lobbyists, consultants, and political junkies looking for insider intel beyond what they can get on the site for free. Politico publishes Politico Pro, a paid "policy news service offering indispensable policy news in real time" which includes two exclusive daily newsletters, breaking news alerts, and special events. 4. Identify participation opportunities for members that are also valuable to the publication. For publishers who are building membership programs, finding participation activities that are both of interest to members and valuable to the publication is one of the major challenges in creating a sustainable membership program. De Correspondent's members lend their expertise as technical proofreaders on select stories while, with some staff training, supporters of other sites serve 1. Understand the different forms of direct audience revenue: subscription, membership, and donation. There are, generally, three models of audience revenue generation: • A donation model encourages audiences to give their time or money to an institution in support of a common cause or common values. Donation conveys a charitable relationship. • A subscription model requires audiences to pay money to get access to a product or service. Subscription conveys a transactional relationship. • A membership model invites audiences to give their time, money, connections, professional expertise, distribution to their networks, and/or ideas to support a cause they believe in. Membership represents two- way knowledge exchange between journalists and members. You might think of membership as a more committed relationship that is robust and active. 2. Direct audience revenue can be a cornerstone revenue stream, but it is unlikely to be your sole business strategy. Rarely did we find news organizations funded by direct audience revenue alone (including membership, subscription, and/or donation). Digitally native publications including MinnPost, VTDigger, and Berkeleyside are among those that are relying on a mix of revenue approaches — sometimes including advertising, corporate underwriting, foundation funding, article syndication, events, affiliate programs, merchandise, and book sales — in addition to direct revenue from audiences.

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