Reader Revenue Programs...What?

TL;DR: What are Reader Revenue Programs and Should You Being Doing One?

As digital media, adtech and martech worlds become more complex, more disintermediated, more interdependent, it is important for publishers (and all of us!) to evaluate our business strategies and opportunities. Are you doing enough? Is that the best idea?

Last week I had the opportunity to lead a working group at the Digiday Publishing Summit in Vail, and I wanted to share some of our findings with you. The topic was “Reader Revenue.” The group comprised a wide array of publisher sizes and business types, and vendors of various scopes and services. Our goal was to explore Reader Revenue Programs and help define or resolve our shared challenges. 

Oh, before we begin, here’s a new acronym: RRP. Reader Revenue Program. Get it?

Alrighty, let’s dive in:

1)   What is Reader Revenue? 

a.   Revenue that comes from your readers, not from advertisers. Reader Revenue come in many different forms: subscriptions, memberships, e-comm, donations, and more I’m sure. Don't overthink it (ex. what is affiliate e-commerce revenue), but it's definitely different than you ad revenue! 

2)   Do you have a product to put into a Reader Revenue Program?

a.   These take time and money to develop, its more than just allowing access to your regular stuff. Think of it like building a SAAS business next to your ad supported one. What are you offering? How frequent? How valuable?

3)   Do you have the skills, tools and money to build an RRP?

a.   You will have a completely new set of problems like payment processing, customer service and fulfillment, before you even get to the part of "do I have a good product." Don’t forget you need to be good at marketing; and running house ads is not a marketing strategy. Speaking of which, did you budget for marketing; how much are you willing to spend per customer?

4)   How do you know if you have a good RRP once started?

a.   If you are even able to measure and compare LTV vs. RPV of an RRP or ad supported program, did you consider the investment and resources needed to do so and the business risk of failure? Is there value for the reader in your RRP? Also, you're never done testing, improving and servicing your RRP.

5)   Is a pivot to Reader Revenue for me? (drum roll please)

a.   Maybe. It’s a great business if you can figure it out, but failure would be a distraction at best and lights out at worst. How’d you do on the questions above?

Lastly, we concluded that a good RRP launch requires you to invest before you test. This is antithetical to normal publisher operations; we like to test, then invest. To have an RRP means that you have a product, marketing, support and much more. Such a commitment obviously raises the risk profile but also the likelihood of success.

There are many great examples of success both recent and a little further back and no two publishers will have the same approach. What's worked for you or what would you avoid?

Good Luck.

-Scott