Research: Consumer attitudes to publishers’ subscription products
Consumer attitudes to publishers’ digital subscription products are evolving as media companies place greater emphasis on generating revenue directly from their audiences.
With more content placed behind paywalls, many consumers are now thinking more carefully about how and why they’re paying to access it. Some are broadening their subscription portfolios while others are scaling back. And although overall satisfaction with publishers’ subscription offerings is growing, frustrations with cancellation processes and restricted content continue to mount.
To better understand consumer perceptions of publishers’ subscription products and approaches, Toolkits conducted a first-of-its-kind consumer study in partnership with research and insights firm National Research Group. Key findings from the survey of over 6,500 U.S. respondents included:
- Satisfaction with subscription products is increasing.
- Consumers’ subscription portfolios continue to grow and subscribers say they’re less likely to cancel.
- Easier cancellation mechanisms could help drive more subscriptions.
- Over half of consumers attempt to circumvent publishers’ paywalls.
- Introductory discounts continue to help drive subscription purchases.
- Paywalled content is deemed higher quality and more trustworthy by some consumers.
Satisfaction with subscription products is increasing
More consumers are satisfied with the value for money they get from publishers’ digital subscription products than in 2022. Eighty-five percent of subscribers to digital publications reported being “completely” or “mostly” satisfied with the value for money they received from their subscriptions, up from 75% in August 2022. Twelve percent reported being “somewhat satisfied”, while just 3% said they were “mostly unsatisfied” or “not at all satisfied”.
Engagement with publishers’ subscription products appears to be growing as well. Sixty-eight percent of consumers said they accessed paid content from their subscriptions on a daily basis, up from 58% in 2022. Meanwhile, the portion of consumers who subscribed to at least one digital publication they did not visit at least once a month dropped to 27% from 46% in 2022.
The increases suggest that publishers are doing a better job of engaging and delivering value to subscribers, that consumers are canceling subscriptions they don’t regularly engage with – or a combination of the two.
Among subscribers who were not fully satisfied with the value for money they received from publishers’ subscription products, cost, advertising load, and content relevancy were cited as the top reasons for their dissatisfaction. Other top concerns included a lack of content variety, content quality, and a lack of frequency.
Few respondents cited overall content consistency, app and website design, or poor customer service as reasons for their dissatisfaction.
Implications for publishers
Increased focus on value and engagement could be paying off
To grow subscriber retention and loyalty, many publishers have focused their efforts and resources on promoting product engagement and better communicating the value of their offerings over the past few years. The data suggest those efforts are being recognized by consumers, who reported clear increases in both their value perceptions and engagement levels over that period. Engagement and value will likely prove more important than ever throughout 2024, and as canceling and moving between subscriptions becomes easier, publishers with the stickiest products and the most compelling propositions will be best positioned for success.
Consumers may be cutting low-value subscriptions from their portfolios
Another possible explanation for engagement and value perception increases is that subscribers are managing their subscriptions more carefully and weeding out those they glean little value from or interact rarely with. As consumers become more familiar with subscription products and sample a variety through trials and low-priced introductory offers, they might simply be voting with their wallets and gravitating towards the ones that deliver them the most value. As the market for publishers’ subscription products matures, consumers will increasingly allocate their subscription dollars based on the strength of the underlying content and features on offer.
Subscribers are increasingly displeased by advertising
Among subscribers who were not fully satisfied with the value for money they received from publishers’ subscription products, advertising load was cited as a key reason. Aversion to advertising within subscription products appears to be growing, too, with 28% highlighting “too many advertisements” as a key reason for their dissatisfaction, up significantly from 19% in 2023.
This shift in sentiment coincides with a difficult economic period for publishers, many of which are seeking to maximize both advertising and subscription revenues to sustain their businesses. In many instances that’s led to increases in advertising loads across publishers’ properties and the introduction of advertising within previously “ad-free” subscriber experiences. Publishers are also able to monetize their logged-in users and paying subscribers much more effectively than other portions of their audiences, thanks largely to the availability of powerful first-party data to help inform targeting and measurement. Some publishers have specifically stepped up their efforts to monetize subscriber attention via advertising as a result, which could explain subscribers’ growing distaste.
Subscribers say they remain sensitive to cost
Conversations about pricing have moved front and center for publishers as they hunt for ways to grow revenue per subscriber and maximize yield from their existing subscriber bases. Many are now exploring how best to increase their pricing and migrate subscribers on cheap (and often long) introductory terms to more lucrative ones. The data show that – despite receiving value for money from publishers’ subscription products broadly – consumers do remain sensitive to their cost. Among subscribers who were not fully satisfied with the value their subscriptions provided, 36% highlighted cost as a primary reason, up from 31% last year. Complaints about cost and price are typical for any paid product, but the sentiments are worth noting for publishers looking to raise their pricing in the months ahead.
Consumers’ subscription portfolios continue to grow
Twenty-nine percent of subscribers to digital publications said the total number of subscriptions they held increased in the 12 months before October 2023, while just 7% said it decreased. Sixty-four percent said the number of subscriptions they held remained consistent.
Eighty-one percent of subscribers said they owned subscriptions to more than one digital publication, up from 71% in 2022.
Products related to news and current affairs (46%), media and entertainment (41%), sports (36%), cooking (29%), and lifestyle (29%) proved the most popular among subscribers for the second year running.
The prominence of news and current affairs on the list is perhaps unsurprising given that many news publishers now require subscriptions to access portions of their content. In other categories, paid subscriptions may be less essential for accessing content since free alternatives tend to be more readily available.
The groups most likely to own at least one subscription include men, people earning over $100,000 per year, and 25 to 34-year-olds.
Implications for publishers
‘Power subscribers’ want more
Research conducted by Toolkits in 2022 revealed that a relatively small but highly engaged group of “power subscribers” – about 4% of the population – accounted for an outsized portion of subscriptions held in the U.S. We suggested at the time that these consumers could reach a saturation point in terms of the number of digital subscriptions they would hold, but the new data imply that appetites for additional subscriptions remain strong.
Twenty-nine percent of subscribers said they increased their total number of subscriptions in the 12 months before October 2023, while just 7% said they decreased. What’s more, demand for additional subscriptions among current subscribers appears to be growing: 33% said they expect to increase their number of subscriptions in the future (compared with 27% last year) while 21% said they plan to reduce their number of subscriptions (compared to 29% last year).
Growth in the number of subscriptions people hold is likely being driven by the continued proliferation of subscription products and subscriber-only content. As more content is placed behind paywalls, more subscriptions are being purchased. The increases may also reflect easing economic tensions: Although economic uncertainty persists, the 2022 data were collected against a backdrop of more acute recession fears.
Ultimately, the data suggest that U.S. consumers have not reached a subscription saturation point – or “peak subscription” – as some have suggested, but remain prepared to add new subscriptions to their portfolios. Individual publishers may see contractions in their subscriber bases even as subscribers maintain more subscriptions, however, as competition continues to grow.
Subscription revenues rely on a relatively small group of consumers
Although strong demand from power subscribers remains, the data suggest that publishers could be increasingly reliant on a relatively small total audience for their subscription revenues. That could leave publishers’ businesses exposed if this group begins to make deep cuts to their subscription portfolios or simply fails to add new subscriptions quickly enough to offset cancelations.
It also suggests that publishers broadly are “preaching to the converted” in terms of the audiences they’re marketing subscriptions to. Attracting, educating and converting first-time subscribers will therefore become essential for further growing the overall market for publication subscriptions.
A growing bundle opportunity
As more consumers add multiple publications to their subscription portfolios, it stands to reason that demand for “bundled” products offering access to content from multiple publications will continue to grow. Eighty-one percent of subscribers said they owned subscriptions to more than one digital publication, up from 71% in 2022.
It remains to be seen if publishers can strike deals with intermediaries – or other publishers – that they believe are in the best long-term interests of their businesses, however. Some publishers – such as The New York Times – are hoping to capitalize on the bundle opportunity by offering consumers access to a range of verticalized products and features via their own “all access” subscriptions. Other publishers are experimenting with licensing or otherwise distributing their content via aggregation services such as Apple’s News+ product, although some have expressed concerns about giving up direct paying relationships with their audiences when working with third-party platforms.
First-time subscribers could unlock incremental growth
Although the data suggest that publishers could continue to add new subscriptions from the “power subscriber” pool for the time being, the importance of unlocking first-time subscribers to drive incremental subscriber growth remains clear. Attracting, educating, and converting consumers who have never held a digital publication subscription will likely be a growing focus for publishers hunting for subscriber growth in the years ahead, and many are investing in programs to reach younger audiences for that reason.
Subscribers say they’re less likely to cancel
Consumers said they were less likely to cancel subscriptions to digital publications than they were in 2022, suggesting they may be spending on subscriptions less cautiously than when fears of a recession were more acute.
Fifty-six percent said they canceled a subscription in the twelve months before October 2023, down from 63% who reported doing so in September 2022.
Looking ahead, 22% said they expected to reduce their number of subscriptions in the coming year, down from 29% in 2022. Thirty-two percent expected their number of subscriptions to increase or stay the same, while 46% expected it to remain consistent.
Lack of use, budgetary concerns, and price increases topped the list of reasons for canceling publication subscriptions, remaining broadly consistent with 2022. Fewer consumers reported that value for money was a reason for canceling compared with last year, suggesting publishers may be doing a better job of delivering value through their subscription offerings and/or communicating value more effectively.
The data also imply that consumers cancel subscriptions to digital publications for different reasons than for streaming services such as Netflix or Spotify. People who have canceled subscriptions to streaming services tended to do so because of cost, not because they weren’t using the service enough, implying streaming services might be more “sticky” than most publishers’ products.
Previous NRG research found that among consumers who have canceled a TV or movie streaming service subscription in the past, the most common reason was the expense. For music and podcast streaming services, 41% canceled for the same reason.
Implications for publishers
Economic conditions are influencing subscription behavior less
The data suggest that consumers are spending on subscriptions less cautiously than they were in 2022 when inflation was at its height and fears of a recession were more acute. That’s good news for publishers with subscriptions as a core part of their revenue mix, particularly for those emphasizing their subscription businesses heading into 2024.
Publishers should tread carefully when raising subscription prices
Conversations about pricing have moved front and center for publishers as they look for ways to grow revenue per subscriber and maximize yield from their existing subscriber bases. Many are now actively exploring how best to increase their pricing and, crucially, migrate subscribers on cheap (and often long) introductory terms to more lucrative and sustainable ones. Twenty-four percent of subscribers said they’ve canceled subscriptions in response to price increases, however, highlighting the importance of a strategic approach.
New features and benefits often make for nice “hooks” on which to hang price increases and to help convince subscribers to push beyond introductory tiers and pricing. Some publishers are also experimenting with dynamic approaches to renewal pricing that seek to segment customers by price elasticity and identify at what price points different groups of subscribers are likely to churn.
Increased value perception can help minimize churn
Adding value and maximizing subscribers’ value perceptions remains the most powerful way for subscription businesses to reduce churn. Publishers are currently attempting to do so in a variety of ways: Some are bolstering their existing subscription products with new content and features, while others are launching additional offerings designed to appeal more directly to specific segments of their audiences. Almost all are exploring opportunities to market “bundles” – however they’re defined – which promise audiences greater value and cost efficiencies. Forty-nine percent of subscribers report actively “hopping around” and trying different subscriptions with the intention of canceling those they don’t get value from, highlighting the growing importance of value perception for attracting new subscribers.
Engagement remains critical for subscriber retention
The data reinforces what most publishers are well aware of: Subscriber engagement is crucial for driving retention. Lack of use remains the most common reason for canceling subscriptions, and 62% of consumers said they’ve subscribed to publications with the intention of canceling before trial periods end. As canceling and moving between subscriptions becomes easier, companies with the stickiest products and the most engaged audiences will be best positioned for success.
Easier cancellation mechanisms could help drive more subscriptions
Sixty-seven percent of U.S. consumers said they would be more likely to subscribe to digital publications if the process of canceling subscriptions was easier. Seventy-seven percent of consumers also said they would support a law mandating “one-click cancelation” mechanisms.
Consumers’ experiences with publishers’ cancelation processes vary. Just over half – 51% – said that they encountered at least some difficulties during their last attempt to cancel a subscription. Forty-nine percent described the process as “easy and straightforward.”
Implications for publishers
Easy cancelation could boost conversions
Converting new subscribers is becoming increasingly challenging for many publishers as competition for consumer attention intensifies and they begin to search for growth beyond their most engaged and loyal audience segments. The data suggest that easier cancelation processes could help publishers drive incremental conversions and revenue: If consumers are confident they can easily cancel subscriptions, they might be more likely to subscribe in the first place. Converting subscribers is not the same as engaging and retaining them, of course, but publishers who give consumers complete control over how and when they’re charged might find they’re able to convert more easily.
Consumer support for “click-to-cancel” requirements is clear
Dark patterns, confusing cancelation flows, and forcing subscribers to call or chat with representatives may help publishers reduce churn, but they’re increasingly irking both consumers and regulators. Consumer support for the Federal Trade Commission’s proposed “click-to-cancel” rule in the U.S. is evident: 77% of respondents said they would support a law mandating “one-click cancelation”, and 51% said they have encountered difficulties when attempting to cancel a subscription.
Public comments to the FTC’s proposal tell a similar story: Consumers are frustrated by the subscription practices employed by many companies and would support any changes that give them greater control over how and when they’re charged. Meanwhile, The Digital Markets, Competition and Consumers Bill is seeking to reform U.K. law to further protect consumers from practices including “subscription traps”, and in France, a decree has entered into force requiring that businesses allow consumers to cancel subscriptions and contracts online in three clicks or fewer.
Product value is increasingly essential for driving retention
As greater control is placed in the hands of consumers, luring consumers with creative marketing hooks and attempting to trap them with legalese and technicalities is not a viable strategy. Consumers will increasingly allocate their dollars based on the underlying and ongoing value that publishers’ subscription products provide, rendering the use of aggressive marketing and retention tactics less effective over time. As the market for publishers’ subscription products begins to mature and consumers become more familiar with their offerings, publishers without differentiated and demonstrably valuable subscription products may struggle to compete.
Transparency is becoming a differentiator
Publishers go to great lengths to position their editorial output as trustworthy, transparent, accurate, and accountable, but convoluted cancelation practices threaten to undermine those promises in many instances. As consumers become more familiar with subscription models and their dynamics, aggressive and misleading retention approaches increasingly risk damaging publishers’ editorial credibility. The risk is particularly pronounced for news publishers, whose subscription offerings are frequently oriented around access to trustworthy reporting, unbiased journalism, and greater accountability to their subscriber bases.
Consumer control results in clearer value signals
Cleaner and more transparent data around subscriber preferences and value perceptions might help publishers improve their subscription offerings, tailor their content more effectively to subscriber interests, and optimize their pricing strategies and approaches accordingly. No subscription business likes churn, but easier cancelation processes may give them greater visibility into who finds value in their products and why.
Over half of consumers attempt to circumvent publishers’ paywalls
Fifty-eight percent of digital publication readers reported regularly looking for ways to access paywalled content without paying, and two-thirds said they avoid sites with paywalls entirely.
Sixty-eight percent said they avoid clicking links to websites they know use paywalls, down from 73% in 2022. And almost as many, 67%, also said they avoid clicking links to sites they know use registration walls.
Millennials (63%) and Gen Z (62%) were more likely than older consumers to look for ways to get around paywalls without paying.
The most common methods for circumventing publishers’ paywalls included searching for the same content on other websites, using incognito browser modes, opening sites in different browsers or devices, deleting cookies and browsing data, and using dedicated paywall evasion tools.
Implications for publishers
Declines in circumvention rates could be a positive sign
Although a significant number of readers continue to try to circumvent paywalls, they said they’re doing so slightly less than last year. This might be explained by one or more of the following factors:
- Economic conditions have eased: Consumers may be more willing to pay to access content than in 2022 when inflation was at its height and fears of a recession were more acute.
- Satisfaction with subscription products is growing: More consumers said they were satisfied with the value for money they get from publishers’ digital subscription products than in 2022, and engagement with them is growing too. Readers might be more comfortable with paying for access to publishers’ content if they’re confident in the value they’ll receive.
- Discounts and free trials are readily available: Publishers have leaned heavily on free trials and discounted introductory subscription offers in recent years, and a portion of consumers may have opted to accept those offers rather than attempting to circumvent them. Forty-nine percent of subscribers said they actively “hop around” and try different subscriptions with the intention of canceling those they don’t get value from.
- Publishers are securing their content more tightly: In response to growing consumer interest in paywall circumvention, some publishers have taken stronger measures to secure their content and mitigate paywall circumvention. If consumers can bypass paywalls less reliably they may be less likely to attempt to do so.
Of course, declines in circumvention rates could also reflect a declining interest in accessing publishers’ content generally. News publishers, for example, are well aware that demand for their output has softened in the wake of the Trump presidency and the COVID-19 pandemic.
Converting new subscribers could become increasingly challenging
Research suggests that consumers have not yet reached “peak subscription”, and that people who subscribe to digital publications are continuing to add more subscriptions to their portfolios. Nevertheless, it stands to reason that consumers will eventually reach a saturation point in terms of the number of subscriptions they hold, and/or that aggregation services and other bundles might gain traction in the years ahead. Against that backdrop, the finding that 68% of readers said they avoid clicking links to websites with paywalls may pose a challenge for publishers looking to reach and engage new audiences and prospective subscribers. Attracting new subscribers could become more challenging if their consumption habits and content diets become more narrowly oriented around the handful of subscriptions they already pay for.
Convincing younger consumers to pay remains a challenge
Enticing younger subscribers remains both a priority and a challenge for many publishers. On one hand, the fact that Millennials and Gen Z are more likely than older consumers to attempt to access paywalled content without paying implies there’s demand for that content among those audiences. On the other, it may suggest publishers have work to do when it comes to convincing younger audiences to part with their dollars, and/or stopping them from accessing their content illegitimately.
Introductory discounts continue to drive subscription purchases
Seventy-three percent of respondents said they were more likely to subscribe to digital publications when offered an introductory discount, and 76% said they were more likely to subscribe if a free trial period was offered.
Fifty-four percent of consumers also said they were more likely to subscribe if a publisher allowed them to access some content for free, and 67% of consumers said they would be more likely to subscribe if the process of canceling was easier than it currently is.
When it comes to evaluating monthly plans vs. longer annual commitments, consumers were evenly split on whether they’d rather pay more money upfront for long-term savings (30%) or a smaller monthly fee that may cost them more in the long run (33%). The remainder – 37% – said they do not have a preference.
Implications for publishers
Introductory discounts drive purchasing decisions
The majority of leading consumer-facing publishers continue to offer introductory discounts and free trials for one simple reason: They remain an effective driver of sustainable subscription growth.
What consumers say and what they do often varies widely, so self-reported data should be always taken with a grain of salt. Nevertheless, advanced publishers say their behavioral data tells a similar story, and that introductory discounts continue to prove effective for growing their subscriber bases and revenues. There’s a reason introductory rates continue to be offered by the world’s most successful subscription publishers, and their use does not immediately call into question the health of a publisher’s business despite what some industry observers suggest.
Consumers expect introductory rates
Publishers with valuable and highly differentiated subscription products don’t typically want to offer them at reduced prices, and some argue that introductory offers risk “cheapening” products in consumers’ eyes. But the reality is consumers have largely been trained to expect introductory discounts when beginning subscription relationships. While some publishers might avoid them in an attempt to differentiate their offerings and communicate more “premium” positioning, they might simply be limiting their subscriber growth as a result.
Short-term vs. long-term revenue
One common critique of introductory discounts is that publishers are leaving money on the table by selling at a discount, but as far as many publishers are concerned the data tell a different story. Introductory discounts may cost publishers revenue in the near term, but the additional subscriber volume afforded by introductory discounts often results in significantly greater revenue yield over a multi-year period.
Many publishers also say they see little evidence to support the theory that discounted subscribers will churn at a significantly higher rate than those who pay full price from day one. Publishers optimizing for short-term revenue may wish to curb their discounting, but for those looking to maximize revenue on a long-term basis, introductory discounts will continue to be attractive.
The B2B exception
Publications targeting business or professional audiences may face very different dynamics, particularly if subscriptions are being expensed or charged to an entity other than the individual purchasing them. Publishers that sell primarily to businesses may find that introductory discounts are less effective at converting subscribers and that less aggressive discounting could result in greater revenue yield.
Paywalled content is deemed higher quality and more trustworthy by some consumers
Thirty percent of respondents said they believe content they must pay to access is higher quality than content that’s available for free, and 25% said they have more trust in publications that require a subscription. Ten percent said they view free content as higher quality and 13% said they trust free publications more.
Cause and effect
The correlation between paywalled content and consumer perceptions of quality and trust is clear, but the factors driving those attitudes are open to interpretation. Several explanations are plausible, including:
Better business models: Publishers have gravitated towards subscription offerings and paid content access in recent years largely because they believe audience revenue can help fuel healthier and more sustainable businesses. That theory may be proving true, as challenges with ad-supported models mount and publishers with audience revenue components to their businesses fare better than those without. It stands to reason that healthy, stable, and sustainable media businesses might be likelier to produce high-quality and trustworthy content.
Improved user experience: Publishers that generate revenue directly from their audiences are often less reliant on advertising and can offer improved user experiences as a result. Some offer paid readers ad-free or ad-light experiences, while the data associated with logged-in or known users can often help boost ad relevancy – all of which can help boost consumer perception of quality and trust. Consumers may not dislike advertising in and of itself, but publishers frequently find that improvements in user experience correlate with increased perceptions of quality, trust, and value.
Marketing and product positioning: Publishers that ask consumers to pay for content often go to great lengths to position it as higher quality and more trustworthy. Whether that’s true is subjective and difficult to quantify, but marketing messaging and product positioning alone might influence consumer perception, to some degree, regardless of the nature of the underlying content on offer.
Confirmation bias and behavioral psychology: Publishers increasingly find that subscription products and other audience revenue approaches enable them to more closely align their business needs with their editorial missions and the interests and needs of their audiences. While audience revenue might help underpin more viable business models, however, there’s also an argument to suggest it incentivizes publishers to pander to audiences by playing to their existing beliefs and biases. That, in turn, may influence perceptions of quality and trust. Elements of behavioral psychology come into play as well. Consumers often ascribe more value to products and services simply because they own them or because they’ve paid to access them, for example.
Methodology
Research was conducted by Toolkits and National Research Group, a global research and insights firm that works with the world’s largest content creators and marketers. The study surveyed 1,007 U.S. consumers aged 18-64 who reported having a current or previous subscription to at least one digital publication and was conducted in October 2023. The audience for this sample was weighted to reflect the pool of total subscribers to digital publications in the U.S., based on a larger market-sizing study of 6,562 consumers.
