Are monthly subscribers worthless?

Monthly subscriptions may be largely worthless for many publishers, FT Strategies argued last week. The subscription consultancy published an analysis of one of its client’s data and suggested that offering short-term subscriptions at aggressive discounts is not an effective way to maximize revenue in many instances. Publishers optimizing for revenue instead of simple subscriber volume would be better off pushing audiences to longer terms instead, it said.

The analysis sparked conversation among publishers. Some observers said the churn data in the case study seemed extreme compared with other benchmarks published by organizations such as INMA and technology vendors such as Piano. “Churn indeed makes annual contracts more valuable than monthly contracts, but monthly contracts are far from worthless, at least for most news brands,” argued INMA’s researcher-in-residence, Grzegorz Piechota.

But regardless of whether or not the data in the FT’s study reflects the experiences of publishers more broadly, it highlights mounting questions about sampling strategies for publishers’ subscription products as the distribution landscape continues to shift around them. 

Many publishers have leaned heavily on cheap monthly terms in recent years to drive sampling of their subscription products and build engagement before pushing users on those terms toward more meaningful commitments. Their worth to publishers has primarily been as marketing and engagement tools rather than direct drivers of revenue. As far as some publishers are concerned, users on monthly terms shouldn’t be considered “subscribers” at all, and conversions should only be recognized when monthly users move to more intentional 3-month, 6-month, or annual tiers.

This approach – sometimes referred to as the cyclone strategy – has proved effective for many publishers, despite arguments it risks devaluing their products in audiences’ eyes. There’s a reason introductory offers and monthly terms have persisted despite the data suggesting they do relatively little to contribute revenue directly.

But as their subscription businesses mature – and as consumer expectations and the broader digital media landscape shift rapidly alongside – publishers are beginning to rethink their sampling approaches entirely. Publishers are increasingly leveraging third-party platforms more deliberately to drive sampling while locking access to content on their properties more tightly – and at higher price points.

Some are using podcasts and audio, others are disseminating paid content via news aggregation apps, and a growing number are looking to partnerships with generative AI and search companies such as OpenAI and Google. For premium publishers with strong brands, a new model is emerging where casual audiences are engaged (and monetized) on third-party platforms, while their owned and operated properties are firmly geared towards establishing direct paying relationships. 

“Our data suggests that deeply discounted monthlies aren’t really sampling products because we don’t see a great deal of upsell to longer-term subscriptions… In my opinion, we should allow for sampling off owned and operated properties (audio, newsletter, socials) but generally protect the majority of what is on our sites,” commented FT Strategies senior manager George Montagu on LinkedIn.

As major platforms send less traffic to publishers’ sites, it appears inevitable the nurturing of “organic” traffic will increasingly take place on third-party platforms. The efficacy of existing conversion strategies built around cheap short-term subscription plans could therefore begin to diminish, placing growing emphasis on publishers’ ability to consistently deliver high-quality, differentiated content that will set their brands apart in audiences’ minds.

Most publishers would disagree that monthly subscribers have proved “worthless” to their subscription efforts to date. But as they reevaluate their approaches and attempt to best position themselves for what’s next, it’s likely publishers will move away from monthly subscriptions in favor of longer terms in the years ahead.