There are many buzzwords flying around in the digital subscriptions industry. “Conversions” is a particularly common one. But do conversions automatically equal more revenue?

No, not really, according to Alexander Kreybig, director of strategic services at Piano. 

Speaking during the workshop sessions of the INMA Media Subscriptions Summit in Stockholm on Wednesday, Kreybig said the outcome of conversions has had a disproportionately big seat at the table compared with revenue.

Until now.

Kreybig shared insights from 500+ publishers worldwide, including the following:

“There has been a big obsession on focusing on conversions and the number of active subscribers and less emphasis on revenue,” he said. “That is changing now — or at least it seems to change more and more. Publishers are now, when A-testing something, they are more and more taking revenue as importantly as the lifetime value equation, revenue generated over time.”

Kreybig also stressed the importance for news publishers to focus more on annual subscriptions as opposed to, for example, monthly subscriptions:

“The retention rate amongst annual subscriptions is much higher,” he said. “A healthy subscriber core consists of long time subscribers. From the perspective of how long they are being subscribers, it doesn’t matter if they are paying a monthly fee or an annual fee. They are long-time subscribers, loyal ones. But it is easier to get them if you manage to convince them on an annual subscription, instead of a monthly subscription.”

We talked with him after his presentation to clarify a few points:

INMA: Has it been a mistake from the publishers not to put even more focus on annual and long term subscriptions?

Kreybig: No, it has not been a mistake that the publishers were focusing on shorter-term and cheaper subscriptions and so on. This is just a development in the industry, going hand-in-hand with the revenue and lifetime value of things.

INMA: Is there any leading trend going on currently in the industry as far as digital subscriptions are concerned?

Kreybig: No. We know what the biggest thing is with digital subscriptions: Content is still king. You had to generate good content, quality content. If you don’t generate good content or content that appeals to your audience, then you can have whatever attractive offer you want … people will not buy it. Content is the king. That is the underlying thing.

One area where the is room for improvement currently, according to Kreybig, is seasonal pricing. Here, companies are still far too rigid. Kreybig said he sees no reason for prices not to fluctuate more, comparing this to the price of petrol fluctuating constantly without scaring customers away.

“What I am seeing is cheap pricing campaigns, saying Christmas, Black Friday, and Cyber Monday, and these type of campaigns. But I see less reflections as far as pricing is concerned for a particular season. Like in the summer, in July and August when everything calms down, results tend to come down as well unless you are a travel magazine. 

INMA: Should media companies be more active in this regard, then?

Kreybig: Yes, I think they should. It might bring better results, over the quieter periods.

The INMA Media Subscriptions Summit is March 6-10. Details can be found here. 

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