Flash back to 2008 and The New York Times (NYT) was in difficulty. Advertising was in decline as print subscriptions were being cancelled as readers sought to source their news online. And there was no obvious digital news revenue model to balance all this out.
Today, that’s all changed - nearly a third of total US population turns to the NYT every day, with upwards of 10 million signed up as digital subscribers. It’s a remarkable transformation story and a bellwether example of what Zuora long ago coined as the Subscription Economy.
At this week’s Subscribed event in New York, Ken Houseman, Vice President of Product at the New York Times, a long-standing Zuora user, provided an update on the story so far - and what’s on the next page. He began with a mission statement:
Our strategy is to become the essential subscription for every curious English-speaking person seeking to understand and engage in the world.
So that’s the goal. What are the tactical elements of delivering on that? It starts with a core of high-quality journalism, said Houseman, content that’s worth paying for:
Our strategy is aimed at ensuring that our subscribers find the most value in their subscription and that we continue to show them that truth-based journalism is worth paying for. In service to that mission, our digital evolution has been focused on creating a product portfolio that elevates our journalism, drives deeper subscriber engagement around the passions of our readers, and shows increased value across our portfolio.
That mission opens up a large market size opportunity, he added:
We see 50 to 100 million plus weekly average users, but only 9.7 million of those are digital paid subscribers today. That is a huge upside opportunity for us. One third of those paid subscribers are all access bundle, or multi-product subscribers. Our strategy is to find the most engaging and authentic way to reach more of those subscribers in the funnel and convert them to be paid subscribers, at the right time with the right product.
According to Houseman, there are two main mechanisms for achieving this, beginning with a focus on engagement within each product:
We know how important healthy engagement is to a healthy business. In each of our subscription categories, we have command over the product levers that help drive that, and we believe there's a huge growth runway ahead of us.
But second, and more importantly, is engagement as a driver of growth and retention across the bundle. Our digital bundle allows the Times to provide more everyday value to subscribers and drive higher engagement, retention, and ARPU [Average Revenue Per User].
This focus on engagement is crucial, explained Houseman:
First, our data shows that if we can engage a subscriber and keep them inside our platform, they're far less likely to churn. It's that stickiness that we talk about. We want to provide our subscribers with the most meaningful tailored news and deepest passion exploration, because those daily habits create a connection. Those connections become essential, and essential, authentic connections drive success.
Second, we believe that retention and engagement go hand-in-hand. In the digital world, we're able to measure how our subscribers leverage different features and connect those features to tenure and retention. In the digital landscape, we're able to understand our subscribers due to the sheer volume of information. We're able to track how they engage with our products and build that relationship. Our data shows that the most engaging features are the features that are aligned to the strongest retention. The more engagement we drive within our products, connecting them across the ecosystem, the more value our subscribers find in our bundle and are willing to pay for it.
That’s important as the NYT has set itself the bold ambition of reaching 15 million subscribers by 2027. Houseman acknowledged the challenge:
We got [to 10 million] in the last decade with digital. We want to be at 15 million by 2027. That's not that far away.
Again, there’s a multi-part strategy to hit that target, circling back to the importance of content and the goal of being the best news destination in the world:
We need to extend our product canvas to better showcase our core journalism and the many different types of news coverage that we produce. Breaking news, for example, helps people get caught up quickly on what's happening right now. Interpretation helps people feel connected to the journalist voices and opinions that they relate to and admire. But across our report, we want to differentiate and tailor how you receive your news based on your interests and your passions. We want to meet the multiple different needs and perspectives you have when it comes to consuming our core product.
There’s an intent to become more valuable to more people by meeting everyday life needs, Houseman added:
We want to apply the same approach to each of our individual products so that they drive the same depth of engagement and value on their own, but become magnified when experienced together. Culture and lifestyle helps people enrich their lives so that they can escape in a way that's worth their time. Our games - everyone knows Wordle - help you improve and engage in smart fun, learn something new. Cooking helps you manage your work/life balance, but also explore new cultures, ingredients, stories. And unlike our competitors, we can deliver on so many different needs across our products because of our vast and stellar journalistic coverage.
Finally, there’s a need to ensure ease of use, he said:
To expand and connect our products, we need to make it easy and seamless to navigate across all of our products, adding essential qualities that make our products more personally engaging and rewarding together. So net net, we believe that getting more subscribers on the bundle will boost their engagement and retention.
So, that’s the plan. For today, there’s plenty of evidence that this thinking is working out in practice. In Q1, the NYT reported its highest ever number of bundle starts in a quarter, the highest percentage of bundled subscribers in total, and the highest number of bundle upgrades, increasing their lifetime value and revenue to the company.
More of the same and better is the next phase. Houseman concluded:
News will always be the core and center of our solar system. Our promise is to create a product experience unlike any other, to help our subscribers make the most of every day, and our mission is to seek the truth continuously, highlighting that quality journalism is worth paying for. Our strategy is to connect with each and every subscriber across the bundle on a daily basis.