TThe COVID-19 pandemic served as a catalyst for massive subscription growth, in part because consumers sought quality journalism to get accurate information about the virus. It also accelerated content consumption trends that were already happening. Let’s explore the main highlights across digital engagement, retention and conversion during a year of increased appetite for news content. We’ll also unpack how publishers can use this data to prepare for future shifts in consumer demand. 

Paid trials convert to full price more often than free trials

According to our Subscription Performance Benchmark Report, approximately 17% of new monthly subscribers in January 2020 signed up using a free trial as the pandemic spread around the world. By December 2020, only 5% of new subscribers signed up on a free trial. This indicates that publishers became more confident with their pricing and smarter about promotional strategies as the pandemic raged on. 

Free trials can attract a lot of new users upfront. However, they make less financial sense when there’s high demand for content. At the same time, there’s much lower lifetime value gained from users who subscribe on a free trial offer. On average, you’ll lose over a third of free trial subscribers to churn before those users are required to make their first payment. It generally makes more fiscal sense to use paid trials in acquisition campaigns since you earn a little money upfront and retain a higher volume of users over the long term compared to free trials.

Onboarding post-pandemic subscribers is crucial for retention 

As many new users subscribed to online publications for the latest news about the pandemic, the strategic focus for media publishers had to shift from acquisition to customer engagement and retention. Convincing people to subscribe is only half the battle; encouraging them to continue subscribing is the other half.

If new subscribers don’t engage with your website early and often, they’re far more likely to cancel the subscription at the first given opportunity. There’s also the risk that they could become “sleepers,” which are subscribers who haven’t visited your site in the past 30 days. According to our benchmark research, an average of 40% of subscribers on media sites are sleepers.

To minimise the number of sleeping subscribers on your site, you need to act fast. Over half of your annual subscribers and nearly two-thirds of monthly subscribers will cancel in the first year if they become inactive. Your mission as a publisher is to incentivise those subscribers so they remain engaged. That’s why onboarding programs are so helpful to minimise churn and boost customer lifetime value. Use programs like guided tutorials and onsite benefits promotion to showcase all of the capabilities a new subscriber can access using their account. These programs not only drive user engagement, but they’ll also create habitual patterns that keep subscribers engaged on your site.

The COVID-19 retention bump endured thanks to annual subscriptions

Given the volume of new subscriptions early in the pandemic, many publishers expected lower retention rates and higher churn as the year went on. However, those fears never materialised. We found that users who became subscribers between March and July of 2020 retained at much higher rates than those who became subscribers prior to the declaration of the pandemic.

In an effort to maintain higher retention rates during the second wave of the pandemic, many media publishers made a concerted effort to increase annual subscription rates across their websites. Annual subscriptions retain much better than their monthly counterparts, and they subsequently carry much higher lifetime value for brands and publishers.

Throughout Q4 2020, many publishers used special promotions and smart pricing strategies to increase demand for annual subscriptions. Publishers used special events like Black Friday and Cyber Monday to create short-term offers for annual subscriptions that, in many cases, more than tripled conversion volume.

Lessons learned

The COVID-19 pandemic continues to be a prominent and dynamic world event. Publishers should use this time to assess how user behaviour impacted their subscription models in 2020 to make more strategic business decisions for 2021 and 2022. It is critical to:

• Determine when and how people were most likely to subscribe
• Analyse conversion rates, churn rates, special offers and trials to understand more about audience behaviours
• Optimise websites with targeted messaging and personalised content that incentivises greater onsite engagement
• Maximise revenue opportunities with paid templates designed to boost conversions

By understanding these patterns, your business can make strategic decisions that will boost retention rates and, by extension, lifetime value. This will help you improve growth and develop a sustainable subscription business beyond this last year of high consumer demand.

This article was originally published on DCN.

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Piano works with hundreds of organisations that collectively manage thousands of websites and billions of visitors. This vast network provides an unparalleled benchmark dataset through which we can understand digital engagement, conversion and retention trends. For the first time ever, we’ve packaged up this data into our inaugural, bi-annual Subscription Performance Benchmark Report so you can see the numbers that matter most to your subscription business.

In this first edition, we dive into our learnings from a year in which we saw a surge in subscriptions, due in part to COVID-19 and in part to a shift in consumer acceptance to support and pay for good journalism. Some highlights:

• The newscycle around COVID-19 effectively onboarded new subscribers, sparking increased retention rates since March 2020.
• Hard paywalls have 10x higher conversion rates than soft paywalls, which have double the conversion rate of bottom ribbons.
• 15.2% of visitors to longer-tenure sites saw a paid offer in Q4 — almost 3X that of more recently launched sites.

With ongoing shifts in consumer demand over this last year, we hope these insights will help publishers remain nimble in their approach to data-driven customer experiences. See all the insights from our benchmark data by visiting the full report.

Get the report

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We’ve designed our new Best Practices Highlights to help break down the main components of a subscriptions strategy. They’re underpinned by industry-leading expertise and data-driven benchmark data from across hundreds of publishers. Read our Highlights for more on:

• Journey orchestration
• Onsite content recommendations 
• Testing 
• Registration 
• Ad blocking 
• Retention 
• Paid targeting 
• Pricing 
• Paid conversions 

Explore more

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• Type of pricing offer likely to increase your revenue 
• Renewal rate of annual vs. monthly subscriptions after one year
• Conversion rate achieved with hard stops vs. bottom ribbons

Read it here

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Want more information around preparing for the cookieless future? Check out our Cookieless Survival Kit.

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Last January, Google announced the end of third-party cookies by 2022, and then updated that timeline to 2023. The industry went into a frenzy.

All the while, Google forged ahead quietly on its own. Occasionally, it would pop up to say, yes, we really are going to stop supporting third-party cookies and no, the pandemic hasn’t changed our plan.

It wasn’t until last this past January that Google fully reappeared announcing its plan to start publicly testing Privacy Sandbox. This included some associated privacy controls, and early performance results for FLoC, or “Federated Learning of Cohorts,” which allows ad targeting at large groups of users based on common interests. And just a few weeks ago, they affirmed that they would not adopt new tracking tech after phasing out third-cookies. Their claim: It’s no longer necessary to “track individual consumers across the web to get the performance benefits of digital advertising.”

The end of ad tech?

Another frenzy ensued. First reactions predicted the end of non-platform ad tech. And many companies saw their stocks drop. But then, by the second day after the announcement, some observers started pointing out that Google hadn’t actually done much besides make it clear (yet again) that support for third-party cookies will end. They also stated that they aren’t going to adopt a solution like Unified ID 2.0, which The Trade Desk, Prebid.org, and IAB are lining up behind.

That wasn’t the only announcement of note in the past few weeks. IAB Tech Lab released draft guidelines for advertising identifiers like Unified ID 2.0, LiveRamp, ID5, etc. The Trade Desk announced the start of beta testing for Unified ID 2.0, with advertisers being able to transact on impressions using the tech. And just a week after Google’s identity announcement, the company published another blog post with initial details of a plan to extend publishers’ first-party “Publisher Provided Identifiers” (PPIDs) from private marketplace deals to open auction.

Pointing out that the ad landscape is confusing and in flux for publishers is a bit of an understatement. And that’s without mentioning Apple’s moves on tracking consent and IDFA. Let’s try to clarify things a bit.

Prepare to have options

Between Google, Apple, and the “open web” ad tech players, there seem to be at least three different approaches publishers will need to test and adapt to:

1. Google’s FLoC, which might (or might not) become an industry standard;
2. Apple’s strict app tracking rules and Safari ITP limits; and
3. Unified ID 2.0 or whatever other standard emerges from the IAB TechLab working group, assuming that either regulators or the browsers don’t block those cookie replacement solutions.

Publishers and advertisers alike have fought an increasingly brutal battle against the walled gardens. Chatter has abounded that the cookieless future could tip things in their favour. Google’s latest announcement actually runs counter to that theory. Their publicly confirmed focus on Privacy Sandbox means, in the words of former Magnite CTO Tom Kershaw, that Google will “actually use the same tools as the rest of the industry.” The end result could be a peaceful coexistence of the Chrome solution, user logins and publisher first-party segments. And that would mean choice for publishers, advertisers, and consumers alike.

Focus on first-party data and identity

While there’s an element of self-interest, it does seem clear that Google is developing solutions to make it possible for publishers to activate first-party data. These include non-PII user IDs in the Google ad ecosystem. Of course Google relies heavily on first-party data and known user identities in YouTube, Search, Gmail, and its other properties. So, limiting publishers’ ability would be hypocritical. It would also be risky at a moment when the company is under antitrust investigations in more than one country. However, from a publisher perspective, this is further reinforcement of the need to focus on first-party data and identity.

Start your transition now

In some ways, we’ve been our own worst enemies in the run-up to third-party cookie deprecation. Many publishers and advertisers have awaited Google’s next move as if we were pawns in a drawn-out chess game instead of coming up with a plan and starting to execute on it. Let’s not so quickly forget that where third-party data offered efficiency, it often lacked effectiveness, due to uncertainty of where it comes from and, therefore, its accuracy.

Six steps for transitioning away from third-party cookies

There are six areas you need to cover as you begin your shift away from third-party data:

1. A minimum amount of zero-party data
   It’s not just about first-party data. Zero-party data — the data that users volunteer to you via other explicit data-capture tactics like registration forms — will be just as important. You need a certain amount of data to generate effective lookalike segments. To do that, it’s necessary to start targeting some segment of your audience and guiding them to register and provide their data with incentives such as the ability to access locked content.
2. Tools for storing and managing consent
   Whether it’s a data-management platform, a customer-data platform, or a consent-management platform, figure out now where you will store all of this data and consent.
3. Audience segmentation tools
   You need audience segmentation tools to create subsets of your users. This can be based on like characteristics extracted from zero- and first-party data. You can also leverage lookalike modeling to produce larger audience pools.
4. Collect data at the right moment
   Collecting more data over time requires thinking through the right moment in the customer journey to ask for it. At each stage, aim to understand how to move users deeper into the funnel with the right offers that will net you more data to round out your customer profile.
5. Vet identity partners
   You need one of these to replace cookie-matching and activate all that zero- and first-party data you will collect. Be sure that you vet their offerings to see which identifier could work best for your business.
6. Start testing solutions now
   As Travis Clinger, SVP, Addressability and Ecosystem at LiveRamp, said in our recent Piano Academy event: you don’t want to get caught trying to apply new technologies and strategies in the middle of the Q4 holiday season. It’s worth testing different solutions, including identifiers and different data- or consent-management platforms, now.

We’ll be sure to hear more from Google publicly throughout this year and next. It will remain important to read successive announcements with a critical eye. We’ll need to remain focused on the steps required to prepare for third-party cookie deprecation now (as opposed to needless panicking). And remember you have a whole industry navigating this transition with you as we move towards a new era of privacy-first personalisation.

The post Retiring Third-Party Cookies: Stop Panicking and Start Planning appeared first on Piano.

• See how prepared you are compared to other publishers with our Cookieless Future Survey
• Ensure you remain up-to-date on the key cookieless terms with our glossary
• Learn what you can start doing now to prepare your business with our checklist 

Read Now

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Last week, Google announced its plan to start testing Privacy Sandbox, including some associated privacy controls, and FLoC, or “Federated Learning of Cohorts,” as a potential replacement for third-party cookies this spring. It’s as much as we’ve heard the tech giant publicly state since it announced the deprecation of third-party cookies a year ago. But, unsurprisingly, waiting around to hear what Google might do next has gotten neither the advertiser nor the publisher side very far. A survey of 450 marketers, advertisers, publishers and technology providers released by Aroscop and Brand Equity last December found that only 8% had deployed alternate solutions to prepare for a world without third-party cookies.

Earlier this year, I spoke on the topic of post-cookie identity to publisher members of Digital Connect Next as part of their DCN Next: Summit. I advised them to take control of their own strategies for how they will personalise experiences whenever the cookie crumbles. And there’s a big difference between saying you plan to use first-party data — which 67% of publishers say they’ll do in the next few months — as part of your strategy and, well, actually using it. Below are some of the tips I shared that can help you start to harness your own data as we move into a new era of personalisation.

1. Take inventory of your zero- and first-party data: There are two types of data that will become more valuable than ever as third-party cookies fade away: first-party data, the data you collect about a consumer via behavioural tracking as they browse your website, and zero-party data, the data a customer intentionally shares with you via registration forms, surveys, preference selections and other explicit data-capture tactics. The most basic question to ask first is how much zero- and first-party data you have at your disposal today. There are both technical and qualitative questions to answer. How are you currently collecting and storing that data? Can you easily create segments? Can you activate it for both onsite targeting and within the advertising ecosystem? What of that data is working for you now?

2. Collect more of the right data with the right customer journey: Now that you’ve identified your gaps in data, how are you going to fill them? To collect more zero-party data, you should consider your strengths and weaknesses in content and site experience and how these things intersect with your most important users. Users need a reason, a value exchange, for parting with their precious information. Some smart examples we’ve seen include asking users to enter:

• Postal codes for local news and weather
• Birthdate to get a birthday greeting or coupon
• Preferred content topics, collected to improve personalisation or receive email newsletters
• Surveys or mini-polls about interests, future purchases or opinions

Consider the moments in the logical flow of a user’s journey where it makes sense to ask for data. Try not to ask for all of it at once — you can ask a user for two pieces of information when they first register for your site, and then give them another prompt that unlocks something else. No one wants to fill out a 12-question form to access a piece of content.

3. Use your data to refine targeting and find like users: Once you’ve determined your strategy for orchestrating the customer journey across users, you need to find technology that can help you collect zero- and first-party data, segment it and activate it to offer segments to advertisers, or target users for your own marketing initiatives. Lookalike modeling can help take a limited amount of data and expand it into a wider audience by looking at common traits and behaviours held by your current users and finding other users that share them for more precise segmentation.

Whether companies flock to Google’s FLoC, or become partial to the various identity-based cookie replacements, publishers can’t afford to wait for the industry to make up its mind. A first-party relationship is critical for a world without the third-party cookie, and that starts with collecting zero- and first-party data from active, brand-loyal audiences that you cultivate. This strategy will not only prepare your business for the deprecation of a legacy technology, but also future-proof it against other industry changes to come.

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