Bloomberg Media is on track to double its digital subscribers by the end of the year, with revenue from subscribers reaching double-digit percentage of total digital revenue in 2020, according to the publisher.

Bloomberg, which launched its paywall in May 2018, wouldn’t share exact subscription figures, but said that subscribers currently number in the “tens of thousands.” By the end of 2018, it had signed up three times as many subscribers than expected, and plans to double that by the end of 2019. The progress to date has been the result of frequent paywall iterations including tweaking the number of free-access articles, to pricing strategy, color and placement of offers.

Bloomberg has a dynamic paywall based on 22 criteria, including factors like how long readers spend on site, traffic referral source and return visits, which determine when a reader is most likely to convert to a subscriber. A sweet spot for how many articles it takes before a new visitor converts is three a month, said Scott Havens, global head of digital and media distribution at Bloomberg Media. Although the publisher did launch with a fixed 10-article meter, it shortly started testing different paywall heights based on reader data. Over the years, publishers have tended to tighten paywalls to keep growing: In 2012, the average meter limit was 13 articles a month. Now, as a way to keep driving growth, the average is five, according to a Shorenstein Center and Lenfest Institute study.

According to Havens, subscriptions revenue has started to become meaningful. In the coming years, subscriptions will be a nine-figure revenue business. Annual digital access for a Bloomberg Media subscription is in the region of $450 outside of the first-year introductory offer.

“Revenue is becoming significant enough where we’re starting to think about revenue balance and how do you optimize between digital advertising and subscriptions,” said Havens.

The paywall launched with a dedicated team of 20 people managing acquisitions, retention and customer service. For these skills, it hired from companies with commerce and customer-service businesses, like Blue Apron and American Express. This led to customer marketing efforts like running its own version of an Amazon Prime Day offer in July — while people are in the value-grabbing mindset — which drove a 43% month-over-month growth in subscriptions.

Content that converts includes digital projects such as the Businessweek periodic table of the elements, the latest in the China and U.S. trade war and longer-form pieces like the $9 billion verdict against the Nigerian government. But also, global economic volatility.

“For us [market] volatility is a good thing,” said Havens, adding that August has been its most successful month for new subscribers. In the same way that news publishers felt the subscription Trump bump, financial markets coverage converts a lot of subscribers, and fear of recession also drives high traffic numbers, he added.

Roughly two-thirds of Bloomberg’s subscribers convert from site visits, which are roughly 50 million monthly unique users, according to Havens. (SimilarWeb stats show Bloomberg had over 63 million monthly visits in August.) Another 25% convert from Bloomberg’s app, while around 8% come from Apple News, where all but two articles a day are free. The rest of the subscriber conversions come from search and social marketing and email newsletters.

According to media analyst Thomas Baekdal, on average, publishers convert roughly 2% of their site traffic to subscribers.  Bloomberg can do more to convert a higher percentage of its site audience.

“Bloomberg has a very focused market, and fast growth to begin with,” he said, “but there’s a question about how soon it will reach a mild saturation of that audience who may not need it in the same way.”

Unlike other media companies, Bloomberg has its highly profitable terminal business, so it lacked the urgency and necessity to put up a paywall that other business-focused publishers faced. Its competitors, The Financial Times and Wall Street Journal, have had digital paywalls for decades.

“Bloomberg had believed that paywalls wouldn’t work,” added Baekdal. “By beating its expectations threefold, it tells us about its mindset and that was behind where it should have been.”

As the publisher’s paywall has developed, the importance of plugging the holes to manage customer churn, and save money in acquiring new ones, has become more important.

For instance, propensity modeling showed that those who hadn’t visited the site in the last 10 days were twice as likely to churn, so the product and marketing team sent out emails with readers’ first names and relevant content. First-name personalization increased email open rates by 186%, said that publisher. Tactics like offering more-attractive annual offers rather than monthly have helped save 10% of people close to churning. Although the publisher wouldn’t share its churn rates.

While a more flexible paywall has meant that advertising revenue didn’t take a huge hit as the publisher closed off content to certain users, Havens admitted there were initial concerns from the advertising sales team.

“Publishers need to live in a world of balance,” he said. “If you have scale in pageviews and unique monthly users, you can have two nine-figure-revenue sources. My goal is not to maximize either revenue source but to optimize digital overall. It’s about reassurance.”

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