Digiday+ Research: Fewer publishers seek revenue from selling products — even in this economy
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Selling products has never been publishers’ bread and butter, but it has at least historically been a piece of their revenue puzzle. It turns out, though, that puzzle piece has been getting significantly smaller over time.
This is according to a Digiday+ Research survey of 112 publisher professionals that found the number of publishers getting revenue from selling products has dropped off over the last two years. And, unlike with affiliate commerce, selling products doesn’t look like it will be a significant area for growth.
Overall, Digiday’s survey found that 46% of publishers get at least a very small portion of their revenue from selling products. But that number has been consistently falling over the last year. Six months ago, 54% of publishers said they got at least some of their revenue from selling products, and a year ago, 60% said this.
Of publishers who do get revenue from selling products, the largest percentage has consistently been those who say they get a very small portion of their revenue from this part of their business — about a quarter of respondents have fallen into this category over the last year. Meanwhile, as of the first quarter of this year, only 8% of publishers said they get a large or very large portion of their revenue from selling products.
And even under very uncertain economic circumstances, publishers don’t appear to have a plan to change this in the coming months. In fact, Digiday’s survey found that far fewer publishers said they plan to put any focus on this part of their business than just six months ago.
Just as with publishers who make money from selling products, the percentage of publishers who plan to put at least a very small focus on this part of their business has been falling for the last year, with a big drop-off occurring in the last six months. As of Q1 of this year, 46% of publisher pros told Digiday they will put at least some focus on selling products in the next six months. In Q3 of last year, that percentage was a full two-thirds (66%), and a year ago it was 70%.
The percentage of publishers who put a very small focus on selling products has remained consistent over the last two years at about 20%, but the percentage of those who put a small focus on selling products fell from 19% in Q3 2022 to just 7% in Q1 2023.
Digiday’s survey found that the majority of large publishers (or those who made more than $50 million in revenue last year) do make at least a very small portion of their revenue from selling products. Specifically, 59% of publisher pros who work for large publishers said they get at least some revenue from selling products.
Of large publishers who make money from selling products, the largest percentage (27%) make a very small portion of their revenue from this part of their business, followed by those who make a small portion of their revenue from selling products, which came in at 12%. Meanwhile, a combined 12% of publishers make a large or very large portion of their revenue from selling products.
Interestingly, an even bigger percentage of large publishers say they will put at least a very small focus on building their products business in the next six months. A full two-thirds (66%) of publisher pros who work for large publishers told Digiday they would put at least some focus on building this part of their business.
Twenty-nine percent of publisher pros said building their products business will be a very small focus for them. But a somewhat significant 15% said it will be a very large focus, indicating that, especially in the current economic climate, big publishers — which generally have more resources available to them than their small counterparts — see the potential in selling products to grow their revenue by any means necessary.
Small publishers, on the other hand, are not as flexible when it comes to adding and building different parts of their business, especially outside of their core function of content creation. Digiday’s survey found that fewer than a third (31%) of small publishers (or those who made less than $10 million in revenue last year) currently get any revenue at all from selling products.
Of the small publishers who do make money from selling products, those who make a very small portion of their revenue from this part of their business accounted for the largest percentage (11%).
And, it turns out, this isn’t likely to change anytime soon.
The same percentage of small publishers (31%) said that they plan to put any focus at all on building their products businesses, Digiday’s survey found. And in this category as well, of the small publishers who will put any focus on selling products in the next six months, the largest percentage (14%) was among the publisher pros who said it would be a very small focus.
In other words, selling products is a very small focus among small publishers, and it’s going to remain a small focus for the foreseeable future.
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