The Financial Times is branching out into consulting, banking on a lucrative business in sharing its knowledge of how to build a large direct-to-consumer business.
FT Strategies can give other businesses advice on how they can grow their data and direct-to-consumer arms. Current clients ranging from other publishers, such as Nordic media company Bonnier Group and London’s V&A Museum. The FT is also in talks with other businesses outside the publishing industry. Everyone’s a media company now, after all.
“Understanding customers in a DTC way, rather than when you’re looking at an audience in aggregate, or even in segments, is very different,” said Tom Betts, Financial Times chief data officer, told the Digiday Publishing Summit Europe in Budapest, Hungary.
As the FT’s subscription strategy moved away from a metered model to making paid trials the main focus around four-and-a-half years ago, a deeper look at reader engagement became the guiding principle across the business.
The FT’s newer, customer-centric metrics look at three different dimensions of usage: When the user last read a story (recency); how often the user is visiting (frequency); and how many paid articles they read (consumption.) Those three components are put together to calculate a score to identify when the reader is likely to buy or cancel a subscription, Betts said.
“Our company-wide focus is the number of people that have crossed that tipping point to becoming engaged,” Betts said. “For us, that’s the thing that makes the biggest commercial difference to our business.”
The FT is trying to focus on the very early stages of retention. Much like starting a gym membership, it’s about trying to get readers into a regular routine within the first 30 days of signing up.
“The first [month] is always the hardest,” said Betts. “Once you get people over into month two or month three it definitely gets easier.”
First-month retention tactics have included pushing readers to download the app or sign up to newsletters. The FT’s contact-center has been trained to walk new subscribers through aspects of the product they may not have discovered yet.
“These things actually cost money to do but actually make a big difference to retention because people are getting value from our product and therefore want to stick around,” Betts said.
Now the FT is looking to take its subscription learnings and apply them to other businesses through FT Strategies, a new consultancy division comprising of both internal and external practitioners.
The FT’s own DTC strategy was also a two-way street of inside and outside expertise. Betts, for example, had experience in telcos before switching to publishing and he says it took “a very long time” before he hired someone from within the media world to his team.
“I was staggered when I came into the news-publishing world and was like: How come you don’t understand how to describe value? How do you not have a lifetime-value model? This is the bare bones of the way you run a telco and that was really how we set about building some of the techniques and tools we needed to change the model for monetizing content,” he said.