‘We know this is just the beginning’: Facebook has new tools for publishers to get paying subscribers

Facebook also announced it was testing a new product called News Funding, which allows smaller publishers to convert Facebook users into paying subscribers directly inside Facebook. To date, publishers using Facebook’s subscription tool have converted Facebook users on their own mobile sites, thereby being able to control the customer relationship.

The News Funding tool announced Tuesday is essentially identical to the Fan Subscriptions product rolled out to creators late last year. There is a key difference: Facebook will not take a cut of the revenues that publishers generate using News Funding, compared to the 30% cut it takes of Fan Subscription revenue. However, Facebook would still own the customer relationship. Publishers focused on consumer revenue have cited customer ownership as a key problem in their relationship with platforms including Google and Amazon. Facebook would not disclose a full list of publishers using the tool, which is still in test phase with a small group of invited publishers, including the Mexican investigative news publisher Animal Politico. After an initial test, 10 additional publishers are testing it now.

Some publishers have found Facebook’s features to be useful for acquiring and retaining subscribers — for instance, using Facebook ads to drive newsletter signups or Facebook groups to cultivate subscribers. Publishers that participated in Facebook’s accelerator programs, which have focused on topics including membership and retention, have also given those programs high marks. The Denver Post, for example, grew its digital subscribers more than 170% using strategies devised at a Facebook accelerator.

But so far, Facebook’s home-grown subscription-driving tool, which allows publishers to convert Facebook users into subscribers using Instant Articles, has not made a big impact on publishers’ hunt for subscribers. Publishers that participated in the tests of Facebook’s tools gave the tools a so-so grade after a year of use, saying that neither Facebook’s nor Google’s tools were driving meaningful subscriber growth. Facebook declined to share top-line statistics about how many subscribers its tools had helped publishers acquire.

“To date the number of conversions is so low that it makes no difference to me,” said a source at one publication that’s used Facebook’s tool, who declined to share a specific number of subscribers to avoid being identified.

Facebook said it remains committed to expanding the tools it provides to media companies, and that the product announcements made Tuesday represent an early contribution. Moving forward, the platform said it hopes that its products will help publishers drive consumer revenue, even off its platform.

“What we believe is that we need to build a flexible portfolio of products,” said Sameera Salari, the product manager in charge of news subscription monetization at Facebook. “We know this is just the beginning.”

Over the past year, Facebook has worked with more than 40 publishers to optimize its subscription tools, which first rolled out 18 months ago in an alpha test. Publisher feedback led to several changes, such as a welcome screen that greets people who subscribe to a publication using Facebook’s tools. Adding the welcome screen helped participating publishers grow their Facebook followings, and increased the amount of publisher content their subscribers read on Facebook by 40%, Facebook said.

Facebook has partnered with paywall providers such as Piano, and by cutting implementation time down; Facebook now claims that the average implementation time for its subscription tools has gone from an average of more than 12 weeks to around four weeks.

Many of the improvements Facebook made have been tied to its tools, rather than baked into Facebook’s platform as a whole. For example, the welcome screen only works on users that subscribe through Facebook, rather than any digital subscriber who happens to open publisher content on Facebook.

Salari said that Facebook intends to begin testing a version of the welcome screen that activates whenever a subscriber logs in to access content. “We want to make sure we’re methodical,” Salari said, citing the sensitivity of user data as one of the reasons why Facebook has tread lightly.

Facebook’s experiments also make it unclear whether Facebook wants to own the customer relationship, a major sticking point for publishers hunting for direct connections to consumers. Though News Funding does not prevent the publishers using it from forming a direct relationship with Facebook users, it does take the credit card information in the initial transaction.

Even if the tools do not drive a ton of action right now, many publishers still see a lot of upside in tools that Facebook could develop.

“If Facebook can develop something like a propensity to subscribe model, that will likely change the game,” said Mark Campbell, CMO at Tribune Publishing. “We could identify users who have a greater propensity to subscribe and vary the meter accordingly, and even create custom audiences of likely subscribers that I’d pay to reach.”

Ultimately, the biggest factor in the uptake of Facebook’s subscription tools may be how far along most publishers are in their hunt for subscribers.

“It’s not that we aren’t interested. There’s just so many other development priorities and we have so much else to work on,” said Dan Petty, the digital director of audience development at MediaNews Group, which owns newspapers including the Denver Post.