As it becomes harder for publishers to grow digital ad revenue, they’re looking for money from high-end subscriptions costing not a few hundred dollars a year, but $5,000 or more for specialized news and information. Publishers from stalwarts like The Wall Street Journal to digital natives Business Insider, The Information and upstart Axios are betting they can wring as much as $10,000 out of subscribers.
“The thing is, if you’re going to sell subscriptions for $10,000, it has to be significantly different from what you’re doing today,” said Bobby Moran, vp of business development and strategy at Politico Pro, whose annual subscriptions for D.C. insiders start at $5,000 a year. “You have to recognize it’s not going to work out right away. And don’t hire within the industry.”
That last part may be a hard one for publishers to swallow, but those who have been at this a while say selling such services requires a special skill set that may be utterly foreign to people used to selling media. In addition to the high price, it’s a product that the consumer may be unfamiliar with and may not think they need. As a result, the selling process can take multiple meetings and conversations over as long as six months.
Over at Atlantic Media, National Journal adopted the selling approach honed by the Advisory Board, the consulting firm founded by Atlantic Media owner David Bradley. National Journal transitioned to a members-only operation in 2015 and charges $5,000 to $50,000 a year, depending on the size of the organization, for specialized research, tools and networking events for D.C. insiders.
Kevin Turpin, the president of National Journal, said the formula is to hire people who know the product well, almost akin to a researcher, know the market they’re selling to, and are relatable — which typically is a recent college grad without sales experience.
“It’s not a schmooze sell,” he said. In the ideal scenario, he said, “The prospect can look across the table and — and this is something David would say — see their kids in that person.”
Politico borrowed heavily from that model when it hired what it calls sellers for Politico Pro. Moran himself came from the Advisory Board. Back in 2010 when Politico Pro was launched, he said, people thought they could do the selling over the phone. Over time, they realized that not only were in-person meetings a more efficient way to talk to multiple prospects at once, but they led to a higher conversion rate and more money spent.
Now, account execs make sure they know as much as they can before a meeting about the people who will be in the room, what services they already use and how satisfied they are with them. Pro account execs also get put through training twice a year, where they get feedback directly from subscribers.
The payoff can be worth it, though. Politico Pro found that people were twice as likely to renew their subscriptions when they were contacted four rather than two times a year to check on their service and that if a customer subscribed for two years, the chances of them renewing were around 95 percent. So Pro’s account management team follows up on average four times a year. Last year, Moran said, it grew subscriptions 25 percent and revenue, 35 percent.
“It’s not a transactional sale,” Moran said. “Sometimes it’s a week; sometimes it’s several months.”
The tough part of this is also that selling this way isn’t cheap. Selling $12 magazine subs aren’t as lucrative, but they’re relatively cheap to sell because the process can be automated. Having human sellers cuts into profit margins. It costs money to make money.
Companies solve for this different ways. The Politico Pro model favors people with experience, but hires fewer of them. National Journal tends to hire people close to or at entry level, which lets it train people in it (and keeps costs lower). “We’re confident that this approach is working for us, as it allows us to groom and grow our staff according to these very specialized needs,” Turpin said.