Publishers pursuing international subscribers face market-specific hurdles
Publishers focused on growing consumer revenue will take opportunities wherever they can find them, even abroad. But international markets come with specific challenges, including a low propensity to subscribe, complicated tax issues and lower awareness of U.S. publishing brands.
Thirty-eight percent of American publisher respondents said international expansion would be important to their business in 2018, according to a Digiday Research survey. Markets outside the U.S. hold promise for publishers looking for subscribers, too. But the hill is steeper for publishers that don’t have strong brand awareness overseas.
“There is an opportunity for a couple U.S. publishers, but not for all of them,” said Lisa Jaeger, a partner in the media practice at the strategic consultancy Simon-Kucher & Partners.
Some address this problem by forging partnerships with local media companies, a move typically made to bolster ad sales. Bloomberg Media, for example, has partnerships with media companies from Mexico to Saudi Arabia, which provide access to local advertising dollars, local reach and marketing muscle.
“International success for media companies generally comes from a mix of quality content, strong brand equity, symbiotic and collaborative partnerships in market, and hard detail-oriented work,” said M. Scott Havens, Bloomberg Media’s global head of digital. “When you take a brand that’s not global, that may not translate as well as others that have international scale and recognition.”
People aren’t exactly wild about paying for news in the U.S. But in Europe and elsewhere, the concept is more foreign. While 16 percent pay for news in the U.S., just 13 percent of Australians, 8 percent of Canadians and 6 percent of Britons paid for news in some form, according to the Reuters Institute.
The price consumers are willing to pay for content differs from market to market. Publishers including The New York Times and The Wall Street Journal are offering introductory rates as low as 99 cents per month to grow their international subscriber bases. Such a low price can help get volume, but makes it hard to get people to pay full price.
“I’m concerned about the price image they’re building here,” said Jaeger of the American publishers charging low introductory rates. “In research we’ve done, what we’ve found is that those customers who subscribe to a new offer at a very low price are in many cases just subscribing because of the price.”
The value-added tax, or VAT, is a cost that the supplier of any digital content or service to the European Union must collect on all transactions, then pay back to the EU, at a rate that differs by market. While the EU sets a baseline rate of 17 percent, member states are free to raise it at their discretion, or even lower it in certain exceptions; in some cases, the VAT is as high as 25 percent.
Each EU member state has its own way of accounting for the VAT payment as well, which adds a layer of complexity to publishers’ accounting and fulfillment systems.
Online payment with credit cards may be common in the U.S., but overseas, it can be a different story. “In some countries in both Europe and Asia, personal credit card use is not as common as other payment forms, and those payment forms vary widely across countries,” said Miki King, vp of marketing at The Washington Post. “Additionally, in some areas, there is a general lack of awareness of news subscription services.”
The Post, which has quadrupled the size of its international subscriber base over the past year, said it is testing PayPal-esque systems in parts of Southeast Asia and experimenting with various payment methods and subscription promotion messaging.
GroupM’s Kieley Taylor and Amanda Grant are on the lookout for the future of identity in advertising
Between's the cookie's demise and Apple's anti-tracking moves, digital advertising's identity picture is still coming into focus.
Digiday’s updated breakdown of 12 publishers’ diversity statistics
A roundup of publishers' diversity reports reveals that nearly all of the companies included have majority white staff, leadership and new hires.
Member ExclusiveGlobal Publishing Summit Recap: prepare for a world without cookies
If you were listening in to our Global Publishing Summit on February 24-26, you’re probably still processing the wealth of insights, tips and strategies shared by all the speakers we heard from over the course of the summit. If you weren’t able to attend, fear not: we’re here to distill the key talking points from […]
SponsoredHow publishers are maximizing retention after the COVID-19 subscription surge
Michael D. Silberman, senior vice president of strategy, Piano For many publishers, 2020 was a good year for subscriptions, and the trend has continued into 2021. For example, over the last month, The New York Times grew active news subscriptions by 48%, and Insider has doubled its subscriber base to just over 100,000 in the […]
Member ExclusiveMedia Buying Briefing: Black-owned media companies step to the forefront of the upfront
Mediabrands is bringing together a raft of its biggest clients — about 20 Black-owned and Black-targeted media players — for an Equity upfront.
‘They’re solving a problem’: The Washington Post readies its Zeus platform for the buy side
Zeus currently offers more than 4 billion impressions per month across its participants' owned-and-operated sites.