Optimising a focussed portfolio of revenue streams is a critical part of resilient journalism business models. For community-driven news organisations, reader revenue is an increasingly popular business strategy. More newsrooms across Europe are shifting their focus to direct- compared to in-direct models. However, sometimes the exploration of what reader revenue can look like for a given organisation doesn’t go much beyond choosing one of the traditional tried-and-tested approaches (membership, subscription or crowdfunding). So we set about developing a new methodology to better understand and explore ways to convert audience relationships into revenues.
What we describe here is a step by step of how I developed a Reader Revenue Toolkit.
The Engaged Journalism Accelerator identified that reader revenues was an impact area for grantees and reached out to run a workshop in Budapest, November 2019. We wanted to:
establish the key processes and stages that media organisations need to go through to assess the viability of reader revenues for their organisation
gain a better communal sense of practical challenges and opportunities around reader revenues
Step 1: Desk-based research led us around an extensive set of reports and analysis on reader revenue strategies. The logic of reader revenues hinges on listening and engaging communities more, and how to translate that relationship into an economic one. The Lenfest Institute has set out key trends in subscription and membership models. There are a range of data driven insights and metrics that media can use to help guide their performance. The Membership Puzzle has put together an extensive range of tools to help get started with membership models. Community enagement can go further and translate into cooperative models and investments. Reader revenues is set against a wider trend to explore many different revenue streams for non-profits and commercial media, as well as for hyperlocals in UK and Europe.
From this the known unknowns were:
1. Wishy washy evidence that there’s a link between engagement and revenues. It might help media get more grants and a bit more adjaceny income. Maybe a few more subscribers.
2. We don’t know how much reader revenues contribute as percentage of total income
3. We don’t know how to translate relationships to revenues as a strategic process
Step 2: I started playing with some early ideas. What was the difference between media who were Exploring reader revenues, compared to those who were Expanding their offering or Exploiting and diving deeper? What are the relationships we are talking about? What are the reader revenue options?
Step 3: Trying to move beyond the 4Ps of innovation or the 4Ps of marketing, I have always appreciated Tapscott’s ABCDE of marketing. I played around with all different types of categories that came into play when thinking about audience relationships for money. Distribution and connections, engagement funnels, audience funnels, conversions, decision making with money, content differentials, marketing and resourcing, the back-end technology…
From there I developed an ACTIVE framework for reader relationships. A = audience C = content T= trust I= ideals V = value E = engagament. I had a left-over ‘nuts & bolts’ section which related to all the back end resourcing, technology and structures needed… I honed the idea and came up with sub categories for each
AUDIENCE Funnels Segmentation Nuts & Bolts
CONTENT Differentials Performance Nuts & Bolts
TRUST Giveback and Transparency and Nuts & Bolts
IDEALS Empathy and Insights and Nuts & Bolts
VALUE Differential Motivations Nuts & Bolts
ENGAGEMENT Touchpoints Digital & Social Nuts & Bolts
Step 4: Now I had to consider ‘if a media had some sort of sense of what they were achieving in terms of relationships, how would they choose which revenues to experiment with?’ It seemed there was a matrix: passive relationships and transactional revenues on one side (here I was thinking micropayments, one off donations, print or digital subscriptions) and on the other investments and engagement (membership models and cooperative or crowdfunded investments). I had two clear phases: the relationship diagnostic followed by the revenue design.
Step 5: I needed to create a journey through this experience. So I turned to my UX specialists at the Media Innovation Studio. We knew from the innovation canvas style games that we could combine a canvas and cards, or even an innovation style game. We thought about scoring relationships on a scale of 0–5. But then there was no way of moving relationship diagnostic onto the revenue design? So we drew from hexagonal heat mapping. If each sub category from the diagnostic was totalled and then transferred on to a heat map in the design you would be able to see a hexagon, mapped against an ideal to see how you were doing. This is a qualitative and holistic approach — but it would work as a guide and prompt, which was our main aim. For the workshop we have added an important element that we will work in pairs so one media will help capture tips and advice for the other.
The toolkit offers a springboard to explore the different stages of readiness that organisations need to be at as a relation with their community, content and business development to make the different reader revenues work. It is iterative and non-linear while still providing a logical framework.
Relationship Diagnostic · Explore and evaluate your reader relationships · Deepen your understanding and stress test assumptions · Search for unmet needs and new opportunities · Clarify risks and spot critical blockers · Identify gaps in your capacity
Revenue Design · Orientate reader revenues against relationship depth · Identify how to convert relationships into revenues · Suggest revenue strategies to explore, expand and exploit