How to build a good reader revenue model: lessons from Spain and the UK

Nespaper stand

British newspapers in London on the day after the election of Donald Trump. REUTERS/Toby Melville

20th February 2020

Flower shops are a risky business proposition. Many get a big portion of their revenue on two single occasions: Mother’s Day and Valentine’s Day. The product they sell is not perceived as essential. They need to be as close as they can to their best customers and this requires paying expensive rents to be in high-end neighbourhoods. Then there’s the inventory problem: flowers start to die the moment you cut them. Within three weeks, they’re rotting in your fridge. 

The founders of American start-up H. Bloom solved these problems by creating a subscription business. They targeted hotels, restaurants and other businesses and offered them weekly flower delivery, installation and maintenance for a recurring fee. Four years after its launch, H. Bloom had nearly 1,000 clients and more than $7 million in sales. 

Flower shops are not that different from news organisations. Both have to deal with similar problems: perishable inventory, seasonality, a product that is not perceived as essential, a lumpy demand. Subscriptions can provide a solution to some of those problems. Setting them up, however, requires a particular mindset and expertise. As a Journalist Fellow at the Reuters Institute, I looked at how different newspapers are dealing with the different aspects of this transformation right now. 

Subscriptions: why now

There are at least three reasons for the rise of the subscription economy. 

The first one is the rise of broadband Internet around the world, which makes it easier to build digital services for a sizable market. 

The second is the rise of the access generation, millennials and post-millennials who value access over assets and see any physical possessions as unnecessary baggage. As Tien Tzuo puts it in Subscribed, these younger customers want “the ride, not the car. The milk, not the cow. The new Kanye music, not the new Kanye record.” They like convenience and personalisation, and expect companies to provide them with a reliable service. These are the customers behind the rise of Zipcar, Netflix and Spotify.

The third factor is the ability to analyze customer behaviour in real-time. “Today businesses are closer to their customers than ever before,” says John Warrillow in The Automatic Customer. “All those customer interactions are being fed into mathematical models, which are run by computers that are now capable of storing and processing billions of data points in seconds.” These interactions can create a virtuous cycle. Subscription companies can watch how their customers use their service and tweak it accordingly. There’s no need for surveys or focus groups.

A few newspapers adopted digital subscriptions in the first years of this century. Most of these efforts failed. There are many reasons why subscriptions didn’t work at the time. Payment systems were clunky. Digital advertising was still attractive for general newspapers. People weren’t used to paying for services online. Smartphones and tablets didn’t exist yet.

Things started to change after the Great Recession. The FT introduced a flexible pay model in 2007. The Times and The Sunday Times adopted a hard paywall in 2010. The New York Times launched a metered model in March 2011. In the last few years, many newspapers have followed this path in different flavours. Freemium and metered models have flourished in European countries as diverse as Finland, Germany, Italy, Poland and France. 

The paper I publish today explores what news companies with reader revenue models are doing through structured interviews with 26 media executives from 15 news organisations. Some of these outlets run digital subscriptions. Others have reader revenue models with a less transactional value proposition. Most of them are based in Spain and the United Kingdom. Some are based in other European countries such as Denmark, Sweden, Italy and France. 


The paper doesn’t analyze either the virtues of different pay models or the price of the offerings of every particular newspaper. Its main goal is to explain the strategies news outlets are applying to deal with the profound changes required by a subscription business in the hope that some could be used by other news organisations elsewhere.  

Why Spain and the UK

Most of the news organisations featured in this paper are based in Spain and the United Kingdom. These media markets have a few things in common. Both have similar percentages of people willing to pay for news according to the Digital News Report: 10% in Spain, 9% in the UK. Newspapers operating in both countries share the blessing (also the curse) to publish its content in a global language. Unlike the Nordic countries, they don’t have the competitive advantage of a language almost no one speaks outside their market. The Internet provides them with an open field where they compete with outlets based on the other side of the Atlantic. They can pursue traffic overseas. 

Paying for news


Spain and Britain have very different media landscapes. Tabloids and digital-only news organisations are mostly free in the United Kingdom and operate under the shadow of the BBC. Most national broadsheets and magazines, however, have been running pay models for a few years. The Financial Times, The Times and The Sunday Times operate with hard paywalls. The Telegraph runs a freemium model. The Guardian combines memberships and contributions with several subscription options. News start-up Tortoise is exploring a promising model through newsletters, sponsorships and events.

Spain is on the other side of the spectrum. Digital-born newspaper had more than 35,000 paying members in January 2020 and several regional newspapers are running digital subscriptions. But not a single national legacy news organisation was running a substantial pay model in July 2019. This is changing. El Mundo launched a freemium subscription model in October 2019. El País is launching a metered paywall in the first quarter of 2020. Other outlets are expected to follow suit in the next few months. 

As this transformation unfolds, it’s worth looking at strategies news organisations are using on five aspects of the subscription process: things to do before launch, value proposition, pricing, acquisition and churn. Here are twelve themes that came out of my interviews.  

1. Pay models require a different kind of organisation. 

Successful subscription companies break silos and create cross-functional teams. Marketing, technology and editorial work closely and obsess about customers’ needs. The FT, for example, bridges the gap between marketing and editorial with a weekly meeting. “We want to know what they’re about to do so we can turn that into both existing customer engagement opportunities and acquisition opportunities rather than waiting for the news to hit,” says Marie Goddard, head of customer marketing. 

The best media executives make sure everyone knows the metrics that matter. Facebook likes, page views, and unique users are now valued mostly as means towards an end —acquisition and retention of paying subscribers. Frequency, recency and time spent mean readers are getting value from your site. The goal of every news outlet should be to get more people to enjoy its content more often during more time. Loyalty is the first step towards a subscription. Occasional readers never subscribe. 

2. Every newspaper must learn to tell its own story. 

There will always be outlets offering free access to their news content. Any company with a pay model must explain why readers should support its work. This appeal should be crafted carefully. It must take into account the mission of the organisation as well as its ownership, its history and its constraints. 

After launching its membership model, people at The Guardian noticed many readers saw the newspaper had 150 million readers and assumed they were making a lot of money. So they realised they had to explain how advertising revenue was dropping and why they needed their readers’ support. “As journalists, we have always been telling the stories of other people. Now we also have to tell our own,” says Amanda Michel.

Journalists should explain how they do what they do. Media executives should be as transparent as possible in their financial reports. Newspapers could benefit from presenting themselves within a broader social narrative. A conversation with their readers could help frame a narrative that is clear and attractive. Anything a news brand does should be aligned with its editorial mission. Paying readers are less forgiving than occasional users. Clickbait can destroy trust.

3. Subscription companies must obsess about their core audience. 

Most of the reader revenue of every newspaper with a pay model comes from a small percentage of their readers. These are the ones most attached to the brand and most likely to subscribe. Media executives should look at the behaviour of these readers. Their goal should be to learn what their news habits are, how they structure their news diet, what they’re looking for when they come. News organisations should learn as much as possible about this group and should think of strategies to grow it. Their future depends on this.     

4. The best newspapers focus on their digital products. 

Most of the legacy outlets covered by this paper still get most of their revenue from print. Their top priority, however, is improving their digital properties. This is not an easy task. Loyal readers are not uniform. Their consumption patterns could be all over the map. Quality often means different things to different people. Every channel requires a different language and different skills. 

The best companies invest their resources on the platforms that are popular among their core users and adapt their processes and priorities to their needs. This could mean producing audio versions of your best stories, as Danish digital magazine Zetland has done very successfully, or creating niche editorial products for audiences that are underserved. A great example is The Times’s Crime Club newsletter. It gives reviews, free ebooks and event tickets to crime fiction fans. It’s the most successful newsletter at The Times with a 70% open rate.

5. Good user experience is essential to succeed. 

News organisations are realising that content is just one of the aspects of their value proposition. User experience is almost as important, especially on a mobile phone. A great editorial product can fail as a result of poor user experience. On the other hand, great user experience could be a great selling point for a news organisation. 

The Guardian lets everyone read every article on its website, but makes readers pay to read some of those articles or a daily edition in its premium apps. The most successful news organisations think thoroughly about loading time, packaging and presentation. Younger audiences are used to the high standards set by digital platforms. They don’t accept pop-up windows or invasive ads. 

6. Readers appreciate a product they can finish. 

In a world dominated by endless news feeds, finite editions are having a comeback as a way to foster loyalty among subscribers and recreate the news habits of the past. Older readers still love to read the electronic versions of print editions. Younger audiences gravitate towards daily podcasts, niche newsletters or news digests bundled into cheaper subscriptions. 

Readers love the sense of achievement that comes from finishing a daily edition. News organisations are betting on the renewed appeal of editions as a way to recreate the news habits of the past. This trend is behind daily podcasts such as The Economist’s The Intelligence and The Guardian’s Today in Focus. It’s also what’s fuelling the rise of newsletters as a way to engage with the audience without depending on algorithms. 

Journalists should remember their job is not so much publishing everything as editing what is important. Their work shouldn’t be guided by outdated processes but by the routines of their current audience. 

7. Print shouldn’t be the focus but it could help. 

A print product could be overwhelming or pointless for a portion of your digital audience. But print can still be an asset today. Newspapers face a strategic dilemma: most of their growth comes from digital, but most of their revenue still comes from print. 

The most successful companies adapt their content to the language of every channel where its loyal readers spend their time and print is a channel too. The Guardian uses price hikes to transform anonymous buyers into print subscribers and repackages some of its articles into a new glossy weekly magazine. The Economist creates most of its daily picks from articles already published in the print edition of the magazine. 

8. The best subscription companies experiment with pricing. 

Newspapers have produced a single product and sold it for a single price for the last couple of centuries. Digital subscriptions require a different mindset, much more open to experimenting with bundles and price points. Discounts and free trials may be in your toolbox. But you should make it very clear to your readers they enter into a paid relationship. Otherwise, you will attract people who won’t stay for long. Hard data, not gut feelings should guide your decisions. 

Any changes on pricing should be made after reviewing the behaviour of the people most likely to subscribe. Newspapers are partnering with other news organisations. Swedish newspaper Dagens Nyheter offers bundles with The New York Times and with a few local newspapers. Spanish newspaper offers bundles with a couple of magazines too.

9. Open vs closed is not the right framework. 

The difference between membership and subscription models is more blurred than ever before. Some news organisations with a membership model run very hard paywalls while newspapers with subscriptions allow sampling opportunities through free trials, social and search. 

Open news organisations are more closed than you think, and vice versa. The Guardian runs a successful subscription business. The FT ran an open WhatsApp channel and still publishes audio and video content for free. The most successful news outlets are not attached to their models. They tweak them according to the behaviour of their audience and experiment with bundles and revenue streams. The shape of your paywall must be just one of the elements of your value proposition. Newsletters, podcasts, audiobooks, trips, discounts and events must be added to the mix. 

10. Journalism is a great acquisition strategy. 

Every news organisation covered by this report experiment with search and social channels. But everyone says that nothing beats journalism as an acquisition tool. Memberships and subscriptions are not impulse sales. People start paying after engaging with a news organisation regularly for a long time. Creating news habits is the best way to get subscribers and reduce churn.
Journalists working at the newsroom of

Readers often convert after reading long-form pieces and investigations that force politicians to resign. Quality and consistency are important for every subscription company but also for newspapers with a less transactional value proposition. News sites should perfect the way they ask for the support of their audience. They should test different messages and try to answer with them any questions they could have. 

11. Friction is your enemy. 

Subscribing or donating to a news outlet should be as easy as possible. Newspapers should take a page from technology start-ups and adopt frictionless payment systems. Anyone should be able to subscribe in a few seconds. Anyone should be able to cancel its subscription without making a phone call. 

Creating a seamless payment system is especially difficult for global news organisations, whose managers have to deal with different platforms and different regulations. You won’t reduce your churn rate unless you get your customers into reliable payment systems. Many cancellations are the result of credit cards’ expiration dates. 

12. Churn is much more important than acquisition. 

Getting thousands of subscribers who leave a few months after they join is not a sustainable path for any news organisation. This is why acquisition and churn strategies should be run by the same team. Dirty acquisition channels bring in the wrong kind of customers and produce high churn rates. 

Good subscription companies design great onboarding experiences and encourage their readers to make the most of their subscription in the first few days. They also segment their users by demographics and by the time they joined. Creating habits matters much more than showing any particular piece of content. Retention often correlates with frequency and time spent.

Marie Goddard, head of customer marketing at the FT, says that embedding habits in new subscribers is much more useful than showing them articles. “It’s not about showing them content because content is short-lived,” she says. “It’s about showing them how to sign up to a newsletter, how to choose the right newsletters or how to download our mobile app. If you use the app, you are very likely to be engaged with the FT. So we flipped from content discovery to thinking about the nudges we need to get them to access our content in their way.”