Newsday has emerged as one of America’s leading publishers when it comes to a local news online paywall strategy. As revealed by Press Gazette last month, the Long Island local newsgroup now has over 50,000 paid digital subscriptions.
Notably, Newsday has achieved this feat while being headquartered in the same state as the world’s digital news subscription trailblazer, The New York Times.
“I believe they’re complementary,” Patrick Tornabene, Newsday’s chief officer of consumer revenue and strategy. “We are local exclusive news – the vast majority of it is Long Island, meaning Nassau and Suffolk counties, whereas the New York Times is global.
“There is a high overlap in people who get both [Newsday and the New York Times], particularly when we look at our digital subscriptions and we survey them to understand what other content they’re reading.
“So I think in some ways, they help each other. If the New York Times is growing in our market, we’re growing and vice versa. It’s causing people to recognise the value in journalism.”
Tornabene says Newsday only launched its paywall in earnest in 2019. Today Newsday says its “digital penetration rates” – the proportion of the site’s visitors that turn into paying subscribers – are higher than 90% of publishers worldwide, citing benchmarks from the International News Media Association.
Like many other publishers, Newsday says its impressive subscriber and traffic growth tailed off after a bumper 2020 and 2021.
But its digital subscriptions revenue has strengthened over this period as introductory offers have given way to full-price payments. Newsday’s digital subs revenue grew 90% between 2020 and 2021.
“We had some thousands of digital subscriptions, maybe doing half a million dollars a year,” says Tornabene. “Now, three years later, we’re doing eight figures in digital subscription revenue.”
‘From a conversion funnel to a conversion cyclone’
How has Newsday managed to grow so quickly?
“It’s this paradigm shift of going from a conversion funnel to a conversion cyclone,” explains Tornabene. “Instead of viewing conversion at the bottom of the funnel and that the user builds engagement before they convert, the strategy is to build engagement after they convert.”
In other words, Newsday does not aim to sign up subscribers only after they’ve read a certain number of articles. Instead, subscribers can be “nudged” to sign up at much earlier stages with a tempting offer, perhaps on the basis of an enticing headline. It then aims to make the subscriber see the value of Newsday content which the publisher says is core to its growth.
Like other publishers, Newsday has built its subscriber base through a deeply discounted long introductory offer of $1 for five months. While other sales strategies, such as one day sales, have helped, it’s the five-month deep discount, in place since 2020, which has been the key.
“Making a no-brainer offer accelerates that growth tremendously, not only in subscriber count, but in revenue, as well. That’s been one of the biggest levers that’s helped us grow.”
Adopting sophisticated data analytics earlier than many of its peers (the company’s comprehensive data strategy, says Tornabene, dates from its print days) has also helped Newsday understand conversion and retention better.
The publisher counts a highly-skilled data science team of five which helps Newsday understand its churn, reader engagement and the impact of new products on retention. Two recent leavers were hired by Facebook’s parent Meta.
Building a data-informed, not data-driven, newsroom
Although Newsday came relatively late to digital subscriptions, sophisticated analytics and a knowledge of “what plays worked and did not work” has helped Newsday hit the ground running, according to Tornabene.
Prior to selling digital subscriptions in earnest since 2019, digital subs to Newsday had been bundled in as part of the cable subscription package to Newsday’s previous owner, Long Island cable provider, Cablevision. Shortly after Cablevision was bought by telecoms giant Altice in 2016, Newsday was resold to former Cablevision owner Patrick Dolan.
While deep discounting runs the risk that large numbers of subscribers don’t translate to commensurate revenue, Newsday has found that enticing sign-ups with a bargain introductory price has not led to higher drop-off rates when the offer period ends.
Almost three times (2.7) as many subscribers sign up based on the $1 for five-month offer, when compared to a traditional one-month offer. The retention curve (the rate at which subscribers tail off) however, looks similar for both one-month and five-month introduction periods, says Tornabene. Beyond the five months there is, he says, a “very good willingness” to pay.
While the publisher is confident it has the right sales strategy, content is key. Newsday is staffed by over 200 journalists.
“It moves the challenge back to the newsroom. Okay, now you got this 90th percentile and penetration. Where are you going from here? You have to dramatically look at the inventory of what you’re producing,” he says.
Newsday’s Covid-19 content was a major driver of its subscriptions growth. But despite the fact that the pandemic is no longer top of the news agenda, health remains one of Newsday’s strongest verticals, scoring well for both conversion and retention.
Readers that convert on stories related to restaurants also tend to stick around – much more than those that convert on stories on topics such as crime.
“Generally more sophisticated content converts and retains better,” says Tornabene, explaining that stories with longer headlines or that use more complex vocabulary and sentences tend to encourage readers to stick with their subscriptions. Tornabene points out, however, that the newsroom is data-informed rather than data-driven.
Despite Newsday’s digital success, the publisher has no plans to abandon print in the immediate future. In the six months to March 2022, the paper’s average circulation was 97,182 – the tenth highest in the country. The paper’s household penetration rate is also among the country’s highest, believes Tornabene – 18% of households on Long Island pay for print content, he says.
“Our print outlook is for as long as possible. We see it in the longest vision we have which is five and seven years out,” he says.
Looking ahead, Newsday plans to focus on maintaining the quality of its content offering. The publisher is also exploring the retention opportunities of its longstanding suite of newsletters, something Tornabene says the company only started exploring some six months ago.
“[Newsletters] are ripe for opportunity for retention, not just acquisition,” he says. A large percentage of Newsday’s paying subscribers either consume the publisher’s content only in newsletters or via referrals to the site from its newsletters.
The brand is also launching a streaming service later this month, Newsday TV Plus, which will be available to print and digital subscribers. The service will host all of the publisher’s video content including documentaries, sports and restaurants.
More personalisation meanwhile is also on “its roadmap” for the next year. “I’m optimistic about our future and particularly about the future of publishers at large under digital subscription as the core revenue,” says Tornabene. “Perhaps more so for independents like ours. I think that structure enables more investment in the organisation.”
Image credit: Newsday
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