The Financial Times sells its subscription-building skills to publishers and other businesses. These efforts have grown into a multimillion dollar business in the first year.
The separate division, called FT Strategies, is independent of the Financial Times. Still, it has decades of expertise in building reader revenue that relies on experts working out the publisher’s propensity models that predict consumer behavior.
The consulting firm has grown from three to 13 employees, many from companies such as Goldman Sachs, Boston Consulting Group and Accenture. Former media and data specialists also belong to this talent base.
In its first year, FT Strategies worked with 90 clients, 85 of whom are European news publishers, including The Independent, El Mundo and Bonnier News. It has also worked with organizations like the Google News Initiative and the International News Media Association.
Thanks to companies demanding recurring audience revenue, FT Strategies has doubled its revenue target and quadrupled its profit target, even though it wouldn’t share any specific numbers.
“We can go from theory to reality quickly, we don’t just leave our customers a 100-page document,” said Tara Lajumoke, general manager at FT Strategies and former partner at McKinsey & Company. “Instead, we work with them to test and learn, set up experiments, build experiences and methods, and improve skills.” This can be a three-month period or a two-week intensive program that focuses on a specific issue, e.g. B. improving conversions with female readers, an issue the FT has been addressing since 2017.
For several years now, publishers have been getting into the consulting business, mainly through content creation. Improving the marketing grocery chain requires approaching an advertiser’s overall communication strategy rather than starting a single branded content campaign. Only a few have gone to the length of the FT and set up an advisory unit based on ride subscriptions.
Much has been shared about the FT’s North Star strategy, where the entire company aligns with one metric that drives business growth. In most news publishers’ cases, this is a proxy for engagement. For the FT this is a combination of the topicality and frequency of the visits as well as the extent of the articles read. When a reader’s metric falls below a certain level, their tendency to churn increases, so the publisher uses various levers – such as promotions or products – to save them.
For The Independent – current CEO Zach Leonard was former FT CEO until 2004 – this metric combines the number of days the reader has been active over the past 30 years, premium content consumption, and volume. By identifying the correlation between this metric and subscribing, we identified the threshold that creates a tendency to subscribe or churn.
According to Publishers Audience Measurement Company, the readership of news across digital platforms in the UK has increased 20% year over year. As with most publishers, the FT has seen a subscription slump caused by pandemics. In the first six months of 2020, digital subscriptions increased 12% compared to the same period last year. Readership engagement, measured by metrics such as timeliness, frequency and volume, rose by 27% over the same period.
While Covid-19 cohorts have spiked in most subs companies, those who can tailor their products to suit each person can keep them when the busy news cycle wears off. The FT would not say what its churn rate is.
“The pandemic has focused news brands on the need to offset the inevitable decline in print sales with an increase in digital audiences,” said Sarah Johnson, general manager, publishing for Havas Media Group. “The outbreak reached a trapped audience, but before it even started, signs were pointing in the right direction for subscription growth. I would expect this trend to continue through 2021. “It does, however, point to a 35% decrease in FT print run and a 25% decrease in print subscriptions, which, according to the Audit Bureau of Circulations, is offset by a 75% increase in digital spending, albeit from a low base.