Paywall model breakdown: The current landscape and new frontier

As publishers continue investing in reader-driven revenue streams, the question of which paywall model — or models — to pursue or experiment with has been a hot topic among many of our partners.  

If you’re reading this and considering a paywall-driven strategy, it helps to understand the primary paywall models and how each might be right for you. It’s also important to learn what leading companies are doing to experiment with these models as they pursue success.

Hard paywall models: Lock the gates

Simply put, a hard paywall gates all your online content, and requires users to subscribe in order to view any given piece of content in full. While The Economist (shown below) adopted the model within the past decade, publishers like The Wall Street Journal and Financial Times have successfully used hard paywalls since the 1990s.

paywall model breakdown chartbeat

That said, hard paywalls are now rare to find, as conventional wisdom holds that they’re  most rewarding and durable for publications that are occupying a particular niche, and dominating their markets within that area of focus. (Can you guess what The Economist, The Wall Street Journal, and Financial Times have in common?) 

If factors such as these don’t apply to your own publication, success with a hard paywall may be an uphill climb, as the majority of prospective subscribers tend to bounce offsite when encountering an inflexible gate — and you’ll have to plan to cushion against possible financial repercussions, e.g. decreased ad revenue. 

(For more on this topic, see: Why value-based pricing drives subscriber retention for publishers)

Metered paywall models: Room to grow

Metered paywalls allow readers to consume a limited sample of articles before a paywall is shown. Two well-known metered paywalls are the ones used by The New York Times and The Boston Globe (shown below), but metered paywalls are widely adopted overall — especially in the U.S., where 76 percent of newspapers publishing online had one in place last year, versus 46 percent of outlets in the EU.

There’s room to grow with a metered paywall: publishers who use them are growing savvier and more successful in their strategies over time, as this report from the Shorenstein Center details. The pros and cons of a metered paywall strategy are actually the same: in order to be successful with yours, you’ll have to commit to frequent experimentation and iteration, driven by careful data and reporting. 

(For further reading, see: Subscriber Analytics: Enhanced and Empowering Publishers in Real Time)

Freemium paywall models: A mixed bag

“Freemium” models offer readers a mix of free and premium content, in which editorial teams often curate the articles that will appear behind a paywall. (The term is a portmanteau, like telethon or cronut.) 

freemium paywall model example

If you’re generally looking at paywall models’ global popularity, freemium paywalls are neck-and-neck with metered ones, with particularly wide adoption among newspaper publishers in the EU (such as above) and newsweeklies and magazines everywhere. Like metered paywalls, they require organizations to be open to frequent iteration and experimentation, and deeply committed to understanding their target market.

Hybrid paywall models: The cutting edge

Experimentation and innovation are key to success with any paywall model you choose. That said, we’ve seen successful subscription-focused publishers who have honed their expertise with one approach are increasingly taking things up a notch by building models that integrate aspects of various paywall setups. 

This approach (as seen above) governs a diverse category known as “hybrid,” “dynamic,” or “intelligent” paywalls. These also might:

  • Function as “leaky” hard paywalls, which allow certain segments of users to access content, so that the publication can collect data about their reading habits to hone various consumer marketing, product, and editorial strategies. The Wall Street Journal is one publisher that has used this strategy. 
  • Adjust the type of offer that appears when content is gated. This could be a call-to-action to subscribe, sign up for a newsletter, or register with the site as a user.  
  • Combine aspects of metered and freemium models, with additional premium content or programming (experiential events, newsletters, etc) made exclusive to paying subscribers, or to users who register for free with the site. Kauppalehti, shown above, is one such publisher who employs this strategy. 
  • Integrate intelligent rules that dynamically adjust a paywall meter to auto-calibrate the number of stories a user can access before a paywall gate is shown. This strategy is used by publishers like The Washington Post.

It’s exciting to see these new approaches develop on the horizon of paywall publishing, not least because they require close collaboration and alignment from several teams in a publishing organization — Editorial, Product, Marketing, Data Science, and others.

As someone who leads a product team committed to building tools that foster cross-functional insights and results, I’m keeping a close eye on these experiments (and if you’re interested in sharing details about your own hybrid model with me, I’d love to chat). 

Paywall Models: Looking Ahead

We anticipate that all these categories will continue blurring more intensely, as publishers iterate and experiment with approaches that work for them. 

In the meantime, they still have to deeply understand the subscribers they have in order to retain them for the long term — and we’re here to help them along that journey. For more on subscriber behavior, check out our most recent data.

Emily Ingram (@emilyingram) is the Director of Product Management at Chartbeat, where she focuses on building tools that serve the needs of digital publishers. Previously, she was a senior product manager at HuffPost and The Washington Post, where she launched the Post’s national iOS app and digital partner program.

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