Pivot to paid driving pivot to CRM for media companies and start-ups

Fork in the road Gypsy lane to the left, Brobury Lane to the right. by Jonathan Billinger, Wikimedia Commons, Some Rights Reserved

I had to do some digging into the stories that my network was sharing today to find this gem about Pico, one of a number of media services providers that are pivoting to provide customer relationship management (CRM) services. It may be at the bottom of the list of headlines in my newsletter today, but it tops my list in terms of personal interest.

The profile of Pico by Nieman Lab got my attention because it is connected to the conversion funnel work that I’m doing in my day job. Beginning in 2017 as I was doing more and more consulting work with media companies in Europe and Asia, I realised how important conversion funnels were as more companies shifted to paid strategies. If I had studied marketing rather than journalism, conversion funnels would be old hat, but they were something that I stumbled upon as my work with audience engagement shifted to audience development and flowed naturally to conversion to paying customers.

Back to Pico. The company started out as a micro-payments provider called PennyPass. Micro-payments (think iTunes for news – garf!) didn’t really convert many readers to subscribers, but founders Jason Bade and Nick Chen realised that that they had collected a lot of leads during the pilot.

What publishers really needed was a funnel to some sort of reader revenue, and we had been too prescriptive about that type of reader revenue.

Pico wants to inject CRM smarts into news sites hungry for reader relationships, by Christine Schmidt, Nieman Lab

Now, they are building propensity to subscribe models as well as handling a lot of other “customer-relations stuff”. They connect Mailchimp or another email service and a payment service like Stripe and link the data flowing through the site and these other platforms.

But Pico isn’t the only company making this pivot. GroundSource, which started as an SMS-based engagement platform; Steady, which grew out of KrautReporter in Berlin; and the News Revenue Hub are all shifting to this space.

Pico just landed a $4.5m funding round that includes money from Stripe and Bloomberg Beta so they have some runway to find the right model.

I would say for the public service broadcaster that I work for, we’re looking for something that integrates more effectively with other software services that we’re currently using to allow us to segment more effectively, especially when it comes to knowing who is a member and who isn’t when it comes to the users of our digital services. We believe that would be transformative for our business.

Fascinating stuff, and if you see a story that you think I should share with my readers, let me know @kevglobal on Twitter.

A deep dive into Schibsted’s plan for $115m in reader revenue by 2020

Departure hall at Bergen Railway Station, Norway. Neon sign with logo of newspaper Bergens Tidende.
Departure hall at Bergen Railway Station, Norway. Neon sign with logo of newspaper Bergens Tidende, by Wolfmann, Wikimedia Commons, Some Rights Reserved

The top story in the newsletter today is a look at Scandi media giant Schibsted’s march to 1 bn NOK ($115m) of reader revenue by next year.

You need to read this piece because it challenges conventional wisdom and explains some of the thinking behind Schibsted’s nuanced and data-informed strategy. Their strategy has changed over time and is flexible enough to make allowances for the audiences and positioning of their different properties.

In terms of how their reader revenue strategy has evolved, it started simply by trying to grow their paying audiences when it launched in 2017, and then as they built the customer base, they pivoted to customer retention. And now, they are focused on “pricing, packaging, user experience and additional products, all the while keeping a steady hand on churn”.

What is really impressive is how adaptable and flexible their thinking is. They eschew the one-size-fits-all model that can be the reflexive response by some large groups. In that model, they run the same playbook everywhere. One gets the impression that this is to control costs because they don’t have the resources for multiple strategies tailored for different products.

For Schibsted, they have different models for their high volume tabloids – VG and Aftonbladet. Those properties remain mostly ad-supported. The reader revenue component is mainly to do with premium content. But for a local title, Bergens Tidende, up to 70% of the content is behind the paywall.

But they are also adding information into their model about stories that converted users to subscribers in the past. Very smart and well worth your time.