LION data shows centering audience grows publisher revenue

Building news products that resonate with an audience and contribute to a healthy revenue mix requires audience engagement. But how critical is it, really? We looked at nearly 400 Sustainability Audit records from the past 10 months to see how various types of audience engagement relate to audience size and revenue growth.

The Bottom Line

Investing in getting to know your audience and using that data to set strategy is an investment in your news business’s sustainability.

1. The deeper the relationship, the higher the metrics: The more actions an organization takes to engage with and listen to its audience, the higher its revenue and larger its audience.
2. Skipping steps doesn’t cut it: A news business starts to see the strongest business health impacts after it has implemented two-thirds of the audience engagement processes we analyzed. A coherent strategy for deepening your understanding of your audience and using that information to make business decisions is crucial.

What audience engagement actions did we look at?

We analyzed 15 audience engagement indicators from the Sustainability Audit. Items on that list include processes like:  

1. Regularly conducts audience surveys
2. Reviews audience metrics at least monthly
3. Has a process for using audience metrics to inform revenue strategy
4. Tracks loyal users

What did we find?

News businesses that regularly engage with their audience tend to make more money, earn more traffic, and build their newsletter subscriber lists faster. The median number of actions taken by news businesses in our data was eight, and we see a noteworthy acceleration in benefit around the ten-action mark. 

We also looked at the amount of revenue from audience-driven revenue streams such as small gifts, large gifts, memberships, subscriptions, and events. This positive association remains, but the association is generally strongest at the 11-action mark.

Among narrower revenue outcomes, like unique donors, average donation amount, and recurring donor percentage, we don’t see donor activity take off until seven engagement actions. Growth in total paying members/subscribers and average revenue per member/subscriber similarly begins to accelerate around the seven-action mark. This isn’t necessarily a causative relationship, but it is likely important to have basic audience engagement practices in place to attract and retain donors, members, and subscribers.

Among the individual actions, reviewing audience metrics at least monthly, regularly conducting audience surveys, having a process to use audience data to inform revenue strategy, and tracking loyal users show the most significant impact on annual revenue, monthly web users, and newsletter subscribers, with organizations taking those actions showing higher performance. News businesses that: 

• Review metrics at least monthly have median monthly web users six times higher and median revenue 40% higher than those who don’t
• Regularly conduct audience surveys have median monthly web users and median newsletter subscribers two times higher
• Have a defined process for using audience data to inform their revenue strategy have median annual revenue nearly two times higher
• Track loyal users see two times higher median revenue, five times higher median monthly web users, and three times higher median newsletter subscribers

As news businesses develop, they should incorporate engagement into their workflows and culture rather than rushing to check off all engagement actions. Our analysis shows that earlier-stage organizations are best served by establishing systems for tracking and reviewing analytics data to grow their audience, conducting surveys to better understand their audience, and then leveraging audience data to build robust audience funnels that translate audience growth into revenue growth. Why?

• Median monthly web users are nearly three times higher, and median newsletter subscribers are 15% higher, for Preparation- and Building-stage businesses that review audience metrics at least monthly compared to their peers who don’t, though median revenue is 11% lower for regular metrics reviewers.
• Median monthly web users are 36% higher, and median newsletter subscribers are 70% higher, for Building- and Maintaining-stage businesses that conduct audience surveys, while revenue remains comparable between those who do and don’t survey their audience regularly.
• Median annual revenue is 25% higher for Maintaining- and Growing-stage businesses that have a defined process for using audience data in their revenue strategy.

If you’re a news business leader who is looking to build out robust audience engagement processes for your organization, the Sustainability Audit can help direct you to stage-aligned resources for deepening these workflows. You can read more about the Sustainability Audit here.