Critical Role of Chief Subscriptions Officers in Advertising

As the importance of subscription revenue continues to grow, some media companies are taking steps to ensure their internal structures better reflect their evolving business model. The moves are designed to drive efficiencies in both their advertising and subscriptions efforts, but such realignments can be fraught with personnel challenges. To navigate that transition, in the last year publishers including Gannett, The Washington Post, Dow Jones and streaming platform DAZN have all hired chief subscriptions officers––or similar positions with different titles––a role whose creation signals that reader revenue is now a defining focus for publishers, rather than a bolt-on. The popular refrain is that a heightened focus on subscriptions bolsters advertising efforts by proxy: A CSO fixated on providing a clean user experience will reduce ad clutter, which ultimately benefits ad performance, leading to CPM hikes. The valuable first-party data captured from new subscribers can also inform high-net-worth audience segments for marketers to reach. But that's not to say it's easy. The newly created position has a sensitive relationship with newsrooms’ advertising departments, which, rather than operate in a vacuum, are now treated as one leg in the larger consumer journey. While CSOs technically occupy equal footing on the corporate ladder as other c-suite executives, their chief priority is also now the overarching business objective for companies that have committed to being subscription-first. Mayur Gupta Explains His Role as Gannett’s First Chief Marketing and Strategy Officer The growing popularity of the position is more than symbolic, said Keith McAllister, a partner at the executive search firm SRI. In some newsrooms, like The New York Times and The Economist, reader payments outstrip advertising as the primary source of revenue, prompting publishers to see themselves more as direct-to-consumer businesses, rather than primarily advertising-based ones. “Publishers are transforming or, in some cases, just catching up to their own business model,” McAllister said. “They are saying, ‘We are declaring, by words, organizational design and investment, that we are a subscription business.’” Serving two masters At DAZN, chief subscription officer Ben King, who was promoted to the position in August 2020, combined the company’s previously siloed business-to-business and business-to-consumer marketing teams into one 170-person unit, folding brand, advertising, performance marketing, distribution partnerships, retention and lifecycle marketing and analytics into a combined function. The team treats customer acquisition cost and return on advertising spend as its two key performance indicators, with an eye toward extending subscriber lifetime to maximize profitability. By orienting the entire company around those two KPIs, King aligns the incentives of the advertising and subscriptions departments. “We try to look at the subscription funnel end to end,” King said. “That way we can look at the customer relationship from the day they become a prospect, right through the end.” At Gannett, chief marketing and strategy officer Mayur Gupta has been tasked with transitioning the company from an ad-focused model to a subscription-oriented one. To do so, Gupta hired Renn Turiano as its svp of new subscription products and revenue in August. Neither hires led to internal restructures. But the new leadership made it clear that Gannett's north star is now reader revenue, not advertising. To prevent this shift from stirring internal power struggles, Gupta and CEO Mike Reed made sure all 16,000 employees were “looking in the same direction.” “We have made choices that consciously lean on driving subscription growth, so there is going to be some impact to our advertising dollars,” Gupta said. “But the way our strategy is laid out, as our content evolves it will increase the stickiness of both our free and paid readership. It’s not an ‘either-or’; it’s an ‘and.’” Different skills, different needs While the DAZN and Gannett models seem simple on paper, organizational change is tough and its success depends on a number of factors, such as company maturity, subscription type and existing legacy models. Efforts to draw the advertising department into the world of consumer revenue at newspaper businesses face challenges, said partner at Prohaska Consulting Scott Bender. The two practices require different skill sets, such as fluency in digital advertising versus granular customer analytics, and they employ different sales cycles—often quarter-by-quarter versus annual or lifetime customer value—and objectives, making their integration difficult. Plus, advertising has long been the predominant revenue driver for publishers, so relegating the ad sales department to an equal or supporting role must be handled sensitively. “You need somebody to champion the change,” said Debbie McCarthy, the director of advisory services at Prosci Consulting, “so having a chief subscription officer becomes crucial.” Advertising departments must understand why their roles are being recontextualized. Research from the firm suggests that projects hoping to spur internal change have a 73% success rate when led by effective sponsors, versus a 29% success rate when that leadership flags. All roads lead to subscription growth Of course, the majority of publishers, even subscription-oriented ones, have not hired a CSO. At The New York Times, the frontrunner in the subscriptions race, two senior executives are devoted to generating reader revenue, but the paper has yet to appoint an overarching figure to oversee those efforts exclusively. However, even if they lack the CSO title, a rising cohort of CROs and other financial decision-makers have come to their positions from subscriptions-focused or data-centric industries, such as tech, finance or marketing. Peter Doucette, who started as CRO at The Philadelphia Inquirer in February, joined the publisher after several years at The Google News Initiative. Before GNI, he led digital subscription growth at The Boston Globe, where he helped it accrue more than 200,000 paying subscribers. While no CSO, Doucette embodies a new breed of revenue operator, one who comes from a subscriptions background that has shaped his approach to revenue and data collection. “The concept of the chief customer officer has been popular at software companies for a while, and this is a clear extension of that concept into the media business,” Doucette said. “If you're trying to become a customer-centric organization––and most publishers are––then the momentum behind this role has been brewing for a long time.”

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Chief Subscriptions Officers Have a Critical Role to Play in Advertising Efforts

The position, tasked with internal change, requires a diplomatic touch

Mark Stenberg

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Mark Stenberg