How Defector Media Turned Its Hit Podcast Into a 7% Bump in Subscribers

The sports and culture publisher Defector Media, an employee-owned company launched by former Deadspin staff, has accrued nearly 38,000 subscribers in its first two years of business—an accomplishment aided in part by the success of its breakout hit podcast, Normal Gossip. The publisher, which generated $3.8 million in revenue in its fiscal year ending in August, makes 95% of its revenue through subscriptions, according to Jasper Wang, its cofounder and vice president of revenue and operations. But while the paywalled Defector Media website—where monthly subscriptions start at $8—is responsible for converting the bulk of its readers into subscribers, an additional two-tier subscription product related to its free-to-access Normal Gossip podcast has generated 2,500 new subscribers—a 7% bump—since launching in May. The podcast, helmed by Defector Media writer and cofounder Kelsey McKinney and producer Alex Sujong Laughlin, explores one listener-submitted piece of gossip in each show. It now averages 250,000 streams per episode, and it released the finale of its third, eight-episode season Wednesday. “We have three podcasts in total, and we would love to make this a repeatable model,” Wang said. “But we also don’t have the hubris to think that we can just general Normal Gossips every year.” The decision to monetize Normal Gossip via a standalone subscription runs counter to prevailing trends amongst news publishers, which typically offer their podcast products for free with advertisements or as part of a larger bundled subscription. How the Financial Times Is Using Podcasts to Build Its US Audience But the method borrows its logic from the broader podcasting industry, which encourages hosts to monetize their audience through direct payments, as well as precedents set by other paywalled audio products from publishers, such as Cafe Insider from Vox Media. The success of Normal Gossip subscriptions suggests an alternate path for publishers looking to capitalize on the traction of a new audio product, one that trades on the willingness of podcast listeners to pay to support creators whose work resonates with them, said Mathew Passy, the founder of The Podcast Consultant agency. “Having some sort of a subscription-based option is always good for a podcast,” Passy said. “In the case of Defector, it also aligns with their employee-owned culture in that it shows the world that user-supported content can be successful and does not have to make compromises.” Normal Gossip expands the Defector Media aperture The Normal Gossip subscription product offers two tiers with different price points and benefits. For the $5 per month Friend of a Friend tier, subscribers receive a bonus monthly episode (even in between the eight-episode seasons) and access to a limited number of Defector Media articles, which normally lie behind a paywall. For the $12 per month Friend, subscribers get the bonus episode, a chance to serve as the guest on the extra episodes, access to Normal Gossip Close Friends content on Instagram and full access to the Defector Media website. Of the new 2,500 subscribers, 66% pay for the $5 Friend of Friend tier, and 33% pay for the $12 Friend tier, according to Wang. Unlike subscribers to its website, 80% of whom pay annually, the majority of Normal Gossip subscribers pay monthly. When it comes to conversions, podcasts can typically expect to convince between 2% to 7% of their audience to pay for content, according to the podcast agency DoubleUp. Given that the 2,500 subscribers of Normal Gossip represent roughly 1% of its 250,000 streams, its potential for growth remains, theoretically, untapped. Normal Gossip subscribers are a different demographic with similar tendencies When crafting the Normal Gossip subscription product, Defector Media also took pains to avoid cannibalizing its own subscriber base. Should they want them, existing Defector Media subscribers paying $12 per month for the Pal tier automatically receive all the benefits the Friend tier offers Normal Gossip subscribers, which increases the value of their subscription. The equal pricing—the Friend tier at Normal Gossip and the Pal tier at Defector Media both cost $12—also reduces the likelihood that legacy subscribers will switch products to save money. These measures, while prudent, are largely precautionary, as the Normal Gossip fanbase and Defector Media readership share little overlap, according to Wang. In fact, of the 2,500 new subscribers who joined through Normal Gossip, 95% had never given their email to Defector Media, indicating they had never previously visited the website or engaged with it only superficially. Spotify Revolutionized Podcasting. Can It Do the Same for Podcast Ads? Although the data is too nascent to be conclusive, the 3% monthly churn rates of Normal Gossip subscribers roughly mirror the churn rates of Defector Media subscribers, according to Wang. The retention rate for annual Defector Media subscribers is roughly 87%, although cohorting muddies the numbers slightly. In addition to its subscription program, Normal Gossip also monetizes its content with advertising, although its efforts in that department have been limited. As a company, Defector Media generated only $200,000 in advertising revenue last year. Live events, however, have proven an immediate hit for the podcast, which sold out its first show, in June, in 48 hours and its second event, in December, in less than one week. “Normal Gossip is the natural endpoint and best possible outcome for our general thesis, which centers on letting people create what they want, making small bets and seeing what sticks,” Wang said. “The freedom of being an independent media company means that we get to pull unorthodox levers.”