The Financial Times Restructures Its Consumer Revenue Team

After a windfall year of subscriber acquisitions, the Financial Times has found itself in the enviable position of needing to solve a problem most publishers would love to have: Retention. The London-based publication grew its digital subscriptions by 6% year-over-year in 2020, bringing its total number of paying customers to 1.1 million: 960,000 digital and 140,000 print. While the publisher has by no means abandoned its efforts to recruit new readers, its traffic has hovered comfortably at nearly 16 million unique visitors per month, leading company executives to turn their attention toward retention, especially customer lifetime value, the company said. In line with its renewed focus on keeping subscribers satisfied, the Financial Times named Fiona Spooner as its managing director of consumer revenue in early April. Spooner, an 18-year veteran of the paper, folded the marketing, commercial development and customer care teams into one unit, creating a roughly 150-person unit dedicated to streamlining the customer journey from initial awareness to dedicated subscriber. “I think we're acknowledging now that it's not necessarily everyone's role to acquire customers,” Spooner told Adweek, “but it's definitely everyone's role to retain them.” To boost retention rates, Spooner has redoubled efforts focusing on customer-subscription fit, deployed a bevy of new products and even offered a discount at the tony publication. Customer lifetime value is the north star While the pandemic rattled the Financial Times’ bottom line, the publication remained profitable in 2020, marking its seventh straight year of double-digit revenue growth. The publisher has doubled the size of its business in five years, and digital revenues rose 30% last year, according to Spooner. As a premium brand, the Financial Times has long worked to balance volume of growth with preservation of quality. This mentality has spurred Spooner and others to deemphasize the importance of subscriber acquisition, or “filling empty buckets,” and instead prioritize finding customers who make sense for the brand and keeping them satisfied. Given this mindset, Spooner and her team have set customer lifetime value as their north star metric, a figure that multiplies the cost of a subscription by the average number of months a customer subscribes. The metric aligns the incentives of both parties, promoting a healthier relationship for both: The publisher benefits from finding subscribers who will stick around, and will only pursue readers whom it believes it can legitimately serve. Spooner declined to share an average LTV, citing the wide variability of the figure. Tracking engagement through recency, frequency and volume To track the engagement of its readers, the Financial Times calculates a metric through the recency of visits, frequency of visits and volume of articles read (RFV). If this number drops below a certain cohort-based threshold, the publication might deploy tactics designed to stimulate engagement. Media brands intent on retaining subscribers need to ensure they offer readers a balance of personalized content and “surprise and delight,” said Rob Ristagno, the CEO of the Sterling Woods Group. Through its RFV model, the Financial Times can understand its readers’ interests and use that information to encourage habit, as well as offer occasional departures from the norm to keep them interested. Subscribers with low RFV scores whose renewal period is impending might receive an email from the Financial Times, presenting them with statistics about their site engagement. The email might show them how many articles they've read, on which topics, written by which authors and for how long. The point, said Spooner, is to demonstrate the value of their subscription. “This way, when we ask them to subscribe, it’s not a question for them,” Spooner said. “They know what they’re getting.” Making it easier to cancel subscriptions If data presentations help to demonstrate the value of a Financial Times subscription, its retention methods help to amplify it. The publisher has made it simpler for customers to downgrade their subscription or opt out entirely, a business strategy that can almost appear counter-intuitive in its willingness to sacrifice revenue in exchange for customer satisfaction. “Publishers are moving away from the ‘sleeping dog’ strategy,” Ristagno said. “Hiding the unsubscribe button might lead to short-term benefit, but ‘right-sizing’ the product shows that the Financial Times cares about the customer first.” The publication also has two tiers of subscriptions, standard and premium, each of which features multiple packages. On one end, a premium print and digital subscription runs $675 a year; on the other, a digital-only standard subscription costs $40 per month. The majority of subscribers have premium subscriptions, Spooner said, but the variety allows customers to find the model that best suits them. Likewise, the Financial Times has also begun offering an annual discount on its standard subscription package, a pricing strategy that has become commonplace for most outlets, but one that the exclusive publisher has been hesitant to embrace. By offering a steeply discounted annual subscription, the publication hopes to incentivize prospective customers to opt in for a year, thus giving the paper as much time as possible to convince the nascent subscriber of its value. Brendan Spain, VP of Advertising at the Financial Times, Explains Why Print Ad Sales Are Up at the Paper

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To Ratchet Up Retention, the Financial Times Restructures Its Consumer Revenue Team

Customer lifetime value is the company's north star

Mark Stenberg

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Mark Stenberg