Newspaper Subscribers Stick Around Longer, Pay More

Cancellation Rates Down as Publishers Figure Out How to Sell Smarter

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NEW YORK (AdAge.com) -- Amid all the bleak news for newspapers, there's something good going on: Subscribers are sticking with their papers for longer -- and frequently paying more.

The cancellation rate for newspaper subscribers has plunged pretty incredibly, to 31.8% last year from 54.5% in 2000 and from 36.6% in 2006, according to new statistics out from the Newspaper Association of America. That's despite price increases for home delivery, which brought the average seven-day delivery price to $3.66 in 2007 from $3.37 in 2006.

How are newspapers -- frequently cast as the internet's saddest victims -- pulling this off during the terrible economic times?

It was necessity: They couldn't keep running up paid circulation numbers at any cost and expecting advertisers to pay all the bills.

"The economic environment, meaning the tough advertising revenue environment, makes everybody stop and start thinking a bit more about profitability, and specifically circulation profitability," said John Murray, VP-circulation at the newspaper association. "The bottom line paid-circulation number that particularly the major metropolitan newspapers lived and died for, and went to extremes to achieve, is not really that relevant to the health and well-being of a newspaper in today's world."

As a result publishers got much smarter about the way they sell subscriptions, for one thing, de-emphasizing or even abandoning home delivery to areas that cost more to service but didn't mean much to advertisers.

Publishers have also gotten better at setting renewal prices according to what they know about a given subscriber, Mr. Murray said, letting certain subscribers continue at introductory rates, for example, if they've canceled rather than pay full freight in the past.

And publishers are offering discounts to help get subscribers into automatically renewing payment plans charged directly to credit or debit cards. Last year 38% of new subscriptions were sold on recurring payment plans, the association found.

Newspapers haven't found a new equilibrium yet. But it's nice to see some of their smarter moves paying off even during a recession.

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