Content paywalls are an essential part of any subscription businesses. From video publishers to magazines, paywalls are the #1 way to convert free viewers into paying subscribers. But how many different types of digital paywalls are there? What are best practices? And how do you choose the right ones for your business?
At MAZ (now Zype Apps Creator), we’ve partnered with subscription businesses like Conde Nast and Harvard Business Review for over a decade. From metered and content prompts to every kind of digital paywall imaginable, we’ve done it all. So if you’re looking for expertise on monetizing your business, you’re in the right place. In this guide, we’ll go over everything you need to know about paywalls on your site and app.
So without further ado, read on below for our full guide to metered and content paywalls below.
What is the definition of a paywall?
Paywalls are a method of restricting content to paying members only. They typically appear in websites or apps, interrupting the content and prompting viewers to subscribe or log in to an existing account. Content paywalls can take a variety of forms, but the main purpose is to convert free viewers into paying subscribers.
Most paywalls can be broken down into a few basic categories: Hard, metered, and freemium. For help building native apps with paywalls, get in touch with us here. Or for definitions and best practices, see our guide below.
Category #1: Hard Paywalls
Hard paywalls are the most straightforward. In this scenario, a wall appears immediately, only allowing subscribers to access the content. New users must either sign up to pay or be turned away.
Pros and Cons:
A hard paywall is a simple system that forces users to subscribe or leave. On the plus side, this method reduces ‘freeloaders’ who want to find ways to get content without paying. If your content is high value or unobtainable anywhere else, then this can lead to much high conversion. However, studies show that hard paywalls can deter new signups.
In most cases, users want a preview of the content they’re getting before they buy. That’s where our next system can come in handy.
Examples of Hard Paywalls:
The Wall Street Journal is a good example of a hard paywall. On the WSJ site and app, subscribers need to sign in immediately to view articles in full. There is no way around the paywall.
To build your own apps with hard paywalls, contact us at MAZ here.
Category #2: Metered Paywalls
Metered paywalls (also known as Soft Paywalls) allow users a limited preview of content, before forcing users to either subscribe or leave. The exact metering of the paywall differs by company. Time-based metering allows users to access content for a limited time (for example, a free trial). View-based metering allows users to view a certain number of videos/articles before enacting the wall.
Pros and Cons:
Metered paywalls are a custom solution. They are a little different for each business that uses them. This gives you an advantage, since you can optimize the paywall placement to match your consumers’ demands. And while coding metered paywalls into your site or app can be very difficult, you don’t have to worry about that if you build your mobile or OTT apps with MAZ (learn more about that here).
On the downside, this method can end up hurting your conversion rates if you’re not careful. Businesses that use metered paywalls successfully understand their customers. They use data to understand when they’re most likely to sign up and when they’re not. If you put up a metered paywall at a random point with no proof that they’re working, you may end up hurting your own efficiency.
Examples of Metered Paywalls:
The New York Times is one of the foremost innovators in metered paywalls. Their paywalls are not only metered, but they are also dynamic. NYT is able to obtain certain data about their readers and when they are most likely to subscribe. They use this data to automatically adjust when and where their paywalls appear, increasing their conversion rates. Hence, why we call these dynamic paywalls.
OTT streaming services like Netflix and Disney+ are also excellent examples. Disney+ offers a time-based free trial to new users, while Netflix offers the first episodes of certain series for free. This allows new viewers to get hooked on their shows/movies before signing up.
To build your own apps with metered paywalls, contact us at MAZ (now Zype Apps Creator) here.
Category #3: Freemium Paywalls
A freemium model monetizes both subscribers and non-subscribers. In essence, non-subscribers can access all or most of the content for free, with ad interruptions. They can then pay to subscribe, removing the ads and possibly accessing even more content.
In this way, the freemium paywall is less of a hard ‘wall’ and more of a suggestion. Freemium models
Pros and Cons:
Freemium models help your business monetize in more ways. By selling ads, you can still make money on viewers who choose not to subscribe. But for your more committed fans, offering a subscription plan gives them a better user experience in exchange for consistent revenue.
However, ads can create a negative experience for free users. And in turn, offering an expansive free option can discourage others from subscribing (why pay for something you can get for free?) Depending on how you look at it, freemium can be considered a best of both worlds, or a worst of both worlds. The difference will likely come down to your audience and your business’s execution.
Examples of Freemium Paywalls:
The Guardian is a good example of a standard freemium format. The Guardian offers their articles online for free, with ads. Then premium users can purchase a digital subscription for $20/month to remove ads from the online experience and get access to two exclusive apps.
Another interesting, non-standard example is Hulu. Hulu provides a tiered pricing model, with the lowest tier including ads and the highest tier with no ads and live TV options. Though this is not freemium because there is no free option, it still provides interesting insight into Hulu’s business model. There are so many interesting ways to incorporate ads with subscription paywalls.
How do I choose the right paywall for my business?
Choosing a paywall starts with evaluating the pros and cons of each model.
Hard paywalls are best for established businesses with high-value content and a high-loyalty audience. Since a hard paywall offers no free trial, you need to have confidence that your brand name and quality will be enough to win subscribers. This can be a tough proposition, especially for younger businesses. But if you meet these conditions, a hard paywall is a straightforward solution to monetize your content.
Metered paywalls are highly customizable, which is both good and bad. To be successful with this method, you need the right website and app-building solution (MAZ has excellent paywall options). You also need a firm understanding of your audience and a willingness to test different methods. Metered paywalls can succeed for businesses of any size, but your access to audience data will be the most important factor.
Freemium paywalls are excellent for businesses with high traffic, usually consumer-facing content. If you expect subscriber rate to be low but traffic to be high, you can still monetize efficiently through freemium. This is great if your business relies on driving traffic through social media or other viral methods.
Content paywalls have transformed the way we consume media. Though some readers may dislike them, they’re an essential monetization tool for thousands of the most beloved companies. And with more innovation happening each day, it seems clear that paywalls are here to stay.
If you’re interested in building a TV streaming or magazine app with paywalls, get in touch with us here at MAZ (now Zype Apps Creator). We’ve been assisting businesses for over a decade in developing fully monetized apps for every major platform.
We hope you found this deep dive into the world of content paywalls helpful. Thank you for reading!
MAZ is now Zype Apps Creator. Read more here about Zype's acquisition of MAZ and why it will change the game for video publishers.