How the humble text message could shape the future of publishing

How the humble text message could shape the future of publishing
The Media Leader Interview

In the second of a two-part feature examining publisher strategies with direct messaging, Subtext’s co-founder and CEO, Mike Donoghue, discusses why SMS is a core part of the future of audience outreach.

Direct messaging is becoming increasingly normalised as a way for publishers to interact directly with audiences.

Many publishers have turned to WhatsApp to drive engagement and page views, especially as a first port of call for beginning a test-and-learn strategy with text messaging.

But there are other options for publishers looking to have more control over how they engage with subscribers via traditional short-message services, or SMS.

In part one of this two-part feature, Reach’s engagement director, Dan Russell, told The Media Leader that the Daily Mirror publisher has begun working with Subtext, a texting platform that connects users to subscribers via SMS, in the US market.

Now, Mike Donoghue, co-founder and CEO of Subtext, tells The Media Leader that while he appreciates WhatsApp from a consumer perspective, he believes its use for publishers is more akin to sending a push notification.

SMS, however, offers a “real, meaningful bilateral” form of communicating with readers.

“We’ve moved publishers from WhatsApp to our platform pretty regularly,” Donoghue says. “I think a lot of people get a start there, but you still deal with the same issues that you deal with on any of the other social platforms because it’s a Meta product at the end of the day.”

“You don’t get analytics, you don’t get any tools to help you build the audience, you don’t get any insight into those audiences. And you certainly don’t own any of it,” he adds.

Renting or owning?

Subtext was founded in 2018 with the goal of addressing what Donoghue described as a lack of control felt by publishers and independent creators over the distribution of their own content.

“We saw first-hand the amount of time, money, love, effort and resources that not just media companies, but artists, brands, athletes and professional sports teams put into building up these huge audiences on social channels, only for algorithms to shift or monetisation policy changes to starkly remind people that they were renting the relationship with their fans as opposed to owning a really meaningful line of communication,” he says.

Reach turns to WhatsApp to drive audience growth and engagement

“Not only does [SMS] feel more like a conversation with a friend or family member, but it’s bilateral as well. It takes a high degree of sociopathy to start replying to email newsletters and expecting a response,” Donoghue joked. “We really wanted it to feel like you know somebody who’s ‘in the know’.”

When Subtext was founded, email newsletters and personal blogs were the dominant ways in which publishers and individuals speak directly to their audiences, as well as solicit feedback. In contrast, Donoghue says in 2019 he could count on one hand the number of media companies and individual artists using SMS as a meaningful engagement tool.

Then last year, Subtext helped send 5 billion text messages to over 5.5 million unique individuals, Donoghue says. The company now works with some of the largest publishers in the world including The Washington Post, Condé Nast, Gannett, and Axios. Today, Subtext is operational in 110 countries.

How does it work?

Donoghue compared the basic idea for how Subtext works, both for users and from a business standpoint, to newsletter platform Substack.

Messages are “broadcast” from an individual account holder, which Subtext calls the “host”. They can choose to send messages to their entire subscriber base or segments based on their interests or geographic location. For example, USA Today could send a message to all its subscribers in the New York metropolitan area about the earthquake that occurred there last week.

According to Donoghue, the opt-in nature of the platform, as well as the immediacy of receiving a text, has resulted in open rates of 98%, the vast majority of which occurs in the first 10 minutes of pressing send — both significant points of difference from newsletters, where successful open rates are typically closer to 30-40% and opens occur over a period of hours.

Another selling point: the capacity to deploy messages to people without internet access, since SMS is sent over cellular data.

From the consumer end, receiving a message looks and feels the same as getting a message from a friend or family member. Individuals who subscribe to receive messages can, unlike on WhatsApp, also send replies, which then show up in the host’s dashboard for them to view and, if they choose, respond to within the dashboard environment.

“We recognise if you’re a big pop star or a big media company, you’re going to have hundreds of thousands of subscribers, so there are scenarios where you’re never going to be able to get back to everybody,” explains Donoghue. “One of the things we always suggest is indicating to the audience that you’re listening without having to get back to everyone.”

That can take the form of Q&As, where the host picks and chooses certain answers from individuals to answer to the entire subscription base, just as one example. Subtext also offers automated messaging associated with keywords and templates that can help its clients as they scale their subscriber numbers.

Two ways of driving revenue

Subtext’s own business model relies on two different forms of revenue. The first is by charging users of its unlicensed model based on their total number of subscribers and messages sent. Donoghue says this option is tailored more for larger publishers, who are likely to use the service as a value-add for existing subscribers.

The second model is tailored more toward creators and independent journalists, who can create a paid subscription model. Through Subtext, they can create private, paid communities and set their own prices for the cost of inclusion, out of which Subtext takes a cut.

TikTok/Instagram rivalry moves into photo-sharing

Donoghue describes such a subscription play as a bit more niche. But for users with highly loyal followings, it can provide predictable revenue — Donoghue says Subtext users own the entirety of their own audience data, meaning it’s easy for them to leave for other services if they lose faith in Subtext.

It’s clear to see a parallel here with newsletter publisher Substack. And, more recently, to attract additional users, Subtext made the platform free for any journalists who were laid off in the past six months amid widespread layoffs in the industry.

“For us, it’s really important to be able to support this sort of burgeoning ecosystem, particularly as the efficacy of email starts to drop in terms of click through rates and engagement,” expresses Donoghue.

‘Sacrificing your business at the altar of virality’

That said, while Subtext may offer an interesting option for publishers, journalists or creators with already-established followings, similar to WhatsApp, it does not currently offer tools for users to grow audiences. As such, publishers seeking to increase their Subtext subscribers will need to cross-promote elsewhere, including and especially via social media.

“No one’s ever going to abandon social,” Donoghue admits. But, he says, “people are looking at it now and are saying ‘You know what, this economic model is so fleeting,’ because the algorithms are so unreliable and the monetisation policies change all the time.

“You’ve built this huge audience and then TikTok does away with its Creator Fund, or they prioritise a certain type of content. So you end up sort of sacrificing your business at the altar of virality, and someone else controls what is viral and what is not.”

As such, its no surprise to Donoghue that Subtext’s userbase is growing given publishers and creators are pursuing strategies of pushing people towards subscriptions  — “like with us, or with Substack or a paid Discord server” — or developing direct-to-consumer executions, such as MrBeast Burger.

Unlike social media platforms, Donoghue says: “We’re never gonna have a billion subscribers. It’s a quality play, not a quantity play.”

Media Jobs