4// Outside’s Big Bundle
On Outside Media’s subscription playbook
Hey friends,
One of the most seismic shifts in the outdoor industry has been Outside’s consolidation of the multiple publications and platforms.
I could write tonnes about the strategy (and their ‘Outerverse’) but I’m going to focus on the most interesting part - Outside’s playbook for growth. All of which comes to down to CEO Robin Thurston’s big bet on the future of the media industry.
Hope you enjoy :)
Matt
A New Dawn
The dust has just settled in the outdoors media industry after Outside inc’s bumper M&A sweep. Since 2021, Outside inc. acquired 20 titles and products across the outdoors industry boosting its portfolio to over 30 brands. I’m sure if you ran a small running publication you were probably wondering if you were next.
Outside have fundamentally shifted the outdoor industries media environment, consolidating the fragmented industry into just a handful of players. With a reach of over 250 million across some of the most influential titles in cycling, running, backpacking and skiing, its hard for any advertisers in the same industries to avoid spending money on Outside.
Outside of Outside, Media consolidation is just an everyday headline. Just last year we saw Amazon acquire MGM, Buzzfeed acquire Complex, Axel Springer buy Politico and over 120 other nuggets of M&A across the media landscape. Each deal led by a thirst for new audiences, more revenue streams, greater scale, more assets, fresh IP and chunks of first-party data. What makes Outside’s M&A strategy different is that they also purchased products like GAIA GPS, AthleteReg and FKT in addition to websites and magazines to sweeten their subscription package and showcase a fresh take on the ever-popular subscription business model.
The Outside Playbook
This year of acquisitions was driven by an insight Outside inc. CEO Robin Thurstons drew from his past as co-founder and CEO at MapMy, a mapping software company for cyclist and runners.
Through the millions of data points they acquired through riders and runners inputting their activities, Thurston found that most subscribers who were willing to pay for the premium product were multi-sport athletes. By catering to more than one athletes needs, MapMy were able to acquire new users who saw greater value in a product that supported all their interests.
This insight forms the backbone to Thurston’s bet on Outside inc. - if they acquire multiple media assets that cover a variety of activities they will can introduce a multi-platform subscription, increase their reach and revenue per subscriber, and rely less on advertising for revenue.
The Outside ‘pivot to subscription’, if you will, is a carbon copy of the New York Times playbook that has enabled them to flourish as a heritage newspaper in the 21st century and maintain focus on their core asset - high quality journalism. The strategy goes that you prioritise growth through subscriptions over advertising by investing in your core value proposition (high quality journalism, in NYT case), reduce print circulation to keep variable operational costs down that don’t scale, keep content on print different to content in digital, paywall and introduce new distribution models that can become revenue streams in themselves, for example NYT’s podcast and games portfolio.
Outsides value exists in its bundle, not quality or unique nature of content (NYT model). If Thurston believed that the way to increasing subscription revenue was through acquiring high quality heritage outdoors media platforms with a proven track record, he would have focused on a core subset, not over 30 brands. Yet the conglomeration of media assets is Thurston’s big bet on his hypothesis that people with an active lifestyle consume content across multiple disciplines and are willing to pay for access to a portfolio of assets that move with their interests.
Additionally the purchase of products, like Gaia or Athletereg, are packaged up in the bundle giving more practical value to the subscription, but also more data on their users outside of content consumption.
This is all part of Outside Media’s five pillars of growth: content, experience, utility, commerce and community. Each pillar captures multiple facets of the outdoors person’s life, in total becoming a one-stop-shop for all your needs. Say you’re training for a 10K, you can browse Podium Runner for a 10K plan, download meal plans from Clean Eating, book your 10k through Athletereg, seek out new training routes on Gaia, recover through a yoga flow on the Yoga Journal, be inspired by a video on Outside TV, race, then pick up your photos from Finisherpix, all without leaving their ecosystem.
In providing this all encompassing library of content, tools and experiences, Thurston is betting that being an omniscient presence in the outdoors industry will win over subscribers. Currently their subscribers sit around 1-2 million, but Thurston has ambitions to have 20 million subscribers in 5 years time1 and 90% of all site users being logged in. Ambitious, considering the only journalism site to reach 8 million subscribers currently is the New York Times. But in interviews, Thurston draws inspiration from tech and entertainment companies like Disney, Amazon and Netflix for his business model, not journalism, placing Outside media in categories where subscription numbers hit over 200 million.
The subscription pricing strategy has changed over the past two years. Last year Outside had two levels2. One could subscribe to a single magazine and pay that individual membership or they could sign up to Outside Plus for $99 which grants them access to the entire portfolio of Outside media brands and tools. The dual levels enabled Outside to generate greater revenue from dedicated users as well as casual readers. However the cost difference between the two subscription levels was substantial at 4x, so Outside leaned heavily on its vast media portfolio, tools, events and strident belief in multi-sport readers.
Following changes to its business in 2022, which I cover later, only Outside Plus is left with an introductory rate of $30 a year and $60 PA after that3. The shift to a cheaper model leaves the impression that $99 was too much for most and now the focus is on increasing volume than the value of each subscriber.
Whilst the focus in on growing subscriptions, advertising will always play a large part in Outside’s revenue, if anything the deals will be even bigger. The value of any form of media consolidation is to provide a larger more diverse audience for brands to snack on, attracting bigger brands in larger strategic deals. Outside has always attempted to be subtle with its advertising, relying on product placement in Outside TV, affiliate marketing and sponsored posts in an effort to not disrupt the user experience. Thurston hopes to continue this approach through leveraging its large bank of free content (60% of all articles) to monetise non-subscribers through advertising4. But ultimately, Outside’s focus is relying less on brands advertising on their platform and move to a place where growth is sustainable through recurring subscription revenue.
Thurston’s Big Bet
Whilst subscriptions are becoming more commonplace, the acquisition of products as well as media platforms is a unique approach to bringing additional value for reader to a subscription bundle. However, the scale of their acquisitions and merging of completely different active cultures and communities has undoubtably left an indelible mark in outdoor sports. The media targets like Pinkbike and Trailfork were attractive because they had active hard-won communities. To retain that culture and grow it in-tandem with other active cultures at scale will be one of the biggest challenges to growth.
If Outside can learn to contribute to the cultures they’ve entered, maintain their individual brands position amongst their fans, whilst showcasing the additional value of their wider portfolio, then Outside might be on to something.
However 2022 has not proven this to be the case just yet, and many question whether a one size fits all its really appropriate for the outdoors industry5.
In May of this year, Outside let go 66 members of staff in a reorganisation that led writers to be pulled into ‘content pods’ that cover sports (running, climbing, backpacking) rather than the individual titles they came from.
Additionally they cut multiple print publications, one of them Trail Runner, citing the current macro economic climate and declining relevance of print in today’s modern media landscape.
The underlying sentiment is broadly correct - it is harder to generate revenue from print publications and across the action sports industry there has been a consolidation of print media publications. Yet this is more likely a reflection of Outside’s portfolio strategy - cut the variable operational costs of print publications, reinvest in higher margin digital publications - than of the industry.
Thurston appears to be leaning more on content than community to build their subscription base. By diluting the products of each title and cutting investment in quality journalism that contributes to the cultures of each discipline, Thurston is betting the house on his belief that personalisation at scale is the future of digital media.
Robert Sanchez’s reporting on Outside’s growth provided a fantastic grounding on Thurston and his ambition for the company