Gift subscriptions are vitally important to iSUBSCRiBE as they account for around half of our business. Yet they also offer real potential for the whole industry for two key reasons. Firstly, the PPA’s Loyalty Challenge research shows that 73% of consumers who currently hold at least one subscription for themselves are not giving gift subscriptions to other people – so, there is an immediate sales opportunity there. Secondly, gift subscriptions are taking the "subscription gospel" out to the wider magazine reading public, many of whom have simply never thought of subscribing before.
The Loyalty Challenge research showed that magazine gifting is a very black and white area – people either already do it and think that it is a great idea or it has simply never occurred to them at all. For this second group, once the process is explained to them, they too enthuse about the idea, but they have lots of questions about how to do it. The general level of consumer awareness about this whole area still seems to be quite low.
Where are gifts purchased?
The table below puts the whole area of magazine gifting into context.
| If you have purchased a gift for someone else, please indicate where you purchased your gift subscription from (Please select one) | |
| Source of Gift Subscription | % |
| From an advert or insert in the magazine itself | 40 |
| Internet - direct from publishers website | 27 |
| Internet - from an online subscription shop (e.g. isubscribe.co.uk) | 13 |
| Cannot remember | 8 |
| Gift Box (e.g. a special pack from a shop like WHSmith) | 6 |
| Other | 6 |
| TOTAL | 100 |
| Source: The Loyalty Challenge | |
The first place many people still go to buy a gift subscription is to the magazine itself, either by buying a copy or by going to the magazine website. With 40% going via the internet (27% publishers’ own sites plus 13% online shops), this is a major and growing channel for gifting.
So, it was with this general background that we recently set out to find out more about the whole gift subscription process.
Why do people give subscriptions as gifts?
By far the two most common reasons given in both our and Royal Mail’s research are, "It’s a gift that lasts all year round" and "It was appropriate for the person." A magazine subscription is a unique and flexible gift. It is also very personal and shows a real understanding and knowledge of the recipient.
Why do people not give subscriptions as gifts?
The most commonly stated reason (22% of people who have bought a subscription for themselves but who have never given a gift sub) is, "never really thought about it before": there is real potential to raise the awareness of magazine gifting right across the whole market.
The next most common reason is "wouldn’t know which magazine to buy". The positive aspect of a magazine being a personal gift has a downside: what if I get it wrong? This is where the role of online browsing is becoming more important as an aid to the whole gift-choosing process.
Are gift donors different from ordinary subscribers?
Yes they are. They tend to be older and more upmarket than the average self-subscriber which ties in with past Royal Mail research. From a specifically iSUBSCRiBE point of view, they spend more with us, visit our site more regularly and have longer customer lifetimes. In short, they are prime customers. Also, women appear to be much more into gifting than men: 73% of iSUBSCRiBE gift donors are women in contrast to 57% of our self-subscribers.
Who is the gift for?
This is quite volatile and shifts from year to year, but the profile of our current business is shown in the table below and demonstrates two important points:
Thinking of the gift subscription you have just bought, who was it for? | |||
| Husband / partner | 15 | ||
| Wife/partner | 10 | Partner total | 25 |
| Mother | 14 | ||
| Father | 8 | Parent total | 22 |
| Daughter | 6 | ||
| Son | 6 | Child total | 12 |
| Other female relative | 15 | ||
| Other male relative | 8 | Relative total | 23 |
| Female friend | 10 | ||
| Male friend | 4 | Friend total | 14 |
| Work colleague | 2 | ||
| Other | 2 | Other total | 4 |
| TOTAL | 100 | ||
| Source: iSUBSCRiBE customer survey | |||
The majority of gifts (59%) are made within the immediate family. A magazine subscription is seen as a personal, tailored gift, normally for someone well-known to the donor. One of the biggest hurdles to giving a gift is of not being sure precisely which title to give the recipient, which is why gift tokens are a growth area for us and for consumer goods generally in the broader marketplace.
Linked to this, it also means that most gift donors are normally very focused when they come to our site – 73% of gift donors come with a clear idea of which magazine they are going to buy. Yet, this still leaves a significant 27% who are "guess-buying" and who like the ability to browse and to compare titles and prices before making the final purchase.
Other relatives, normally characterised as being "difficult to buy for", are also important and account for 23% of our sales.
While 73% of our gift donors are women, only 57% of the subscriptions are for women. It is women who tend to buy gift subs, but many of them are for the men in their lives!
What is the occasion of the gift?
Here, there has been a real change over the years. Old Royal Mail surveys dating back to the late 1990s show Christmas accounting for over 60% of all gift subs occasions, but that has steadily reduced as birthdays have grown in importance. The current profile of our own business is shown in the table below.
| Thinking of the last gift subscription you bought, what was the occasion? | |
| Christmas | 54 |
| Birthday | 36 |
| Mother's Day | 2 |
| Father's Day | 2 |
| Other | 7 |
| TOTAL | 100 |
| Source: iSUBSCRiBE customer survey | |
The psychology behind each occasion is subtly different:
* Christmas. This is panic-buying time when there is a real pressure to find gifts for a number of people at the same time. Consumers are also prepared to spend more, typically over £20, for their inner circle if the present is felt to be appropriate. Subscriptions fit neatly into this whole gift area.
* Birthdays. Here consumers are looking more critically at the amount of spend and want to be absolutely sure that they have got the right title. Yet the main barrier is that many consumers simply do not automatically think of a magazine subscription as a birthday gift. Once the thought has been presented to them, they usually warm to the idea.
* Mother’s Day & Father’s Day. These occasions need a much more creative approach for two reasons. Firstly, there is usually a lack of forward planning! Secondly, there is a general desire to show appreciation through actions and thoughtful words rather than through a gift. So, flowers, plants, chocolates and being taken out to lunch are thought to be more fitting. Yet these entrenched views are capable of being shifted.
Are gift subs renewed?
The Loyalty Challenge project shows what a complex area this is, filled with all kinds of feelings of guilt and indecision!
| When you buy a gift subscription how often do you continue with the gift the following year? (Please select one) | |
| Renewal Activity | % |
| I always extend the gift the following year | 22 |
| I sometimes extend the gift the following year | 52 |
| I never extend the gift the following year | 26 |
| TOTAL | 100 |
| Source: The Loyalty Challenge | |
The first time a magazine gift is given, it can be a last minute "brainwave". This often means that consumers are then unsure what to do at renewal. Also, over a quarter of gift donors subscribe in the knowledge that this will be a one-off, "in and out" purchase. There are several reasons for this, but the main two are that the donor does not want to appear boring or unimaginative in repeating the same gift idea over and over and that sometimes the donor is not always completely sure that the magazine choice is the right one.
Yet, on the other hand, once the donor is assured that the magazine selection is right, they know that they have chosen a personal gift which can be extended easily in subsequent years. There is also the added pressure that the donor may not want to be seen to be mean in failing to renew!
The whole complexity of the process of renewing a gift subscription is a key reason why publishers can see wildly different retention rates. It is therefore a process which demands great sensitivity on the part of the magazine. Gift subscriptions have "handle with care" written all over them – a warning that many publishers ignore, but which they do so at their peril!
Overview
Gift subscriptions are massively important not just for an online shop like iSUBSCRiBE, but for the whole publishing industry. Gift donors are high-spending customers who need nurturing and developing. Yet "magazine gifting" is not one single, simple event. Instead, it is spread across a series of different occasions and it covers a whole range of different relationships across different ages.
Getting it right can result in high volume, high lifetime value customers who renew at high levels. Getting it wrong can make it an expensive and leaking bucket! Online shops can play an important role in getting it right!
