Said Jacobsen, “We’ve worked hard at the offence and are good at driving sales. Now it’s time to build our defence – shifting focus to UX, product stickiness, engagement and lifetime value.”
When we interview Tor Jacobsen in Schibsted’s Oslo offices for the upcoming WAN-IFRA Reader Revenue Report focused on churn, he’s only a few months into his new role, after serving as Chief Commercial Officer for Schibsted Norway’s subscription-based newspapers.
As SVP Consumer Business his job is to set the course for the digital subscription business, leveraging expertise across the group. The new role is part of an extended function-driven matrix organisation within the Media division.
On the advertising side there’s been a cross-brand function in Sweden and one in Norway for the past couple of years.
However, in consumer revenue, collaboration has so far been limited to a specialised Subs group for the four subscription newspapers in Norway. (“Subscription newspapers” refers to the print business model for Aftenposten, Fædrelandsvennen, Stavanger Aftenblad and Bergens Tidende in Norway and Svenska Dagbladet in Sweden, as opposed to the reach-based businesses of VG in Norway and Swedish Aftonbladet.)
“It’s key that we collaborate in an efficient way. Our Norwegian Subs group for the four subscription newspapers has produced big benefits. The consumer business is becoming increasingly specialised around data, CRM, customer experience and sales, and we need to work more efficiently by sharing best practices instead of working in silos.”
– Schibsted Media SVP Consumer Business Tor Jacobsen
The newly formed Consumer Business management team consists of Jacobsen, Bård Skaar Viken, Director Digital User Revenue at Schibsted Norge Abonnementsmedia (the four Norwegian subscription titles); Petter Lorentzon, Director Digital Sales, Analysis & Data at Svenska Dagbladet; Andreas Aspegren, VP & Digital director, Aftonbladet; and Cathrine Løken, Digital Customer Relations Director at VG. The group also includes representatives from Finance, HR, Product/Tech & Strategy and Offline.
It’s still early in the process, but one objective of the collaboration is to create closer cooperation around areas such as customer experience, insights, and so on, sharing lessons and building solutions together.
Another objective is to establish common goals. “Two years ago we set a goal of reaching 100,000 digital-only subscribers for our four Norwegian subscription titles. It was our top KPI, more important than the news brands’ individual targets, and what we communicated everywhere. We’re now working on setting these types of goals for 2018–2020,” said Jacobsen.
WAN-IFRA: Would you say that KPIs are shifting in focus from conversion to retention?
Tor Jacobsen: Yes. We’ve been very conversion-driven, but the focus is moving towards usage, getting customers to stay on our sites. We have perhaps over-focused on sales, for most of our brands, and sales are often deal-driven, which produces high churn. The goals going forward will be more about lifetime value of users, for both our subscription and non-subscription news brands.
Tor Jacobsen will speak on “Schibsted’s new focus on consumer business: Challenges, priorities and organisation” at Digital Media Europe, 10-11 April in Copenhagen.
What are the key differences in the reader revenue business between the subscription-based newspapers and the reach-based ones?
The challenges and opportunities are essentially the same; we need to get better at retention, become more data-driven and collaborate more effectively. But there are some major differences, including the relative revenue generated. At VG, which started offering premium content in 2011, digital subscription revenue now constitutes approximately 15% of the total digital revenue.
At Aftonbladet, which launched Plus in 2003, it’s actually a little bit less than that. At the other end of the spectrum is [Norwegian national morning paper] Aftenposten, where subscriptions constitute about 60% of digital revenues [75% if you include print]. The share of digital revenue coming from digital subscriptions is increasing for both our subscription-based newspapers and the reach-based ones, though.
The culture is of course also different at the news titles that have always been subscription businesses; the newsroom is good at focusing on subscribers and valuing the subscription relationship. This has historically been a bigger journey for our reach-based titles where advertising is the main digital business, but here we have seen a dramatically positive change the last one to two years.
Is the strategy to focus on the number of subscribers or volume of revenue?
This is a good question, and something we discuss lot in the management group – opinions vary. We’ve not actually set the goal yet, but the answer will probably be ‘both’. We’re in a phase now where we need to be revenue/value-focused. On the other hand, the market is a relatively new one, so volume is still important. Plus volume – the number of digital subscribers we’ve reached – has more of an impact in terms of how we communicate to advertisers, competitors, press – and internally. As a publicly traded company we can’t publish specific revenues. So I think we’ll need strategies to grow both. But generally over the next 2–3 years we will increasingly be value/revenue driven.
How do you balance the subscription business and the advertising business?
This is trickier for brands like Aftenposten, with a high proportion of subscription revenue. We work closely with editors-in-chief to identify optimal levels. At Aftenposten we started at around 10% premium content; now we’re at about 30%. All the subscription newspapers in Norway have turned up the share of premium on the homepage and are monitoring the traffic. Because we’ve been able to drive more digital subscriptions, and our users are increasingly logged in, we’ve in general been able to maintain the level of uniques.
Another aspect regarding advertising is that we need to explore whether we should offer a different ad experience if you are a logged-in subscriber versus if you are a logged-in non-subscriber or not logged in at all. On the whole, we’ve been able to successfully grow our digital subscription business to a point where balancing it with the reach/ad business is not a day-to-day struggle.
What is the top priority for you in 2018?
One key factor for our success will be to enable collaboration between all our clever people working in different newspapers. We need to structure our work so we can optimise sharing of best practices and content – that’s the internal priority.
In terms of our customer-facing activities we need to shift from being sales-driven to become better at engagement, lifetime value and product stickiness. We’re starting to be good at the content side of premium, but there’s a lot we can still do on the product value proposition. This will be a focus over the coming years: Strengthen the value proposition for the subscription to the users.