Besides operating the country’s largest news site, Stuff owns Neighbourly – a hyperlocal social media platform, Stuff Fiber – a fibre-only internet service provider, Stuff Pix – a digital movie streaming service, energyclubnz – an energy retailer that provides electricity at cost for a small weekly membership fee, and a slew of other business ventures.
Even after shedding 35 percent, or 28 of its print titles earlier this year, Stuff still operates a mix of more than 47 national, metropolitan, regional and community newspapers across the country and several magazines, including the TV Guide.
In this interview, ahead of her presentation at WAN-IFRA’s Digital Media Asia Conference in Hong Kong on 8 November, Boucher tells WAN-IFRA’s Joon-Nie Lau what makes Stuff tick.
WAN-IFRA: Why the name ‘Stuff’?
Back then, the site was seen as a repository for the daily newspaper content, rather than a really important part of the news business. But over time, and with some real passion and hard work, it has grown to be New Zealand’s largest domestic website (in any category) as well as our flagship product. So, the decision to rename the New Zealand arm of Fairfax Media to Stuff was simple – Stuff represents who we are now as a modern New Zealand-centred business, and also where we are going.
Our business is rooted in 160 years of rich print history. We started out as independent local newspapers around New Zealand, and we still maintain that very strong local presence as well as a strong national coverage.
Our purpose as an organisation is to help New Zealanders, or Kiwis as we call ourselves, connect and thrive in their communities. Our journalism is central to that, but it also has given us an opportunity to explore other avenues.
We know the traditional advertising and print subscription funded publisher model that we – and most other media print organisations in the world – have relied on for so long is not enough to sustain us into the future. So we’ve really tried to reimagine the potential for our products and how they could be built out in different ways.
“This meant radically rethinking what we could build off our key assets and looking at Stuff.co.nz not just as a news site, but as a platform. And when we thought of it as a platform, in the same way as a Google or Facebook, it opened up lots of possibilities for new revenue. Key among those was using our platform to launch and turbo-charge new businesses of our own instead of just advertising others.”
We also went out to other New Zealand publishers and offered Stuff as a distribution channel, either as an alternative or supplement to Facebook but with a good revenue return for them, and we developed products for wholesalers and retailers to have direct e-commerce ‘shops’ within our platform to maximise their ability to connect with customers.
In the last few years, we’ve acquired and grown Neighbourly, a hyperlocal social network startup, which has grown so fast that it is about to become one of the top 10 sites in NZ; we’ve launched a fibre-only internet service provider; a disruptive electricity retailer; a VOD movie-streaming service; many more joint ventures; and have doubled down on journalism to produce some of the finest work ever to come out of our newsrooms.
What have been the most difficult aspects of making the transition from print to digital and gaining acceptance of these new, untested ideas for you as a leader and key decision maker?
In those early years, the little Stuff team really was viewed as either a curiosity or an internal enemy, competing for news and ads that otherwise would be kept for print the next day.
The hardest thing has always been encouraging people and the organisation to take a risk or invest in something unknown or unproven – all while we still had lots of revenue coming through our traditional channels. But that argument has not been a factor for the last few years as we integrated Stuff throughout the company; everyone shared in its success and everyone was responsible for its growth.
“By the time we came to rename the whole company after the digital site, the reaction was incredibly positive as we are all proud that we had managed to grow this little internal disruptor into New Zealand’s biggest website.”
Since I became CEO, it’s been my priority to ensure our organisation is equipped to not just make a profit at the end of the day, but to provide the right internal environment for our people to connect and flourish.
We’ve focused on building a culture of transparency, of information-sharing and the collective celebrating of success.
“We have tried hard to ensure everyone understands our overall strategy, the reasons why we have diversified and that all these new revenues will be key to funding our journalism and fulfilling our purpose to serve New Zealand communities into the future.”
We also have to apply that purpose – helping people connect and thrive – internally if we want to be successful. That means more than ensuring the best technology, systems, policies and procedures are at play, it means caring for your people and laying the foundations for a strong and resilient company culture.
For instance, we’ve changed our HR department to the People & Culture team to more focus on looking after our people and what they need to connect and thrive rather than the process itself.
There was a time when no household thought twice about buying a newspaper. So why is it so difficult to get readers to pay for digital content these days?
The digital revolution has removed all geographical boundaries and now the amount of content available to Kiwis is boundless. And we’re realistic – if they don’t get their news from Stuff, they’ll get it from other platforms.
We’ve looked at a paywall and, given the size of our population of only 4.7 million, the economics of a content-funded business model are difficult, especially when we consider how well served Kiwis are by publicly-owned and other commercial media. So, we always need to think outside the box with a bit of Kiwi ingenuity.
Paywalls and subscriptions can and do generate revenue, but they are not the only way to take advantage of our audience scale and trust.
To date, our model to enter new industries, launch new businesses and explore alternative revenue streams is proving successful and is enabling us to continue to deliver high-quality news and journalism to Kiwis, every day.
Stuff has diversified its business into non-media lines. How do you see the share of revenue from traditional channels, such as advertising and print subscription, changing?
Print is still supplying very strong and important revenues for us, through subscribers and ads, but like everyone we are seeing that decline.
New Zealand always seems to be a year or two behind the rest of the world in trends, so that gives us a window to observe what is happening to others and then think how we can be proactive before it hits our business.
“We have seen the rate of print decline elsewhere, plus wobbles with digital ads, and while we are not at that stage yet (with strong growth still in digital ads in particular), we know we need to diversify and develop new businesses and models.”
Over time we will see a much more even spread across our businesses and products. And while we don’t have digital content subscriptions, we do effectively have subscription businesses in Stuff Fibre and energyclubnz where customers pay weekly and monthly for their service.
Tell us more about Neighbourly.
Neighbourly was founded by Shane Bradley and Casey Eden, who have a strong entrepreneurial history.
We invested early into Neighbourly (22.5 percent in 2014) because we really believed in the product – helping local communities to connect – and it aligned perfectly with our mission as a business.
With our scale of audience and trust, and increasing business support, we’ve helped Neighbourly grow from 60,000 members to well over 650,000 members today.
“Our ability to grow this business by utilising the power of Stuff as a platform was the first proven test for our new strategy and gave us the confidence to go further.”
Neighbourly has been profitable since its early days and has become in its own right a very powerful platform and an emerging channel for our community journalists.
Neighbourly is in about one third of New Zealand homes, which is incredible for such a young site, but it still has huge room for growth.
Ultimately, it confirmed our strategy to look further afield at other revenue streams and launch new products and services that would help Kiwis connect and thrive in their communities.
Neighbourly will become a more significant share of our revenue in the future, and it will sit alongside and work into other new ventures that support our core operations.
Publishers all over the world seem to be either joining forces in ways such as ad alliances or merging. In New Zealand, the idea in 2016 to merge Stuff with competitor NZME, which owns some 80 media brands, was a bold one – one rejected by the Competition Commission, then the High Court and now the Court of Appeal in September. In Australia, however, the Nine Entertainment and Fairfax Media merger was announced. Is this the shape of things to come?
The proposed Nine-Fairfax merger is seen as the best possible outcome for Fairfax Media and its future outlook.
Nine is a strong and resilient media company with largely complementary assets to Fairfax so I think it’s a good fit both in terms of business and culture.
“The NZME merger would have been a great move for New Zealand media, cementing a strong business foundation that would really have made that future of local New Zealand journalism, particularly in small towns and regions, much surer. But we have not been standing still. We’ve focused on building out our own business and so has NZME.”
Our position as a Kiwi platform has also allowed us to open up Stuff to other publishers/broadcasters and we have enjoyed developing these relationships and working together on significant stories too that would not be possible without our combined resources and abilities.
Share with us the importance of non-traditional partnerships as a new revenue stream.
Many organisations are keen to hear about our ‘non-conventional’ approach and what we’ve learnt – because everyone is looking for ways to build new revenue streams.
For us, it’s about being very clear about what our strengths are in any partnership and approaching propositions with an open mind. We have a large audience and a trusted relationship with them. That means we are effectively a really powerful marketing machine and, therefore, a good partner for scaling great business propositions.
“In partnerships, we look for people who have the specialist skills and expertise that we don’t have – be that a telco, a social media, or an energy retailer – and then marry that with our strengths to create a real competitive advantage in those areas.”
We are looking to be the disruptor, instead of being the disrupted. And internet and energy were perfect for that because of government investment and deregulation.
It’s important to understand the industry, the pricing, your customers and your product or you will fail at marketing it at scale. So the partnership match is truly vital to the success of a new venture.
Recently, Stuff’s weekday newspapers went compact in response to readers’ preferences. Print runs are being reduced and some papers have been closed. What do readers expect out of their paper today? How is Stuff reimagining print?
In late April this year, we changed our nine daily newspapers to a compact format and since February, we have been consolidating our print portfolio.
“Print remains the largest part of our revenue, but not all of our titles were delivering profit and we made the decision to sell or close 28 of our smaller community and rural titles in February.”
This combined with revitalising our core daily mastheads with a new format, a refreshed editorial approach and simplified internal processes, has enabled us to extend the print runway and confront the decline in print.
While not every reader has been happy with the changes, particularly some of our longer-standing community titles, the overall response has been very positive – from readers, subscribers and advertisers.
In this age of “fake news” and trust in the media at all-time lows, is journalism broken? How can it be fixed?
No, I do not believe journalism is broken. It is certainly in a challenging spot though. A good functioning democratic society relies on having journalism at its foundation.
I strongly believe that at Stuff we are producing some of the highest quality journalism we have ever produced.
We’ve invested in new specialist teams like Stuff Circuit, which focuses on video-led investigative journalism; the National Correspondents team, which champions high-profile national issues like health care, crime and education; and our Special Projects team that develops new, innovative and interactive ways to tell our stories.
However, we need to really be mindful of the important role we play and ensure we are living up to the expectations of our readers – and society – have of us.
Our newsrooms are also focusing on constructive, thought-provoking journalism that sparks conversation across our audience – instead of just reporting the news, we are trying to deeply explain the problem to Kiwis with truthful, accurate and easily digestible reporting.
These are just some of the ways we are working to counteract the fake news phenomena and leave a more positive impact on society.
Digital Media Asia in Hong Kong, and the latest issue of ANF
See Sinead Boucher in person on 8 November 2018 at Digital Media Asia in Hong Kong. Click here for programme details and registration information.
This interview first appeared in print in the latest issue of WAN-IFRA’s Asian NewsMedia Focus, which can be read in its digital form by clicking here.