Exploring revenue models at DMAfrica in Johannesburg

WAN-IFRA’s Digital Media Africa 2018 conference wasn’t about journalism per se, it was about how to make good journalism sustainable. The question then is: What makes digital media in Africa so unique?

by WAN-IFRA External Contributor | December 3, 2018

“We have members all over the world, and I can honestly say that the most passionate and hungry for knowledge are always our African members,” said World Editors Forum Executive Director Cherilyn Ireton to participants at the conference in Johannesburg.

Time has indeed played some role if you think about how just a few years ago media in Africa stood on shifting sands.

Audiences were being lured away from the quality news that publishers produced – attention was turning to other platforms, dragging revenues along with them. This still poses significant challenges for the future of digital media.

Paula Fray, managing director frayintermedia, said we now find ourselves having to confront those challenges head on because they aren’t the future anymore.

“We want to explore new revenue ideas and to look at innovative products. We also want to look at it in the context of quality journalism and the impact that trust actually has on revenue. Media trends have shown that there is a cost around trust, and we cannot think of editorial and revenue generating issues as being separate,” –Paula Fray, frayintermedia

The era of customer centricity, which marks the move to digital paid models, offers an opportunity to ask a number of pertinent questions, such as how has consumer buying changed and how closely can the patterns be followed?

Leading subscriptions and digital marketing consultant Jocelyn Cripps said the market has evolved drastically and there’s no longer a passive customer base. Today’s buyers are highly active, they have the ability to critique prices on any platform and value access – not just ownership.

“Today we need to know who our customers are so that we can provide them with relevant and contextual information,” Cripps said. “We have a newly empowered generation of customers. As we move to digital paid models we really need to think about how they consume, how they pay and what kind of format that content should be.”

She said publishers have to be willing to let go of notions that worked in the past and dare to “rip up the rule book and put customers at the centre of your strategy.”

“Be clear why people should pay for your content. Find out what makes you different and focus on that. The ones that have made a success of paid models have been really specialist,” –Jocelyn Cripps, consultant

She added that winning companies are those that have appreciated the value of building infrastructure for identifying, scoping and meeting future customer needs. By doing so, they are able to use data to dissect the numbers and act to drive persistent customer value.

Set goals and change the culture

Aftonbladet Plus editorial head Ted Kudinoff said a new culture was important for their paid content model.

For them, it took a series of failures with the disastrous trial of single article sales with micro-payments in 2009 – and a flop with the hybrid model in 2014 – to realise what their customers really wanted.

“It was a little too early for us, and our subscribers didn’t like it. They would call and email us to ask ‘Hey, what are you doing? I don’t want only sports or only entertainment. I want everything from you.’ It was pulled back, and the decision was a resounding ‘Never again!’ ” –Ted Kudinoff, Aftonbladet Plus

The change in culture, a jolting experience between the business minded and steadfast journalists, was the fusion of the editorial and tech teams coupled with an increased focus on customer relationship management.

The change also came in when they introduced daily goals. Today, they aim to convert at least 450 readers to subscribers per day.

The cold fact is that in recent times good news has seldom paid for itself outside of strategic partnerships that nudge it towards viability. The key lessons here being a heightened focus on retention, integrating content into experience and a commitment to motivating staff.

Whom to target?

Riaan Wolmarans noted the importance of knowing how to combine product bundles. He said when you want to make the offering attractive by adding things you still have to be careful. Make sure you don’t outprice or underprice.

Pricing can be a very complex issue. In a panel discussion, Jocelyn Cripps said another element to consider could be having a standard and a premium offer where there is unlimited access – even to the journalists.

What works in some instances is relating to audiences at a hyperlocal level by producing vernacular content at every chance. Wolmarans said, “We know that local news is still important to people, yet it’s often done quite badly.”

Carl Jordan, the head of digital Sub-Saharan Africa at Kwesé said this means a lot more demand for original content.

“We’re trying to come up with content that doesn’t come from anywhere else and that resonates from a cultural perspective,” –Carl Jordan, Kwesé

Partnerships with telecommunications companies helped them overcome reservations over high data costs. This makes it easier to target 18-24 year-olds with more futuristic products like Iflicks.

A strong need for innovation

Taking a broader look at how innovation has changed the digital landscape in Africa, Viacom Executive Vice President Alex Okosi said Africa will probably leapfrog the technologies available in developed markets. He said this is because a strong need has developed for innovation.

“We can come back to the main premise: Content is king. Being able to tell authentic stories through your content is always going to be what carries the day,” –Alex Okosi, Viacom

Perhaps this is why companies tread carefully when they balance content decisions that require calls to be made either at an editorial or at a data analysis level. There is also a challenge to decide on what to prioritise between ad revenues and paid content and where exactly to invest resources.

By Tebogo Gantsa for WAN-IFRA

WAN-IFRA External Contributor

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