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3 keys to success for transitioning to reader-led revenue

2021-09-03. Shrinking advertising dollars has been a top concern for publishers for at least the past decade. Larger newsrooms have consequently made the leap to a business model led by reader revenue, but what about those that have yet to make the transition?

by WAN-IFRA External Contributor info@wan-ifra.org | September 3, 2021

By Ng Mei Yan

During WAN-IFRA’s Newsroom and Business Transformation Asia 2021, programme leaders and guest speakers stressed the urgency of change to remain viable and provide a toolbox of key techniques for publishers to get started.

It is never too late to begin, said programme leaders George Brock and Gregor Waller at the second edition of the five-month-long Newsroom and Business Transformation Asia (NBTA) 2021 programme.

Now in its second year, NBTA is organised by WAN-IFRA and supported by the Facebook Journalism Project. The programme is designed to help Asian publishers implement and accelerate their newsroom transformation projects.

Learned insights are essential

While competitors may have established a lead in getting paying readers, the “late-mover advantage” can be valuable.

With learnings from case studies around the world and tools to now extract fine-grain data to understand audiences on an unprecedented level, there is now less guesswork on the road to transformation.

Steve Dempsey, guest speaker at the first session of NBTA and Group Director of Publishing Products at Independent News & Media in Ireland (INM), recalled that The Independent’s main competitor, The Irish Times, were five years ahead in switching to a reader-led revenue model.

“But they were premium and costly. We gained competitiveness in price difference,” he said.

Dempsey also credited a highly supportive senior management and cultural shift for successfully implementing The Independent’s subscription business.

While market conditions vary across countries, Dempsey’s account clearly demonstrated some main factors Brock and Waller pointed to that will shift the needle in any newsroom.

1. Transformation starts at the top

Two of the biggest questions publishers first need to ask are whether the organisation is truly digital and how they can win revenue from readers.

“If we step back and look at these challenges from above, there are two things that really matter, and they are leadership and strategy,” Brock said.

Good leaders in news publishing clarify the goal and always communicate with those they lead, he said.

Leaders are also tasked with navigating the obstacles with a sound strategy.

Rather than lofty targets and mission statements, strategy, Brock said, involves diagnosing the problem, developing a guiding policy to shape the approach and finally a set of coherent actions that bring the guiding policy to reality.

A participant of last year’s NBTA, the Philippine Daily Inquirer used this systematic technique to figure out what made the Inquirer Plus, its digital newspaper, worth paying for. Then COO and now CEO Rudyard Arbolardo first obtained support for the project goals across the newsroom and engaged the expertise of a technology vendor.

A cross-functional team then took action, segmenting the various target readers while ensuring the product was affordable, easy to buy, pay for and reach (via digital means). Exclusive content was also developed for Inquirer Plus.

As a result, they achieved double digit conversion rate, steady growth in subscribers and an average subscription term of 12 months among other success indicators.

2. Harness the power of data

Technology and connectivity have now made it possible for publishers to obtain valuable insights, from the amount of time readers are spending on each article and which users are mostly likely to convert to their search habits and professions.

“The idea of a data strategy is to know your users, having different offerings for different segments and having a very thorough idea of the channels, such as mobile, desktop and push services, that people are using,” said Waller.

By understanding readers and matching them with their preferred journalistic formats, letting them access a website that is populated with personalised offerings, the likelihood that they’re going to subscribe and stay is much higher, he added.

Additionally, “data can serve as a ‘single source of truth’ and be a unifying force in the newsroom,” Brock said.

For example, a daily email to summarise and explain insights from data during the past 24 hours is a good way to communicate the qualitative value of those numbers.

For those who have not yet started developing a data-informed newsroom workforce, there is no need for a mindless rush to develop a sophisticated dashboard and visualisation tools.

“Instead, start with what you have, even if it is a limited set of data,” Waller said.

In his Quick Step Strategy (below), Waller recommends that publishers first group their readers based on loyalty, dive into each group’s use patterns and embark on A/B testing as a means of experimentation.

When this stage is complete, a cross-functional team can be established and more resources and investment can then be made into integration and data-gathering capabilities.

3. Serve your most important audience

While it might feel counterintuitive at first, trying to please every news consumer is likely to be detrimental to the bottomline.

Instead, publishers need to segregate audiences based on loyalty.

Norway’s Amedia news group found in a 2017 study that readers who visited a news site for 21 days or more in a month were exponentially more likely to subscribe, and those who visited for more than 25 days would likely stick with their subscription.

“It is absolutely crucial, and also one of the biggest challenges, that you are able to identify and measure these target groups. Separate the heavy users and fans from the occasional user and fly-bys, those who visit one to two times a month,” Waller said.

Though heavy users and fans may only make up a small percentage of readers, it makes sense to formulate the editorial strategy around this group.

The average revenue per user (ARPU) for this group tends to be significantly higher – their high number of visits and higher page impressions per visit correspond to more advertisement views and consequently more returns.

“You don’t have to look for a big audience, but the relevant audience for you to focus your strategy on because their ARPU is higher,” Waller said.

Newsroom and Business Transformation Asia (NBTA) 2021, organised by WAN-IFRA and supported by the Facebook Journalism Project, is the first training and coaching programme of its kind in Asia designed to accelerate transformation in Asian news companies. NBTA’s five-month-long curriculum supports senior editorial and commercial managers in developing an editorial vision, business strategies, integrated product plans and newsroom processes.

About the author: Ng Mei Yan is a freelance journalist who writes for a variety of clients including government agencies, healthcare institutions and lifestyle businesses. In recent years, she has covered digital transformation stories of organisations in various industries ranging from retail to maritime.

WAN-IFRA External Contributor

info@wan-ifra.org

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