Online Looks Like a Newspaper?

The great media experiment begins as London’s The Times and Sunday Times erects a paywall that requires online readers to subscribe.

So what are they selling? Simple really, either you buy today’s edition – or you buy a subscription to all the editions this month.

No atomic content sales here! No micro payments of 2p for 1 article – no! Just as we forecast, we have returned to selling newspapers!

Hurray!

The big question now is – can The Times make it work?

Well, time will tell – but let’s take a look at their offer. You have two choices

• £1 for a day pass (ie today’s edition) – sold rather like WiFi access is sold – on a time limited basis.

or

• £1 for 30 days (ie a subscription) – with repeat billing at £2 per week after the first month – or £8.66 per month.

So what does this tell us about strategy?

Clearly, everyone will choose the £1 for 30 days over the £1 for one day! So, the pricing is designed to turn us into subscribers.

And, what are we subscribing to? A £104 per year subscription. Is that a lot or a little? Well, my Economist subscription renewal has just arrived and I’m offered a 47% discount which means I pay £108 per year.

Practically the same then!

What is interesting is how this relates to buying copies at the newstand. Each copy would cost £1 during weekdays and £1.50 for the Saturday paper. The Sunday Times costs £2.

So, add it all up and you ‘could’ spend £442 per year on buying every copy of The Times and The Sunday Times. So, will the offer be shown as 77% off? Well, maybe, but who buys every copy every day? Perhaps a library – but no sane individual?

Hence, there would appear to be a growing practice of charging just over £100 for an annual subscription for a quality news feed.

And it fits well – because even if you took the view that you would only buy the paper 3 times per week plus the a Sunday paper – and not holidays – so 48 weeks of the year – your annual cost would still be £240.

And, of course, this subscription gives you access to the mobile (iphone) edition too – which, if bought through a different iPad subscription is a more expensive £9.99 per month. Now, the iPad edition is not great to navigate – the FT does a far better job – but that is another story.

The point is that the current pricing model adopted by The Times makes internet buying of newspapers a bargain!

Great – so the pricing strategy is clear – and is based on The Economist superbly successful subscription model. Now, will it work?

Want me to get off the fence and answer that? Well, of course, I have to say yes.

Why? Simply, the pricing is very attractive but also based on very sound principles – The Economist probably the best selling subscription product in the world and people are already paying for it – and The Times have taken a leaf out of their book (or newspaper).

You can register at http://www.timesplus.co.uk/welcome/index.htm to get a ‘preview’ of what is to come  – and yes, it is all about paying, but it is also about paying for the new generation of digital media.

The point here is that we are about to see a new generation of digital media – perhaps partly inspired by the new devices that can carry it – but far more interactive, graphical and video based, than before.

Interesting development.

So, what is significant about this?

… you are looking at an issue – a publication – no longer looking at atomised content – or a collective of individual pages.

What is clear is that this is a particular issue from a particular time covering all the issues, the scores, the stories and the trivia that were alive and interesting and relevant at that time.

It is an issue. It has a date. In time, it gives a glimpse of what was important back then, when it was published.

Media then, is attempting to return to its roots with its latest devises – that is publishing newspapers, magazines and books – only this time with multi-media content.

Perhaps we should have labled this post Back to the Future?

News Stand - Should Look Like This Online?

The FT is not going to ’sell content’ online but they are going to start to sell daily newspapers online. Remember, the daily newspaper is the essence of any newspaper brand.

In an interesting report (also on the FT) the news was headlined as FT selling content for micropayments.

However, the really interesting news is that the FT is not going to sell individual articles (content) – but individual daily newspapers.

The mooted price is £2 – which is a similar price to what people pay at the newsagents.

It does rather seem that we have a hallelujah moment here. Suddenly, online media looks like offline media only distributed digitally as opposed to via newsagents.

Suddenly, you get the feeling here, what’s the big deal to buy a newspaper for £2? Do you have an issue with that? Of course not.

So, by dropping all this nonsense of online media is different, we can just see digital as a different distribution route for the same ideas.

Of course, there may be a few interesting developments here – such as the daily print newspaper containing a voucher which allows the reader to view it online… to deliver an enhanced brand experience  … an automatically download copy to your iPad …. or perhaps not?

It will be interesting to see what the FT does – and then even more interesting to see how the FT adapts its model to reflect consumer response.

But this is the first clear sign that media owners will return to selling packaged and branded goods (in this case a daily newspaper) and stop all the silly nonsense around selling single articles for pennies.

Print media owners figured out years ago that readers didn’t want to stand at the newstand shelling out 2p for each article they found interesting. No, they just wanted to hand over the money, get the package/ paper/ book/ magazine, and take it away.

Not so very different after all?

We Live in Interesting Times! (with apologies to the FT’s We Live in Financial Times strapline)

Do you have a website? Of course you do.

Or perhaps you have a blog? Or have written a book or guide?

Certainly if you are a consultant or part of a business, then that business will have a website, right? And probably a blog? And you might be thinking about a forum or a newsletter?

Or perhaps a whole lot more, audio, video, reports, graphs, moving images and so on?

Either way, you are now publishing, aren’t you?

And, whilst a few websites may remain static digital business cards (and some should simply revert back to this status), the majority of business websites or websites for business people, need updating.

Updating today, and tomorrow, and the week after, and next month? That’s publishing – creating, displaying and distributing new content to the (hopefully growing) band of users.

In fact, how does it look if someone looks at your website and sees the last post or entry is from last year (ie last month, December)? Not good is it?

So, now the tail is wagging the dog. You thought it would be great to have website, you knew you needed to add content to get search engine ranking and so bring in the new enquiries and so forth; only now, the regular blog is getting harder to write. If you send a newsletter it is going out a week late (or two). And you are starting to think, can we keep going?

It is a good question. Or at least, it is good that you are asking the question. Sadly, many websites don’t address this issue – that is, they stagnate and then just sit on the web growing old and damaging your brand.

So, what do you do?

You have a choice, either return your website to a digital business card (such that it doesn’t need updating) or accept that a website is like a magazine and needs to be updated and refreshed on a regular basis.

The reason that so many websites fail, is because they fail to do one of these two things – update and refresh.

We are all publishers now (okay, accept those business that restrict themselves to just a digital business card) and, publishing needs to be done professionally and to a reasonable standard to maintain your brand.

If not, then your website risks joining the other 90% of living dead websites that fill up most of the internet.

Internet's 3rd Phase?

Is the development of the internet entering a new 3rd phase? I think so. And curiously, this phase is driven by credit and business needs not technical developments.

In the first phase – pre 2001 – the Internet was the modern equivalent to the goldrush. Lots of people were selling up and going for broke. Lots of these people broke down on the way, lost everything and made a real hash of it. But whilst this phase did burn a lot of money it still make some unknown people multi-millionaires. Some temporary, other permanently.

Equally, this first phase was the stage during which the infrastructure was laid down – domain rules were set, cables buried beneath streets, broadband was developed – but not yet distributed.

Phase 2 began after the 2001 tech bubble burst. During this second phase the internet went into a maturing phase and we saw proper development of internet marketing service companies. Pay per click became established and videos moved online too.

During this phase we saw You Tube sell for mega bucks and Google become a massive company with a worldwide brand. However, we also saw a lot of boutique and home businesses get established offering web design, writing and marketing/ SEO services.

We also heard the talk and early experience about web 2.0 – where the users create the content. This has morphed into Social Media – where the users ARE the content – the site is simply a bunch of tools hung together under a (trusted?) brand.

We also had the disappointment that most user generated content is rubbish and realisation once more, that there is no such thing as a free lunch. You can’t put up a webpage and expect millions of people to find it or even to contribute anything but self promotion and spam UNLESS you invest hours and hours of editorial management and development.

In this 2nd phase collaborative tools were developed online, but like broadband before, they were not widely distributed. And just as broadband became universally available and widely distributed in the 2nd phase, so social media and collaborative tools will do the same in phase 3 on the internet.

Phase 3 began with the global credit crunch in which business models collapsed and all businesses began searching for new and cheaper ways to find customers and do business. Hence, they are naturally turning to the internet.

This 3rd phase is killing local newspapers as we all search online or LinkedIn for our next job and no one pays for job advertising anymore.In this phase we are seeing the splintering of google’s control as we have ‘knowledge engines’ to go alongside search engines and a large number of niche based websites will be created and will achieve success – there are enough users online these days. Google will become the lumbering giant that Microsoft once was in phase 1 as new concepts of search and information/ ideas delivery bite into their marketshare.

Success will finally come to small online media owners, because advertisers are now willing to go online too! But, these small publishers will probably band together to form a bigger firms as they seek to use size to leverage their results or seek to use the outsourced media sales and publishing services.

The key factor in this phase is workers collaborating online as never before. This removes the need for rigid job roles and we will all become – essentially – freelance. This suits the company too – as they need to reduce their fixed costs following the 2008 meltdown in finance.

The internet business to build, in phase 3, will be an online networked business of freelancers. Overheads will be close to zero and this will allow the successful companies to build fat profit margins. Like all phases before, this will sound easy – whereas it is not – and will require dedication and focus to ensure success. In particular, the issue will not be how to attract freelancers but how to retain them and therefore keep their knowledge and experience of your markets alive and available to your business.

That, though, is a business challenge rather than a technical one. Albeit, one that needs to intimately understand the opportunities offered in this new and exciting 3rd phase of the internet.

Where are we up to with online publishing?

Ever since the web started to hit the mainstream back in the late 1990s people have been predicting the end of publishing as we know it. Let’s look at some of the things that have been tried since then and where they’ve worked and where they haven’t. As a quick review this is clearly glossing over a lot of detail.

The first response from publishers was to put magazine content in so called walled gardens online – websites run by internet access companies like AOL or CompuServe – where content providers looked to earn subscription fees from people paying to get their content.

This didn’t work, and publishers looked beyond the walled gardens to set up their own websites, extending their brands into online and targeting subscriptions and advertising.

Again that didn’t work, and, worse than that, a new breed of online-only competitors entered the market.

Publishers then largely dropped the subscriptions to focus on advertising revenue (of the major newspapers the FT is now probably the only one to still have paid-for subscriptions, with even the Wall Street Journal finally throwing in the towel).

To get better advertising demographic data the publishers still required people to join and provide email addresses so that they could send emails and track user behaviour. Email marketing proved more powerful than web marketing.

The early 2000s brought the period of the ’special report’ and the ebook. Longer-form reports and ebooks started to sell online, and magazine publishers that offered these specials were able to start making money both from sales direct to consumers but also from the advertising sponsorship.

With the vast expansion in small publishers offering ebooks, reports and blogs came the biggest challenge – how to be found? With customers drowning in spam, email became less likely to be delivered or read. With the rise of Google if you couldn’t be found on Google’s first page of results for your market you likely couldn’t be found anywhere.

In recent years publishers have even begun to drop the requirement to register for free for access to their content – partly in order to boost readership and so advertising revenue, and partly to boost their visibility in Google’s all-important rankings.

Long form special reports live on now only really if they can be advertising funded or sponsored rather than sold direct to consumers. There remains a market for paid-for content on the B2B side, but this is most sustainable where there is large amounts of proprietary data under control, or where there are extremely strong brands (e.g. The Economist).

So in general, what we’ve seen is a headlong dash to give away more and more content for free online in a market where it’s harder and harder to be seen and be found.

So where does that leave print publishing?

Print publishing is in a very interesting situation. Faced with the deluge of information on the web, often available for free, customers are having different problems.

One is that they can’t trust what they are reading on these millions of free websites. As a result there is more strength in having an established brand and readership that trusts the editorial content of your publication.

Another is that reading online, even with a laptop, is inconvenient, and printing is expensive (1ml of HP colour inkjet ink costs £1.70, compared to 23p for 1ml of 1985 Dom Perignon vintage champagne). A professionally printed copy of a magazine is read differently, and competes for a different share of the reader’s time – a share of their offline time.

A publisher with print titles has a unique offering, which, balanced with the right online elements, can bring great strategic advantage and long term value to the company.
So how should online and print media be used together?

The key to getting a real return on investment from print and online media together is to focus on the fundamentals – manage costs tightly and drive out every bit of revenue.

Revenue in publishing either comes from advertising or subscription. The most important question to ask before making any change to either online or offline publishing is ‘Will advertisers or subscribers pay enough more for this if I change it?’

What adds value for subscribers?

The answer to this question depends on having a good knowledge of your subscribers. If your subscribers are businesspeople, then look to see whether online services can help them grow their businesses.

If you have a large number of subscribers who run small businesses then they may not be able to profitably take advantage of online opportunities, but you could bring them together.

One concrete example could be where subscribers run highstreet businesses selling a physical product. Offering a simple online e-commerce site for your subscribers might give them another route to market, and the content on the site would boost your and their search engine rankings.
The answer for each type of publishing business will likely be different and will depend on their particular subscriber base and markets.

What adds value for advertisers?

Looking at the advertiser’s business can help here, but the main answer is likely to be to help them to sell more of their products.

Check that you’re not missing some of the simpler options first, like having an email newsletter. As a print publisher you have a stronger relationship with a customer than you do as an online only free content provider. This means that people are much more likely to read your emails – if you ensure that they have something interesting and useful in them.
This provides you with a simple extra marketing channel to place adverts in.

Again, the special reports option is worth exploring – this is likely to work better for a print and online publisher than it will for a pure online publisher because of the greater loyalty and closer relationship you have.
So what’s the bottom line?

The bottom line is that print publishers have a real strategic advantage over online-online publishers.

By carefully considering the added value for subscribers and advertisers of each element of your offline and online presence you can cut costs and add new revenue streams.

It’s not all doom and gloom in print publishing, and you can act now to protect and strengthen your business.
That’s all for now – I hope this post kicks off some thoughts. It can only scratch at the surface of this subject so let us know your thoughts and what works / doesn’t work in your business.

Is the Internet Killing Local News?

Take local newspapers. These businesses are closing down at a greater speed in this current recession for two reasons.

Firstly, their business models have been weak and the market oversupplied for some time. And the second is the internet.

Local newspapers come in two varieties, the free circulation ones and the paid for readership type.

The free circulation papers have relied entirely on advertising for their revenue. And this revenue comes from 4 key areas – selling property and related products, selling new cars, offering jobs and classified advertising (ie anything second hand).

It doesn’t take an expert to spot that the first three sectors are dead for different reasons. Property isn’t selling and developers aren’t building – so there is next to nothing to offer. Cars aren’t selling either, but the advertising budgets that remain are focused at a national level to stimulate national demand with attractive advertising – rather than offer local opportunities to purchase.

Why is this? Simply, in a recession people care about price and value more than convenience. The local showroom offers convenience it might not offer value, so customers head off onto the internet to source alternative offers.

Thirdly, there are very few jobs. Or at least, those jobs that are being offered are specialist jobs and not typical admin, telesales or retail – the bedrock of local newspaper job advert sales.

Again, jobs are also moving online but in a different form. For instance, more and more jobs are being offered (or advertised) directly amongst existing circles of networks – and this has been made possible by business social networking sites such as LinkedIn.

The barrier to receiving or offering a job on LinkedIn comes down to two aspects – geographical location and language.
Of these two, language is the most rigid, in that if the job requires fluent French and you only speak English, then you don’t get the job – no matter how clever or smart you are. However, for the right job, you’d move anywhere in the UK, right? And possibly abroad?

In a similar way, someone hunting for a second car in Bracknell might be willing to buy via ebay from a seller in Newcastle – but he won’t buy from a Calais seller, even though it is closer.

Again, let’s ask why? The answer is clearly language, but also in this case, the car will be equipped wrongly with left hand drive instead of right hand drive.

What this tells us is that language is the rigid barrier to products and services and many of those products are services are designed at a national level. Therefore more and more of the products that were sold locally are now sold nationally.

So, the trouble of local newspapers is that their attempts to go online have failed because they have attempted to keep their websites focus on ‘local’ whereas once a customer is online he wants the maximum feasible choose – and that makes the web national at least, and international in some cases.

For this reason, ebay.co.uk beats local newspapers for classifieds because it is national, not least because you pay once for national coverage and not repeatedly for each local newspaper edition.

So, the strength of a local newspaper – its local distribution network – is lost the moment it goes online because of the nature of its traditional business model.

You might argue that local newspapers still perform a service that customers want in covering the results of local football games (say). And it is true that this is a service that people want, but the point is that as soon as you put it online, you might as well cover all local football events across the English speaking geography. That means the UK and Ireland to start with, but could equally include any English speaking country.

Therefore, the internet destroys the local advantage in all these respects.

However, there is still one thing that happens at a local level that will never happen at a national level and therefore will seek localised advertising opportunities. These are events.

For instance, if I want to know which English country houses are opening their gardens for public visits this spring, I will look locally.

I may be willing to travel an hour from my home or even two – for something special – but most events will be advertised and consumed in a local area.

Therefore, local newspapers need to become What’s On guides to the local area and close down their ‘me-too’ attempts to sell second hand cars online. They will not defeat ebay.

Sadly, to date, the internet strategy of most local newspapers has weakened the one thing they have in their favour – the local franchise. But, there are alternative internet strategies that do leverage this advantage. In the next few years, those local newspapers that survive will be the ones that successfully develop What’s On guides and move them onto the web plus similar strategies.