Knowing their sources of reader revenue is key to newspapers’ continued existence and success, says Editor-in-Chief of Weber Shandwick, Vivian Schiller.
Citing the fact that print media in the United States currently gets three times as much share of revenue as they are “getting eyeballs”, Schiller warned that when this evens out, “it won’t be good news for newspapers” that haven’t identified alternative revenue streams.
Illustrating her point, Schiller recalled that during her 2006 - 2008 tenure at the New York Times (NYT), “print display revenue probably represented 75 per cent or 80 per cent of revenue.” Compare that to The Guardian in London, where print display revenue is now fourth in terms of total revenue.
Schiller was addressing members of the local media during the Unit Trust Corporation’s (UTC) second annual Media Workshop, held on Friday at Jaffa at the Oval, Port of Spain.
Digital display advertising is another evolving area. Schiller said what was once “a huge growth engine for news organisations has now either flattened or is declining, as advertising moves to mobile and as Facebook and Google gobble up all of that revenue.” Specifically, 80 per cent to 90 per cent of all mobile ad revenue goes to a Facebook or Google platform, not to individual publishers.
There are two growth areas though – branded content and reader revenue.
In terms of branded content, the NYT, CNN and British publications, The Financial Times (FT) and The Economist have set up separate newsrooms for branded content so that it’s distinct from that of editorial. They produce everything from blog posts to videos and info-graphics, all clearly labelled “branded content” or “sponsored content”.
Reader revenue, formerly referred to as subscriptions, are having a resurgence in the US.
“The NYT has had great success with their model where you can read a certain number of articles for free before you have to pay. Others, you have to pay from the very first click – the Wall Street Journal has that. I would say that within two years, every legacy print newspaper organisation in the US will have some form of reader revenue in the form of digital subscriptions.”
In order to maximise on this, Schiller advised that newspapers need someone in place whose sole duty it is to track and analyse sources of reader revenue and identify ways to enhance such.
“The kind of complexity, pricing, customer service management, (involved in this) requires that every news organisation has, at the executive level, somebody I’ll call an audience development executive. Someone who works hand-in-hand with the editorial leadership to understand where the audience is, to understand the metrics and the data around how people are consuming your content, how long they’re staying, what content they like, where are they spending the most time, where do they click from. All of that is essential in order to make any of this work.”
“Of course it’s important to the business but it’s critical for newsrooms to understand how people are finding their stories and how people are engaging,” Schiller declared.