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Asociación Técnica de Diarios Latinoamericanos
Boletín Semanal Mayo 15, 2017

While national titles and some big regional newspapers are showing positive trends and quite good numbers, it is clear that first movers tend to be market leaders and show good growth. However, many regional brands are still focused on transforming print subscribers to digital.

Over the years, you probably have heard the following from publishers:

  • We can’t cannibalize the newspaper!
  • The fall of print reach and advertising will stop soon. 
  • People will not pay for quality content online.
  • Digital advertising will continue to grow and we will be the winners.

But all of those assertions are wrong. 
“We should be confident about what we produce and be willing to put a price tag on it.” 
– Kalle Jungkvist, WAN-IFRA’s Principal Consultant for Reader Revenue

For most local newspapers, however, the overall paid content performance is weak. There are many different reasons for that: We often started too late or have had difficulties defining the content that really differentiate us from the competition.
Local is a strength, but not a niche in itself. The most important task for any publication wanting to go into or relaunch paid content is to answer these questions:

  • What part of your offer is really driving engagement in your community?
  • What is the real size of your digital reach?
  • How many local, daily unique users do you get?

I suspect it is a smaller number than you tend to think about your digital audience as.
We are living in times of growing streams of news and views of extremely varied quality, whereby fake news is just one problem.
Combined with the growth of hate speech and slander, many turn to more traditional and trusted brands for news.

Core product is valuable
This trend shows that the core of our journalism – good and trusted storytelling, analysis, expert comments, insightful opinions, and exclusive interviews – is a valuable product and can convert readers to subscribers.
So who around the globe is winning at reader revenue? There are many companies that are showing the fruits of well-executed strategies, some of which our consulting team has helped.

In terms of models, the large majority in the US market use the metered model, most likely inspired by The New York Times. Just a few use a hard paywall. The trend in the US is clear: The metered model increasingly dominates the market. 
In the European market, it is more or less the other way around. The freemium model dominates, but the metered model is also quite common. 
Let’s take a look at a few of the best cases.

Aftonbladet
Before joining WAN-IFRA Consulting Services, Jungkvist was Editor-in-Chief of Aftonbladet New Media, there he launched Aftonbladet PLUS in 2003, a freemium model digital subscription. He set the price very low – only 2 euros a month. Why?
He says, "We were a first mover – and a little afraid of what could happen. Was there a risk that we could lose our market leadership? We also wanted volume; the more users who learn to pay the better, even at a low price.

"In hindsight, I think we were right to set it at such a low price. We did not lose any traffic, despite the fact that we were the only newspaper in Sweden with a paywall for nearly 10 years. For a market leader, it fell on us to educate the market."
Today, the price for Aftonbladet PLUS has risen to 6 euros a month and 10 euros for a premium offer. In total, Aftonbladet has around 260,000 digital subscribers, generating substantial revenues. 

Svenska Dagbladet
The next example is the Swedish newspaper Svenska Dagbladet. They have implemented what is often called a bridge strategy. It is a strategy that maps the customer journey from print to digital and the steps to convert readers into digital subscribers. It is used by quite a few newspapers and demonstrates important pricing differentiation for different groups.

As at most newspapers, print subscribers are usually older. The first goal is to give them digital access and transform them to active digital consumers. For this group, an e-paper version of the newspaper is very important, as it replicates the newspaper reading experience online.

At the same time, the paper has a big digital audience where the majority are younger and many have never been print subscribers. In that case, the e-paper is not as important.

Given that the two groups have very different behaviours and preferences, after several experiments Svenska Dagbladet developed two price levels: a 19-euro package for the traditional print subscribers that includes the epaper, crosswords and archives; and a cheaper 10-euro offer for digital subscribers without the extra services mentioned.

Folha de São Paulo
Many places outside the US and Europe are still only beginning to explore paid content and reader revenue. The Brazilian newspaper Folha de São Paulo is one example of a successful strategy in South America.
They launched a metered paywall in 2012. Twenty articles per month were free. Digital subscriptions after three months exceeded their expectations, and they did not lose any traffic.

Two years later they attracted 150,000 digital-only subscribers with a price of US$ 12.80 per month. They also had 350,000 print-plus-digital subscribers who pay $38 per month. The growth since that time has not been as strong because of the weak Brazilian economy. 

The future of reader revenue
And what about the future of paid content? In Europe, the next wave of successful models is already being tested.

A new crop of purely digital, crowdfunded initiatives have communities built in from the start. The idea behind KrautreporterThe Correspondent or El Español is that you know and trust the journalism team in a small newsroom. Reader input is valued and encouraged, appealing to a group of savvy, independent-minded millennials who are willing to pay around 5 euros per month to support the project.

The Guardian is also heavily pushing a donation strategy, but with clear price points. It’s similar in Germany where journalism is not tax deductible. You can’t simply ask readers to donate what they want; there has to be a clear value exchange – which explains why readers of Die Tageszeitung in Berlin have a choice between joining the Cooperative Society that owns it (and therefore contributing more capital), or simply subscribing at a fixed rate.

Expert advice from MMA and at Congress in Durban
If you would like to learn more about the best cases in paid content or ensure that your launch is successful, you can learn directly from Kalle Jungkvist and Ben Shaw on WAN-IFRA’s new online learning platform, the Media Management Accelerator.

And they will be available at the upcoming World News Media Congress in Durban, South Africa, from 7-9 June. Both Kalle and Ben will be joining a panel discussion on 9 June titled, “Driving Digital Revenue.”

Along with Stephane Pere, Chief Data Officer (Global) for The Economist, they will review the changing mix of revenue, including advances in digital paid content models and the rising role of programmatic advertising and creative ad units. Stephane will share how The Economist Groupis deploying its data strategy.

 

Asamblea ATDL en Lima, Perú 2016

 

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