Editor’s note: This is one of 19 case studies featured in INMA’s strategic report “Smartphone App Lessons for Media Companies,” released in July.
The Dallas Morning News spent 2014 and this year shifting its app strategy from one of market saturation to a focus on just a few apps that serve its audience and extend its brand.
In the app boom of 2011 and 2012, as developers across the tech industry were pushing out new apps for anything and everything, the news media company developed about 30, says Christopher Williams, digital strategist for the newspaper.
“The strategy here at the time was, let’s build 100 apps and let’s really start to kind of fill the shelves of the App Store and take over that way, by saturation,” Williams says. “And by pure network size, maybe we’ll start to garner audience.”
But while it is easy to come up with many ideas for apps, not all of those ideas will find a place in the market. And the maintenance of two or three dozen apps is a massive undertaking, Williams says. So the Morning News went small, reducing its portfolio to just four apps.
The company offers a core news app using its main news brand and a second app that offers only a digital replica of the print newspaper and is popular with tablet users.
It also offers a third app through a partnership with a popular local sports radio station, The Ticket, KTCK-AM, which includes streaming audio as well as Morning News sports content and a DVR functionality provided by the Morning News digital team.
The fourth app, currently under review and in need of a rebuild, focuses on high school sports, which are hugely popular in Texas. All are free to download and include advertisements.
In shrinking its app portfolio, the Morning News has increased its curation of content, going from almost total automation to a mix of the two, with opportunities to boost certain kinds of content or specific stories.
The company is also considering recruiting insiders and specialists in certain content areas to contribute topical content on popular subjects, which could spill over from mobile to the Morning News Web site and also be cross-promoted through the content providers’ own channels.
As such specialised content grows, Williams suggests, it could expand beyond just being a channel of Morning News-branded content and become its own brand that could expand to the national level, embracing a much larger audience and the potential revenue that would come with a significantly larger user base.
The Morning News has outsourced its app development to a legacy print agency that has branched out into offering a wide range of digital support, from ad-hoc campaigns to full app solutions.
The partnership is likely to continue for some time, Williams says. But as the news media company plans for future app build-outs, it is considering the merits and challenges of creating an internal app team and how its workflow would be structured.
While it would be less expensive to develop apps internally, the company would then have to ensure that the development team had work to do after the launch of an app. It would no longer be able to go months without any costs related to app development.
But contracting top-tier development talent is expensive, ranging about US$150 to US$250 per hour. Building a new app from scratch and integrating it with an existing content management system can cost from US$200,000 up to even US$1 million, depending on the outsource partner and its processes.
Costs have also increased over time, Williams says, recalling rates of US$75 to US$90 per hour just a few years ago and apps built for US$50,000 to US$80,000. It is still possible to find developers willing to work for lower rates, but there is a trade-off:
“They’re usually the smaller houses,” Williams says, “where the quality isn’t necessarily any different but the turn-around time can be, because you’re talking about much, much smaller teams and much less support that can be called on to get certain things pushed through, like design and creative, and things of that nature.”
The media company’s initial approach to generating revenue through apps was similar to that of a stock market investor who imagines her money working for her while she’s sleeping, with an expectation that advertising revenue would more than cover the apps costs, Williams says.
But the cost-per-impression has never been as high as the company would like it to be, and over time it has begun to explore other revenue opportunities.
Now the Morning News is focused more on giving its audience the content it really cares about. That includes important breaking news stories, but also niche interests for readers, balanced through thoughtful curation and monitored through data analytics, as well as through direct feedback from consumers.
It has also shifted away from what Williams called “the NASCAR approach to advertising … getting as many ads in place as you can” toward “a very consumer-focused application of advertising where we don’t cross the threshold of desirability or patience with advertising.”
The media company is also considering custom solutions for certain advertisers that would be consumer-friendly but also drive key performance indicators for its clients.
The Morning News has moved away from using a content paywall on both its Web site and the app because it was difficult to separate out content that should go behind the wall vs. free content. It was also a challenge to present consumers with a value proposition.
Now it is considering, among other things, targeted micro-subscriptions to give readers additional information about specific areas of interest, such as health or travel.
Current app revenues are not as high as the company would like, in part because some elements of the apps have become dated, an issue that the Morning News is addressing.
“Apps are not like fine wine and cheese,” Williams says. “If you don’t continuously update them, they don’t age very well. Realising that this year, I think, was us really turning the boat in the right direction. The fact that we’re rebuilding them for some big re-launches this year means that we’re on the right path.”
The Morning News has found that app users are much more engaged than readers using browsers on either desktop or mobile. Williams suggests many browser users are “transient consumers” finding content through search and social media.
“They come in kind of through a side door, right at the article, and then they exit,” he says.
But app users have more significant relationships with the Morning News brand or its content and tend to come back for the same kinds of content repeatedly.
Because app users are so deeply engaged, Williams says, future apps will be built largely around specific content or utility needs to satisfy a particular potential audience it has identified.
As part of its rebuilding efforts, the Morning News has turned to its readers, through one-one-one interviews, to learn what they really care about and want, whether that is content or app navigation. It has developed a longer-term strategy focused on satisfying consumer needs rather than getting a huge quantity of downloads in a short period.
“We’re heavily invested in how much time people spend in our apps and how can we continue on a path of not just new downloads every single month, but a consistently growing unique visitor count that really shows our audience is not only growing but also very loyal,” Williams says.