Africa has moved to an increasingly digital, mobile, and social media environment with increasingly intense competition for consumer attention. In response, legacy news media companies need to develop new, sustainable business models.
Four companies doing this successfully include Business Day in Nigeria, IOL Independent Media in South Africa, Nation Media Group in Kenya, and The Standard Group in Kenya. Speaking at Wednesday’s Africa News Media Summit, executives from each of these companies shared their case studies and strategies with INMA members.
The Standard Group: Subscription and paywall journey
Like most news publishers today, The Standard has had to diversify its revenue model and create new revenue streams in addition to advertising.
“Around the world we’ve seen a drop in ad revenue,” said Jared Kidambi, head of reader revenue. He attributed this largely to the low CPMs from social media, Big Tech platforms, and free online advertising.
“At the end of the day, you can have millions of visitors on your platforms, but the revenue you’re getting doesn’t really make sense,” he said.
In July 2020, users were able to register directly on The Standard platform to read premium content for the first time. This premium product is called The Standard Insider. By October 2020, the team began experimenting with a hard paywall on The Nairobian Web site, and a freemium model on The Standard that allowed users to read 15 articles before registration was required.
“By January of this year, we decided to set an audacious target of attaining at least 900,000 registered users,” Kidambi said. “As of today, we have over 800,000 registered users on our platform, and we are certain by the end of the year we will be able to attain the 900,000 that we set.”
The team continues to experiment with the freemium model, and in April 2021 redesigned the digital platforms to fit The Standard’s strategy of providing content that really matters to its readers. They conducted a lot of reader surveys to build the content strategy.
He acknowledged that The Standard encountered some challenges in this process that other news media might also come up against. “If you really want to implement a paywall, just start,” Kidambi advised. “There’s no right time. Once you start, from there you are able to learn your audience, learn what truly works for you. Then from there, you’re able to implement as you grow.”
Business Day: Digital models for success
Onyinyechi Eze, head of digital services at Business Day in Nigeria, echoed what Kidambi said about these being challenging times in revenue and monetisation for most news publishers.
In terms of sales, Business Day is at the mature stage with its print media, but still at the growth stage for digital.
“We’re seeing that print media is going through a decline now, but it’s still big revenue for us as publishers,” Eze said. “It’s forecasted that it will further decline through 2024.”
A reader revenue subscription model is relatively new in Nigeria, and Business Day was one of the first to roll this out. When developing this model, the team looked inward at the company’s mission and took a holistic view of how to generate revenue.
In addition to digital subscriptions, Business Day monetised conferences and other events through sponsorship and ticket sales, began offering corporate subscriptions, and bundled print with digital. They also created valuable partnerships and affiliate relationships.
“We looked for how we can monetise what we do,” Eze said. “Places that we didn’t originally see as a monetisation unit, we started to see how those could actually fit inside our digital strategy.”
As far as the Web site paywall, Business Day took a dynamic and hybrid approach. This combined a freemium paywall where 40% of articles are behind a metered paywall, where a reader must pay after eight articles. The dynamic aspect included personalisation and analysing reader behaviours and their willingness to pay.
“Diverse strategies meant we were really able to meet our audiences,” Eze said.
Additional revenue streams implemented included advertising, magazines, affiliate revenue-sharing, and premium newsletters. The result of this digital-first strategy was a digital subscription growth of 40% in a one-year period, with digital revenue growth of 244%.
“It has been an amazing journey, and with this model and the strategies we have adopted, we have really seen great success.”
Independent Media: The road to reader revenue
Lance Witten, chief audience officer at the African News Agency and editor-in-chief at IOL Independent Media in South Africa, said his company launched several digital innovations during the COVID-19 pandemic, such as digital magazines and content marketing.
They brought everyone along on the journey, from print legacy teams to the commercial and sales teams, marketing, and accounting. This philosophy of building together is an important ethos at the Independent.
“We run a very lean structure and very lean team, which forces us to work smart,” Witten said. “There are two core competencies we really focus on.”
Witten advised companies to build the tools they can’t buy. For example, the Independent created its own data analytics dashboard called Mr. Jones, which informs the content strategy.
To play the reader revenue game, Witten said, a media company must have the right tools, train and mentor its people, know who they are and what audience they want to attract, give the audience content they can’t get elsewhere, and be data-driven.
“That has really been the focus of our reader revenue journey,” he said.
Nation Media Group: Digital transformation journey
As a company founded in 1959 in Kenya, Nation Media Group (NMG) has a powerful reputation and is the largest independent media house in East and Central Africa. But as print revenues declined, it began looking at how to accelerate its digital transformation journey, explained Max Okeyo, head of strategy and innovation. And, although the journey is not complete, the company has made impressive strides in its transformation.
In looking at its strategy, Okeyo said the company had to look at what was driving industry trends. It defined several important factors, including the impact of Big Tech and the use of AI to lure away NMG’s audiences, an increasingly fragmented digital audience, and the possibility of reader revenue models.
Recent trends and changes have led to the rise of a new type of customer, one that is more discerning and more informed. Being able to provide more for them to discover on the NMG platform is critical, Okeyo noted.
“So as opposed to just content, what else are they willing to do while on our platforms? Are they willing to engage suppliers or service providers of different things? Is it health education? Is it gadget reviews? What else are they willing to achieve when they get onto our platforms?” he asked. “And how do we leverage that opportunity to be able to derive more value in monetary terms?”
These considerations have all been central to NMG’s digital journey as it looked to transition audiences from the newspaper and traditional TV and radio into consuming content — both premium and free — on its digital platform. That journey, branded Nation Africa, began with getting company executives on board and helping them understand the objective. With a shared vision, they were able to deploy the mission and ensure everyone across the company understood and supported it.
One obstacle on the journey has been reluctance of readers to accept a paywall, and that’s a challenge they are still working through. But, he noted, this transformation is a journey, not a quick overnight trip.
“It’s a mindset shift. A lot of them were so used to consuming our content for free on the Web site, so we have to give them a reason to make that transition. We have to develop content that helps them make that shift. And so quality journalism then remains key in driving subscriptions for the products that we’re developing.”
The Summit continues Thursday.