Aftonbladet, the biggest news platform of the Nordic countries in both print and online, has diversified its monetisation strategy by implementing e-commerce.
“It’s no surprise to anyone that the publishing industry is going through a large change right now,” said Mikaela Jaconelli, head of sales at Tipser, an e-commerce partner of Aftonbladet. “The publishers need to react to this.”
Speaking in a members-only INMA Webinar on Wednesday, Jaconelli said that on one side are drastically declining ad revenues, and on the other side are the users, who are consuming news content in a different way.
This has led to a fourth revenue driver alongside subscriptions, advertising, and affiliates: e-commerce.
Many people confuse affiliate revenue with e-commerce revenue, she said. Affiliate models send customers to an outside link, while e-commerce allows the organisation to conduct keep them on its own Web site and grow direct collaborations. Direct e-commerce also usually brings higher revenue streams and higher conversions.
“It’s a trend we have been seeing for some time now, and I think we can finally conclude that a fourth revenue driver has taken place.”
Many players on the market are speculating that e-commerce will be one of the main revenue sources for online media publishers in the future.
The embedded e-commerce ecosystem
Jaconelli led INMA members through the complex e-commerce ecosystem, though she noted that adopting e-commerce does not mean publishers have to hire 50 additional staff and take on huge risks.
“We’re talking about something different here — a phenomenon we like to call embedded e-commerce. An important aspect of this is the provider behind the technology takes care of what’s needed to run the traditional e-commerce project.”
This allows publishers to focus on content and subscribers. Embedded e-commerce is built on small, modular building blocks, giving the publisher a lot of flexibility.
One example of this is Erbjudanden, the e-commerce site of Dagens Nyheter, which features embedded e-commerce on the loyalty section of its Web site. It allows consumers to buy different products from totally different brands, while staying within the DN site and content.
E-commerce and journalistic integrity
Should publishers place embedded e-commerce into news content? The simple answer is no, Jaconelli said. The good news, however, are that there are many suitable places in a publisher’s Web site for e-commerce.
The Dagens Nyheter example shows how a publisher can use e-commerce to build reader loyalty. Transparency is key.
“Communicate that you are including e-commerce elements in the content, that has the point of inspiring readers,” Jaconelli said. Publishers should not forget that the entire model of embedded e-commerce was developed as a reader service, she added.
Jaconelli shared some factors for publisher success with embedded e-commerce.
- It requires a long-term commitment.
- Don’t get comfortable — study data and act accordingly to optimise projects.
- Convert existing advertisers into e-commerce suppliers.
- Always be relevant and only sell what is of value to your audience.
- Be transparent about your commercial content.
One success story is Aftonbladet, which sold 300 cookbooks via e-commerce on about three minutes of work put into it. The company used an existing article that had that mentioned a certain cookbook — one that was already for sale in their e-commerce line. They incorporated that into the content and sold hundreds of books very quickly.
“You can transact on inspiration if it’s done right,” Jaconelli said.
The Aftonbladet e-commerce experience
Daniel Britz, digital growth manager at Aftonbladet, discussed his organisation’s journey in this space.
Aftonbladet is relatively new in the affiliate and e-commerce models, and Britz said it is important to have “more than one egg in the basket.”
The publisher has a very good digital subscription base on its freemium model, which provides one of its major revenue streams, along with advertising.
“The thing here is to find more new revenue,” Britz said. “I think as media you need to test it live. And of course you can build things by yourself, but there are some costs of developing thing. That’s why it’s pretty nice to go into a revenue-sharing deal and test things.”
When it comes to embedded e-commerce like Aftonbladet’s recent partnering with Tipser, a big advantage is that the user does not leave the publisher’s site, he said.
Britz spoke about the differences between digital advertising and e-commerce revenue. With advertising, a publisher needed to garner a lot of pageviews to realise any real revenue. But that is shifting, and conversion has become more difficult. Content is still king, and e-commerce that can co-exist with that content can more easily bring in larger revenue.
The cookbook article is an example of how Aftonbladet is back-populating to match content with integrated e-commerce that easily goes with it. This is a strategy Aftonbladet is implementing in these early days of its foray into embedded e-commerce. The company is doing this in feature departments such as food and health, not in news.
“Then you can start tweaking things,” Britz said. “You need to be able to analyse the traffic and test things.”
For example, Aftonbladet has a Corona Live offering and places affiliate links that would be of interest to readers in that section. One product was a book, which did not perform and so they removed that product link.
“You need to test things constantly to see what sticks,” Britz said.
Another way Aftonbladet benefits from content related to products is in search. When people are interested in buying a product, they often conduct searches to get more information. And if a publisher has content about that product, consumers find them and their traffic increases.
The Aftonbladet team, which consists of two full-time staff and an extra part-time staff member, is constantly adapting the strategy, Britz said. They work closely with potential merchandisers for the Tipser e-commerce platform.
The importance of diversification — more than one egg in the basket — cannot be overstated according to Britz.
“Even if you’re small, if you only have one revenue stream it’s a risk. If you have two, it’s a smaller risk but still a risk. But it doesn’t matter if you’re big or small, it’s better to have more streams of revenue.”
The next big milestones for Aftonbladet will be to increase the e-commerce revenue stream and to tweak and optimise the model. The team is also testing live shopping on TV and how to merge that into their model.
The e-commerce initiative is not only about revenue for Aftonbladet, it’s also about the user experience.
“It goes hand-in-hand,” Britz said. “If you build a bad user experience, you will lose the users, and then you will lose the revenue. We’re also looking into how could the e-commerce enhance the value for the subscribers.”