Digital transformation continues driving the news media industry and during this week’s Webinar, INMA members heard why it’s vital to focus on readers’ needs and preferences to drive sustainability and profitability.

Readers First: A blueprint for digital business transformation, offered insights from Nils Arne Bakke, professor of economics, and Jens Barland, associate professor of media studies, both of Kristiania University College in Norway. Pam Siddall, co-president of Advance Local in the United States, also shared some of her company’s experiences and learnings. The Webinar was presented by the INMA Readers First Initiative.

Bakke and Barland, who authored a research paper on the readers first paradigm, explained that such major shifts happen when an outside entity changes what’s considered the norm within an industry.

“That’s exactly what happened for the media industry,” Bakke said. “Even if a lot of journalists thought about it as a journalistic operation, their main income came from advertising. So it was basically a marketplace for advertising that financed the whole operation.”

Then, digital platforms came along and changed the game. That started a decline in advertising and sparked innovation as publishers fought to survive. Much of the early experimentation failed, but Bakke and Barland’s research looked at some of the criteria that allowed companies like The New York Times, The Wall Street Journal, and Aftenposten to succeed. Ultimately, Bakke said, they discovered four key factors driving success in new models:

1. The value proposition must change. “It has to be major. What is the product you offer, and who is your customer?”
2. There must be a major shift in how the product is delivered.
3. There needs to be a cultural shift in operation “because you have to rethink what you’re doing, which often is the most difficult.”
4. The model must be different from what was being done before.

“To succeed with the reader first you have to innovate in terms of how you’re thinking about journalism,” Bakke said, noting the emphasis must be on producing high-quality content that readers are willing to pay for. That wasn’t always the case in an advertising-driven model.

The digital advantage

The digital format means news companies can learn more about their readers’ preferences, learning what types of stories they prioritise.

“This has a huge impact on what you can do. But to make it work, you have to be willing to innovate in terms of a product — implying that journalism has to change,” Bakke said.

The researchers noted a significant difference between media outlets that took advantage of the new value proposition related to technology and those that tried approaching digital the same way they had approached print: “A lot of newspapers experimented in this crisis phase with paywalls and most of them failed,” Bakke said.

Over time, news media companies have learned from platforms like Netflix and Facebook, adapting to provide personalised user experiences. Barland said one big difference is that in today’s digital environment, publishers gain insights and feedback immediately. Leveraging that technology is critical to a readers first mindset, but it also requires a change in mindset within the newsroom:

“You need to drive a cultural change in the newsroom that [journalists] are more willing to cater to the responses from the readers and adjust their own way of working to ensure that produce something that people are willing to pay for,” Barland said.

Even with all the technology in place, success will elude companies if they don’t change their culture.

Barland shared the example of Amedia, which looked at the data and realised it was producing too much content on areas like sports and culture. It changed the coverage and increased engagement.

The readers first mindset is a journey of continuous improvement Bakke added, one that requires cross-functional teams to test out new initiatives and measure the results: “Doing this every day creates a kind of continuous innovation machine,” he said. “Journalism always was a day-to-day kind of business, but it has to be improved by combining it with new technologies which make it possible to multiply the positive effects.”

How Advance Local did it

Advance Local began a massive transformation in 2012 when it decided to “completely disrupt our business model,” Siddall explained. The idea was to create a robust, sustainable digital company, and the changes were dramatic.

“We reduced our print publishing days in most of our markets to three days a week from seven days. We drastically changed our content model,” she said, adding that journalists pivoted to focus on publishing for digital platforms.

“We changed our sales structure and our go-to-market strategy, really focusing on those top-tier digital prospects. Talk about culture change!”

Then, it changed its audience development strategy and focused on creating a subscription business. It didn’t create a digital subscription business at that time, but its digital advertising was thriving. For the next two years, Advance Local focused on growing its audience and digital advertising revenue.

In 2018, it brought all Advance Local publications together as one company, hired more journalists, and began targeting communities that didn’t have print publications. Then, during the 2020 COVID-19 pandemic, Advance Local pulled the trigger on its digital subscription strategy.

“We invested in a customer data platform [and] we hired data scientists to work with us to leverage that across the company — not just in content, but really across our other areas of the company,” Siddall said. “I think it’s fair to say most of our decisions are all baked in data.”

She also emphasised the importance of the right leadership to lead such a cultural change. For Advance Local, it starts at the top with the CEO and is shared through clear and consistent communication.

“We have a mission that drives every decision that we make. We have a leadership team that understands that mission. They lead by example, alignment around the sustainable digital future and what that looks like,” she said.

Employees understand it and it affects how Advance Local structures incentives, manage performance, and look at dashboards or KPIs.

“You have to pick what’s most important and build your business around that,” Siddall said.

This readers first approach has meant responding to what its audience wants. Advance Local has invested in more journalists, generative AI tools, high school sports coverage, and audio, among other things. The data will continue telling them what readers are looking for — and the company will continue to listen.

“If we don’t go where the readers want us to go, then we’re not going to be able to build the audience or serve the audiences or serve the communities that we live and work in — and that matters,” she said, “We have to go where the readers want us to be, and I like to think that’s what we’re doing.”

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .