More than 50 news media executives from 14 countries traipsed throughout Manhattan by bus and on foot Thursday and Friday, visiting 21 media publishers and vendor partners on two study tours:
- New Avenue for Content, Audience, and Revenues (also known as the “blue tour,” led by Alan Mutter, an international consultant who teaches at the University of California at Berkeley and veteran INMA study tour leader) visited The New York Times, Google, Dow Jones, Lotame, Chartbeat, Nativo, Bloomberg, WNYC Studios, ProPublica, and Playbuzz.
- Mastering Innovation (also known as the “red tour,” led by Robert Whitehead, a self-styled “disruptionist,” current member of the board for McPherson Media, and formerly with Fairfax Media) visited/heard from Facebook, Condé Nast, NBC Universal, Hearst, Parse.ly, HuffPost, PageFair, MediaMath, Piano, Advance, and Thomson Reuters.
1. Media companies are replacing advertising revenue with subscription revenue.
Edward Roussel, chief innovation officer at Dow Jones, has seen what he describes as two “tectonic shifts” in the media industry: The shift from print to digital and the shift from a fundamentally advertising model to a fundamentally subscription model.
“More than half of Wall Street Journal revenues are subscriptions as opposed to advertising,” he said. “That’s a big shift. Ten years ago, most big newspaper groups — certainly in America — were probably getting 70 to 80% of revenue from advertising. We’re managing that transition, away from print-first to digital-first, away from an advertising-based revenue model. It has made our strategy simpler. Our goal is to provide news services and projects that people are willing to pay for. That makes us far more focused on the user experience.”
His advice for innovation: Get going. Move fast. Break silos.
The focus at Dow Jones is three-fold:
- The future of news/experimentation: Get familiar with chat apps, VR/AR, personal assistants and the like now. If they don’t become a big deal, ditch them later.
- Mobile: Step back and see what problems the team is trying to solve, and make the mobile experience personalised and beautiful.
- New business disruptor: “Our job is not incremental advances,” Roussel said. “We don’t always have to be the disrupted. We can also be the disruptor.”
“The marketing funnel for media used to be relatively traditional,” said Trevor Kaufman,
CEO of Piano, a software platform that runs audience-revenue programmes for publishers including AOL, The Economist, Gannett, Hearst, McClatchy,
NBC Universal, and Time.
It used to be that a reader would intentionally pick up or go to a product. Now, a reader might click on a friend’s Twitter link and end up on a Web site reading a story with no real idea the site or source. This makes your potential audience hard to find, yet find them you must.
“Most traditional media companies are not really focused on hard-core consumer marketing,” Kaufman said. A contact of Kaufman’s at The New York Times said the No. 1 indicator of whether a reader will become a subscriber is the number of times they visit your Web site. “But when have you ever been to a Web site that asks you to come back? It’s somehow uncool to engage the users. That’s what’s got to change.”
Why? Because media companies are transitioning from primarily advertising-revenue supported to primarily audience-revenue supported.
“Unless you believe there’s going to be some change in this infinite inventory model or unless you believe that Google and Facebook are going to get less good at this, it’s difficult to maintain the myth that premium advertising is going to pay for content.”
2. Technology + humans = the future.
Bloomberg has a new initiative called Bloomberg AiQ, combining AI (Artificial Intelligence) and human IQ.
Thomson Reuters showed study tour partcipants what they could with automation and data, such as auto-writing stories, but shared that an editor is necessary to draw the conclusions and craft a unique lead to articles.
Likewise, Hearst explained its branded lifestyle content, pointing out that the most successful campaigns integrate well-planned ad content with editorially driven interaction with current Internet topics.
All three media companies discussed the essential application of human creativity within the automated future.
3. Unique content and brand are the great selling points.
“Is your content really different? Is it really good?” asked Monica Ray, executive president for consumer marketing at Condé Nast. “If you can’t say yes to both of these, you can’t charge for content.”
Kaufman agreed, adding this nuance: “The great myth is that people are paying for articles. They aren’t paying for articles. They’re paying for great access to a brand they like.”
4. Data must be used smartly (whether in-house or managed by a third party).
John Levitt, general manager at Parse.ly, says media companies should created a “data-informed culture, not a data-ruled culture.”
“Analytics shouldn’t tell you what to do next,” he said. “It should give you an idea of what to do next.”
Vincent Wu, head of operations at HuffPost (which uses the Parse.ly data platform) agreed: “It’s not the more data the better.”
Gustavo Morales, senior client services manager at Latome, offers this advice: First, somebody at the media company must “own” data management. Second, understand the data process is a bit like “black magic” — a leap of faith like a scientific experiment — in the beginning.
5. The “Trump effect” is a real thing. U.S. President Donald Trump came up at least once in most presentations over the two days of tours — either in his current job or as a candidate during the 2016 U.S. election.
Between the November elections and the end of January, subscriptions at The New Yorker increased 250%. The Atlantic, The New York Times, The Boston Globe, and The Guardian all set subscrption records during that time frame, as well. ProPublica’s donor list surged from 3,500 in 2015 to 26,000 in 2016, due in great part to “Last Week Tonight” host John Oliver’s mention of it shortly after the November election.
Suzi Watford, executive vice president/chief marketing officer at Dow Jones, listed the company’s five key drivers:
- Having a “big hairy goal” of three million subscribers in three years.
- Strategic vision.
- Rebuilding paywalls.
- Using its greatest asset to sell: journalism and content.
- Donald Trump.
Other interesting facts learned along the way:
- 77% of adblock users are willingly to view ads, up from 66% in 2014 (from PageFair). What are they most willing to view? Image displays and skippable video.
- 79% of people only scan online content; 16% read it word for word (from Playbuzz). Along those same lines, one in three readers spend less than 15 seconds reading an article they’ve landed on.
- The acceptable wait for an Uber used to be eight minutes. One year later, it was four minutes.
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