What better way to talk about the demise of newspapers than to quote Mark Twain? When an enterprising reporter tracked him down in London on rumors of ill health, he set the record straight: “Reports of my death have been greatly exaggerated.”
Just so with newspapers. We’ve been hearing news of the industry’s grim fate for a number of years. A study by Pew Research Center’s Project for Excellence in Journalism in 2012 – “The Search for a New Business Model” – reported that newspapers lost $7 in print revenue for every $1 gained in digital. By the end of last year the numbers had sunk to $16 in print losses for $1 dollar in improvements to digital advertising. To combat steep declines in revenue, more than a third of U.S. news organizations have implemented paywalls, according to News & Tech. While paywalls can increase subscriber revenue, they can also reduce the reading audience by as much as 40 percent.
Gloomy, yes. But I don’t think those stats announce the death of newspapers. The truth of the matter is that many newspapers and other media companies are in a state of evolution, not extinction. If there is a death, it’s in the extreme economic disruption of the historic business model. I assume no one knows that better than Amazon founder and CEO Jeff Bezos. His acquisition of the iconic Washington Post this past month for $250 million will undoubtedly turn out to be a bellwether. In an interview with the German paper, Berliner Zeitung, Bezos had earlier predicted there would be no print newspapers in 20 years. Many readers, however, still currently prefer a print edition, he acknowledged.
Some newspapers are already making huge strides in straddling the print, online, social, and mobile worlds. Frankly, one of the big differentiators is something that seems far afield from a working reporter’s life, and that’s data! Technology offers not just new ways to deliver content digitally, but also makes it possible to track readers and viewers in real time, analyze their preferences, target advertising, and deliver more relevant information quite literally from moment to moment. Here’s how publishers can use data to improve their businesses:
- Develop data-driven monetization strategies. Every department in a media company has the opportunity to adopt monetization strategies based on datasets delivered across traditional and digital platforms. Production, for example, can gain insights by analyzing audience navigation and preferences for optimizing content on different media platforms. Marketing and circulation can assess and prevent attrition risk associated with paywalls. Sales can be coordinated across print, online, social, and mobile platforms to provide a single point of service for advertisers and help them leverage their media “buys.” What’s required is ready access to un-siloed data at a level granular enough to support advertisers and make decisions. Data that’s not actionable is of little value.
- Monetize editorial content. Publishers can track readership and viewership using highly granular, real-time data, enabling news writers and editors to optimize content and prompt readers to jump paywalls. (See my ClickZ column, “Who Cares About Real-Time Data Anyway?“) The U-T San Diego is a case in point with its print edition; online, social mobile platforms; and local cable TV station. Those platforms generate a mountain of data, which the U-T San Diego uses to monetize content in pioneering ways. Reporters, for example, see a daily dashboard in the newsroom, tracking real-time results on article traffic, headlines getting the most attention, how long an article generates audience views, the number of pages readers follow a story, page movements, and domain referrals, to name just a few. One news writer drove a 400 percent increase in readership of his stories in one month using data to improve headlines, choose topics of greater reader interest, and extend audience reach with social sharing. These practices have made the U-T San Diego profitable even with its decision to institute a paywall, bucking trends with revenue increases of 15 percent year-over-year. (See the ClickZ column by Jim Sterne, “Profitable Newspaper: Hold the Presses!“)
- Optimize advertising revenue. The Pew Research Center’s study on new business models I mentioned earlier cited newspapers with gains in digital ad revenue of 50 to 60 percent using data about readers’ online behavior to sell targeted digital advertising. Only 40 percent of the papers in the study used “smart advertising” in any significant way, however. Using data and the analytics, publishers can also optimize ad revenue by segmenting readership/viewership to better target buyers and prove ROI. Ad positions in media can be adjusted based on real-time reader and viewer response. Data can enable publishers to analyze and exploit ad inventory gaps. With the right technology platform, the publisher also can connect and analyze data from cross-channel advertising, internal sales, financial systems, and any other source to get a bigger picture of how to optimize revenue.
Publishers in the years ahead will embrace many innovations. But one thing is clear. Media companies cannot afford to ignore the volume, velocity, and variety of data generated in their interactions with the reading and viewing public. The data gives publishers the power to better understand their customers, create more relevant and timely content, monetize those editorial products more efficiently, and deliver them at the right time using the best channels. These are elements that are fundamental to survival – and success – in any industry.
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