Friday, 6 December 2013
Is there a future for Newspapers? What? Is there ever and here's why.
I find myself a lot, in constant debates (arguments really) about media and digital. Traditional Media Versus Digital Media. Offline Versus Online. Effective Advertising V Social Media. Constant.
Admen get cranky with me because, although they know I'm second generation Ad Agency with some good industry stature behind me (and some less so) plus some longstanding Internet experience, as you'll see on my profile. That makes it worse for them.
But they read this blog and see me and "my like", as a "digital evangelist". Re-born poacher.
But it's like being asked if I have a disease.
Because digital is resented by those who don't take the trouble to understand it.
I am in fact, an Ad man that's interested in what consumers are doing and especially the manner in which they're consuming news and media, notably Newspapers. And subsequently, how they consume Advertising with online video.
Because that is what I've always been about - and frankly, what all 'Ad people' should be about too. Arguing this shift is like standing on Dollymount beach, trying to push out the waves.
It is such an exciting, dramatic revolution.
And what I try to argue, is to convince those media pals, to take the sunglasses off their head and to look at digital as a huge opportunity - and not as a threat. Businesspeople too.
To try to stop them go the way of booksellers, music companies, DVD rental businesses and others, the so many traditional businesses that ignored digital and did so at their peril. Indeed, most used legal issues, notably record companies, to try stifle it. And they all perished.
Some businesses indeed, have since embraced it, but possibly too little, too late.
So what happened to their businesses?
Book sales are up! Music sales are up! Movie downloads are up!
The web actually increased their businesses, albeit as it turned out because of their neglect, to benefit other visionaries at the demise of those traditionalists. If only they had embraced it rather than fight it and try to see the opportunity.
"Visionaries" indeed, like Amazon, Netflix and ITunes who did see what was going on. These aren't "new" business ideas but rather better ways of selling the old ones. That's all.
It is exactly the same for Newspapers.
Why did it happen?
Because they understood the Web brought more people, more access to these products, with more convenience. And so people, bought more.
If you make it easier for people to buy, they will.
I can buy a book now, at my kitchen table rather than drive to a bookstore. I can buy an Album now in my sitting room, rather than drive to a record store. 247. And even then when I did make the drive, they might not have it.
So why wouldn't I prefer to use online?
I can after all, get my groceries delivered to my door. I can watch dvd movies on my phone. I can bank on the street (check my balance, transfer money) waiting for a bus. I can buy that shirt, suit, shoes, jumper...and have it delivered same day. I can pay my car tax, my esb bill, my phone bill....instantly online sitting in my car. Done.
Because that's what I, you and consumers want.
Like it or not.
And as so often I have to explain, I can read my newspaper, for free, on my phone all day - anywhere - without having to go and buy it. I can get my news as it happens, instead of waiting for 6 or 9 O'clock bulletins or waiting for tomorrow's newspaper.
Because that's what I and you want and we will want more of it, not less.
Can we all at least, accept that?
And therefore, we have to accept that we'll all need to do more of it.
In relation to Newspapers particularly, for these very reasons, people will buy less print editions and view the online versions more, in time. Hard as it is to accept, some day in the future we simply won't print Newspapers anymore. There will be no need to. But that's not the end of Newspapers as many confuse it!
You know what? that's the greatest opportunity Newspapers have had. Ever, as I'll try to explain.
And why are we all struggling with it?
Because newspapers are/were run by newspapermen shock! (yep, men). The Ben Bradlees.
Nothing wrong with that (!) but understandably, they believe ingrained in their psyche, that what comes off the press is more important than what's on their website. When it's exactly the other way around - or will be soon. And the new younger breed of newspaper people are getting that.
Like DVD Stores thought their bricks and mortars shops were more important or book shops or record shops or retailers, than their websites. They were wrong too.
Whereas, if newspapers saw their website as a new, easier, quicker better way to deliver their content, they'd see a resurgence in revenue.
I know you doubt that revenue bit, but bear with me.
Forgive me too, for singling out one Newspaper as an example, but topically, today's INM ABC data appeared and I'll use those stats because they stand out (as I've blogged before) as being one group that has made the leap brilliantly.
And I do know titles like The Mail are becoming online effective as too, the Irish Times and others will.
But look, let me take the example at what's happening at independent.ie, an excellent all-round site, to illustrate this.
(Indeed an aside, as I'm writing this, I'm watching Zuma announce at a live Presser, that Nelson Mandela's has died and only one site has that news now. Independent.ie)
Today's ABC ONLINE numbers show them with 64 million monthly impressions.
Up +51% in a year with a staggering, 6 million unique monthly readers or 354,000 viewers a day. Not bad in a country of what, 4.5 million people!
See? People want online. And people want news!
Now look at a print example.
The Sunday Independent has circa 900,000/1 million readers a week. Biggest selling newspaper, extremely strong and has been for years.
So call that 4 million readers a month, brilliant as it is (and it is), but it's 4 million, compared to 6 million online....so the online site is worth more than a month of Sunday Independents. That's the sort of stuff that needs to register amongst newspapermen as it has, at INM.
Reporters whom I know and love (kind of) talk about the downfall of news, an area where I've also worked. Whereas in fact, independent.ie, and other newspapers titles, are driven by news! It's news that's delivering the impressions.
Hard news but better breaking news. News is and will be, the hook.
But now it's news with audio (the Anglo tapes for example) which newspapers could never offer before. It was a newspaper, The Toronto Star, that broke the Rob Ford video recently. Now it's news with video (something new too), now it's news instantly (no deadlines per se, which has been the scourge of newsdesks all our lives). News as it happens, news on your mobile from guess what, a newspaper.
Now it's news with unlimited printing (digital can add pages at little cost) and consequently at relatively little cost. Online is cheap to "print".
Now it's news with a global audience so the Irish abroad (and there's more of them now as we regrettably know) who can read the newspaper online, instead of having to search abroad for a shop that might sell the printed paper at an inflated cost.
But news remains the hook and most importantly, news from a trusted source, a trusted brand that's been delivering news for a hundred years. Which only a newspaper has that cache. The Anglo Tapes were investigative online news, the start of new journalism.
Fabulous opportunity or what?
It just requires an early mindset change. Both print and digital should keep going in tandem and in fact, use them combined, but expect that balance to shift in time, to more digital readers. They're still readers....just in a new delivery ecosystem.
INM online, have +51% growth in a year, some achievement that would be nigh impossible to deliver in printed editions. Imagine another year of that? And it is doable by attracting competitor eyeballs back.
But....so they all say, you can't make money from digital newspapers because they're free and you lose the cover price revenue? Yep, you do.
But if you're telling me that you can't make more money from more readers, then I'm telling you, you don't understand advertising.
Can you make money from 64 million impressions and 6 million unique readers a month as an example? You sure can. Exactly as you can with 6 million monthly print readers!
What business wouldn't give to have 64 million impressions in this market?
So how do you convert that into revenue then?
Firstly, Ad money follows audience, follows eyeballs - as sure as night follows day. The more readers you have, the more Ads you get. Trust me on that.
So keep building the online audience, even perhaps promoting it in the print edition. Sacrilegious? No, it's mindset change (think about it).
I think it's critical to remember that more and more advertiser money is going online. You are therefore, in a growth sector so the 'pool' of money for what you're doing is increasing.
However, it is true that the current low cpm rates for impressions and pre-rolls won't do it. Those rates have to change upwards before that style of Ad revenue will start contributing and there's no short-term sign of that.
When did we decide or agree that one day's newspaper reading for one person was worth circa 2 euro but a thousand views online was worth as low as 3 euros? Newspapers didn't, the market did, but everyone rolled over. Effectively they've slashed comparable print rates by -270%. The readers are the same.
Therefore, Newspapers should start pushing up those rates and stop giving away their space cheaply to networks or low rate advertisers. Forget them for now. Like in print, there's a price you just won't accept. Let digital not be different and hold your line.
In a recession? Yes.
Who needs who here?
Remember, this is a small market and advertisers will need you as you deliver high audiences that simply can't be ignored. They can't keep ignoring you as that audience builds, so they will be back at the higher, reasonable price because your readers will be worth more to them. I guarantee you.
But it'll be hard to come back from low ad rates when they do.
Newspapers also fail (delivering in this example, say 345,000 impressions a day) by offering confusing formats. Formats need to become standardised, exactly as print advertising is.
Forget MPU's, Banner Ads, expanding banners, roll-overs....standardise the formats so traditional buyers can understand better.
I did a recent campaign in October for a well-known brand. We produced one press ad version, one 48 sheet poster and wait for it, over 60 different digital formats. Time, money and fed up. More hassle for less money.
That'll turn Agencies and Advertisers away who constantly complain that it's "too labour intensive" and it is.
Why not half pages, quarter pages, third of pages? Just like we've always done in a manner which Ad Agencies and their clients understand. Keep it simple, keep it comparable and cross-sell print with digital.
At the moment, we force advertisers to develop new, labour intensive online formats which cost. Why?
So high audiences will deliver high advertising if you make it easier, through standardised formats and if you hold your rates, at least above the current low cpms.
Secondly, advertising needs packaging.
Sponsored sections (travel, sport, beauty, culture....) or simply sponsored stings of say, daily weather, daily stock prices, daily...or sponsored events like Budget Day coverage, GAA finals, Rugby international coverage - get advertisers locked in on 6/12 month deals like TV or Radio do.
Every key section, sponsored.
Thirdly, introduce new brands.
Imagazines are typical of these, appearing both in print and online. Almost like the supplements or features of old, they're a terrific way to deliver smart, quality content online which video brings to life.
And they're additional revenue through new brand creation.
Fourthly, you can charge for content.
That old chestnut, the great paywall debate, but after all, why should people expect their news (that I've always paid for), to be free? They don't.
However, the big problem here is, that if you're brave to introduce a paywall, when competitors won't, you'll lose online readers overnight.
Consequently, perhaps start with niches who will pay.
Business is a typical niche example where corporates will pay. Perhaps add value by emailing them business news alerts or sms them as business news breaks and/or, give them insights and analysis. Most will simply have to have it either way.
Fifthly, think about your readers as shoppers.
The Daily Telegraph does reviews of books, music, concerts, sports and so on, but you can also buy a ticket from them, there and then. The Newspaper gets a margin simply by introducing the sale. That is massive revenue potential.
Say, using my example, only 1% of your 64 million impressions click to buy something, which is a low click thru rate, that's 640,000 shoppers a month. Or think of it as one giant department store and then at only 1% conversion....revenue there.
Which leads me lastly, for an opportunity to consider to sell advertisers, not on a simple traditional space basis, but on results. Sell click thrus.
Suppose a car manufacturer wants website visits from their Ad campaign.
Sell them those, via the newspaper's ability to get readers to click thru as an add on to their Advertising. 1000 clicks is x euro. That makes advertising in the newspaper, an absolute no-brainer...buying a result. It guarantees Ad money.
Or say online grocery retailers who want to get sign-ups.
Newspapers just need to think differently. As some are.
But no medium is in a better place.
TV is well, much trickier.....and digital is demolishing TV. Consequently, that TV advertising will go digital too as TV stations lose viewers and could easily migrate to newspapers online.
Never, ever, been a better time.
Digital will be won by those who embrace it and learn the lessons of the past.
Finally, I can't leave this conversation without a nod to well-known businesspeople, some are friends of mine, who invested substantially in newspapers and continue to do so.
They were criticised at the time, because seemingly, "it made no sense" and brought me into more rows.
I do hope this goes some way to end those arguments too.
They're not fools, indeed as you all tell me and Newspapers, will get this right.
Just the light switch needs to go on.
If you ask me, I can't think of a better business I'd rather be in right now.