The past decade has seen massive changes in the publishing industry (magazines and newspapers). At our annual Subscribed conference this year Denise Warren shared her views on how publishers are evolving to compete vigorously alongside pure digital media players.
Warren was most recently the President of Digital for Tribune Publishing (a group which includes The Chicago Tribune, The LA Times and other newspapers). Prior to that, she was the Executive Vice President of Digital at The New York Times.
Here are the highlights from her session at Subscribed:
Understand your customer
The major lesson is to understand your customer – their interests and habits and to understand where you’re providing unique value that nobody else is, because they will pay for that. The average Joe or Jean does not see things the way we see them, so it’s really important to get anthropological, and to really understand them and how you differentiate for them. I would say that’s probably the biggest single lesson that I’ve learned.
Business model disruption
The crisis in the newspaper industry isn’t a journalism crisis or a content crisis. Actually, the journalism and the content has never been read by more people than this time in history. It’s a business model crisis. Advertising in the newspaper industry historically represented about 80% of the revenue and profits. The end-user or consumer was viewed as the loss-leader for advertising. That’s the model that really got disrupted. What’s happening now is that the industry is focusing on the end-user. I think that’s going to be better for journalism and for the users. And ultimately, healthier for businesses once we get through these challenging times.
What I’ve been seeing is this shift towards the customer, towards the end-user. It’s about really trying to understand their needs and creating products and services that they can’t live without. And using data to iterate and test products and services to create lifelong subscribers. I think that’s really the overarching shift that’s taking place.
I also think that these businesses will need more than one revenue stream. They’re not going to be able to just rely on subscriptions or advertising. We’re in search of additional revenue streams. There are all sorts of other alternatives that the industry has to look at if it’s going to thrive and succeed.
Paywalls and differentiated services
Paywalls can work if you have something unique and differentiated to offer. Each brand is going to have to find its own niche, depending on its own unique capabilities. I don’t think it’s going to be the predominant business model for these industries. It’s going to be a very meaningful one and lead to interesting changes. I think when you deeply understand your customer, and you’re serving them in ways that you couldn’t have imagined, new opportunities will open up. The industry is going to have to rely on many different revenue streams, in order to succeed.
There are definitely approaches being taken in the newspaper industry along those lines. The main issues when launching these niche products is figuring out how much emphasis you want to put on them and what’s the ROI? That’s what needs to be looked at when you’re considering these approaches.