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Featured Post | Industry-Research | Revenue

Change, lots of it: Enders Analysis on saving local news in the UK

For the news media industry, the rise of artificial intelligence for is a double-edged sword. While some publishers are using it to churn out news stories regardless of how their audiences receive them, local news titles are considering how it can provide them with a major point of differentiation. For many, that will also be a lifeline.

A report into the state of local news in the UK from Enders Analysis and the News Media Association pulls no punches. It is clear about the extent to which local news publishers did not benefit from advertising spend moving from print to digital. It’s also candid about the likelihood of titles foregoing print entirely in the near future.

However, the report goes well beyond rehashing the impact of technology on the news media business. While it clearly sets the stakes for the industry, the report, “Signs of local life: a new phase for local media” also focuses on opportunities and collaborative strategies for local publishers as we move forward.

The authors note that “publishers have done very little to transition habitual paying print readers—or the next generation—into habitual paying digital audiences”. It also points out that local media have lost the war on digital classifieds and have no realistic path back to reclaiming that revenue.

That is exacerbated by other challenges facing print media. From higher production costs to the “effective monopoly” of the two major distributors, the ability to print and disseminate dailies and weeklies is becoming strained. The report states it expects the number of titles that go digital-only in the next decade will be greater than the previous 10 years.

As a result of that—and the absolute dominance of tech giants in digital advertising—the report states that appetite for external investment is limited: “No one in the industry would deny all this decline has driven investment sentiment away from the sector, and consequently depressed the value of local and regional media.”

Green shoots

But rather than being solely self-flagellation, the report highlights some of the irreplicable strengths of the UK local news industry. Owen Meredith, chief executive of the NMA explains that, “while clearly everything isn’t rosy, there are some positive signs of life. There is innovation there; DC Thomson [for example] is really good at building a membership model and subscription model that genuinely works in local news.”

As the report makes plain, the greatest strength of the local news industry is the direct relationship it has with its audience, and the trust that flows from its original journalism. It states: “At one time all of these distinctions were obvious because they were visible in the physical world: print was plainly different from other content and consumption. Online, these distinctions evaporate.”

So, the report argues that the local media industry needs to “shout these distinctions from the rooftops” particularly in the emerging era of generative AI-created content. Local news has provenance and personality. The report makes the argument that it will be difficult if not impossible for AI-generated content to take its place. In an age where the amount of noise online is to grow exponentially, local news media can provide the signal.

Meredith says local publishers like Newsquest are already set-up to take advantage of that trend: “We’ve got these huge scale audiences… there’s been a perception that a lot of that was driven by non-core local news.

“Actually, there is more data coming to light now… that you really do have deep engagement, multiple pageviews, reasonable penetration and good scroll-through. People are actually coming to local news sites for the local news product.”

That is in line with the recommendation by the report that local publishers move from pursuing digital advertising based solely on scale: “Too much revenue today is reliant on low-yield programmatic advertising” which has diminishing returns—particularly for the newspapers.

Show me the money

In order to survive to take advantage of that strength, however, local news organizations need time and investment, particularly around tech. Meredith says: Tech is a big-ticket item for a lot of smaller publishers. You can’t therefore do everything you might want to do at once. But I think you can do phased-based tech and there’s a lot of off the shelf solutions, frankly, that provide publishers with answers without massively excessive investment required.”

Given the long-term forecasts for ad spend and a lack of philanthropic support in the UK, the report suggests a number of alternative sources of funding.

In line with earlier recommendations from the Cairncross Review, the Enders report points out that direct government funding is basically impossible for any independent press that seeks to hold the government to account. Instead, it suggests alternatives that include more government advertising (already the largest single source of local advertising revenue across its many departments) with the local press.

Meredith concurs with this assessment, stating: “We think a genuine commercial exchange on advertising is fundamentally different to subsidy. We firmly believe that there is a long-term sustainable future for local news in a commercial way.

“We’ve been talking about the digital markets bill for ages. It’s not a silver bullet, but it will certainly help. There’s lots of elements but you [can] combine that commercial vitality without government subsidy or intervention, as well as the Competition and Markets Authority getting out of the way and allowing market consolidation to happen”.

Meredith is also keen to point out that the BBC has a key role to play in the future of the local press. It is a wholly unique organisation by any media standards, and Meredith argues that if it were proposed today its free-to-access nature means it would be immediately shot down by competition authorities. He advocates for a resetting of the relationship between the local press and the BBC, both through the BBC Local Democracy Reporting Service and other means.

Ultimately, the conclusion of the Enders Analysis report is that local news in the UK needs to make itself attractive to investment from outside the industry. That will be like ripping off a sticking plaster, as it has been resistant to change for years – for a variety of reasons. Executives at the major publishing houses have been accused of riding the slow decline of tested revenue sources in service of their payouts, for example.

True change in order to attract investment will require, as both Meredith and the Enders report advocate, collaboration and collective agreements in order to reach sustainability.

Advertising | Revenue | Supporter Spotlight | Video

Here’s why publishers should be thinking about CTV revenue

Once again, the media world has found itself in belt-tightening mode. A number of high-profile media companies have announced layoffs, and ad spend has grown more slowly in 2023 than in the previous few years. Publishers are looking for revenue streams beyond subscription packages – and for those who have video content, CTV offers a lot of promise. 

After all, CTV is where the growth is, in terms of ad spend and audience. For publishers that are already monetizing video on desktop and mobile, CTV is the most intuitive next step for diversifying revenue. For those that aren’t monetizing their video content yet, that’s all the more reason to jump into CTV.

In terms of both viewership and the influx of ad dollars, CTV is growing like gangbusters. Streaming CTV ad spend is tracking to reach $23 billion by 2026 – a double-digit increase from today. Streaming video consumption has surpassed linear TV, as experts had predicted, and there will be 3.5 users of over-the-top (OTT) streaming services globally by 2027. 

Right now, the audience growth is coming from ad-supported tiers, which is an ad inventory source so desired by brands that supply can’t keep up with demand. This sure sounds like a field day for the Netflixes and Hulus of the world. But while the largest streaming platforms get the lion’s share of attention in the industry trades, they won’t be – and, considering demand, can’t be – the sole beneficiaries of this influx of ad spend.

Power to the content owners

According to industry experts, more than 90% of CTV ad spend coming through DSPs goes to around 30 streaming platforms. That’s a much larger number than the handful of big names that get name-dropped most frequently in CTV conversations. Not many of these platforms own all, or even most, of their content outright. They source it through deals with other media creators. And those creators have a distinct advantage: They reserve the rights to sell ads on their content. Streaming services don’t have exclusivity in the same way as the publisher who creates the content. 

Clearly, media companies stand to benefit greatly by partnering with CTV services for video syndication. There are two types of publishers who can most easily grab those ad dollars: those that already stream their content on CTV, and those that have video content on their owned and operated properties that they’re not monetizing via CTV yet. 

We’ve heard about leading publishers who have launched their own video apps on CTV services including The Economist, Vox, the Wall Street Journal, and the Washington Post. But across the broader landscape of publishers who produce the high-quality video content advertisers crave, there’s a great untapped opportunity for ad revenue. 

Good news for publishers: The bar for entering the CTV space isn’t nearly as high as it was a few years ago. Free ad-supported streaming TV (FAST) services have democratized access to the streaming ad market, as it’s not nearly as costly as developing a subscription app – the means of access in the days before FAST. 

Publishers who already have the video content can launch their own channels across multiple CTV platforms and devices, at a reasonable cost. For the great many publishers who already have experience syndicating video across social channels, it’s an intuitive move and it opens up inventory that delivers higher CPMs, is more desirable to advertisers than pre-roll on the video players hosted on publishers’ own digital properties, and presents opportunities for advertisers to connect with viewers in a wider variety of viewing environments and viewer mindsets. 

CTV calls for a strong data strategy

Expanding to CTV will be an easier task for publishers who partner with data platforms that offer flexibility and interoperability. The limited availability of actionable, scalable first-party data remains a pain point not only for advertisers, but for publishers looking to get into streaming. This presents challenges in working across streaming platforms and devices, which have their own data but are reticent to share it. To drive the most revenue, publishers will want to be able to connect their data with any of their ad partners who need it for campaign optimization. That means the ability to solve for identity, and to provide interoperability, are essential pieces of the puzzle.

A solid, well-applied data strategy opens up key advertising functions like cross-platform targeting, frequency capping, and personalization at scale. Publishers don’t have to consider themselves out on their own in sourcing the necessary data, though. Streaming device makers are one place to look, although publishers may need to match the device makers’ proprietary IDs for actionable cross-platform insights. Using IP as a proxy (common in CTV) enables measurement in CTV, although IP may not be the best proxy in other digital environments, or for targeting at the individual level. Demographic, location, behavioral, and other data from data providers will enable programmatic buying, and incentivize advertisers that want the scale and efficiency of programmatic. 

To get the most value from CTV, publishers benefit from having a capacity to break down data silos and unify all identifiers (and the data signals used for ID enrichment). This opens up access – access to inventory for buyers, and to new revenue for publishers. It also allows for targeting across the broader ad ecosystem, while limiting wasted spend. 

A strategy that unifies data from relevant sources, and the ability to solve for identity, enhances a publisher’s value proposition to advertisers in CTV. It presents a great revenue opportunity for publishers. And delivering the value of actionable data insights is central to deepening long-term relationships with advertisers.

Making the most of the opportunity

At this stage of the CTV marketplace’s growth, there’s a real opportunity for any creator with quality video content. Therefore, publishers should be taking advantage of their video libraries. To fully capitalize on those advantages, they’ll need to be able to access and fully leverage the data that advertisers are looking for. 

Publishers who can bring both to CTV will be in a better position to weather economic unpredictability that may come to the digital media marketplace in coming months and years. Resilience hinges upon the ability to vary revenue sources, reach new audiences, and capitalize on an ever-expanding viewer base. And a strong data strategy, based on bringing together data from all relevant sources, will be key to truly realizing the revenue potential CTV holds. 

About the author

For over a decade Hunter has held and managed a variety of sales, consulting, and partnership positions in Advertising/Marketing Technology (#MADtech) throughout the US, Southeast Asia, and Australia. Currently based in Baltimore/DC after six years in the Asia Pacific, Hunter leads Lotame’s Connected TV initiative focusing on household graphing, viewership data partnerships, and data enrichment throughout various supply and demand channels.

Prior to his current role, Hunter led Lotame’s Global Solutions Consulting team solving leading marketer and publisher challenges through identity resolution and data enrichment methods. Additionally, Hunter has helped expand the Lotame Sales and Account Management teams in their Singapore and Sydney offices during his tenure in APAC.

Advertising | Revenue | Supporter Spotlight | Video

5 ways the writers’ and actors’ strike will impact advertising

On May 2nd, the Writers Guild of America (WGA), an alliance of over 11k film, TV, news, radio, and online writers went on strike demanding fair contracts and pay stability. They also stated numerous concerns surrounding artificial intelligence. In June 2023, 65k actors from the Screen Actors Guild (SAG) cast their votes to join the strike in support of their colleagues and to protest how technology has affected their wages as well.

There is much talk about the impact the current entertainment industry strike will affect advertising. The truth is, we are just starting to see its influence. This is mostly due to the timing of the strike. Many scripted shows are on hiatus during the summer and typically advertising is purchased well in advance of their run dates. As the strike drags on, the impact will be keenly felt across much of the media industry. 

Here are five ways we will likely see the strike impact advertising’s bottom line.

A short strike may be a win for broadcasters and streamers

In the short term, broadcasters and streamers are likely to see a boost in their profits. While that may seem surprising on the surface, if the strike lasts under four months it’s a real possibility.

Broadcasters and streaming companies have already sold the advertising that will air during these months. Additionally, contractor and personnel costs declined sharply during the early months of the strike. Hopefully, these early profits are reinvested to buy up the rights to movies and content available for sale – as a way to shore up their audiences regardless of the strikes’ duration. 

However, broadcasters and streamers should be prepared with new inventory, so they don’t lose out to social media if the strike continues until early 2024, as many predict it will. They will want to avoid airing reruns instead of new content, since that will affect viewership and in turn advertising revenue will be lower.

Broadcasters will be hit hardest if the strike goes beyond six months

If the strike lasts only a few months, changes in ad spend may be limited. In the short term, we haven’t seen much of an impact on ad sales. However, if the strike goes beyond a few months, the largest TV broadcasters could be hit hardest. Relative to streaming channels, TV broadcasters have more content that’s prepared “just in time.” 

Unscripted television, like variety shows, reality shows, and game shows have not been impacted by the strike too much. However, we do see a hit to lucrative late-night talk shows, which have already been off the air for a couple of months. This programming relies on writers who have been on strike since early May. 

Prime time advertising is estimated at $13.1 billion during the first half of 2023, which makes up 50% of all national TV ad spend. If the strike is prolonged, we could easily see some weekly prime-time TV shows off the air after a few months of their Fall debuts, as a result of new episodes not being completed.

Media & entertainment advertising will suffer across media

Movies, streaming services, and TV shows (along with others that support the industry) invested over $3.9 billion from January through June 2023. This represents 39% of the total ad spend from media and entertainment advertisers ($10 billion). This estimated advertising investment reaches beyond just TV, to over a dozen media formats. Since the start of the strike, we saw a dip in May YoY (4%). However, in June this segment was already down 26% YoY.  As the strike continues, advertising to promote movies, shows, and streaming services will likely continue to decrease and shift in investment. 

A prolonged strike may even prompt the largest U.S. firms to move more English-language production outside the U.S., to work around the problem entirely. Many countries have none of the protections offered to SAG members in the U.S., offering a viable alternative to production companies. 

Streaming and social platforms may experience a resurgence due to the strike

Streaming channels have significant material pre-recorded, “in the can.” This gives them the  ability to release movies, mini-series, and documentaries. If they have new content while broadcasters are struggling to recreate fall lineups, streamers will benefit. Netflix’s CEO has already said they’ve been preparing for the strike for some time and will stretch out their new releases.

In the event of a longer strike, streaming channels can easily dub content from outside the U.S. and show it here. We saw this during the pandemic. For example, Netflix saw great success airing the South Korean survival drama, Squid Game in the US. Another example, and a personal favorite of mine, was the HBO produced sci-fi flick, Beforeigners. This show  was originally produced in Norway and was dubbed and placed in their U.S. lineup. 

We are also likely to see social video platforms like YouTube, TikTok, and Instagram benefit from a prolonged strike. Their content producers are independent and non-unionized so these platforms will not see a pause in content creation. Viewing hours could easily surge as they did during the pandemic, which will drive more advertising dollars away from traditional broadcasters and toward streaming and social platforms.

Sports and news content will be sold at even more of a premium

Broadcasters with sports rights could do well in this environment because sports content is likely to be one area that isn’t negatively affected by the strike. Broadcasters will likely lean into more active coverage of sports. And they can use the strike as ammunition to defend the high price of sports licensing fees. 

We also predict that news broadcasters will sell advertising at a premium as well. News broadcasters are covered by SAG, but they have their own separate contract. As a result, news programming and advertising supporting it will continue and may even expand. Media like CNBC, NPR, Bloomberg, etc. will be mostly unaffected.

While the full impact of the writers’ and actors’ strike is still very much uncertain, it is expected to result in notable alterations and realignments of advertising investment in the upcoming months. While some may experience short-term advantages due to reduced costs and pre-sold advertising, the long-term impact could profoundly impact advertising investment across media.

Featured Post | Perspectives | Revenue

Beyond demographics: embracing a unified audience for local news

I have a request: Please stop the fearmongering and exaggerated claims surrounding the future of local news. Local news is still here, and it’s going to stick around. 

With approximately 15 years of experience in news media revenue sales leadership, I am driven to address the frustrations and challenges faced by local news outlets in connecting with advertisers and audiences.  

Yes, local news is still here, but it is facing challenges. The ad model that supported it for hundreds of years has been critically impaired. So, while I believe in the importance of local news and see its value on a personal and professional level, I also see some issues that need to be addressed to turn things around.   

The ad business will never be the way it once was. But whether the revenue that sustains local news comes from advertising, subscriptions or other means, it all starts with serving local communities.  

My perspective stems from countless conversations I’ve had over the years with local organizations, sponsors, and community members who genuinely express concerns about the content produced in local news media. They find it frustrating when local news outlets overlook crucial community topics. However, overcoming these challenges requires a complete rethink. While that’s no small ask, reconnecting with the community, attracting more subscribers, and increasing revenue are achievable goals.  

Audiences of all ages 

But let’s think about audience for a moment. Media companies are often focused on “attracting younger audiences.” Ok, sure. On the surface that makes sense since keeping that audience funnel full should maintain audience size or help it grow.   

However, I’d say that, instead of patronizing and pandering to the youngs (i.e., hiring some younger people to communicate with the younger people, and maybe one day they’ll have a story on page three), local news organizations must strive to be authentic and become an integral part of the entire community served. 

Though subtle, a slight condescending undertone related to younger audiences has become apparent. Fact is, these so-called “younger” people are fully grown, adult, tax-paying audiences with their own families, income, and ability to afford subscriptions and the products advertised in publications. They should be treated as such. 

This type of thinking is applicable to other generations and demographics as well. Rather than overly-segment coverage, think about serving broader audience needs. There are informational resources that are universally sought after, regardless of age or demographic. These extend beyond the traditional topics of weather and politics, encompassing areas such as finances, health, entertainment, local culture, and advocacy. 

For instance, Baby Boomers, Generation X, and Millennials have young grandchildren and/or children and they universally seek entertainment events and activities to enjoy together. They are all concerned with local greenspaces, educational funding, maintaining infrastructure, sustainability, and much more. In terms of the local news, they have a lot in common.   

It is crucial to invest time in understanding the needs, interests, and concerns of the entire community. By providing content that resonates with their daily lives and challenges, engaging in meaningful conversations, listening to their feedback, and addressing their worries, you establish trust. You foster genuine community connections instead of fragmenting content to target certain groups.  

This approach is going to be uncomfortable because it requires a creative shift in outlook. Think of this perspective as something like: Star Trek fans are Star Trek fans regardless of age group or generation because it appeals to a consensus of wonder and exploration inherent across generations. For local news, this sense of shared engagement can arise from pride in the community and access to informative resources. 

Furthermore, the current structure of local news heavily relies on a skewed interpretation and representation of news. While it is important to cover national and regional political issues, a lack of local community coverage and insight can lead to subscriber and advertiser avoidance, resulting in churn and attrition. Additionally, there are numerous outlets competing for attention on the national stage.  

If one is in the local news business, the mandate is different. It is essential to deliver reliable, informative, relevant, and resourceful information that is specific to the community and audience. This approach is a vital component in enhancing subscriber engagement and retention. Your goal is to establish a platform that fosters a profound sense of connection, where the community feels anchored and takes pride in supporting it.  

Also, while disasters often dominate the headlines, it is equally important to remind people of the positive events occurring, especially within their communities. People need hope, a sense of connection, and pride. These can be found in the contributions made by ordinary citizens, organizations, and companies that enrich and inject vibrancy into these communities. 

From a revenue standpoint, this shift will transform your platform into one that people genuinely esteem and feel compelled to support, rather than feeling obligated (or worse, disinterested). 

And, once a local news organization re-establishes its value proposition with the community and engagement picks up, interest in advertising sponsorship will follow. Businesses are always looking for engaged audiences to enhance their brand value and generate interest in their products and services. This means they “fish where the fish are.”  Tethering a local news organization to the community provides clear value to advertisers, along with a sense of belonging and support they’ll get from being associated with a trusted local news brand and supporting something of value within their community.  

Delivering the news 

Moreover, the traditional approach to presenting news assumes that one or two distribution methods can meet the diverse needs and interests of a growing audience. However, serving your whole audience goes beyond a print and digital reader dichotomy. The key lies in finding different ways to conveniently deliver information and create an excellent user experience.  

Transforming local news involves becoming a reliable source of information, whether it’s on a weekly, daily, or even hourly basis. Since (valuable) information is not bound to any specific medium, it can be effectively shared across all platforms. 

For instance, imagine a subscriber who reads in-depth content about well-researched parenting tips specifically tailored to children diagnosed with ADHD in their local community newspaper. They can keep that issue of the newspaper and refer to it whenever they desire. Additionally, they receive a newsletter highlighting family activities in the community, condensed online articles, podcasts, and social media posts related to parenting. They may also receive text alerts to inform them about topics or events that matter most to them.  

This comprehensive approach enables community readers to stay well-informed, nurture personal development, and maintain a strong connection to what matters. However, the key ingredient in all of this lies in identifying and utilizing the most valuable information available, with the local community as a resource. 

It all comes back to the audience 

That said, it’s important to note that while this multi-medium communication approach has become more commonly employed, what it often lacks is relatability and cohesion. Relatability stems from the understanding and belief that local news organizations genuinely comprehend their audience—knowing who they are, what they look like, what aspirations they hold, and what truly matters to them.  

Cohesion is about enhancing the overall experience and connection with the subscriber in a way that is simple and easy to digest. Create an atmosphere that makes readers feel as though they’re being met where they are with the most topical and relevant information, which helps them navigate their daily life.  

The single most important part is to ensure content is topical, relatable, and relevant to the impact of the day-to-day life of the reader. Unfortunately, this essential essence is still missing in many local news platforms. 

Here is the sticking point: authenticity and genuine engagement are key to unlocking this. News organizations across the country are striving to engage with their audience, but it’s crucial to stay true to the identity as a community news organization. It is essential to embody and reflect the values and aspirations of the audience they serve. Celebrate the vibrancy of the area, acknowledge the past, embrace the present, and look to the future with innovation and creativity.  

Successful news organizations are deeply connected to the community. It’s not just about providing resources or making efforts to be inclusive; it’s about genuinely loving and connecting with the audience you serve.  

Advertising | Revenue | Supporter Spotlight

Real-time data boosts ad revenue for publishers

Today’s fast-paced digital landscape requires publishers to make critical business decisions faster than ever. Over the past several years, as media executives have sought to streamline their operations and optimize advertising revenue, tech-forward media teams have started leaning into data automation to replace cumbersome manual ad ops processes and resolve common data integration pain points.

However, while leveraging automation to address pain points can improve operational efficiency, automation alone is not enough to stay ahead of the competition and drive revenue. To thrive in today’s increasingly competitive market and sail through the macro headwinds putting pressure on revenue from shrinking ad budgets, inflation, and diversification, publishers need the ability to recognize revenue opportunities and act on them in real time. 

Why real-time data matters

Despite the economic challenges publishers are facing, the global digital advertising market is still expected to grow from $178.29 billion in 2022 to $185.17 billion in 2023 and is predicted to reach $209.43 billion by 2027.

Yes, big data can be used for predictive analytics that allow businesses to anticipate future trends and events. However, Real-time data allows businesses to anticipate, act on, and monetize what is trending right now.

Automation is a great starting point. But it is just the beginning of a publisher’s journey towards efficient and profitable operations. With billions of rows of data being gathered from hundreds of disparate sources, data science teams are becoming increasingly overwhelmed trying to report effectively and reliably on this data. And this leaves business teams unable to capitalize on critical revenue opportunities. 

Real-time data analytics driving revenue operations strategies

By leveraging real-time insights, publishers can drive several strategies that generate more advertising revenue faster. 

1. Real-time advertising inventory management

Identifying fluctuations in demand, audience engagement, and ad performance is critical to optimizing ad inventory effectively.  Without real-time insights, publishers may fail to capitalize on peak demand periods or trends, resulting in missed opportunities to generate higher ad revenue, and placements that could have been highly relevant and valuable may go unnoticed or be underutilized.

2. Targeted ad campaigns

Understanding audience’s preferences, behaviors, and interests in the moment enables publishers to deliver highly targeted and relevant ads to their audience. Without this capability, you may be forced to resort to generic or static ad placements, missing out on the chance to engage users with personalized content at premium pricing and lower overall revenue.

3. Competitive pricing strategies

By monitoring market dynamics and competitor activities in real time, publishers can adjust pricing strategies to optimize rates and ad packages while remaining competitive. Without this real-time visibility, you may struggle to stay on top of pricing trends, changing market conditions, or competitor offers and miss opportunities to attract advertisers who are looking for more favorable pricing or packages.

4. Ad performance optimization

Monitoring ad performance metrics allows publishers to make timely adjustments to improve results. By quickly identifying underperforming ads, publishers can optimize placements, targeting, or creatives to enhance engagement and conversions. Without access to real-time data, it may take longer to identify and address underperforming ads. This can result in wasted impressions, lower click-through rates, and decreased revenue potential.

5. Responsive campaign management

Publishers need to be able to respond quickly to shifts in consumer behavior, market trends, or breaking news. By leveraging real-time insights ad campaigns can be adapted and aligned with the evolving needs and interests of your audience. Media execs who struggle to identify emerging opportunities or react swiftly to changing circumstances may miss out on potential revenue gains that could arise from timely and relevant ad placements.

Best practices for optimizing real-time data analytics

Invest in a flexible, scalable, SOC-compliant platform that can support terabyte scale, with hundreds of native connections and the ability to connect to data warehouses, SQL databases, cloud bucket storage & email reports. 

In addition, a platform with an automated data ingestion process (encompassing both 1st party data and 3rd party data) that also automatically monitors for data quality will eliminate the need for less experienced data analysts to do commoditized manual labor and allow your data team to focus on more strategic value-add initiatives.

Build a suite of reports that focus specifically on your KBIs – from information on billable revenue generated and revenue at risk to specific metrics on campaign pacing and impression/click delivery and discrepancies. 

Leveraging automation and channeling real-time data into a single source of truth will allow you to improve targeting and forecasting accuracy, make rapid data-driven decisions, and continually optimize campaign performance in a dynamic environment.

Foster a culture that prioritizes the use of data and encourages employees across divisions to utilize data insights to make critical business decisions. Building a data-driven culture requires buy-in from leadership and organizational communication that reinforces the significance of analytics and empowers their team.

Get real time

Real-time analytics enable effective decision-making and are a crucial element of publishers’ success across content, advertising, and data-driven initiatives. Publishers who can quickly respond to market trends and ever-changing consumer behavior will have a significant advantage in an increasingly crowded media landscape.

But this is only the beginning of a constantly evolving journey. To maintain a competitive position, publishers must stay up-to-date with emerging data management and analytics trends and invest in the right technology and team to help guide their strategy into the next era of digital transformation.

Featured Post | Revenue

How personalization increases the odds of subscription success

Subscriptions are far and away the most consistent source of revenue for newspapers. However, to grow their subscriber numbers, sometimes they need to throw away consistency in favor of a more experimental approach.

The Independent has been a digital-only title for six years, having sloughed off its loss-inducing paper edition in 2016. While it has been solidly profitable for those years, its revenue has largely been generated through digital advertising; the same sort of business model that led to mass layoffs and bankruptcy at BuzzFeed and Vice respectively.

To head off problems with digital advertising, the Independent has made it a priority to diversify its revenue. While ecommerce and video advertising are core, its chair John Paton told me it sees a way clear to multiplying its direct reader revenue by five within three years.

To do that, he states the Independent is pursuing an “unknown to known” approach to its audience. Like many digital publications, it asks audiences to register to read. This provides the publication with data that can be used to track their propensity to ultimately pay for editorial content, among other things.

He said direct revenue is “now going to be a fast-growing. Part of that based on the back of the fact we’ve got these registered users who want to talk to us, and our marketing towards that as well. This improved our pitch and led to revenue of about 2 million. That’s going to be a big number like 10 million in two [or] three years.”

The process of turning a user from an anonymous, fly-by-night stranger to a potential customer is vital because every user’s likelihood of signing up for a subscription is wholly unique. The more data a newspaper has on its users the better its chances of converting them.

At the same time, many general-interest newspapers eschew that approach in favor of a one-size-fits-all hard paywall, sacrificing flexibility for clarity. So which approach, then, works best for different types of media brands?

Flexi and freemium

For many titles, flexible paywalls grew out of a freemium model. Austria’s Kleine Zeitung, for example, offers the traditional freemium model with a number of articles available to read before the paywall prompt appears. Other titles can also manually drop the paywall for certain premium articles, the better to entice people to pay.

In this model, eventually, inevitably, the paywall slams down. This is often paired with messages asking for support for independent journalism, or for registration to continue reading. This multi-pronged approach is vital, as research has demonstrated that the single-approach strategy of demanding payments rarely works.

Ultimately, however, these are largely blanket strategies, decisions made manually by human editors based on analytics and gut instinct. It is a beneficial approach both in terms of cost and messaging, as it reinforces the idea that the journalism behind the paywall is universally valuable.

Over the past few years, though, things have shifted. More personalized approaches have come to the fore, powered by AI and machine learning.

Tech and touchpoints

Analyst and founder of A Media Operator Jacob Donnelly explains that audience ID tech is making personalization of paywalls appealing to newspapers after years of scale-based priorities: “You have to start every conversation with the who, and really be clear about who the audience is, so that you can get everything else right.”

It’s a view echoed by Tim Rowell, general manager APAC for Piano, a paywall tech provider. He says that tools to model propensity to pay have been high up publishers’ agenda for years: “The reality is that, for most newspapers, these data are in disparate systems and the challenge is how to to turn all these data points into insight that can be acted upon. Those that can have built models to identify propensity to pay”.

One of the tech advances has been early deployment of proprietary AI tools. Swiss newspaper NZZ, for example, uses AI to personalize its paywall based around individual users’ propensity to pay.

Its managing director Stephen Neubauer explains: “We’re using machine learning today to derive dynamic segments, and to identify these patterns of preference” as a result of which the paywall can be rigidly enforced or relaxed on a per-person basis, the better to entice that reader to pay.

NZZ, however, is one of the most successful digital newspapers out there. As such it is well-positioned in terms of resources to develop and experiment with that AI tool. For many regional and local news groups that time and spend is beyond them, even as the cost of the tech falls. It is far from a foolproof system, as explained by the New York Times’ own applied/data scientist Rohit Supekar – but it is powerful provided you have the resources to do it.

Experimentation and confusion

But to what extent can newspapers try new things with paywalls without confusing their readership – or more likely causing them to wait for a better deal or free access during trial periods?

The same technology and techniques that allow for personalized paywalls is ameliorating that issue. For one thing a vanishingly small number of readers are likely to compare their own paywall offering with others, preventing confusion at a macro level. At the individual level, the ability to tailor messaging also helps users to understand that they are being served deals based on their usage habits rather than some arbitrary decision.

Rowell says: “It’s theoretically possible that audiences get confused by experiments. But the experiments would have to be pretty extreme to do that. We’d argue that it is a fallacy. Sound experiments based on insight and data and designed to improve conversion rates are likely to involve offers that are attractive to the audience”.

Despite all the advances in tech and strategy that allows papers to entice readers down an ever-shifting, personalized funnel, there is still one fundamental issue: a sizeable proportion of people say they will never pay.

According to the latest Digital News Report, 65% of UK news consumers said nothing could encourage them to pay – compared to 49% in the US, both higher than the 42% average across the 20 surveyed markets where paywalls are in effect. That is primarily ascribed to a lack of perceived value in the news products. And if audiences never seek out your site, the opportunity of going from unknown to known to paying subscriber vanishes.

Featured Post | Innovation | Revenue

Listen in: Lessons on sustainable podcast strategies

When Stephen King calls your production the best true crime podcast he’s ever heard, you know you’ve done something right. It was quite the win for a tiny New Hampshire Public Radio (NHPR) podcast team, which goes up against big-name production companies in an increasingly crowded and volatile podcast market. 

But while NHPR basks in the glow of this win, big names like NPR and Spotify—a traditional radio stalwart and a digital-native streaming company—find themselves stumbling after making big bets on podcasts. So, why are podcasts such a boon for some while they seem to be weighing other companies down? As is so often the case in the media industry, you have to look at the strategy.  

Trouble in podcast paradise

According to data from Edison’s The Infinite Dial Report, podcasts have more listeners than ever—and those listeners are engaged and affluent. Well over half (64%) of people over the age of 12 in the U.S. have listened to a podcast; 42% have listened in the last month; 31% have listened in the last week. That audience skews young, with 40% of people between the ages of 12-34 tuning in weekly. With an estimated 89 million people listening to podcasts on a weekly basis, the audience is also diverse — 45% of Black Americans and 34% of Hispanic Americans listen monthly. It was only a matter of time before the money started to flow.

In 2019, Spotify paid a reported $340 million for Gimlet and Anchor. In 2020, The New York Times paid $25 million for Serial Productions. But in January 2023, Spotify announced it would lay off 6% of its workforce and that Chief Content Officer Dawn Ostroff was leaving. Ostroff was the driving force behind over $1 billion in podcast spending to get exclusive deals with big-name podcasters. As Morning Brew Reports, “Although the layoffs don’t specifically target Spotify’s podcasting staff, the departure of Ostroff is yet another sign that the company is slowing down its full-steam-ahead approach to the space.” 

In March of 2023, NPR made a similar announcement, declaring that it would cancel four podcasts as it looks to cut costs. The story is the same across the board; diminishing ad revenue gets the blame. But it’s hard not to acknowledge the elephant in the room — an over-reliance on the podcast craze to boost the bottom line. 

Betting big on podcast revenue

Part of the appeal of podcasts has always been their guerilla nature. From Marc Maron’s garage to the original “My Favorite Murder” pod-loft, there was a certain informality to it all. Then “Serial” came along, bringing a more refined sound to podcast players and changing the way listeners — and investors — perceive podcasts. Suddenly, a medium best known for off-the-cuff conversations and sometimes-questionable audio quality was a viable channel for journalism. 

Still, it wasn’t until the Covid-19 pandemic pushed people even more online that the podcast acquisition market truly heated up. “The podcast megadeals of the pandemic may have been premature—podcasting made up just 7% of total listening on Spotify in Q1 2022, the company said, despite the massive investment in tentpole shows,” according to Morning Brew “And the exclusive show model that makes popular shows available only to subscribers of a given streamer hasn’t proven wildly successful. The Gimlet and Parcast unions announced that making certain shows Spotify exclusives reduced their listenership by as much as 75% in some instances.” 

Not only was a general decline in ad revenues an issue, but so was a massive decline in listenership. In short, Spotify bet that making popular podcasts available exclusively on its platform would drive subscriptions. That bet did not pay off. This dynamic has played out across multiple providers where the investment outweighed revenue.

Podcast strategies that work

While some networks are still figuring out where and how podcasts best fit into their content strategy, others are seeing big success. For instance, Vox Media forecasts that its podcast network will reach more than 500 million in 2023. According to Hollywood Reporter, “The audience figures, which Vox Media is releasing for the first time, represent a measured approach to growth for the media brand’s podcasting business, which began in 2011 with the launch of Vox’s first podcast but didn’t become formalized until 2017 with the debut of the standalone Vox Media Podcast Network.” In the ensuing five years, the network has acquired  Preet Bharara’s Cafe Studios as well as Phoebe Judge and Lauren Spohrer’s Criminal Productions. It’s also brought in Esther Perel, and other new talent.

So what’s the difference between Vox and Spotify, both of which are investing in popular podcasts? The most obvious is that Vox is not limiting access to the content. But there is more to the story. “They’re getting into the podcast business as an extension of their journalism,” says Rebecca Lavoie, Director of On-Demand Audio at NHPR and a podcaster in her own right, as host of Crime Writers On… and Netflix’s You Can’t Make This Up. And this happens to be the same way the NHPR team approaches its podcasts — just an extension of its journalism, or another way to tell stories. 

Bear Brook may be Stephen King’s favorite NHPR podcast, but it is not the only podcasting juggernaut put out by the team. “Civics 101” launched in 2016, and is — almost inexplicably — still growing. “Our audience grew by…almost 30% just this year,” says Lavoie. Meanwhile, when we spoke, Bear Brook’s second season had just surpassed 2 million downloads for eight episodes. Importantly, however, the team behind Bear Brook is small and nimble — so small that host Jason Moon also writes and records the music. NHPR relies largely on swapping ad spots with related podcasts to help spread the word, and has a diverse number of revenue streams for its podcasts. 

“So, my show outside of NHPR, we’ve got ads, and we’ve got Patreon. That’s it. You know, if you’re a bigger show, you could also do live shows, you could do merch, there’s a limited number of things you can do, but they’re all commercial,” says Lavoie. While NHPR has a commercial advertising partnership with Stitcher, it can also ask for member support, can apply for grants because they are nonprofit, and make appeals to major donors to support special projects. “We’re not relying on venture capital seed money, we are relying on nonprofit stewardship,” she adds. 

A public radio podcasting renaissance 

Up until six months or a year ago, Lavoie says she was chagrined by much of what she heard from the NPR-verse; “Because public radio has never really behaved like it’s part of the podcast industry, right? We have some of the most talented people, we have all of the infrastructure, we have the best microphones, we have these great narrative storytellers. But there’s all this hesitancy to just get into it.” But that’s changing. From stalwarts like WBEZ and little-known stations like KCUR out of Kansas, public radio is finally “getting” podcasts. 

Importantly, NHPR and other member stations don’t have to make a profit, but that doesn’t mean there aren’t lessons to be learned from this scrappy team. Podcasts have the ability to experiment with new revenue streams. Grants may not be possible for traditional for-profit media companies, but finding individual supporters interested in funding the work you do is — especially for highly focused, narrative podcasts. From live shows to merch, podcast listeners support their favorite shows in a variety of ways that journalists just are not used to. So, it’s time to get creative.   

dcn digital media subscription tracking header image
DCN-Research | Revenue | Video

New DCN consumer research: Digital Media Subscription Tracking

Full research report for DCN members only. Register to or login to download (on desktop see top right corner of page, on mobile the top center). Download buttons will appear at the top and bottom of the page.

DCN Members can access the video of today’s virtual event – a review of the study’s topline findings here.

Digital media companies recognize the important role of subscription-based models in monetizing content effectively. Understanding consumer behavior to support this business model is crucial for attracting and retaining subscribers, optimizing user experiences, and staying competitive. DCN’s new consumer subscription study: Digital Media Subscription Tracking offers a deep dive into consumer subscription behavior and covers a wide range of digital subscription services, including SVOD, MVPD, vMVPD, digital newspapers, magazines, and audio – and usage metrics for AVOD and FAST services. The report is DCN members only, please login or register to access (on desktop see top right corner, on mobile the top center).

The Q1 2023 report is available to all DCN members; all subsequent waves will be exclusive to DCN Benchmark participants as part of their Benchmark’s suite of reports offering timely market intelligence each quarter.

This quarterly research, conducted with Screen Engine/ASI, will identify trends and track market penetration, shifts, and growth in the rapidly changing media landscape. The first wave, Q1 2023, surveyed 1,893 adults 18+, representing the U.S. Census population by age, gender, race, and ethnicity. The sample was online-only and represented approximately 89% of U.S. households and adults 18+ with access to the Internet.

Category penetration

One of the study’s key findings is that the U.S. had more than one billion paid subscriptions in Q1 2023 across the digital media landscape – SVOD, MVPD, vMVPD, digital newspapers, magazines, and audio. This indicates that almost all online U.S. households (97%) subscribe to one or more digital media subscription services. On average, households subscribe to approximately nine different pay services when combining all seven digital media services measured in this study.

The SVOD service category has the most subscribers, with nearly a 60% share of total pay subscriptions, followed by MVPDs and vMVPDs, digital newspapers, digital magazines, and digital audio services. The study also indicates that 29% of all subscribers plan to add one or more services next quarter, while 26% plan to cancel one or more, with MVPDs potentially continuing to decline and vMVPD subscriptions potentially increasing.

The study also highlights that free, “ad-only” AVOD and FAST services will continue attracting more traditional media consumers, who tend to be older and watch more linear TV. SVOD with ads and AVOD services will provide a much-needed incremental and growing revenue stream, especially as growth for pay-only services that don’t carry ads slow their subscriber penetration.

Demographic appeal

The demographic profile of digital media service subscribers shows that the heaviest concentration of subscribers for all services combined are slightly younger (P18-34), more male (M18-34), more diverse (Hispanic and African American), family-oriented (parents with children under 18), higher income (households with income $150K+) and slightly more educated. This demographic profile is extremely attractive for advertisers, making the launch of more digital “hybrid” (pay + ads) services likely.

The Digital Media Subscription Tracking study offers digital content companies essential consumer research to support new revenue models and pricing strategies to stay competitive and retain their subscribers.

Please reach out to me at [email protected] with questions about the Digital Media Subscription Tracking study.

Full research report for DCN members only. Register to or login to download (on desktop see top right corner of page, on mobile the top center). Download buttons will appear at the top and bottom of the page.

DCN Members can also access an on-demand video of the study results.

Advertising | Revenue | Supporter Spotlight

Pathway to driving incremental branded content revenue

In a previous post, we predicted that there would be a rapid expansion of brand content with the adoption of generative AI and discussed how publishers can utilize this adoption to fuel growth. I wanted to expand on some strategies publishers can implement to start the conversations with brands and agencies about using the content they have already invested in to drive brand consideration.

Publishers can leverage a brand’s non-promotional content and powerful storytelling to drive new and incremental revenue. Consumers across different mediums are actively engaged with long-form content, increasing brand recognition. Here’s a pathway for publishers that want to help brands use content in order to optimize the revenue potential for their businesses.

Content: A vehicle for influence

Before we jump into the strategies, why should you care about prospecting with content? Here are some numbers to help convince you that consumers rely on content to make purchase decisions:

  • According to Content Science, 70% of consumers prefer to learn about products and services through content rather than traditional advertising.
  • According to Nielsen, the average time spent on sponsored content is two minutes and thirty seconds. That’s roughly the same as purely editorial content.

In today’s digital age, consumers are inundated with display and video advertisements. But when it comes to product and service information, branded and sponsored content takes a backseat to these traditional digital formats. The data suggests that consumers are looking for authentic and informative content they can engage with rather than being sold to. 

Long-form branded content allows brands to tell their story, provide helpful product and category information, and ultimately guide consumers to make an informed purchase decision on their terms. As a result, companies are changing their marketing strategies to focus on creating content that informs consumers throughout the purchase journey. And publishers are the ideal partner to repurpose, optimize, and scale a brand’s content to connect with a brand’s audience.

Content sells itself

Content marketing has proven to be a game-changer; according to HubSpot, 70% of marketers are actively investing in it. Still, only a few industry partners offer solutions to scale this content outside the brand’s owned channels. The increase in investment in content marketing reflects the fact that marketers not only build trust by providing valuable and informative content but that it also positions them – and the brands they represent – as industry leaders. 

Tested tactics to drive revenue 

Repurposing content opens up a unique opportunity to create impactful prospecting strategies. One tested method is to pull content from brand marketing channels and create proactive mocks that showcase their content on a publisher’s site. 

The best outreaches we have seen involve a multi-touch approach to showcase brands’ content within a publisher’s environment, utilizing content sourced from Facebook, Instagram, blogs, ebooks, whitepapers, transcribed videos, and podcasts. These mocks can be used for prospecting new business or encouraging existing clients to invest in incremental budgets. This outreach allows brands to see how their content can be repurposed for maximum engagement.

Pro tip: streamline the process

The most impactful way to showcase the power of a brand’s content presented in the context of your site is to show marketers what that would look like. Most methods require publishers to do that directly from their CMS requiring development and design resources to create a mockup without actually pushing it live. Alternatively, publishers can use native ad servers to do this work. This way, publishers can upload the creative and content, and generate a preview link. Some platforms include content ingestion tools, which will help streamline this process further. The link can then be shared directly with the client or included as a screenshot in slides.

An alternative method would be to build a mock template in PowerPoint or another design software and copy content into the template. The problem with this method is it requires the manual and time consuming process of finding the content, pasting it into your template, and making design adjustments.

In conclusion

Content is emerging as a critical driver of influence in today’s digital world. Writing content and promoting it on different platforms builds trust and creates an authentic relationship with consumers. But creating quality content is a major investment. Taking the time to repurpose that content and automate the process correctly can help publishers partner with brands so that they can more readily scale their content and drive brand consideration. 

Industry-Research | Revenue

Tips and tactics for the growth of digital native media

Digital media continues to transform the way people consume news and information. Native digital news organizations have become a vital source of information for many people around the world. With fierce competition and the role of social platforms as intermediaries, how can digital native media businesses grow, develop, and publish information with greater independence and sustainability? New research, Project Oasis, from Sembra Media, examines the trends, impact, and sustainability of independent digitally-native news organizations.

To help support the growth and sustainability of independent digital native news organizations, the report includes a searchable media directory. This database includes 530 digital native news organizations in more than 40 countries across Europe. It contains information on the types of stories each organization covers, their funding sources, and their audience reach ‒ showcasing the need for diverse voices and perspectives.

The directory is a valuable resource for journalists, editors, and publishers looking to connect with other independent digital native news organizations. It provides a way to easily find and share important stories and sources that offer diverse perspectives, which are essential to accurately informing audiences.

Challenges

Project Oasis highlights some of the many challenges facing native digital news organizations. One of the biggest is the struggle to achieve financial sustainability. Many of these organizations rely heavily on one or two funding sources, such as donations, subscriptions, and advertising. However, the report found that these sources of funding can be unpredictable and unstable, which can makes it difficult for organizations to plan their future. The research identifies the need for two to six revenue sources as optimal for native digital news organizations to be sustainable and remain independent.

Another challenge facing independent digital native news organizations is the need to build trust with their audience. Many people are skeptical of the news they see on social media and other online platforms. As a result, there is a greater need for independent digital native news organizations to establish their credibility and build trust with their audience.

Optimism

Despite these and other challenges, the report finds reasons to be optimistic about the future of independent digital native news organizations in Europe. These include several key trends that are shaping the future of the industry, including the growing importance of mobile and social media, the rise of video journalism, and the increasing use of data and analytics to inform reporting.

The research also focuses on identifying profitable business models for independent digital native news organizations. These models include advertising, subscriptions, memberships, events, grants, and partnerships.

  • An advertising-based model is the most traditional revenue source for digital news organizations. Competition from big tech platforms like Google and Facebook presents a difficult ad sales marketplace for smaller players. However, advertising is still a viable revenue source for digital news organizations. Digital news organizations should differentiate themselves by focusing on building high-quality content, engaging audiences, and offering first-party targeted advertising solutions to advertisers.
  • Subscription models require high-quality content that engages the reader and convinces them to pay for the content. There are also membership models, which offer a more community-focused approach to revenue generation. Memberships typically offer readers access to exclusive content, events, and other perks, in exchange for a regular fee. The report notes that membership models can be particularly effective for organizations with a strong and loyal following.
  • Events-based revenue models involve hosting conferences and workshops to generate revenue. The report notes that events can be an effective way to build relationships with readers and generate revenue. However, they require significant resources to organize and execute successfully.
  • Grants and philanthropy in funding independent digital news organizations are also available. The report notes that grants and philanthropic funding can be an effective way to support journalism that is not commercially viable. Organizations must carefully maintain their editorial independence and avoid conflicts of interest. The report also notes that there may be viable partnerships and collaborations between digital news organizations and other media outlets, as well as non-media organizations. Partnerships can offer benefits such as shared resources and expertise, as well as access to new audiences and revenue streams.

Future focus

As the digital marketplace continues to evolve, independent digital native news organizations will play an important role in shaping the future of journalism, filling news gaps, covering underserved communities, and combating mistrust and disengagement.

The Project Oasis report and its searchable media directory offer important resources to support the future of independent digital native news organizations. The research provides a comprehensive look at the challenges and identifies opportunities for sustainable growth. The directory also provides a valuable resource to help protect democracy by sharing resources, collaborating on projects, and amplifying each other’s voices.

Perspectives | Revenue | Supporter Spotlight

Friend or foe: is AI the latest big tech assault on media revenues?

Every once in a while, a trend rippling through the digital media industry that springs up from the trade publications and into general-interest media. The launch of ChatGPT has been one of those times. AI content generation feels like more than ones and zeroes to media consumers at large. It feels tangible, even visceral, because it has direct ramifications on the production of content itself. Clearly media leaders need to make their voices heard in order to help guide the conversation for users as well as AI developers.

It would appear every Big Tech business wants in on AI chat to power search. But like identity and privacy, media companies are not about to sit back and watch which of the tech giants “wins” generative AI. They need to understand how AI will change content consumption, how they can use it to their advantage, and how to keep walled gardens from absorbing more of their revenue.

A new era for the search business

We’re seeing real and atypical disruption today in AI chat’s applications for search. Bing’s ChatGPT search function removes the onus of poring over multiple search results, and simply generates what feels like a coherent response upfront – be it right or wrong, strong or flimsy, fair, or biased. And history shows that human nature tends to prefer convenience over perfection. Search providers are already investigating how AI search may be monetized, to avoid losing out on the serious revenue search advertising traditionally has delivered (58% of Alphabet’s total revenue last year, for those keeping score).

That brings us to media companies’ reliance on search traffic to monetize their own sites and content. The prospect of users being disincentivized from visiting publisher sites to verify and provide context for information looks ominous to publishers. Today, 26% of all publisher traffic comes from search, in an environment where open web publishers are already competing against walled gardens for traffic and advertisers are reducing their budgets. And as it stands, not all AI search tools link back to their sources, and marketers are still trying to understand how the AI search ad experience should appear. And while search bots already crawl publisher pages, AI chatbots present a less balanced exchange between publisher and search engine.

Publishers that control their data have an advantage

Let’s avoid tunnel vision here, though. Publishers’ imperative to soften any blow to revenue from search traffic overlaps with their existing efforts to reduce reliance on revenue from the programmatic open market. Those efforts involve building loyalty among users and advertisers alike. For users, publishers are offering subscription packages, exclusive newsletter content, and the like. For advertisers, they’re offering private marketplaces and direct deals. Publishers can better navigate AI disruption by continuing and evolving those business strategies. They need to position themselves as sources of trustworthy, high-quality content worthy of the lifetime audience loyalty that can grow CPMs and incentivize deeper advertiser relationships. And AI has real benefits for those strategies.

If and when search becomes a less reliable source of traffic for media companies, they’ll need to ramp up efforts in driving traffic from channels such as social and video. In finding the best channels and business partners, they can turn to AI to analyze large volumes of first- and second-party data, and to do lookalike modelling. Leading publishers have already been doing this as part of their data strategy for withstanding third-party cookie deprecation. Advertisers are taking bold data strategy steps, too, and have the resources to be very advanced here. Publishers should compare notes with their brand partners to learn how to best leverage AI and machine learning for predictive audience creation, modelling, data cleaning and processing, and probabilistic matching.

We’re also seeing publishers take interest in generative AI’s capacity to accelerate and personalize content production, with human staff overseeing and completing the job. AI can do some of the lifting on lower-level SEO writing, bolster production of sponsored content, and source background from the publisher’s content archives. With ad revenues dipping on account of economic pressure, publishers are actively seeking new workflow efficiencies and content initiatives simultaneously without cutting headcount.

IP law will establish new limits for AI crawling

While we’ve all heard chatter about AI displacing human creative talent, media companies have more leverage than they might appear from a slight distance. That human-created input that drives AI output is guarded by intellectual property law. Rights holders are pushing back, and we can expect to see more robust IP regulation, and even technology that protects content from being scraped by AI tools, coming into play in the near future.

Publisher trade body The News/Media Alliance intends to pursue Big Tech companies for IP infringement, and its members want generative AI providers to agree to pay to licence their content (there’s a precedent for such licensing terms, from the use of text snippets in traditional search results). It’s questionable whether scraping publisher sites to train AI would ever fall under “fair use.”

But publishers shouldn’t simply wait for regulators to clear up these issues. That’s a path with unpredictable length and outcomes. At the top of publishers’ to-do lists should be bracing for shortfalls in search traffic, powering their data resources, and finding applications for AI to embolden content production. And Big Tech businesses should be forewarned: AI can’t be a higher priority than the sustainability of the digital publishing business that generative AI models depend on. An input of quality content makes the difference between useful output and unappealing nonsense.

Featured Post | Revenue

7 tips for your subscription bundling strategy

In an increasingly crowded and competitive landscape, media companies are constantly seeking new strategies to increase revenue and customer loyalty. Bundling can play an integral part in achieving these goals. By combining multiple products or services into a compelling package, bundling can unlock new subscribers and revenue streams, as well as help reduce churn.

According to Meredith Kopit Levien, Chief Executive Officer of The New York Times Company, bundle subscribers pay more over time and are less likely to cancel. As a result, bundling can support strategies for customer acquisition and retention.  Subsequently, it’s currently an area of growing strategic focus for many media companies.

Here are seven features that can strengthen your bundling strategy:

1. Make it financially compelling

You may not realize it, but you’re probably already bundling. Many publishers offer products, such as combined print/digital subscriptions, at a discounted price. These are often attractive to audiences due to minimal price differentiation, and dual access can improve their experience of your product(s). 

For publishers, this also opens opportunities to sell advertising across both mediums. This can be especially valuable given the importance of print advertising, and the premium it can demand compared to digital. 

The Seattle Times demonstrates this principle by offering a Digital +Sunday Delivery subscription for the same price ($4.99 a month) as their digital-only package. Bundling in the Sunday print edition, complete with home delivery at no extra cost, is potentially very persuasive for readers.

Screenshot via The Seattle Times, 1st May 2023. 

2. Show consumers what they are missing

Alongside appealing pricing, a further tactic media companies can deploy involves highlighting the benefits each subscription tier – or bundle – offers you. 

Screenshot via The New York Times, 1st May 2023

In doing this, publishers typically point to subscriber-only content such as articles, newsletters, podcasts and events, or access to their archives. In many cases, this content is not available outside the requisite subscription bundle. And that’s a benefit that publishers are keen to emphasize. 

Interestingly, the New York Times also utilizes a different approach, by stressing what you don’t have access to. This is most explicit for those accessing their news-only package (see below). The FOMO here is potentially very real, making an upgrade to “All Access” seem like good value. 

It’s hard to say exactly what role this tactic plays in their continued subscriber growth. However, the company added one million new subscribers in 2022. Commenting on this, CEO Meredith Kopit Levien observes that “with each passing quarter, we saw more proof that there is strong demand for a bundle of our news and lifestyle products, hitting records on both total bundle volume and the share of new subscribers choosing the bundle.”

3. Prioritize building your stack 

The cost of living crisis means that many people have less money in their pockets. To offset this, households are looking carefully at their expenditure and cutting back where they can. CNBC reports that Americans are more likely to cut back on groceries and gas than subscriptions. But this headline overlooks how low down the subscription food chain non-streaming content is. 

Image via Twitter 1st May 2023. 

Given publishers’ emphasis on reader revenue and subscriptions, this belt-tightening brings with it a certain vulnerability. To offset this, it is incumbent on media players to ensure that their offering is one consumers feel they cannot afford to cancel. 

To help them do this, Greg Piechota, Researcher-in-Residence at INMA, suggests three ways media companies can add value to their bundle: build, buy or borrow. 

Using The New York Times as a case study, he charts how the Gray Lady built Games and Cooking; bought The Athletic in 2022 (it costs $7.99 a month to subscribe to independently) and borrowed products in the form of a 2017 link-up with Spotify whereby new All Access subscribers also got Spotify Premium for a year. Bundling in Spotify for free (mirroring a similar initiative by The Times of London in 2014) arguably made their core subscription offerings more attractive to younger audiences. That means it may attract a new demographic of paying subscribers.

4. Flaunt your assets 

Alongside the approaches outlined by Piechota, we should also add peacocking. Media companies with deep portfolios can prominently display this to potential suitors (i.e. subscribers) by creating bundles that tap into the sheer breadth of content at their disposal.

We have already seen this in the form of the Disney Bundle, which includes Disney+, Hulu, and ESPN+. These three content-rich services are considerably cheaper when purchased collectively. The “trio” bundle also comes with ad and ad-free versions too, another model that more publishers can emulate. (NB: ESPN+ comes with ads regardless of the package.)

In Europe, Scandinavian media giant Schibsted has also put this notion into practice. They launched “Full Tilgang” in Fall 2022, a bundle of their Norwegian titles including national, regional and finance news, alongside magazines and their podcast platform PodMe. 

For national subscribers, this regional and local content is a potentially useful value-add that they might not otherwise have consumed. It’s a model other companies might look to replicate.  twipe reports that Schibsted is rolling out a similar model in Sweden.

Screenshot via VG.no 1st May 2023. 

5. Partner for growth 

Of course, not every outlet has the deep pockets – or the smorgasbord of content – enjoyed by The New York Times, Disney or Schibsted. Nevertheless, many outlets can deepen their bundles via partnerships. 

These can come in a myriad of different forms. Digiday has outlined how partnerships with non-publisher brands – such as financial and educational institutions – are being employed by The Wall Street Journal and The Washington Post. Business Insider has also followed suit. In 2020 they offered holders of certain American Express cards a free 12-month subscription. 

Tie-ins with other business and tech providers can also be seen. Major League Baseball has a long-standing partnership with T-Mobile, providing free subscriptions to MLB.TV (worth $149.99 a year) to T-Mobile subscribers. And in 2014, The Sun, a British tabloid, struck a deal with the UK mobile operator O2 to offer 02’s 4G customers content from soccer’s Premier League that gives them a glimpse of The Sun’s content which, in turn, might encourage some users to become subscribers. 

It’s common for publishers to offer bundles with other titles in their stable. The Wall Street Journal offers a package featuring its Dow Jones stablemates Barron’s and MarketWatch. More interesting perhaps are partnerships with other content providers. 

Screenshot via WSJ 1st May 2023. 

In the past, I’ve seen smaller outlets – like my local NPR affiliate KLCC –offer a free subscription to larger publications (like NYT and WaPo) as part of their membership model. For smaller players, this association may bring some extra cachet, or provide an additional incentive to nudge people over the line by taking out a membership or donating. 

Even bigger players can successfully adopt this approach. The Weather Channel is a seldom talked about subscription behemoth, with over 1 million subscribers. It recently partnered with several organizations to offer bundles providing “companion subscriptions.” This trend may only become more prominent.

Screenshot via the Weather Channel 1st May 2023. 

Looking ahead – where bundling might go from here?

And what of that future? Given the need for media companies to attract new audiences, as well as retain subscribers and maximize income from them, bundling will remain integral to reader revenue strategies.  Here are two further ideas worth considering. 

1. Explore different pricing models

In 2019, the advent of dynamic paywalls prompted Piano CEO Trevor Kaufman to ask, “Has AI brought an end to the metered paywall?”. New York Media and Neue Zürcher Zeitung (NZZ, Switzerland) are some of the outlets that have used this model, harnessing variables – such as your location, device type and browsing history – to determine when users hit the paywall. 

Taking this to the next level, The Atlantic recently started using this technology to shape the price of their bundles. Dynamic pricing can be used when signing people up and for retention. For the latter, prices for renewal are determined based on the probability of a subscriber’s subscription lapsing. 

“It is a concept worth exploring,” suggests Subscription Insider, although they stress the “biggest risk is how consumers will feel if or when they find out about it.” How will consumers feel if they get different prices to sign-up (or stay), each time they click on the site? 

Screenshot via The Atlantic 1st May 2023. 

2. Let consumers customize their bundle 

At present, audiences are at the mercy of bundles offered to them by publishers. But what if it were possible to build your own bundle?

Let’s say I just want the newsletters and audio provided by The Economist? Or I want to bundle The New York Times’ Cooking and Games subscriptions, getting them for less than two individual subscriptions? 

Similarly, if I have a $25 a year standalone subscription to Politics with Charles P. Pierce on Esquire, what If I could cherry-pick additional elements to bolt onto my politics subscription? 

Screenshot via Esquire 1st May 2023. 

I cannot do that at present, and this type of choose-your-own-adventure model might be technically tricky. However, personalization could enable me to subscribe to content by topic, writer, location, beat, or sports team that matters to me. 

Of course, it may risk cannibalizing the take-up of other more expensive bundles. However, it might also hold strong consumer appeal, especially those for whom existing packaged offers are not compelling enough.

Moving forward, bundling is here to stay, supporting subscription strategies by playing a role in consumer attraction and retention. 

Fundamental to this is making your bundle attractive and distinctive from your competitors. Subsequently, adding value to the bundle may well shape acquisition strategies, be that for talent (and the newsletters and podcasts they may front) as well as other properties. 

At the same time, consumers need to be attracted by price and value proposition, this includes access to content and services they may not currently consume, but might if it’s bundled in. 

The use of free trials, as well as partnerships with other media companies and brands, can be a way to get a customer’s foot in the door. Meanwhile, dynamic pricing and opportunities for personalization could become key tools to keep them there. 

By bundling multiple products or services together, publishers and media companies can offer greater value to customers and increase subscriptions. There’s no hard and fast way to do this, but these seven steps demonstrate how all publishers can potentially use bundling to drive revenues and improve customer loyalty.

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