Over the past few weeks, 2 sets of figures have been realised that help to illustrate the state of the newspaper market and the future path it might take – the ABC circulation figures for June and News International’s latest digital subscriber figures for the Times and the Sunday Times.
Unfortunately, the ABC figures do little to lighten the gloom around the sector – large year on year circulation drops have remained the norm across the quality titles.
In the dailies market, The Daily Telegraph’s circulation fell 9% year on year to 622,719, The Financial Times 9% to 356,194, The Guardian’s 10% to 256,283 and The Times 13% to 440,581. The mid market title’s fared better with The Daily Express losing 6% to 621,871 and the Daily Mail just 2% to 2,047,206.
Amongst the Sundays, the results were little better. The Sunday Times lost 8% of it’s circulation to teeter just above 1m copies, The Observer lost 12% to fall to 288,928 copies and The Sunday Telegraph lost 7% to 474,722.
Again, the mid market titles fared better with The Sunday Express losing 5% to 539,478 and the Mail on Sunday actually posting a small circulation increase of 1% to 1,927,791.
Of course, as print circulations decline, online audiences continue to rise at a rapid pace with the Mail Online and The Guardian leading the way. However, the problem for publishers is that their online revenues aren’t growing fast enough to replace the lost revenues from their offline offerings. So what’s a publisher to do?
News International thought they had the answer – start charging for the online version. In June last year, a paywall was erected around the The Times and The Sunday Times sites. The objective was 2 fold – create a new revenue stream from digital editions to replace disappointing advertising revenues and bolster the circulation of the print edition, a positive side effect of the online version no longer being available for free.
So how have they fared? Well, the first part of their goal has been accomplished, at least in part. After a year of the paywall, News International has declared 101,036 digital subscribers to The Times and The Sunday Times, albeit a large proportion to the iPad and Kindle editions, raising approximately £10m of new revenue. This new total has exceeded the previous digital revenues for these publications derived from advertising. And digital subscribers continue to grow, with 28% added since February, so the revenue picture’s only going to get rosier. A success story, surely?
Not exactly. The 2nd rationale has proven to be flawed – in fact, The Times print edition has lost circulation at a faster rate than it’s rivals according to the ABC figures. This suggests that although News International has perhaps tempted some ‘free’ readers back to the ‘paid for’ fold, many print readers have merely migrated to paid-for digital versions.
And those paid for digital versions aren’t as lucrative, for 2 reasons – they pay less for each edition and they’re either inaccessible (Kindle) or less attractive (iPad) to advertisers because of the extra investment involved in reaching them.
So rather than the clear the waters for publishers, it looks like the Times paywall has muddied them further. Perhaps, but what The Times has proved is that by offering multi-platform options, particularly on mobile devices, it is possible for newspapers to grow their paid-for readership. Other publications will have taken note and will be expanding the range of platform options (iPad, Kindle etc) offerings to capitalise on the opportunity no doubt, although they’ll need to offer advertisers easy and attractive ways to access this multi-channel audience to capitalise fully, rather than selling in silos as they have traditionally done.
But many will still have the dilemna of what to do with their websites – News International had little to lose with The Times as it was well behind rivals such as The Mail and The Guardian. The latter already command significant advertising revenues – a paywall simply isn’t an option.
My guess is that they’ll continue their push towards larger audiences, particularly international ones, to open themselves up to new advertising audiences. They’ll also increasingly look at ways to find out more about their readers and build closer relationships with them, perhaps even by making some specialist content premium, to make themselves a superior advertising option to the myriad of other online options.
Whatever happens, they’ll be plenty of innovation and experimentation. It’s going to be a rocky road but newspapers and newspaper sites are here to stay – there just might be some casualties along the way.
There’s no doubt that re-targeting is a highly effective form of online advertising. Working on the premis that each piece of communication can only nudge consumers a short way along the purchase funnel, where better to focus spend than in advertising to people who have already been browsing your site?
Now that so many people are interacting with brands on Facebook , it seems natural that brands should offer their fans the opportunity to buy things from them too without the inconvenience of having to leave Facebook. Fashion brands would seem to have the most to gain, given the fact that fashion is such a social purchase and that they have managed to build such strong fan followings.
