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  • Apr
  • 4

What Impact Will Newspaper Paywalls Have on Premium & Luxury Advertisers?

What_Impact_will_newspaper_paywalls_have_on_premium_and_luxury_advertisersOnline newspaper subscriptions are making headlines again with the news that the online editions of the Telegraph and The Sun will be disappearing behind paywalls.

The Sun is set to join its siblings, the Times and the Sunday Times, behind a complete paywall in September, a decision driven by a ‘deep seated belief that it is just untenable to have 2.4m people paying 40p for The Sun at the same time as a bunch of other people are getting it for free,’ according to Mike Darcey, News International’s CEO. The announcement comes just a few months after News International paid £20m to secure the rights to Premier League highlights on the web and on mobile devices – content that will increase the appeal of the post paywall Sun to potential subscribers.

The Telegraph is to introduce a metered paywall, the first newspaper brand to do so in the UK, echoing the successful model introduced by the New York Times 2 years ago.  Online readers will be able to access 20 articles for free per month before the paywall comes into effect. Initial charges will be £1.99 for access to the website and content via apps, and £9.99 per month for a package which adds tablet access and loyalty club membership.

The Telegraph has some confidence that it’s new model will be a success. It launched a metered model for its international website in November of last year and 9 out of 10 people who took a free trial went on to take a full subscription.

And Telegraph execs have no doubt been casting their eyes across ‘the Pond’, where the New York Times has blazed a trail for successful paywalls.  Its metered offering, which allows free access to 10 articles, has been successful in attracting almost 700,000 subscribers and creating a new revenue stream worth over $60m, whilst having a minimal impact on reach and advertising revenues.

It’s clear that the newspaper industry is reaching a crossroads with 2 paths they can take.  It’s looking likely that the majority will go the way of the US press, where most titles have decided that some form of paywall is the only way to secure their future.

The alternative route is to remain free for all and try to drive advertising and other ancillary revenues in line with traffic. It’s becoming clear that this approach will only work for titles that can deliver massive scale.  The Mail Online, with its 8m unique visitors in January, has grown its advertising revenues to a reported £45m on the back of its phenomenal growth – but other titles have struggled to grow at this pace and therefore reap the rewards that come with this scale.

But what impact will the escalation of paywalls have on premium and luxury advertisers? As we’ve discussed before, a potentially positive one. Whilst mass market advertisers may be put off by the resultant decline in reach that may result from paywalls, luxury advertisers will be attracted by a number of their positive effects.

The first is that online subscribers are likely to have a stronger relationship with the newspaper brand they subscribe to than casual readers, and advertisers can leverage that relationship to the benefit of their brand.

Secondly, newspapers are in a position to find out more about subscribers than about casual readers -and subscribers are more likely to volunteer information about themselves if they feel it will enhance their experience. These insights will prove useful to premium and luxury advertisers looking to target their offerings more precisely.

And finally, paywall publications are likely to invest in new advertising formats to try and offset any losses in ad revenues that their new model brings.  New offerings may include more interactive options, and more formats that blur the lines between editorial and advertising such as native advertising. More choice and innovation on offer can be no bad thing for premium advertisers looking to drive new prospects into their purchase funnels.

Although paywalls may make the online press a more attractive prospecting vehicle for premium and luxury brands, they’re only part of the solution for the beleaguered newspaper industry. Paywalls can pay, but they don’t fill the entire revenue black hole created by falling print circulations and ad revenues.  However, they have bought the press some time to work out exactly how to bridge that revenue gap – or how to survive on substantially lower revenues…

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By: Carla Burgess

  • Feb
  • 20

Magazine ABCs: Terminal Decline or Bright Digital Future?

ShortList_(magazine)_coverThere are relatively few surprises within ABC figures any more. Every six months we see print circulations decrease further and further for the majority of titles. As media continues to evolve and platforms proliferate and develop, there will be no end to this migration of audiences to other touchpoints.

Of course, there are a few success stories to trumpet. Easy Living in the women’s sector has seen its print circulation increase 7% year on year, partly due to its new ‘iPad-sized’ format and partly due to a policy of aggressive cover pricing. Esquire is thriving under new editor Alex Bilmes and delivering the near miracle of increasing news stand sales, and Style at Home is growing rapidly by tapping into the new priorities of the austerity-era home improver. And, of course, the freemium titles like Stylist, Shortlist and Sport continue to top the circulation lists.

But the overall picture is one of decline. Last week’s ABC figures revealed a 1.5% drop in the total print circulations of audited consumer magazines for the last six months of 2012. The Home Interest magazine market was down 2.2% YoY, the Travel magazine market was down 13.8% and the Bridal magazine market down a catastrophic 27% YoY. Only the men’s category as a whole remained static YoY and PoP.

ABC now publishes audited circulations for digital editions too, but for most publications, the tablet hasn’t yet proven the saviour that it was hoped to be.

Certain publications have fared well with digital editions – Cosmopolitan and Glamour in the women’s sector, Men’s Health and GQ in the men’s sector and Elle Decoration in the Home Interest sector, but for the most part, tablet editions haven’t covered the falls in print circulations.

But this situation is a little chicken and egg. Most tablet editions are flat, digital page-turning replicas of the print versions rather than all singing and dancing interactive editions.  Publishers are often reticent to invest because there’s no proof that the audience is there to justify the investment, but the audience may well not come if the quality of product isn’t there.

The problem may also be one of penetration, rather than of desire. Research from the PPA suggest that tablet ownership encourages trial of new publications and actual widens the overall reading repertoire – 52% of tablet owners have a magazine and/or newspaper repertoire, either in print or on tablet, which is wider than before they owned a tablet. And tablets editions are popular with advertisers too – as research has demonstrated tablet ads deliver greater recall than print and click thru rates that are stratospheric when compared to other forms of online display advertising.

So perhaps all publishers need to do is invest in tablet editions and wait for the audience to come. Penetration post Christmas may already be 30% and this is expected to grow to 46% by 2016 (eMarketer).  However, much of the growth is coming at the lower end of the market, which creates headaches for publishers in terms of designing for different screen formats and for varying levels of processor power.

For these reasons, we expect digital editions to grow in popularity, but production costs may escalate too and we don’t think tablet edition upsides will compensate for all of the print circulation shortfalls. The 2 major reasons for the falls in magazine purchase have been cost and lack of time, not problems that tablet editions can necessarily solve. And consumers can get the information they want from so many other free digital sources – the Mail Online for their celebrity gossip, various blogs and forums for fashion tips and advice – so long term decline in circulations is probably inevitable.

But that’s not to say that magazine brands aren’t influential and can’t become more influential.  The challenge for publishers is to leverage the power of their brands to open up new revenue streams, and that’s exactly what they’re doing.

They’re innovating to drive more revenue from their advertisers by offering more innovative formats like the first video ad in print run by Marie Claire for Dolce & Gabbana fragrance. AR and QR are now readily used in print making it come to life and increasingly accountable. Click to buy apps are becoming more prevalent in the fashion mags after the success of Cosmo Genie App and then last May, Reveal’s ‘See It Buy It’ app.

In short, the magazine industry is like the music industry 5 years ago – in a state of consumer-driven flux where old revenue models are starting to look outdated and new ones need to be invented.

Consumers are filtering content to become their own editors and as a result over the next year we will see more closures in the print market and a trend of magazines becoming available only in the digital format. Brands that prosper will be the ones that are strong and innovate and keep the focus on trust, investment and 1st choice for consumers.

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By: Karen Stephenson

  • Oct
  • 16

Mobile Response: The 3 Best Alternatives to QR Codes

QR, or Quick Response, codes have become ubiquitous. Found on print and outdoor ads, product packaging and even gravestones, they have risen to prominence as marketers have realised their potential to connect consumers simply and instantaneously to relevant content via consumers’ mobile devices. Used well, a QR code can extend a fleeting impression into a more sustained engagement and thus speed the consumer down the purchase funnel.

But QR codes have their limitations.  The reflective screens of TV, PC screens and digital outdoor can make them difficult to photograph. And their rather functional form, and minimum size requirements, can interfere with the aesthetics of advertisements – a fact that premium and luxury advertisers will be more sensitive to than most.

So it’s hardly surprising that several new technologies are jostling to knock QR codes off their pedestal. Here are the best of them.

Aurasma

Aurasma is an augmented reality app that uses image-recognition technology to identify objects in the real world and then trigger pre-prepared digital content called ‘auras’.

aurasma_logoFor example, during London Fashion Week there was exclusive material available to readers of The Times T2 supplement. Those who viewed the page through the Aurasma app could access exclusive video content of the shows and buy products directly off the page. Other publications that have used Aurasma include the FT, Top Gear, Heat and The Guardian.

It’s not just print ads that Aurasma can recognise but whole range of real world objects, even buildings, if they’re distinctive enough. And the app is sophisticated enough to make allowances for different lighting conditions and camera angles.

Of course, Aurasma can’t match the ubiquity of QR codes, despite their Tottenham shirt sponsorship and an impressive 4 million downloads of the app to date.

However, Aurasma offers the potential to deliver a different kind of experience to QR codes – viewing an ad through the app and then watching that ad ‘come to life’ is a more talkable and memorable experience for consumers than the simple scanning of a QR code to be connected to product information online.

Audio Recognition Apps

Of course, QR codes are not ideal for television or cinema – expecting the consumer to jump out of their seat and photograph a QR code that will be ‘on screen’ for a limited time is asking too much.

Here, the future may lie in audio recognition apps, including audio watermarking solutions.

Perhaps the best example of this is recent partnership announced between Shazam, the popular music identification app, and ITV.

shazam-logoNow ITV viewers with their Shazam app active can be connected to additional content from that advertiser – be it games, videos, discount vouchers or ecommerce pages – via the app recognising music in the ad.  Advertisers such as Cadburys and Pepsi have already leveraged this technology can enable viewers to download music and win festival passes and Olympic tickets.

Audio watermarking is a related technology.  Again, the viewer needs the relevant app loaded onto their phone and active, and audio triggers the app to connect the viewer to additional digital content. However, in this case, the watermark is ‘hidden’ i.e. it’s not audible to the human ear.

Digital Watermarking

Digital watermarking is a technology borne out of a US bank note counterfeit security device. It works by imbedding an invisible-to the-naked-eye algorithm within an image, so ads are not compromised aesthetically. A smartphone or tablet with the digital watermarking app loaded is able to scan the image using its inbuilt camera and link to any online content.

DigWam _LogoPerhaps the best example of digital watermarking is DigWam, a joint venture between Wellcom London, the media production agency and Cousin the global print media specialist. Between them they shared a number of fashion clients and luxury brand retailers and were therefore looking for an elegant solution to the print-to-mobile opportunity.

DigWam comes with the additional benefit of an in-depth data analytics package, allowing advertisers to forensically analyse their response with reports on what device was being used, where it was activated and what online content was downloaded.

The key to which platform becomes dominant is which app becomes most prevalent on consumers smartphones and which is most commonly embedded into the apps of others. However, with the no.1 mobile response mechanism, QR codes, used by just over 11% of smartphone users, the battle for dominance in this sector has yet to be won.

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By: Neil Cunningham

  • Jun
  • 11

New Circulation Figures Demonstrate the Saturday Newspaper Premium

It may not be a surprise to you to learn that daily newspapers sell more copies on a Saturday, but the latest newspaper ABC figures for April demonstrate exactly how marked that ‘Saturday premium’ is.

The figures demonstrate that the average ‘Saturday’ uplift amongst the mid and quality titles is 48% vs. the average circulation for Monday to Friday, but for some titles the Saturday premium is more marked.

For example, the Mail’s Saturday circulation is 54% higher than it’s Monday – Friday average, representing almost another another 1 million copies in circulation. For the Guardian, the uplift is even more marked at 112% – a testament to its longstanding investment in its packed Saturday edition and it’s keen understanding of it’s metropolitan audience’s requirements.

April_Newspaper_ABCs_Saturdays_vs_Weekdays

So despite weekly circulations being in terminal decline, Saturday circulations seem to be in rude health, reflecting a differing role for a newspaper on the weekend vs. on weekdays.  Readers see a Saturday newspaper purchase as a reward for a week of hard work, and with more time on their hands, enjoy the amplitude of press on the weekend.

And advertisers haven’t been slow to pick up on the trend, with weekend revenues holding up much better than weekday ones. Advertisers recognise that if they can catch consumers eyes over breakfast on a  Saturday morning, there are 2 whole shopping days for those consumers to turn desire into purchases.

Similar conclusions were reached in research conducted by the Mail on Sunday last year. However, unsurprisingly, their research revealed that newspapers were even better read on Sundays than on Saturdays. They pointed out that Saturday was fast becoming another task focused day, much like the working week, and that Sunday was the only day that consumers truly relaxed and were thus most receptive to advertising messages.

The fact that advertising in a Sunday title only allows the reader one shopping day to turn interest into action was offset by the fact that Sunday evening was by far the most popular time of the week for internet use, and hence Sunday morning was the ideal time for advertisers to prime their audiences online behaviour for later that day.

Internet_Use_By_Day_of_the_Week

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By: Lucy Jennings

  • Apr
  • 3

Is Print Newspaper Advertising Becoming an Irrelevance?

Is_Print_Newspaper_Advertising_Becoming_an_ IrrelevanceThe release of the monthly ABCs usually means bad news for the newspaper industry.

The latest set, for January 2012, were no better, showing year on year falls across the board.  The worst news was reserved for The Independent, which saw a staggering 37% year on year fall in its circulation. The Guardian and The Times fared little better with falls of 18% and 11% respectively. Even the mighty Mail saw a 6% drop in year on year circulation.

Advertising revenues are on the decline too – unsurprising given falling circulations.  Paywalls and premium mobile versions are proving to be a revenue boon for some, most notably the FT, but not for all – the results of The Times paywall experiment hasn’t seen competitors rushing to follow suit.

You couldn’t be blamed for thinking that print newspapers were becoming an irrelevance to advertisers.  Surely budgets should be following audiences and migrating online rather than being channeled into a sector with dwindling audiences?

Perhaps, but there are many signs that the era of print newspapers isn’t over. Not yet, at least.

In the first instance, some sectors of the newsprint industry are in rude health. Take i, the 20p stablemate to The Independent, which saw its circulation rise by 82% to 243,000 between January 2011 and January 2012. Likewise, The Metro and the Evening Standard are thriving against this generally negative backdrop, showing there is still a desire for news in print albeit it in an easily consumed and free or budget format.

Secondly, the latest figures from the National Readership Survey show that falls in readership have not been as marked as falls in circulation in many cases.  For example, the figures for the last quarter of 2011 showed a slight rise in the readership of The Guardian (+2%) and only a small fall in the readership of The Independent (0.38%), although falls in the readership of the Mail, the Telegraph and Times were largely in line with circulation falls.

Of course, these specific readership results may just be statistical anomalies but perhaps the figures suggest that decreasing frequency of purchase may be more of a factor in newspaper circulation declines that the fall in the overall newspaper reading audience. Or put another way, many of us still like to read newspapers, we’re just doing it less often.

But the third and most influential evidence in our argument in favour of newsprint is that ads in newspapers are still highly influential.  A recent Deloitte study found that 60% of people had visited a website as a result of seeing it advertised in print – just 4% behind the most influential medium, TV, and 10% ahead of online advertising.

The fact is that over 19m of us still read a national daily newspaper and 16m still read a national Sunday newspaper – in both cases, that’s c1/3 of the UK adult population. So although its numbers are in decline, in terms of delivering messages to mass audiences in a highly influential way, newspaper advertising is still second to none.

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By: Lucy Jennings