Peter Whitehead – Knowledge Bridge https://www.kbridge.org/en/ Global Intelligence for the Digital Transition Tue, 12 Jul 2016 15:15:35 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.10 Why Quartz’s news app might be the next big thing https://www.kbridge.org/en/why-quartzs-news-app-might-be-the-next-big-thing/ Fri, 08 Apr 2016 12:10:33 +0000 https://www.kbridge.org/?p=2808 Quartz’s new iPhone app that transforms the news consuming experience into an interactive chat has been given a big thumbs up by media commentators.

Quartz, which is owned by Atlantic Media, prides itself on its originality in delivering news – its pioneering daily email newsletter has nearly 200,000 subscribers – and its newest innovation doesn’t disappoint.

Writing in Techcrunch, Jon Russell says that “using a clear and clean design aesthetic, the Quartz bot interacts with you, offering up news stories which you can choose to get more information about or move on to the next.” A simple chat interface lets users decide on the level of detail – if you want, more just ask for it. The app has been rolled out for iPhones, with Android to follow soon.

For Mathew Ingram, writing in Fortune, “it looks and feels dramatically unlike almost every other news app available.” Its simplicity is its appeal, and the experience of using it is like a personal conversation. “There’s no front-page style list of headlines and images, there isn’t even a time-sorted feed of stories. There’s just what looks like a friend texting you, asking you in speech bubbles (complete with emojis) what you are interested in reading about.” You navigate by replying with simple phrases like ‘tell me more’ or ‘what’s next’. Another bonus is that it’s ad-free, except for a sponsor’s message at the end.

Writing in imediaconnection, Tom Edwards is ‘incredibly impressed’ by the app the “that gives the user the illusion that they are in control of the content experience“. There are three aspects that he particularly likes:

  • Conversational flow: it creates an immediate bond with users because it’s so familiar.
  • User-controlled experience: With an option to direct the experience by clicking on emojis, it makes you feel like you’re in control – it’s more conversational than disruptive.
  • Conversational advertising: Over time, it will be possible to build a robust profile of users based on their interactions and integrate advertising as part of a conversation.

Edwards finishes by saying: “Kudos to the Quartz team for delivering a highly conversational approach to information overload and understanding the importance of empowering the consumer.” High praise indeed.

The logical next step for Quartz is to go native, according to Isabelle Niu in fusion.net – “getting on existing messaging apps and learning to become another person I talk to about current events, latest trends or viral videos.”

But as she points out, in China this is already an everyday reality. “Without the competition of Facebook, Instagram and Snapchat, a monstrosity called WeChat dominates the social media scene in the world’s largest smartphone market. WeChat incorporates some features of most western social networks, but it started out as a messaging app, and messaging is still at its heart.”

More than half a billion people a day log in to WeChat. Public accounts, which are like blogs, are integrated into the chat experience and many have distinctive personalities that enable an interchange between users and publishers. “It’s a bit like having a private messaging thread with the writer you like.”

Niu wonders whether this type of exchange could point to the future of news in an age of information overload. “We-media consumers generally tune in to only a couple of publishers, who must carefully time and choose what they want to say in order to stay at the party. The future of publishing is to become one of those publishers.”

The Quartz app for iPhone can be downloaded here.

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Platforms are eating publishers https://www.kbridge.org/en/platforms-are-eating-publishers/ Mon, 30 Nov 2015 08:29:49 +0000 https://www.kbridge.org/?p=2800 On one level, the synergy between publishers and platforms looks natural, a win-win: publishers need their content to reach an audience so they can attract advertisers; platforms have audience in abundance but need diverse, engaging content to keep them on the platform. Put the two together and everyone’s happy, aren’t they?

Well, no. Publishers are finding themselves at the wrong end of an uneven, unhealthy bargain, which is bad news for both news business economics and quality, pluralistic information.

“This is a really depressing, dystopian way to think about publishers and platforms. It only really makes sense if you view writing as a fungible commodity,” says John West in Quartz. For the synergy logic to work, a piece of journalism must be viewed as an ad unit, its value being no more and no less than how many clicks it generates. Even more depressing for West is that Facebook, Twitter, Snapchat and all other platforms view journalism in this way – they can see the cost (or potential revenues) of quality content, but not the value – and “that’s going to smother journalistic independence and the open web”.

The platforms have created such seamlessly efficient ways to deliver content that news publishers will soon have no need even to have a website. Facebook’s Instant Articles, Apple News, Google’s Accelerated Mobile Pages, Twitter’s Moments, Snapchat – they provide comfortable, contained experiences, perfectly tailored for mobile, which is the direction audiences are headed. While the bare audience numbers make sense in the short term, warns West, “it will cost you”.

By granting control of content to Facebook and its like, publishers are turning platforms into the world’s gatekeepers to information, and these risk-averse megacorps already have a less than glittering track record of speaking truth to power and promoting diverse views.

It also means that publishers become ever more reliant on clicks: they only have worth to the platform if they bring in the traffic. The implication for quality is clear: as publishers become wire services for platforms, they lose their unique voice, their identity and their connection with their own audience. Editorial output has to match the platform’s audience, so publishers are incentivized to create bland, populist or clickbait brand of news. This means that a publisher’s traditional audience trusts them less and, with the context removed (knowing that an article was produced by The Guardian or The New Republic is an important part of the reading experience), an article has less meaning.

West also laments that “we’re also losing the organic and open shape of the web. It’s becoming something much more rigid and more hierarchical.”

“The answer is simple, but it isn’t easy,” he concludes. “We need to stop pretending that content is free. Publications need to ask readers to pay for their content directly, and readers need to be willing to give up money, as opposed to their privacy and attention. This means that publications will have to abandon the rapid-growth business models driven by display ads, which have driven them to rely on Facebook for millions of pageviews a month.”

John Herman in The Awl take a look at another aspect of the unfolding battle between publishers and platforms. Platforms like Snapchat, Twitter, Facebook and Google are creating their own editorial spaces and, in some cases, standalone apps, but are wrestling with what content to put there. With the platforms not having a clear content plan or even what audiences they want to serve, it leaves publishers with the headache of having to ask: “What do these platforms want from us? What will they then want for themselves? What will be left for the partners?” This is an uncomfortable place for publishers to be.

Herman points out that over the past few years, publishers have been providing platforms like Facebook with huge volumes of free content in exchange for big audiences and, occasionally, revenues. However, he warns that Facebook is simultaneously intent on destroying this same advertising system.

Platforms are sucking in the ad revenues that used to go to web advertising that helped support publishers. “These new in-house editorial projects located at the center of the platform, rather than at its edges, will succeed or fail based on how they assist in that project—not according to how well they replicate or replace or improve on publications supported by a model they’re in the process of destroying.”

Publishers be warned.

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Are Facebook’s Instant Articles and Apple’s News app another nail in the coffin for news publishers? https://www.kbridge.org/en/are-facebooks-instant-articles-and-apples-news-app-another-nail-in-the-coffin-for-news-publishers/ Wed, 15 Jul 2015 11:53:13 +0000 https://www.kbridge.org/?p=2785 When Facebook announced the launch of Instant Articles, a feature that will distribute content from select news publishers directly on the social media giant’s platform, it provoked another existential crisis for news media. Media commentators fell over themselves to weigh up the impact of Facebook’s move coinciding, as it did, with Apple’s unveiling of its own News app that will be built into the updated iOS 9, and similar moves by Snapchat and – likely to be announced soon – Google. Many pundits saw this as another nail in the coffin of the news industry, rather than the seeds of a brighter future.

For Michael Wolff, writing in MIT Technology Review, the acceptance of Instant Articles by major players who have signed up to provide content through the feature provided yet another example of bad decision-making by the news industry. As he points out: “Netflix will pay approximately $3 billion in licensing and production fees this year to the television and film industry; Hulu is paying $192 million to license South Park; Spotify pays out 70 percent of its gross revenues to the music labels that hold the underlying rights to Spotify’s catalogue. Now here’s what Facebook is guaranteeing a variety of publishers, including the New York Times, BuzzFeed, and the Atlantic, which are posting articles in its new “instant articles” feature: $0.”

He accuses news publishers of giving away their content for free, while at the same time losing control of their branding and valuable usage data. In the Facebook deal, publishers can sell ads on their articles and keep all of the revenue, or have Facebook sell ads in exchange for 30 percent.

“In the case of these new platform distribution deals—while they all involve slightly different plays—they each mimic a standard publishing business model: syndication. That is, a publisher with access to a different audience redistributes the content of another publisher—of course paying the content owner a fair fee. In some sense, this is the basis of the media business … Content is valuable–otherwise why distribute it?”

This leads Wolff to wonder whether “republishing initiatives are digging a deeper hole for publishers or helping them get out of the one they are already in”. He sees no reason to think things will turn out well: “…publishers have largely found themselves in this dismal situation because of their past bad decisions—accepting the general free ethos, bowing to a vast catchall of casual and formal sharing and re-posting agreements, and failing to challenge an ever-expanding interpretation of fair use. It seems only logical to doubt the business acumen of people who have been singularly inept when it comes to protecting their interests in the world of digital distribution.”

Facebook’s rationale for publishers to support Instant Articles is that it will provide a better user experience and deliver bigger audiences. While true, Wolff says that publishers will lose sustainable brand-building opportunities; it’s a model that better suits content that maximizes revenue potential, in particular ‘native content’, and will further push down digital ad prices.

According to Wolff, this type of syndication arrangement represents “another step closer toward what Ken Doctor, an analyst and journalist who has closely covered the demise of the news business, calls “off news site” reading. In this, publishers effectively give up their own channels and become suppliers of content to more efficient distribution channels … In effect, the New York Times becomes a wire service–the AP, except where the AP gets paid huge licensing fees, the Times does not.”

With the collapse of traditional ad revenues, publishers have justified pushing forward with digital experimentation because others were and because they couldn’t afford not to, even though they don’t fully understand the technology. “The ultimate result was a disastrous, sheep-to-slaughter endgame scenario, in which the new, digitally focused publishers are a fraction of their analog size. And now, in the prevalent view, there is simply no turning back.”

Meanwhile, dollars are flowing into the coffers of TV, movie and sports content creators. Even music, is fighting to win back control of – or at least payment for – its product. Wolff concludes that while there are differences between entertainment and news publishing that may explain why the old rules don’t apply in the new world, “perhaps publishers are just shamefully bad businessmen”.

In Mobile Marketing Daily, Steve Smith reviews the Apple News app and what it means for the news business. He concludes that in user experience terms it’s similar to Flipboard and Zeit – aggregating content from news sites and blogs in an attractive, easy-to-use way – but his diagnosis for the publishing industry makes for grim reading: “The legitimate worry of course is that media brands further lose control of their audience, data, context – and potentially, of their advertisers. I would say “Alert the media,” but in this scenario the media are already dead men walking.”

Writing for Fast Company, Joel Johnson points out that Apple and Facebook are just giving users what they want: a faster, less cluttered experience, compared to the slow load times and multitude of ad forms assaulting users on the sites of news publishers, who are forced into maximizing revenue by any means possible. Aggregators may provide a better – though banal – experience, “but it is unclear if most publications will be able to survive on only the revenue granted by these platform companies alone.” Apple’s attitude that “advertising is always unwelcome, unless it happens to be advertising that Apple itself lords over” is also a serious concern. “With small-to-midsize publishers already dropping like flies, things are looking perilous for readers and writers alike.”

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Is mobile killing the desktop internet? https://www.kbridge.org/en/is-mobile-killing-the-desktop-internet/ Mon, 01 Jun 2015 07:11:22 +0000 https://www.kbridge.org/?p=2765 With mobile growing so rapidly, particularly in emerging markets, there has been much talk of mobile killing the desktop.

An article in The Wall Street Journal claims that desktop usage isn’t decreasing, as is often claimed. Jack Marshall explains that while the share of the market enjoyed by mobile internet access is growing fast, the total time spent online from desktops isn’t falling and might even be increasing.

Source: ComScore/The Wall Street Journal
He analyzes comScore data in the US and concludes that mobiles aren’t stealing online time from desktops, but are “unlocking” new time that people are spending on the web. “That understanding has important implications for media owners and marketers, who often say they’re altering their sites and strategies to cater for their growing mobile audiences. It makes sense to optimize for mobile if that’s a large and growing audience, but mobile isn’t the only game in town. In fact, it seems desktop internet use is here to stay, for the time being at least.”

However, Thad McIlroy on the Future of Publishing blog says this interpretation is misleading. The data The Wall Street Journal bases its findings on “encompasses all desktop computer usage, the majority of which relates to the Microsoft and Adobe application suites as well as email”.

“The real story is not that the PC usage is up, but that simultaneous device use — usually called ‘multi-platform’ — has changed the device landscape.” McIlroy says that data from another comScore report, The U.S. Digital Future in Focus 2015, shows that the number of people only using desktops to access the internet is declining sharply in all age groups, even the 55+ segment, and that across all ages the amount of mobile-only users is also growing fast.

This interpretation of the data – that mobile is growing at the expense of desktop – seems to be backed up by Google, which recently confirmed that it’s now serving more Google searches on smartphones than desktops in 10 counties, including the US and Japan. To respond to changing demands, Google is “rolling out new, smartphone-optimized ad formats that give users more reason to tap than its traditional AdWords. These include picture-heavy automobile ads that show users a gallery of their dream ride before directing them to dealerships, and hotel ads that sandwich together availability, prices, user reviews, and pictures into a compact mobile format.”

However, while the amount of mobile access might be outstripping desktop, an Outbrain study in the Asia-Pacific region shows that people consuming content on desktop are much more likely to engage with content compared to mobile, especially when it comes to paid content, reports Trak.in.

“In fact, if we compare desktop vs mobile, then engagement level falls drastically to 36% in Australia; and 9% in India. This means that if an Indian accesses a piece of content on mobile, then there is 9% less chance of his engagement compared to accessing content on desktop. Engagement here means sharing, commenting, liking the post or following the author/publication on social media.”

Of course mobile and desktop are both heavily used to access email. Yesware Enterprise examined more than 14 million messages sent by its users earlier this year to produce a detailed pattern of when and on what device people use to read their emails. This slideshow gives an insight into their findings.

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Blogging is very much alive — we just call it something else https://www.kbridge.org/en/blogging-is-very-much-alive-we-just-call-it-something-else/ Mon, 09 Feb 2015 08:37:15 +0000 https://www.kbridge.org/?p=2719 Following the decision of Andrew Sullivan, founder of The Daily Dish, to give up blogging, Mathew Ingram of Gigaom discusses what blogging is, how it has changed and, importantly, what its role is in modern media.

Ingram explains that some critics say that Sullivan’s retirement signals the death of blogging, while others claim that it actually died a long time ago. BuzzFeed’s Ben Smith has argued that blogging disappeared when people like himself started to use it as a tool to power their own career. “Ben is saying that some bloggers stopped thinking as much about being part of a larger ecosystem — one in which they linked to and sent traffic to other bloggers, and in turn relied on their resources and links — and started thinking about becoming their own independent media entities instead. In effect, they turned inwards, and became more concerned with creating their own content and building up their readership, and turning that into a business.”

Ezra Klein, co-founder of Vox, thinks that the rise of the social web forced blogging to change. The niche, specialist nature of blogs that linked to other blogs, creating community and conversation, has been replaced by the search for virality through Facebook and Twitter.

In Ingram’s opinion, the truth is that blogging hasn’t died; it has changed. In fact, we are now surrounded by it. When it started, blogging was the quickest way to publish your voice, to share your thoughts and listen to what others were saying. Now, with Snapchat, Instagram and Facebook, all the elements that we used to think of as blogging are everywhere, immediately available to us all, easier to use than traditional platforms, and providing far larger audiences.

“Clinging to a specific form like blogging is an anachronism,” he says. What newspapers like the New York Times have done is to get rid of their blogs as separate entities, and incorporate that content into the rest of the paper.

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Big Data for media: Opportunities, challenges and best practices https://www.kbridge.org/en/big-data-for-media-opportunities-challenges-and-best-practices/ Thu, 11 Dec 2014 09:40:44 +0000 https://www.kbridge.org/?p=2651 The Big Data hype of 2013 turned into reality in 2014. Media companies are using Big Data “to better understand cross-platform audiences, create powerful data journalism stories, streamline business processes and identify new products and services to offer customers”, says Martha Stone in a report for the Reuters Institute for the Study of Journalism.

Big Data is “an umbrella term for a variety of strategies and tactics that involve massive data sets, and technologies that make sense out of these mindboggling reams of data”. The report explains that the media industry can think of Big Data as “the Four Vs, including:

  • volume of data;
  • velocity of data, meaning it needs to be analysed quickly;
  • in a variety of structured and increasingly unstructured data formats;
  • which all have potential value in terms of high quality journalism and business insights and revenue.”

Media companies can use Big Data analysis to improve many aspects of their business performance, such as understanding their audience and better targeting customers, crunching huge data sets to uncover stories, directing campaigns, improving decision-making and creating business efficiencies.

The report provides detailed examples from several leading media companies using Big Data to develop their audience and business, including:

  • Huffington Post, which “uses Big Data to optimise content, authenticate comments, ensure efficacy of native advertising, regulate advertising placement and create passive personalisation”.
  • BuzzFeed, which uses Big Data pre-publication to predict the virality of articles by identifying “characteristics with predictive relationship to virality”, and post-publication to “optimise the article’s promotion”.
  • The Financial Times, which uses registration data collected through its metered paywall “to serve the customer better, create targeted advertising campaigns and create new products based on information collected on background and areas of interest to its readers”.

The report also examines training data journalists and data-driven automation in journalism, as well as lessons from beyond the media sector.

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Australian papers launch online exchange for print ads https://www.kbridge.org/en/australian-papers-launch-online-exchange-for-print-ads/ Fri, 28 Nov 2014 08:19:46 +0000 https://www.kbridge.org/?p=2646 Australian newspaper publishers have joined forces to launch a private exchange to buy print advertising, in what is an industry first, reports The Newspaper Works.

The auction site, which is known as Bid on Print, began trading on 24 November with more than 140 newspaper titles available to media buyers.

Bid on Print is not a programmatic or real-time bidding exchange, like its digital ad counterparts – “instead, a publisher selects inventory, applies a floor price and then sets a timeframe in which the ad must be bought. Buyers then bid with the highest offer winning, or they can simply click a ‘Buy Now’ button.”

The exchange is designed to help publishers sell less valuable inventory and free up sales teams to focus on premium stock, explains mUmBRELLA.

“We are creating commercial efficiencies for both media agencies and publishers. Media agencies can bid and book a print advertisement with a click of the mouse,” Newspaper Works chief executive Mark Hollands said. “We have made the system as simple as possible to appeal to buyers and planners, and make the transaction quick and simple.

The site has been created by The Newspaper Works and Publisher’s Internationalé. It transacted more than AUD$350,000 (USD293,000) during pre-launch trials.

“Feedback from media agencies suggests we have reduced to just a few minutes what took them hours to do previously, especially for campaign-scale purchases,” Publisher’s Internationalé CEO Charlton D’Silva said. “Newspaper publishers see the benefit of helping to create efficiencies for agencies and have keenly supported the initiative.”

In contrast to programmatic trading, allowing publishers to fix a minimum price means that rates can’t be forced below a level they find acceptable .

 

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The newsletter is dead. Long live the newsletter! https://www.kbridge.org/en/the-newsletter-is-dead-long-live-the-newsletter/ Fri, 14 Nov 2014 13:47:37 +0000 https://www.kbridge.org/?p=2622 Email newsletters are back in fashion, with leading digital players like Quartz, Vox and the Financial Times investing in the format. While there’s widespread agreement that email newsletters are popular with audiences, there’s a difference of opinion about the type of news they should contain, particularly whether they should be produced in-house or aggregated, says Ricardo Bilton of Digiday.com.

Bilton quotes Andrew Jack, head of aggregation and curated content at The Financial Times, which recently launched its latest daily newsletter, First FT: “There’s still a very strong appetite for email. People want something that’s always there and easy to access. It also gives us a way to push news and comments to readers in a new form.”

Benjamin Mullin of Poynter.org explains how effective email newsletters are proving for BuzzFeed: “so far in 2014 newsletter traffic to BuzzFeed is up 700 percent over 2013. And newsletters … are now in the ‘top five or six’ biggest drivers of traffic, behind sites including Facebook, Pinterest, Google and Twitter.” BuzzFeed now has 14 newsletters targeted at different audience segments.

While FirstFT aggregates articles from a variety of sources, not everyone agrees. Bilton gives an overview of four of the leading media newsletters.

Quartz: Daily Brief

  • “We wanted the newsletter to feel like a personal email from a savvy, intelligent, well-connected person.”
  • Aggregated sources
  • 95,000 subscribers
  • Sponsored and native ads

Vox: Sentences

  • “Vox Sentences is the fastest way to get caught up on the most important news stories after a long day”
  • Delivery: 8pm.
  • Aggregated sources
  • Banner ads

The Financial Times: FirstFT

  • Morning briefing aimed at global decision-makers
  • 50% FT sources, 50% external
  • Some ads but goal is to drive FT subscriptions by building a relationship.

 Time.com: The Brief

  • A daily snapshot of Time’s content to build the audience’s habit of using Time.
  • Links to 12 Time stories, no aggregation
  • 650,000 subscribers, with a 40 percent open rate.
  • Carries ads and pushes readers to subscribe to its magazine.
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News Media: Diversify or die https://www.kbridge.org/en/news-media-diversify-or-die/ Mon, 13 Oct 2014 14:52:41 +0000 https://www.kbridge.org/?p=2559 Frédéric Filloux of Monday Note says the era of news media based on a single product is over. Diversification is the only way: it’s no longer a question of whether to develop other revenue streams, it’s a question of deciding which ones will work for your business. He offers a guide to help media outlets work out which of their existing and potential products and services will yield the best returns. These, he says, should be the relentless focus of their attention.

Filloux lists products and services found in many media businesses, then attributes a value to each one: “the sum of items in any given mix must translate into the famous Average Revenue per User (ARPU), a number that should be everyone’s obsession.” He identifies 14 products, services and target groups.

table

Then gives an assessment of the relative importance of each option, including:

Daily Print Occasional Reader: For most outlets, this is the least valuable customer. The costs of serving occasional, remote customers usually doesn’t make financial sense. “The practice needs urgent reassessment. In most cases, this means eliminating the weakest point of sales.”
Potential: Zero.
Priority: Low.

Daily Print Subscriber: Some – though a decreasing number of – customers will pay almost anything for their hard copy newspaper to be delivered.
Potential: Limited.
Priority: Limited.

Digital Subscribers: “For quality media, this is the most precious revenue stream.” To attract paying subscribers, you must produce “irreplaceable” content. The first step it so attract as many registered users as possible, then you have to “work on the conversion rate”.
Potential: High.
Priority: Top.

Events and Conferences: A competitive sector, though they can be profitable if they are genuine editorial products – supported by the news staff, the product of editorial thinking and provide something unique.
Potential: High if well engineered and executed.
Priority: Depends on the level of competition in your market. I’d say: High.

MOOCs (massive open online course) and Training Products: Real potential: for many people, deep training is essential just to survive in the job market. There are also dual market possibilities, i.e. corporate for paid-in-advance products and business-to-consumer for sponsored courses. A great opportunity for media to leverage their brand, reach and portfolios of advertisers.
Potential: High
Priority: Top.

Content Syndication: Serious consideration: “digital news is overwhelmed by shallow, recycled, often mediocre content. Premium is rare because it’s expensive and risky to produce. Therefore it carries tangible value.” If you create quality editorial products, you should target outlets that can’t afford original production.
Potential: High.
Priority: Should be on the very top.

Making all of this – and other items that could be added to the list – a reality, “requires agility, light structures (in some cases disconnected from the mother ship), dedicated staff who think fast and react faster. The upside is promising.”

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The Guardian launches membership scheme to finance its ‘open’ digital development https://www.kbridge.org/en/the-guardian-launches-membership-scheme-to-finance-its-open-digital-development/ Mon, 22 Sep 2014 08:09:15 +0000 https://www.kbridge.org/?p=2497 The Guardian, the world’s third largest news site, has launched a membership scheme putting community and events at the heart of its plans to finance its paywall-free digital development.

Inviting readers to join one of three tiers of membership, the British newspaper is relying on a combination of readers being ready to pay to belong to a community of ‘diverse, progressive minds’, and the attraction of privileged access to events and a vast new venue, ‘Guardian Space’, where many of the workshops, activities and courses will be held.

This is how Editor-in-Chief Alan Rusbridger explained the membership plan and vision to readers: http://www.theguardian.com/membership/2014/sep/10/-sp-guardian-editor-alan-rusbridger-welcome-to-guardian-membership?CMP=twt_gu

Ken Doctor in Nieman Lab points out that by building an actual (rather than purely digital) community with a central venue, The Guardian is betting that the answer to newspapers’ digital woes are to be found in the physical world. The newspaper plans to hold hundreds of events a week across the country by partnering with education and cultural institutions to produce and co-produce events. “What makes The Guardian initiative stand out at this point is its sheer scope. Currently, seven to 10 people staff the events/membership business, [Deputy CEO David] Pemsel says he anticipates a ramp up to 30-50.” There are also plans to extend the scheme to some of it 105 million global users in the U.S. and Australia in 2015.

Jasper Jackson in the Media Briefing says The Guardian is “offering access to events and other perks aimed at building a third revenue stream to complement the cover sales, print and digital advertising that currently make up the bulk of its revenue, while also tying a core of readers closer to the Guardian brand.”

The three levels of membership range from free ‘Friends’, through ‘Partners’ at $25/month, to ‘Patrons’ at $100/month, “but will not include any additional access to the Guardian’s journalistic output in print or digital, which is currently available free on the web”.

Converting a 30,000 square foot space in the heart of London will have “an impact on the overall commercial narrative”, but the initiative is projected to contribute revenues within five years. Jackson also quotes Pemsel as saying:

“The revenue from the £15 tier and the £60 tier, in the modelling and all the research we’ve done, breaks even at some point and starts to contribute a quite significant amount of money. The days of legacy print organisations being able to monetise anonymous reach are obviously under severe pressure, therefore one has to look at multiple business models to address that.

“Growing anonymous reach is great for spreading the message but converting that into money is hard. If you don’t deepen the engagement – time spent etc. which are very important benchmarks of how people are engaging with your content – and then through that converting that data into knowing people is very important. Trying to do all three of those things globally is quite an interesting job, but from a commercial perspective, we continually talk about doing those three things equally because you can’t do one without the other two.”

Jackson thinks it’s “a big ask for intangible value … The paid tiers appear to offer limited value for a relatively steep price. Both resemble very expensive loyalty cards (with the added bonus of being able to call yourself a “card-carrying Guardian reader”). And for the moment at least, the events portfolio will mostly appeal to those within easy reach of London.” He compares it with The Times’ subscription scheme at $40 per month, which offers an events programme and exclusive access to digital content.

In addition to the direct revenue created by the two paying tiers of membership, members’ details will be used to personalise ads and content.

Pemsel noted one area where The Guardian is going to have to learn fast – managing relationships: “However, through our multi-platform reach we’ve now got more relationships with more people than we’ve ever had before and we need to try and convert that into something, not just because we want to make money, but because our readers want us to.”

Overall, Jackson’s take on the scheme is that there is too little value in membership to make it work on a rational consumer level, but that isn’t the point – the paper’s strategy is to appeal to emotion: “Yet the way both Pemsel and the wording on the Guardian’s membership site emphasise that Patrons, Partners and even Friends, will be ‘supporting the Guardian’s journalism’ makes it clear this is aimed at more irrational impulses. It’s an appeal to the emotions of those who identify with the Guardian brand. It is reminiscent of the way loyal print readers did, and in small numbers still do, consider the idea of being a Guardian (or Times or Telegraph) reader a core part of their identity.

“The Guardian is effectively saying to its most loyal readers: ‘we won’t make you pay for our content, but we will ask you to in return for a few, mostly intangible, perks, and the knowledge that you are contributing to what we do’.”

In a country where terms such as ‘Guardian-reader’ and ‘Mail-reader’ are regularly used as both badges of honour and abusive stereotypes, “Building a business model around the affection some of its readers feel for that voice makes sense for The Guardian in a way it wouldn’t for most competitors.”

 

 

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