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PAID ONLINE CONTENT
  Trends, best practices and strategies that fit
                         Michigan Press Association
                               Jan. 26, 2013
                             Presented by Mike Jenner
                           Missouri School of Journalism




University of Missouri                                     Missouri School of Journalism
3 THINGS
  YOU NEED TO KNOW




University of Missouri   Missouri School of Journalism
1. HALF the country‘s
  dailies are now charging
  Paid content is no longer a trend.
  It‘s a movement.




University of Missouri                 Missouri School of Journalism
Half the country‘s dailies now charge
• An RJI survey
 of 458 daily
 publishers last
 summer                   Yes
                          47%                            No
 showed that                                            53%
 47 percent
 were requiring
 online users to
 pay


                          0% 0%   Source: 2012 RJI Publishers Confidence Index



 University of Missouri                                    Missouri School of Journalism
Half the country‘s dailies now charge
• Since
 then, the
 numbers have
                          Yes
 climbed to a             50%
 tipping point.                                          No
                                                        50%




                          0% 0%   Source: 2012 RJI Publishers Confidence Index



 University of Missouri                                    Missouri School of Journalism
Smaller papers have led the way
• 59% of dailies under 5,000 circulation
• 53% of dailies between 5,001 and 10,000
• 46% of dailies between 10,000 and 50,000
• 26% of dailies with circulation over 50,000




 University of Missouri                     Missouri School of Journalism
Groups have seen the light
   • Gannett: 71 of its dailies   • Media News-Digital First
   • McClatchy                    • Gatehouse
   • Tribune                      • Schurz
   • Media General                • Swift
   • Lee                          • Wick
   • Cox                          • Pioneer
   • Scripps                      • New York Times
   • Morris
   • Dow Jones



University of Missouri                               Missouri School of Journalism
Why this matters to the industry
• Basic economics: Supply and demand
• Widespread paid content is bringing a badly
  needed scarcity to a glut of news
• It straightens out an illogical business model




 University of Missouri                      Missouri School of Journalism
Why this matters to the industry
It makes an important statement:


           Your content has value
           regardless of platform.


 University of Missouri            Missouri School of Journalism
2. Reduced page views
  don‘t hurt revenues
  Sites have so much unsold inventory, the only
  losses in ad sales are pennies in remnant banners.




University of Missouri                          Missouri School of Journalism
When paywalls go up…
• Page view declines range between 5-40 percent
• Most sites have an inventory glut — many more
  page views than needed to present paid ads
• Only remnant and ―value added‖ avails are lost
• Paid content quickly covers any lost ad revenue
• I know of no site that‘s seen a net revenue
  loss, even those seeing 40 percent fewer page
  views

 University of Missouri                Missouri School of Journalism
3. Your loyal readers will
support your efforts to charge
  They want you to succeed.




University of Missouri        Missouri School of Journalism
They want you to survive and thrive
• Loyal readers are the biggest supporters of paid
  online content, even in markets where they are
  asked to pay more for access to online news.
• In Cape Girardeau: Less than 2 percent of
  home delivery subscribers opted out. Yet less
  than 40 percent established digital accounts!




 University of Missouri                    Missouri School of Journalism
4 BENEFITS
OF A PAID MODEL




University of Missouri   Missouri School of Journalism
New revenue: Straight to the bottom line

• Revenue increases will depend on market size
  and pricing
• It‘s no silver bullet
• Case studies show how pricing affects revenue




 University of Missouri                  Missouri School of Journalism
Your site will become more valuable
to your advertisers

• More local, more quantifiable
• You know who your customers are and what
 they‘re seeing on your site.




 University of Missouri                Missouri School of Journalism
Quality of reader comments improves

Longtime reader to Andy Waters after the
Columbia Daily Tribune launched its paid model:

“Thank you for cleaning up the comments!”




 University of Missouri                  Missouri School of Journalism
Online users are no longer freeloaders.

They‘re customers.




 University of Missouri        Missouri School of Journalism
2 DISADVANTAGES
OF A PAID MODEL




University of Missouri   Missouri School of Journalism
1. Your online users are no longer
freeloaders — they‘re customers
Up until now, if they had a complaint, making
them happy might not have been your highest
priority.
After all, you were giving it all away for free.
Now, they‘re paying customers.




 University of Missouri                     Missouri School of Journalism
2. You‘ll hear some negative
comments when you launch
• Expect story commenters to object
• The wave of opposition will be loud — but thin
  and short-lived
• Plan in advance to counteract it
  • Thoughtful explanation to readers
  • Sustained marketing effort
  • Focus on your value proposition



 University of Missouri                    Missouri School of Journalism
2 CASE STUDIES
  • Columbia Daily Tribune
  • Augusta Chronicle




University of Missouri       Missouri School of Journalism
• 20,000 average weekday circulation
             • Ownership: Family
             • Launched December, 2010
             • Metered model
             • Built it in-house




University of Missouri                              Missouri School of Journalism
ColumbiaTribune.com
                         launched paid content
                         on Dec. 1, 2010.
                         • Advertising-only model
                           was not generating
                           revenue growth
                         • Wanted to eliminate
                           incentive to stop buying
                           print edition
                         • New revenue stream



University of Missouri                  Missouri School of Journalism
How does it work?
                         • Metered model – 10 free/mo.
                         • Online-only: $8/mo.
                         • Print subscribers: $1.50/mo.
                         • Premium: All local content
                           (photos, video, news, sports,
                           blogs, obits, etc.)
                         • Free: Everything else (section
                           fronts, wire, weather,
                           contests, classifieds, etc.)
                         • Only subscribers can
                           comment



University of Missouri                     Missouri School of Journalism
One year after launch
• 3,000,000 PVs/mo (still most popular in market)
• Total unique visitors up; local audience up 7%
• More than 9,500 paying – 60% conversion to
  bundle
• Local advertising unaffected – Non-issue for
  advertisers
• In first month, subscription revenue three times
  lost ad revenue
• Few objections from readers – Quality journalism
  at stake


 University of Missouri                  Missouri School of Journalism
• 55,000 average weekday circulation
             • Ownership: Morris
             • Launched December, 2010
             • Metered model
             • Thoughtful strategy, methodical rollout




University of Missouri                                   Missouri School of Journalism
University of Missouri   Missouri School of Journalism
A thoughtful, deliberate rollout
Core belief: Placing a value on the content is more important than
any penny we‘ll collect.

Strategy: Put toe in the paid-content water to learn. Set stage for
mobile/app paid content strategy. Use flexibility of model to experiment.

Start up: Introduction of page threshold phases in December 2010.

Rollout: Lots of communication with the market.




 University of Missouri                                     Missouri School of Journalism
A thoughtful, deliberate rollout
     • An editor‘s column
     • A publisher‘s column
     • Online FAQ
     • Anonymous comment interaction
     • Media response and comment
     • Phone calls
     • Newsroom mindset: Let‘s give ‘em something
        worth paying for


University of Missouri                   Missouri School of Journalism
What the Chronicle told readers
―We go beyond the button-pushing journalism
some bloggers and copycat online sites offer.‖

From Editor Alan English‘s column:
―How much would you pay to have your favorite
journalist or columnist‗watchdogging‘City Hall?
Would you buy him or her a cup of coffee each
month?‖


University of Missouri                   Missouri School of Journalism
What Alan English told readers
―The value goes beyond access. You support the
local journalism that includes:

• Bio-testing local waterways, revealing problems and
   getting them attention.
• Battling for public records.
• Celebrating local heroes and honoring fallen soldiers.
• Checking the safety of your roadways and bridges.



University of Missouri                          Missouri School of Journalism
What Alan English told readers
• Reviewing policies and hiring practices at city hall.
• Raising awareness and donations for breast cancer.
• Championing better government.
• Leading coverage of ASU's national championship.
• Convening a roundtable of local health care CEOs to
  learn the impact of reforms.
• Rallying charitable giving at Christmastime.




University of Missouri                            Missouri School of Journalism
Editor Alan English asked readers:

 ―Who else does this as often
  as your local newspaper?‖




University of Missouri        Missouri School of Journalism
5 RECOMMENDATIONS




University of Missouri   Missouri School of Journalism
1. Make your site worth paying for

Charging generates revenue to help pay
for journalism, but you now have to make
your digital edition good enough to expect
readers to actually pay for it.




 University of Missouri              Missouri School of Journalism
1. Make your site worth paying for

This means:
• Your site needs to work.
• It looks like it was put together with a
  modicum of care.
• You‘ve added value to the content.




 University of Missouri                  Missouri School of Journalism
Product differentiation

Product differentiation
• Your site should be different from your
  print edition.
• Play to the strengths of digital: add value
  that only digital allows you to add



 University of Missouri                 Missouri School of Journalism
What this means
• Deeper, richer stories: documents & data
• Sight, sound & motion
• Context
• Interactivity
• Links to archived content
• Engagement/community


 University of Missouri              Missouri School of Journalism
2. Go with ―opt out,‖ not ―opt in‖

Give print subscribers the option of not
choosing a digital membership — but
assume they will want to do so.




 University of Missouri               Missouri School of Journalism
3. Choose a meter over a hard wall…




 University of Missouri      Missouri School of Journalism
3. Choose a meter over a hard wall…

• Keep your site search-engine friendly
• Encourage discovery
• Some see value in a porous ―wall‖




 University of Missouri              Missouri School of Journalism
3. …but keep your meter tight

• Most early adapters started loose and began
  to tighten
• The Augusta Chronicle began by giving
  everyone a free buffer of 100 views
• Within 6 months, they‘d tightened it to 10




 University of Missouri                Missouri School of Journalism
3. …but keep your meter tight
                     35                              Surveyed dailies’
                                                     monthly meter settings
                     30
 Percent of papers




                     25
                     20
                     15
                     10
                      5
                      0
                           Less    5       10        15       20     25 and
                          than 5                                       up
                                   Free stories per 30 days

 University of Missouri                                                Missouri School of Journalism
4. What to keep inside / outside the wall
     OPEN ACCESS:         RESTRICT ACCESS:
     • Breaking News      • Unique local content
     • Section fronts     • News
     • Wire               • Sports
     • ―Commodity news‖   • Photos
     • Weather            • Obits
     • Contests           • Ability to comment
     • Classifieds


 University of Missouri                   Missouri School of Journalism
5. Don‘t be afraid to ask for real money

It is possible to charge too little.

Don‘t be afraid to ask readers to pay.




University of Missouri                 Missouri School of Journalism
Mike Jenner
   Missouri School of Journalism
   jennerm@missouri.edu
   Cell: (573) 808-4785



University of Missouri         Missouri School of Journalism

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Paid online Content: Trends, best practices and strategies that fit

  • 1. PAID ONLINE CONTENT Trends, best practices and strategies that fit Michigan Press Association Jan. 26, 2013 Presented by Mike Jenner Missouri School of Journalism University of Missouri Missouri School of Journalism
  • 2. 3 THINGS YOU NEED TO KNOW University of Missouri Missouri School of Journalism
  • 3. 1. HALF the country‘s dailies are now charging Paid content is no longer a trend. It‘s a movement. University of Missouri Missouri School of Journalism
  • 4. Half the country‘s dailies now charge • An RJI survey of 458 daily publishers last summer Yes 47% No showed that 53% 47 percent were requiring online users to pay 0% 0% Source: 2012 RJI Publishers Confidence Index University of Missouri Missouri School of Journalism
  • 5. Half the country‘s dailies now charge • Since then, the numbers have Yes climbed to a 50% tipping point. No 50% 0% 0% Source: 2012 RJI Publishers Confidence Index University of Missouri Missouri School of Journalism
  • 6. Smaller papers have led the way • 59% of dailies under 5,000 circulation • 53% of dailies between 5,001 and 10,000 • 46% of dailies between 10,000 and 50,000 • 26% of dailies with circulation over 50,000 University of Missouri Missouri School of Journalism
  • 7. Groups have seen the light • Gannett: 71 of its dailies • Media News-Digital First • McClatchy • Gatehouse • Tribune • Schurz • Media General • Swift • Lee • Wick • Cox • Pioneer • Scripps • New York Times • Morris • Dow Jones University of Missouri Missouri School of Journalism
  • 8. Why this matters to the industry • Basic economics: Supply and demand • Widespread paid content is bringing a badly needed scarcity to a glut of news • It straightens out an illogical business model University of Missouri Missouri School of Journalism
  • 9. Why this matters to the industry It makes an important statement: Your content has value regardless of platform. University of Missouri Missouri School of Journalism
  • 10. 2. Reduced page views don‘t hurt revenues Sites have so much unsold inventory, the only losses in ad sales are pennies in remnant banners. University of Missouri Missouri School of Journalism
  • 11. When paywalls go up… • Page view declines range between 5-40 percent • Most sites have an inventory glut — many more page views than needed to present paid ads • Only remnant and ―value added‖ avails are lost • Paid content quickly covers any lost ad revenue • I know of no site that‘s seen a net revenue loss, even those seeing 40 percent fewer page views University of Missouri Missouri School of Journalism
  • 12. 3. Your loyal readers will support your efforts to charge They want you to succeed. University of Missouri Missouri School of Journalism
  • 13. They want you to survive and thrive • Loyal readers are the biggest supporters of paid online content, even in markets where they are asked to pay more for access to online news. • In Cape Girardeau: Less than 2 percent of home delivery subscribers opted out. Yet less than 40 percent established digital accounts! University of Missouri Missouri School of Journalism
  • 14. 4 BENEFITS OF A PAID MODEL University of Missouri Missouri School of Journalism
  • 15. New revenue: Straight to the bottom line • Revenue increases will depend on market size and pricing • It‘s no silver bullet • Case studies show how pricing affects revenue University of Missouri Missouri School of Journalism
  • 16. Your site will become more valuable to your advertisers • More local, more quantifiable • You know who your customers are and what they‘re seeing on your site. University of Missouri Missouri School of Journalism
  • 17. Quality of reader comments improves Longtime reader to Andy Waters after the Columbia Daily Tribune launched its paid model: “Thank you for cleaning up the comments!” University of Missouri Missouri School of Journalism
  • 18. Online users are no longer freeloaders. They‘re customers. University of Missouri Missouri School of Journalism
  • 19. 2 DISADVANTAGES OF A PAID MODEL University of Missouri Missouri School of Journalism
  • 20. 1. Your online users are no longer freeloaders — they‘re customers Up until now, if they had a complaint, making them happy might not have been your highest priority. After all, you were giving it all away for free. Now, they‘re paying customers. University of Missouri Missouri School of Journalism
  • 21. 2. You‘ll hear some negative comments when you launch • Expect story commenters to object • The wave of opposition will be loud — but thin and short-lived • Plan in advance to counteract it • Thoughtful explanation to readers • Sustained marketing effort • Focus on your value proposition University of Missouri Missouri School of Journalism
  • 22. 2 CASE STUDIES • Columbia Daily Tribune • Augusta Chronicle University of Missouri Missouri School of Journalism
  • 23. • 20,000 average weekday circulation • Ownership: Family • Launched December, 2010 • Metered model • Built it in-house University of Missouri Missouri School of Journalism
  • 24. ColumbiaTribune.com launched paid content on Dec. 1, 2010. • Advertising-only model was not generating revenue growth • Wanted to eliminate incentive to stop buying print edition • New revenue stream University of Missouri Missouri School of Journalism
  • 25. How does it work? • Metered model – 10 free/mo. • Online-only: $8/mo. • Print subscribers: $1.50/mo. • Premium: All local content (photos, video, news, sports, blogs, obits, etc.) • Free: Everything else (section fronts, wire, weather, contests, classifieds, etc.) • Only subscribers can comment University of Missouri Missouri School of Journalism
  • 26. One year after launch • 3,000,000 PVs/mo (still most popular in market) • Total unique visitors up; local audience up 7% • More than 9,500 paying – 60% conversion to bundle • Local advertising unaffected – Non-issue for advertisers • In first month, subscription revenue three times lost ad revenue • Few objections from readers – Quality journalism at stake University of Missouri Missouri School of Journalism
  • 27. • 55,000 average weekday circulation • Ownership: Morris • Launched December, 2010 • Metered model • Thoughtful strategy, methodical rollout University of Missouri Missouri School of Journalism
  • 28. University of Missouri Missouri School of Journalism
  • 29. A thoughtful, deliberate rollout Core belief: Placing a value on the content is more important than any penny we‘ll collect. Strategy: Put toe in the paid-content water to learn. Set stage for mobile/app paid content strategy. Use flexibility of model to experiment. Start up: Introduction of page threshold phases in December 2010. Rollout: Lots of communication with the market. University of Missouri Missouri School of Journalism
  • 30. A thoughtful, deliberate rollout • An editor‘s column • A publisher‘s column • Online FAQ • Anonymous comment interaction • Media response and comment • Phone calls • Newsroom mindset: Let‘s give ‘em something worth paying for University of Missouri Missouri School of Journalism
  • 31. What the Chronicle told readers ―We go beyond the button-pushing journalism some bloggers and copycat online sites offer.‖ From Editor Alan English‘s column: ―How much would you pay to have your favorite journalist or columnist‗watchdogging‘City Hall? Would you buy him or her a cup of coffee each month?‖ University of Missouri Missouri School of Journalism
  • 32. What Alan English told readers ―The value goes beyond access. You support the local journalism that includes: • Bio-testing local waterways, revealing problems and getting them attention. • Battling for public records. • Celebrating local heroes and honoring fallen soldiers. • Checking the safety of your roadways and bridges. University of Missouri Missouri School of Journalism
  • 33. What Alan English told readers • Reviewing policies and hiring practices at city hall. • Raising awareness and donations for breast cancer. • Championing better government. • Leading coverage of ASU's national championship. • Convening a roundtable of local health care CEOs to learn the impact of reforms. • Rallying charitable giving at Christmastime. University of Missouri Missouri School of Journalism
  • 34. Editor Alan English asked readers: ―Who else does this as often as your local newspaper?‖ University of Missouri Missouri School of Journalism
  • 35. 5 RECOMMENDATIONS University of Missouri Missouri School of Journalism
  • 36. 1. Make your site worth paying for Charging generates revenue to help pay for journalism, but you now have to make your digital edition good enough to expect readers to actually pay for it. University of Missouri Missouri School of Journalism
  • 37. 1. Make your site worth paying for This means: • Your site needs to work. • It looks like it was put together with a modicum of care. • You‘ve added value to the content. University of Missouri Missouri School of Journalism
  • 38. Product differentiation Product differentiation • Your site should be different from your print edition. • Play to the strengths of digital: add value that only digital allows you to add University of Missouri Missouri School of Journalism
  • 39. What this means • Deeper, richer stories: documents & data • Sight, sound & motion • Context • Interactivity • Links to archived content • Engagement/community University of Missouri Missouri School of Journalism
  • 40. 2. Go with ―opt out,‖ not ―opt in‖ Give print subscribers the option of not choosing a digital membership — but assume they will want to do so. University of Missouri Missouri School of Journalism
  • 41. 3. Choose a meter over a hard wall… University of Missouri Missouri School of Journalism
  • 42. 3. Choose a meter over a hard wall… • Keep your site search-engine friendly • Encourage discovery • Some see value in a porous ―wall‖ University of Missouri Missouri School of Journalism
  • 43. 3. …but keep your meter tight • Most early adapters started loose and began to tighten • The Augusta Chronicle began by giving everyone a free buffer of 100 views • Within 6 months, they‘d tightened it to 10 University of Missouri Missouri School of Journalism
  • 44. 3. …but keep your meter tight 35 Surveyed dailies’ monthly meter settings 30 Percent of papers 25 20 15 10 5 0 Less 5 10 15 20 25 and than 5 up Free stories per 30 days University of Missouri Missouri School of Journalism
  • 45. 4. What to keep inside / outside the wall OPEN ACCESS: RESTRICT ACCESS: • Breaking News • Unique local content • Section fronts • News • Wire • Sports • ―Commodity news‖ • Photos • Weather • Obits • Contests • Ability to comment • Classifieds University of Missouri Missouri School of Journalism
  • 46. 5. Don‘t be afraid to ask for real money It is possible to charge too little. Don‘t be afraid to ask readers to pay. University of Missouri Missouri School of Journalism
  • 47. Mike Jenner Missouri School of Journalism jennerm@missouri.edu Cell: (573) 808-4785 University of Missouri Missouri School of Journalism

Notas del editor

  1. ….from a small but vocal group. That wave of negative comments seems to subside rather quickly.The value proposition on digital content begins a new relationship with our new and next-generation customers.
  2. As I mentioned before, now they are customers, not just drive-bys.
  3. Slide shows — graduations, ball games, county fairs — PDFs of lawsuits, county ordinances, city and county budgets, Powerpoint presentations by the city manager