Newspaper brands that manage the transition to digital models can thrive
“Newspapers are dying.” Lately, that’s the constant, gloomy chorus. But it couldn’t be further from the truth.
Certainly, the newspaper industry faces significant challenges, including a tough economy and the mass migration of readers and advertisers to the Internet. But newspaper brands that successfully transition to digital models can thrive — without giving up their streamlined print products.
The key is for newspapers to reach that still-elusive sweet spot between their traditional mass audience business model and the niche readerships found on the Internet. Together, print and online operations can create a sustainable balance that meets advertisers’ needs and attracts new readers while maintaining their existing audience.
Here’s how newspapers can strike that balance.
Bridge the digital divide
The Internet offers an ideal platform to build audiences and win advertisers. Readers today have unprecedented access to breaking news and information through mobile technology, while online advertising shows promising long-term prospects. Newspapers that can leverage these trends can extend or transition their core audience across print, online and mobile platforms.
Newspaper publishers can attract advertisers and niche readers online by creating compelling information for specific markets. Some newspapers have successfully created “hyper-local” sites that provide content at the neighborhood level, enabling advertisers to target specific, localized interest groups.
It’s imperative that newspapers adequately invest in their online ventures. But they must focus on large-scale, sustainable projects that have the ability to reach widespread, marketable audiences—not just local readers. For example, don’t just create a branded photo sharing service aimed at a local sports team—make that same application available beyond the traditional audience through social networking sites like Facebook or other outlets. Online ventures that do not gain traction or cater to local, niche audiences that are not economically viable should be discarded early to channel investment elsewhere.
Streamline the print side
Consumers value the insight and analysis newspaper journalists provide. But an online presence means the print product no longer needs to be all things to all readers. Cater to a smaller audience with a streamlined, higher-priced print product. Raising prices will help determine the scope of the loyal print audience, stabilize circulation rates and better predict advertising revenue; this will help newspaper publishers “right size” their print products and identify content its audience wants.
Newspapers should also focus on areas that distinguish them from their competitors — giving readers and advertisers a reason to spend time and money on their particular print product.
Instead of trimming across the board, publishers should cut areas that aren’t relevant or distinct. Syndicate generic editorial content and consolidate the newsroom to create content that can be tailored at a local level. Develop strategic partnerships with other content providers to target specific audiences.
Rethink advertising sales models
Trimming infrastructure also means only having one sales force for all platforms. Newspaper publishers must develop cross-platform service models, with integrated advertising sales teams that can sell print, online and mobile products and services. This approach will be particularly important as mobile advertising increases.
Redesign existing business models with a bias for agility
Newspapers must consider all available options for reinventing themselves in the new digital era. This means developing strategies to monetize content and intellectual capital online and mobile, and calls for new ways to meet increased customer demand for specialized, relevant and timely information while continuing to provide general news to a wide audience.
Success may come from rethinking traditional methods. Newspapers could integrate print and online coverage so teams of journalists — including reporters, bloggers and citizen journalists — work together in a multiplatform environment to provide editorial content, photographs, videos and graphics. Profitable relationships and potential revenue streams could come from social networks, like Twitter.
Make no mistake: newspapers face intense pressure. The global newspaper market is forecast to decline by 10.2 percent in 2009, with a 2 percent average compound annual decrease through 2013, and in North America the sector is projected to experience a 17.7 percent decline in 2009 with a compound annual decline of 5.8 percent through 2013.
But newspapers have two huge assets — established brands and loyal readers.
Newspapers are not dying. But they must transform. Tactical, transition-related changes can help the industry boost advertising revenue and get more value from smaller print circulations. By crossing the digital divide and making strategic changes to their print operations, newspapers can still have a viable, long-term future.
More information on the newspaper trends can be found in “Moving into Multiple Business Models: Outlook for Newspaper Publishing in the Digital Age,” by PricewaterhouseCoopers in cooperation with the World Association of Newspapers and in PwC’s Global entertainment and media outlook: 2009-2013. Both reports are available at www.pwc.com/e&m.