Think that the disruption experienced in the news media and magazine industry is because of new technology and internet platforms? Think again. University of Technology Sydney (UTS) Senior Fellow Jacqui Park explains that true disruption lies in the attention span of your audiences, and there are four factors required to build a sustainable publishing business into the future.
In her new report that looks at media disruption in Australia, News Media Innovation 2020, Park explains “Previously, information – and access to information – was relatively scarce. It could be corralled, packaged and sold. But now, information is everywhere. It strains to be free, to be ubiquitous. And where supply is effectively infinite, demand for each individual unit falls.”
She says that the time any one person has to consume information is “all too finite”.
“As all the other magnets for attention come rushing in to compete with news media, the attention available for journalism has dwindled.”
“The disruption is not about the technology. It’s not even about the business model. It’s about the clash between living in a world of information abundance and having only a finite amount of time to pay it attention.”
The habits, needs, expectations and value placed on information has changed for news media and magazine consumers, which Park says, calls for an audience-focused response across product development, business models, distribution and journalism.
“Practically, this means aggregating, identifying or creating an audience with a holistic approach: creating journalism they value, designing distribution tools to reach them where they are and developing the products that embed the business strategy to complement the journalism.”
Attacking media disruption through the power of journalism
The key challenge in 2020 and beyond is to grab your audience’s attention through the “power of journalism”.
An article can’t take its audience’s attention for granted – it must be earned. Park says that before creating content, editorial teams must ask: “what’s the value in this? Why should a reader, viewer or listener use some of their limited attention on this”.
But Park explains, it isn’t just about the quality of content, it’s about packaging and delivering your content in the right way at the right time, which not only means navigating search engine algorithms and email marketing, but providing your audiences with the information when they want it using AI-driven personalised delivery.
She says that the goal is R.E.A: repeat engaged attention.
Looking to new revenue sources
News media and magazine publishers have traditionally relied on business models based around advertising revenue.
Parks admits “innovators are still finding those dollars too attractive to just give away. But grabbing a slice of pay in the age of Google and Facebook requires smarts.”
She says that increasingly, innovators are turning to their readers for revenue by turning them into subscribers, donors, members or partners, either via ‘freenium’ or hard-paywall models.
“This monetisation requires recognition that not all audiences are equal,” says Parks. “As a rule of thumb, organisations say that perhaps 5 per cent of weekly [news media] audience will translate into paying subscribers. To encourage that transition, an organisation has to encourage repeat contacts by reshaping news habits with digital products.”
She says that monetising readers also require innovation around both the product and audience engagement, citing research that suggests successful paid content should be unique, compelling and provide transactional value or appeals to the audience’s personal values.
However, Parks admits that paywalls involve a trade-off between the advertising revenues that come from mass (and free) sites and subscriptions revenues.
“The innovation challenge is to build a product that engages an audience and also attracts a revenue mix that is largely based on readers, viewers and listeners.”
She believes that true innovation will lead to revenue diversification – something that most niche magazine publishers have been exploring for the last 10 years via events, content marketing services, custom publishing and the provision of targeted data and research.
Parks says that the most common diversification method for news media is to build parallel businesses, such as content studios that provide additional cash flow and often generate native advertising for inclusion in the organisations’ digital channels. The second most common method is events.
To truly explore diversifying your revenue, real innovation and often rethinking the product is required, and the product’s audience must be at the centre of the strategy.
“If the business model is about building diverse revenue streams with the audience at the centre, innovation in product development is about designing news products that people need and want, will seek out and will pay for. It brings together the journalism, the distribution and the business strategy into a product that fits its market, a product that solves a problem for the audience it centres on.”
You must innovate with audience in mind: business as usual is not an option
Park’s report is based on qualitative and theme-based research, relying on more than 79 in-depth interviews with Australian practitioners. She includes 12 case studies of print and digital publishers that are innovating their content, products and distribution methods in different ways but all with a focus on their audience. These case studies can be read at the end of the report.
Based on her research, interviews and case studies, Parks outlines that the industry’s learnings in the 25 years since first publishing online suggest that building a sustainable publishing business into the future requires innovation in four areas:
- Journalism that understands its audience’s needs and is able to engage it in a two-way relationship and add value through being both useful and entertaining;
- A media product that does the job that audiences want it to do for them and that, directly or indirectly, funds the journalism of news media;
- Social distribution that both uses and builds network power; and
- A business model that relies on diverse revenues from advertisers, readers and some other mix, without being over-dependent on any one source.
But she cautions: “These are not stand-alone points to be ticked off. Successful news media innovators think about each of these steps in a holistic way that integrates them by centring the audience.”
Park’s report can be accessed here: News Media Innovation 2020.