Online Journalism News

'Publishers can go much further to building sustainable relationships by adding value'

Media brands, from magazine publishers to newspapers, are more concerned than ever about their ability to engage customers and remain profitable - and with good reason. Never before has there been so much high quality information available for so little.

With all eyes currently on the Times paywall, or rather what some commentators are referring to as "News International’s anti-social media experiment", we are witnessing a very real struggle as media owners attempt to map out the future of their industry and evaluate how they will build profitable relationships with their customer base.

A recent survey of 3,000 members of the public, carried out by OnePoll on behalf of PR Week, found that 93 per cent of people thought newspapers should use advertising rather than a paywall to make money online. Only time will tell if the paywall works or not, but it would be inaccurate to say it’s the only hope for publishers. There are other revenues streams, such as discounted reader offers and brand partnerships, and real potential in these areas. 

Learn from other sectors

Publishers could learn from leading brands in sectors such as retail and financial services, who have been maximising both customer engagement and generating additional revenue from the mass market very successfully for years. They have achieved this by offering 'added value propositions' tailored to their customer segments, which both differentiates their brands and enhances their core product and service offering. 

The retail sector is an expert at generating stronger relationships with value-added propositions that enhance the customer experience and generate incremental revenue. Take Comet for example, when you buy a flat screen television you also have the option to use their expert installation service to make sure everything works perfectly and then the annual repair service for peace of mind on all existing and future electrical purchases. This widens the Comet customer value proposition, and encourages repeat business at Comet.

In the financial sector, banks offer memberships for a monthly or annual fee, such as NatWest’s Advantage Gold that provides customers with a package of benefits that provides greater value to their everyday lives and keeps them engaged with the brand. These benefits, such as home and travel insurance, fraud protection, and vehicle breakdown cover have a high perceived value and are sold at a significantly cheaper price than if the customer bought these benefits separately.

Astoundingly though, recent research carried out by incremental revenue specialists Collinson Latitude found that one third of publishers are yet to tap into these revenue opportunities in any way and 40 per cent of publishers said that they have never considered providing customers with membership packages.

The existing approach that media brands use for added value memberships is focused around discounts and offers. Times+ is the best current example, as it tries to differentiate its offers by theming them around the readers’ key areas of interest, such as culture, travel and food. However, Times+ will struggle to provide differentiation and exclusivity to the discount based offering. Publishers can go much further than this to build sustainable relationships by offering mass market products and services of a high perceived value bundled into a membership, including benefits serving customer preferences such as travel or leisure.

Need to understand reader lifestyles

The true opportunity for  the publishing industry is to understand readers' lifestyles, personal journeys and experiences, in the context of their brand and the customers’ perspective of where they see value to develop new commercial membership propositions. So how can publishers do this in a way that will fit with the existing business model and produce sustainable results?

Use the customer insight - publishers have a huge amount of data on their readers; after all this is what is used to sell targeted advertising space. This information could be mined so publishers can understand their different customer profiles and where they are best placed to add value with relevant product and service extensions. More importantly, they need to also understand not what their core, loyal paper subscribers would buy from them, but what their wider online readership would too.

The power of partnerships -  this is key to generating greater relevance to the vast online audience, who don’t necessarily associate themselves with a specific publication. Publishers can explore different partnership models that serve contemporary needs, rather than a constant stream of one off discount offers, or links to partner’s websites. Brand extensions with  commercial partner propositions that are contextually relevant, targeted to their wider readership, will enable them to retain and grow a direct customer relationship and benefit from the recurring revenue.

Package the content –  the publishing industry would struggle to compete with businesses selling products such as travel insurance or flights, as they will never be able to differentiate their offering on price, product quality or keep up with innovation. Where the publishing industry has a unique opportunity is to create packages of products that their customers would need for everyday or regular experiences which is not currently being provided by others. For example, newspapers have been protecting customers from unfair travel charges and scams, and providing information on how to make the most from holidays for some time – not the airlines, hotels, car hire or travel insurance providers.

What better place to start than by creating a travel membership that provides piece of mind by offering products and services consumers need whenever they travel? This would also leverage journalists’ knowledge of how to make the travel experience easier, faster and more exclusive by supplying aspirational products and services that wouldn’t normally be easily accessible. Bundling relevant products and services also provides consumers with convenience, and publishers with the opportunity to acquire more behavioral data for refined targeting, value extension, relationship building and long term revenue.

Look for innovative ways to add value  – more and more publishers are realising the value of smartphone (and iPad) apps. This is a great example of how new technology offers a way to add value to existing content that the consumer is happy to pay for, and tap in to new audiences. These innovations represent new channels to build more sustainable and profitable relationships with more customers whilst finding new ways to engage with them in their every day lives.

There is no doubt that these are challenging times for publishers, with consumers that are more demanding, harder to engage, and less willing to pay for the content they receive. But incremental revenue delivered from product extensions provides a way for publishers to not only survive, but to capitalise on the shifting media landscape, and thrive.

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advertising | online journalism | paid content | paywalls | revenue streams |

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Got a story? Email our news team: Laura Oliver; Rachel McAthy or telephone +44 (0)1273 384290. You can also follow us on Twitter: @journalismnews / @LauraOliver / @rmcathy.

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