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By Thomas Baekdal - June 2019

A deep look into how Zetland operates and Blendle drops single-pay

This is an archived version of a Baekdal Plus newsletter (it's free). It is sent out about once per week and features the latest articles as well as unique insights written specifically for the newsletter. If you want to get the next one, don't hesitate to add your email to the list.

Welcome back to another edition of the Baekdal Plus newsletter, this time I have two really exciting things for you.


Plus: The Inside Look at Zetland's Shift to Audio

My latest Plus article is a really interesting one that took me more than a month to write. It's a 46-page guide (it's huge) that takes a really comprehensive look at how Zetland works, and more importantly, how they have been able to use audio in ways that other publishers haven't.

Just take a look at this graph. It's astonishing.

This article is based on several meetings with executives, a bit of back and forth, as well as several days of analysis. And it will take you through almost every single part of what makes Zetland work. From their overall strategy, their business model, their newsroom culture, to how they made this shift to audio, how they got it started, their journalistic and production workflow as well as some financial insights.

It is completely packed with insights, and it was such a fun article to work on.

Take a look at: The Inside Look at Zetland's Shift to Audio

A quick note: This article is actually part of a series. When I first started working on this back in April, I realized that I needed to explain the overall trend and the market as a whole before I wrote this article about Zetland.

So, if you haven't seen these, back in May I wrote "How audio is becoming the third great format for publishers" which talks about how publishers need to think about audio as more than just a format, and "The trend around creating a news oasis" which talks more specifically about creating niche media with a high focus on creating a macro-moment.


Blendle drops pay-per-article and focuses on subscription

There is big news in the world of payments. Blendle, the Dutch platform/bundle for newspapers and magazines, has announced that it will no longer do pay-per-article, and instead focus entirely on subscriptions.

In an email sent to members, they wrote that the pay-per-article model has "had its best time", and that in 2017 they decided to focus on Blendle Premium. Now their subscription service has 60,000 subscribers, so it's time to completely stop the pay-per-article model.

Instead, they now offer a subscription plan where people can browse an unlimited number of magazines, get their newsletters, unlimited listening, and also unlimited search through their archive of three million articles, including those from newspapers that are over 7 days old ...all with no ads.

The price for a subscription is €10 per month (about $11.2).

So, I have a few comments on this.

First of all, none of this should really come as a surprise to those of you who have been following Blendle from the start. Already back in 2017, I wrote an article about micropayments called: "Publishers and Micropayments. We Completely Miss the Point".

In this article I talked about the three stages audiences go through.

As I wrote about Blendle:

When Blendle first launched, they didn't have a relationship with their readers nor did people really know what they would get. Thus micropayment was a way to get things started because it allowed people to try things out without ever really committing to anything.

But now that people have been using Blendle for a while and they have figured out what it is about, people are telling Blendle to stop with the micropayments and give them a subscription model instead.

The result is that micropayments aren't the future for publishers. It's more like an intermediary step that has more to do with marketing than anything else. The micropayments are a way to solve a short-term marketing problem. It's a way to get people from stage one to stage three.

This also illustrated why micropayments aren't really what we need as publishers. The micropayment startups want you to place most of your business at stage 2, because that's where they make their money. But as a publisher, I would always focus on getting people to stage 3 and have as few people at stage 2 as possible. In fact, in many cases it would be a lot better to simply skip the micropayment step altogether.

This is exactly what has now happened at Blendle. And the whole micropayment or pay-per-article model just generally never works. And this is the problem with micropayments and the whole pay-per-article model. It's not actually a payment model, at best it's a marketing model, and at worst it's a distraction.

We see the same when people tell publishers they want to just pay for a single article. For instance, Anders Schäffner, the Head of Digital Products from TV2 (one of the largest Danish broadcasters and news sites) asked people on Twitter what feature they missed the most, and the first answer was someone asking for 'pay-per-article'.

We hear this all the time. In fact, let me give you an example.

Last month someone semi-famous died in my country, and the local newspaper in the town he lived in wrote an obituary about it ... which they put behind their paywall.

What happened then was many people from other places searched for this person and came across this article, where they were asked to subscribe to the entire local newspaper for a month before they could read it.

Obviously, nobody would ever do that. Why would anyone subscribe to a month of a local newspaper from a town that they don't live in just so that they can read one article about someone semi-famous who had died?

It's just not happening. And so people yelled at this local newspaper, some telling them that this article should be free, or that they should implement a way to pay for just that article.

We can all understand why people react this way. But there are two problems here.

First of all, even if this local newspaper were to implement a pay-per-article, the likelihood of people actually buying it would be close to zero. And the technical challenge involved would probably cost way more to implement than what this local newspaper could ever hope to get back.

So, people keep saying that they want this, but they don't really use it if given the option. What we are seeing is an emotional reaction, rather than a decision to pay.

But secondly, the reason why this is even a problem is because people are connecting with things that they could never connect with in the past.

Imagine if this had taken place in the 1980s. Imagine that someone had died in a city far away from you, and that the local newspaper wrote an article about it. What would happen?

The answer is nothing. You would never know.

Maybe you would hear about this death from another source, but you would never know that the local newspaper had written about it, nor would you feel compelled to look it up.

But today we live in a connected world, and people are suddenly exposed to this content. The result is that now people do see content from other places that they really have no reason to see. And they get angry when you show them your paywall, even though they have no real interest in ever becoming a reader in the first place.

We sometimes talk about this in relation to 'in-market' and 'out-of-market', where your in-market is your core audience, and your out-of-market are the extra audience from other places, and we generally see an increase in out-of-market revenue.

But that's not what we are talking about here. What we are talking about here is accidental-out-of-market traffic, people who are coming to your site, simply because they came across a random link on Facebook, who have a very low-intent. People who show zero interest in you as a publisher, but just feel they need to see this one article.

This is not a real market. These people are not going to pay, even if you give them that option. Instead, focus on the audience that show an interest to interact with you more than once or for a longer period of time.


Anyway, enough about pay-per-article. It's kind of a boring thing to talk about. It's much more exciting and relevant to think about the trends around audio, as mentioned above ;)

This is an archived version of a Baekdal Plus newsletter (it's free). It is sent out about once per week and features the latest articles as well as unique insights written specifically for the newsletter. If you want to get the next one, don't hesitate to add your email to the list.

 
 
 

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Thomas Baekdal

Founder, media analyst, author, and publisher. Follow on Twitter

"Thomas Baekdal is one of Scandinavia's most sought-after experts in the digitization of media companies. He has made ​​himself known for his analysis of how digitization has changed the way we consume media."
Swedish business magazine, Resumé

 

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