Welcome back to the newsletter. Today I have three things for you.
The media industry has been very lucky in recent years, and I don't necessarily mean this as a good thing. But for the past 7 years, we have had a constant flow of very big stories that newspapers could cover every single day, and that the public read a lot of.
Each of these things have come with their own 'bump in traffic'. It started with Brexit, where we had the 'Brexit bump', then we had the 'US president who shall no longer be named bump', and now, of course, we have the COVID bump.
As I said, this is not actually a good thing. Being successful because the world is not, is not really where we should be.
However, as each of these ended (except Brexit, which hasn't ended yet), I have made the same prediction. Once these bumps were over, publishers were likely to see an increase in churn as news went back to normal.
I'm going to make the same prediction again. As we get more and more people vaccinated for COVID, the pandemic is finally coming to an end, and so, the daily news consumption focused on checking the latest numbers will slowly disappear ... and the result is an increase in churn.
Again, I have made this prediction before, and I have been wrong because something else came along, but from a societal perspective, we need a few years' break from worldwide disasters.
Here is the interesting thing though. What will this churn be like? Well, I have some theories about what it will look like, and let me explain that by talking about the different types of churn.
There is a funny thing that happens every time I talk about churn with publishers. Most publishers think about churn in a very simplistic way. They count the number of people who have dropped their subscription in a given month, and divide that by the total audience ... and that gives them a percentage churn rate.
However, I consider this metric to be completely and totally useless. What I want to know is the churn vs loyalty rate.
This is also very simple to measure. Once a person cancels their subscription, you calculate the duration of their subscription (or even better, for how long they were an active reader ... since some unsubscribe months after they actually stopped reading).
Let me give you an example.
Imagine you have two people. One has been a subscriber for a very long time, and the other only subscribed for a month ... and both of them cancelled their subscription this month.
These two people are not the same. One has a tremendous amount of loyalty, and the other person never really found the interest or value in your content.
This is obviously massively simplified. But here is what happened with COVID. Before COVID, when people subscribed to a newspaper, it wasn't to achieve anything specific, instead it was just to get the news.
This kind of audience is great because they are essentially just paying you for being there. However, this audience is also increasingly hard to get, and in recent years we have seen countless studies of how few people choose to pay for regular news.
But then, when COVID hit us, we saw this very different form of news subscriptions. Now people had a very specific need, and started subscribing to solve that need. For newspapers, this need was to get informed and to stay up-to-date with the latest COVID data, restrictions, directions, and outlook. But we also saw this across many other topic areas.
Here is one example of the change in page views for UK magazine publishers when the pandemic hit last year.
What you see here is the difference between these two audience segments. The red line (from 2019) represents the first audience segment who subscribed in general, whereas the blue line is the second audience segment who subscribed because they suddenly had a very specific need.
So here is a question. What will happen once everyone has been vaccinated and the pandemic comes to an end?
The answer is simple. The blue segment goes away.
This is a challenge every publisher now faces. As a publisher, you now only have about six months to convince your 'COVID-need-based audience' into having a different need (or to continue that need, even though there is no outside influence to keep it).
This is going to play out very differently for different types of publishers. A simple example is exercise. During this pandemic, Google Search saw a several hundred percent increase in searches for exercise bikes as people tried to adjust to exercise from home. Similarly, many fitness publishers posted articles to help people do exactly that.
But what happens when the fitness centers open up again and people feel safe to go there? Do they now want to go back to the fitness centers, or have they realized a new type of freedom being able to do it from home?
This is not an easy question to answer because thousands more people now have an exercise bike, so having already made that investment, do they still feel that paying tons of money to go to a fitness center is worth it?
You see, the problem is that fitness magazines benefit from people doing it themselves. If people go back to the fitness centers, then there is much less need to read fitness magazines because the center will provide the guidance they need. But if they stay at home, even after COVID, and continue to do their fitness that way, then fitness publishers have a massive role to play in defining that future.
This is a crazy dilemma.
The media industry prosper when people do things on their own. People watch Netflix in the evenings at home, but they don't watch Netflix if they are going out to restaurants, coffee shops and bars to hang out with others all evening.
And this is just one of many examples. So now that COVID is ending (finally), the market is heading into a different future. All these people publishers have gained over the past year change from a "need to have"-market, to a "nice-to-have market". At the same time, all the things people have struggled with over the past year start to return to normal, which means less time for the media.
So, everything becomes way harder to do.
It's easy to get more views when people are stuck at home. It's really hard once people don't have to be home anymore.
This is the churn challenge we now face.
Over the past weeks, I have been writing two big Plus articles about the problems with tracking. The first one was about Google FLoC (and why it's a bad idea). And the second was about the importance of focusing instead on first-party data.
However, after writing this article, I got a number of questions, and one thing many of them had in common was about not doing tracking at all.
I want to make it clear that this is not what I'm talking about. I'm not against tracking. I'm also not against advertising. I see both of them as being very valuable, but also very important for publishers.
What I'm talking about is 'who' gets to do the tracking, and how that works. Since, I have written a third article to make this difference clear, and encourage publishers to think about this.
So take a look at: What do I mean when I talk about privacy and tracking?
I want to add one more thing to this discussion. The main reason why I keep talking about privacy and tracking is because, as a publishing industry, we have dug ourselves into a hole that we really shouldn't be in. And, from a trend perspective, what is happening right now is scary.
Let me explain. Ever since Apple, Google, (and Firefox) started talking about ending third-party cookies, I have seen hundreds if not thousands of articles saying that this is a concern for publishers.
One example was an article posted over at WNIP, talking about Apple's changes to tracking consent. They wrote:
Why all the cloak and dagger stuff? Possibly because the update will introduce changes to ad tracking that might upend digital marketing, and is a matter of concern both for publishers and advertisers.
While iOS 14.5 has a lot of new features, the one that's being most closely watched is ATT, or App Tracking Transparency. The feature forces developers to ask users for permission to track users with targeted ads, making it an opt-in feature.
This is not even close to the worst example I have seen, but I just want you as a publisher to really stop and think about what you are saying here.
You are saying that it is 'a concern' that you now have to be transparent about tracking towards your readers, and to respect their choices.
By extension that also means that you would prefer if you could do advertising in secrecy and obscurity. You would prefer if you didn't have to be accountable to your readers at all.
I don't understand when people talk like this. We are journalistic institutions, and the very concept of journalism is to provide transparency to the world. We hold others to account every single day. We uncover secrecies every single day. We turn obscurities into clarities.
This is what journalism is about.
We should not even have this discussion because, as publishers, we should have been in the forefront of transparency. But instead, I have seen so many articles, on media sites, that frame this discussion around transparency being a concern that we should work to prevent.
As a media analyst, I cannot fully express how worried I am about this. We are defending a system that is fundamentally undermining our role as journalists. We have created a system that everyone hates, that has so many problems, and yet, we keep saying that "transparency is a concern for publishers".
And this problem has only gotten worse over the past 10 years. All the big tech companies today have way more transparency about advertising than any publisher has. If I see an ad on Google, I can click on it, and they will tell me exactly what the targeting parameters were, what verified company posted it, and give me an option to control my ad settings.
If I instead see an ad placed via a newspaper, I get none of this. No transparency.
From a trend perspective, this is not good. We should not have fallen this far behind, and we should not be protecting a system that makes this worse.
It's desperately important that we change this.
Last week, the BBC was ridiculed online because of a breaking news story they had posted about Hugh Grant going to a bakery. In the light of everything else that was going on at the moment, people considered it totally pointless (and they are right). The result was a large number of social media posts making fun of or complaining to the BBC.
Because of this, some of my readers asked me what my analysis would be, and it actually ties into a very important problem.
First of all, the article is pointless. It's a mix of celebrity gossip, which is not what the BBC should be focusing on at all, and completely pointless information about why celebrities live in Somerset. For a regular news reader, this has zero value.
But from a media trend perspective, there is a bigger concern ... or rather two of them.
The first concern is the lack of decision. Ever since publishers moved online, they are no longer limited by how many articles they can publish per day. In print, you have to carefully select what goes into the newspaper to fit the number of pages.
As Jerry Seinfeld once said:
It's amazing that the amount of news that happens in the world every day always just exactly fits the newspaper.
But online, this limitation doesn't exist, and instead has been replaced by volume.
The second trend we see is the reactive nature of the web. Again, this is a new thing and doesn't just apply to the press. In the past, people generally didn't react to things. But today, every time something happens, everyone in the world thinks they have to express an opinion about it.
I'm reminded of an article from Marina Hyde, where she wrote about how people reacted online to the death of Prince Phillip. She wrote:
My colleague Jonathan Freedland made me laugh recently when he noted how Twitter had turned everyone into the archbishop of Canterbury, somehow feeling that every major news story requires them to issue an official statement. Huge numbers of people now regard themselves as bound to post the sort of formal reactions to Philip's death that were once the preserve of former presidents of the United States or the queen of Denmark.
I'm not talking about the sort of things you can imagine people saying conversationally to others back when not everything was pixels - "I hadn't realised his sisters weren't allowed at the wedding", or "my mum met him at the WI and said he was lovely". No, I'm on about this type of stuff: "Hugely sad at the death of the Duke of Edinburgh. He was a modernising influence on the House of Windsor, and his prickly exterior hid passions few understood. My thoughts are with the Queen." Why thank you, random 41-year-old dude from the internet, and welcome to the Pooter party. But really - this is the sort of pontification one formerly expected only from absurdly pompous people utterly devoid of self-awareness or public standing, such as newspaper columnists.
And she is right. This is exactly what is happening, and we all do it (myself included). But this is a trend and a pattern that didn't exist ten years ago.
Ten years ago, no regular person would have posted such statements anywhere. But today, millions of people do it just because they are reacting to things.
And it's the same thing that is happening with the Hugh Grant story in the BBC. Here the journalists weren't trying to create value or make any journalistic decision about what is important, instead they just 'reacted to things'. They came across this story that someone had seen Hugh Grant in a bakery... and just reacted to it.
I have started calling this conveyor-belt-journalism. Think about it like this. Imagine that you are a reporter, and you have a conveyor belt in front of you, and every day news from everyone just flows by. Every time a story comes in front of you, you post about it. It doesn't matter what the story is about, or whether it is important or not. You post it because it's there.
That is what we see here, not just from the BBC, but across the media as a whole.
The problem with this is obvious. Just reporting like this doesn't require any journalistic skill. Anyone could post stories like this, and, in fact, anyone does. So conveyor-belt-journalism is reducing the value of news to zero. And when a very big news site like the BBC does this, the result is an instant backlash of people making fun of them.
As publishers, this is not where we should be. Our level of journalism should be much higher, much more specific, and clearly picked out for its value.
Don't publish stories where you are just reacting to something. That's the market of 'anyone'. We are 'someone special'.
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."
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