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By Thomas Baekdal - September 2021

Let's talk pricing strategies, and why the media is still bad at selling itself

This is an archived version of a Baekdal Plus newsletter (it's free).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.

One of the fundamental problems in the media industry is that we still don't know how to sell our journalism. We keep making the same old packages of content, then we put a subscription in front of that and tell people to subscribe without ever explaining or proving the value of the journalism.

So, in this newsletter, we are going to look at three different aspects of this.

We are starting out with my latest Plus report about pricing strategies, then we will talk about an example from Denmark of how not to do it, and finally we will talk about why the problem starts before we even define our journalistic products.


How much should a newspaper or magazine cost? It's not the price that defines it

In my latest 30-page Plus report, I talk about pricing strategies and problems by comparing what we currently see in the market with people's willingness to spend money.

Not surprising, there are huge disconnects in both directions. In the media, we have generally priced ourselves too high, creating publications that are too wide for their use, while at the same time not getting a high enough share of people's disposable spending.

This is a very big problem, but what you will also learn is that people generally do have the money to subscribe to media. In fact, they already do with TV.

So, the question instead becomes, 'what can we do to change that?' So take a look at "How much should a newspaper or magazine cost? It's not the price that defines it".


There is a general problem in the media industry that we just don't sell ourselves, or worse, when we do sell ourselves, we don't really define what our journalism is supposed to do.

We recently saw a perfect example of this from Denmark, but instead of me explaining it, Lars K Jensen, a fellow media commentator wrote an excellent post about it (in Danish). So, I asked him to translate it for you here.

How not to launch a new product

By Lars K Jensen - Lars is a former journalist who has worked with digital development in the media industry for more than a decade. He is now Head of Digital at Willmore, an agency working with publishers. Here he helps publishers and other organisations with things like user research, strategy and data analysis. Twitter/LinkedIn

Two newspapers are fighting over the right to be crowned "Denmark's biggest news website":

For a long time, B.T. was in second place, but recently they overtook to first place, measured in pageviews. Which - obviously - means they believe that whoever is the biggest should be measured using that metric. Ekstra Bladet is still the largest when measured in users so they feel that that is the most important metric.

You get the picture.

A large part of B.T.'s almost meteoric recent rise in traffic has been powered by better journalism, a smoother product (improved design and load times), clickbaity headlines - and a brave decision only to have ads. Yep, B.T. doesn't have a paywall.

Until now.

Data makes the world go around

Being funded by ads requires a lot of data, so you need people to register and tell you a bit about themselves. And if some feel like paying for some of the content - well, maybe that's not a bad idea after all. To make up for the data deficit, B.T. has just launched a locally focused initiative with a layer of services for registered users and articles for paying users.

To do this, they have hired 32 journalists to publish local news in Denmark's biggest cities; Copenhagen, Aarhus, Odense and Aalborg.

Right now it's about gathering data and people paying, says editor in chief, Michael Dyrby, while assuring that ads are still the major driving force.

This makes the new local initiative somewhat a "fresh start" and a possibility to gather the data (and test the willingness to pay) that is so sorely needed on the website. Neither B.T. nor Ekstra Bladet has a notable strategy, presence or success in newsletters, which seems very odd considering that for many publishers, newsletters are a major force in generating and gathering data.

B.T.'s initiative is a reminder that being funded by ads is hard and that user data is hyper-critical, especially with the coming changes to third-party cookies.

Which makes me wonder why B.T.'s implementation and marketing is so disappointing. Here is a screenshot of what their readers are presented with on their articles and the front page.

Very few users of the B.T. website will understand this interaction element. There is no explanation given as to what that button - which has appeared out of nowhere - is about and what it does.

If you press the button you are asked to register and create a profile to receive "news, sports and entertainment" from the city of your choosing. However, B.T. still neglects to tell me what this whole thing is about:

This is what I like to call a "media industry classic": You launch something and toss it into the mix of the current content and right in the existing product without explaining anything to the users.

I've had my fair share in launches like that when I worked for Ekstra Bladet, but that way of doing things should be a part of the past.

On B.T.'s website the new feature is reduced to a "geo pin" in the upper left corner, which very few users will understand let alone discover:

Pay now, ask later

On some articles you might even win the lottery and meet the new paywall - still without any explanation on what you get for handing over your data, payment information and money. I honestly have no idea what "more" means, yet they still charge $8/month for it.

I assume it's because I've landed on an article written by one of B.T.'s newly hired reporters and published as part of the local initiative. But I'm still left without a clue and the article looked like all the other articles on the frontpage of the website.

There is a lot of communication and marketing, which B.T. are missing out on here. Maybe it's because they all of a sudden found themselves in a hurry to launch. Or, they truly believe that it's enough to place buttons and a paywall in front of users.

Don't make me think", by Steve Krug, is one of the best books on user experience (UX) and usability. B.T.'s poorly executed launch and lack of explanations does the exact opposite.

There is just too much to think about - and it's too hard (almost impossible) to grasp and understand what's going on if you're not already reading publications about the media industry.

The most important integration: People

Marketing and communication are two disciplines which large parts of the media and publishing industry never really understood. A recent example here in Denmark came back in May, when Ekstra Bladet (B.T.'s main competitor) cut a considerable number of jobs in the commercial department working with precisely the combination of marketing and premium content.

Media research shows that cooperation across the entire media organization is crucial - especially if you want to succeed in making people pay for access to the content.

The shortcomings in B.T.'s launch reminds us why.

As the Columbia Journalism Review article tells us:

Savvy consumer-funnel marketing, the linchpin of a reader revenue strategy, relies on directing readers to "sticky" editorial products like newsletters and podcasts, which build regular engagement outside of social feeds.
Producing those products, managing their marketing, and getting readers "down the funnel" from simply engaging with the news organization to opening their wallets, requires tight integration between product designers, audience growth managers, social media producers, and editors and reporters in the newsroom.

Sadly, many news publishers still need to learn and understand that.

On the paper and in the air

Before I go, I would just like to add that naturally, the print version of B.T. has been rebranded:

...and there really wouldn't be a campaign without some sort of expensive, excessive and totally unnecessary outdoor advertisement:

Which takes care of everything, right?

Marketing is - and will probably remain - a difficult part of the media industry. Even if it is an ingrained and absolutely necessary part of developing and launching products and content.


Strategies without readers

Lars' article above illustrates a problem that we see everywhere, but it goes even further than this. The media doesn't just have a problem with marketing their new initiatives, they have a strategy problem too.

As many of you know, I started my career outside the media industry. For more than a decade I worked in the fashion industry, and the first thing you learn is that everything is about the customer.

So in a fashion company, every person, every department, is centered on the customer. The designers try to create clothes the customers need and want, the constructors make sure it fits and feels really nice, the buyers make sure the price is right, the marketing team create an image that makes people want to buy it, the sellers sell it, and the retail team make the shops look inviting and train the staff.

This is the world I come from. Everything you do is focused on your customers.

But read what Lars wrote about how B.T. came to the decision to launch a local news initiative. They are not talking about trying to solve a local need. There is no mention of helping a community. In fact, when I look at their local news site, I can't see anything that an individual reader would need.

Instead, this is not about the audience at all. It's about the advertisers. B.T. is facing the problem that the end of cookies means loss of ad targeting, so they are trying to solve that need, not to create anything useful for the reader.

I have seen this problem so many times.

But the really strange part is that this doesn't just apply to advertising-based publishers. I see the same thing for subscription-based publishers. We hear about a publisher wanting to start something new. Well, great ... but then you ask what it is about, and they say: Oh, we are going to cover politics, finance and culture. And we are going to create five newsletters and two podcasts, and then maybe also do an opinion section.

But, wait a minute, none of those things is about the reader. They are talking about things at their end. Where is the definition of the audience, what they need, why the reader would consider this to be valuable?

This is the problem we see in the media industry. We have a big marketing problem as Lars illustrated above, but we also have an even bigger strategy problem.

You forget your readers!

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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