The once heavily ad-based publishing business is altering in radical ways, at a pace that is hard to fathom. So much so that the New York Times is now more driven by subscriptions than by ad sales, according to an article in Ad Exchanger.
“Any publisher who is not a big platform company is on the express train to becoming a niche ads business, predicts Meredith Kopit Levien, EVP and CRO of The New York Times,” writes Kelly Liyakasa.
She quotes Kopit Levien saying, “Up until now, we’ve been a niche consumer business with a $1 billion-plus newspaper ad business. Now we’re on a path to becoming a very big consumer business and a niche ad business,” she added. “If you’re a content company and you’re not Facebook, Google or Snapchat, you’re in the niche ads business.”
According to Kopit Levien, the NYT is more driven by subscriptions than by ad sales now, and they are shifting their focus toward growing their subscription rates. Liyakasa notes that the NTY now has 1.6 million digital subscribers.
What’s driving the growth of consumers choosing to pay for content? According to Kopit Levien, two factors are fueling this: “frequency, depth and variety of content, and getting people to come back and feel deeply,” she explains. “If they read politics, maybe it’s getting them to read something else like fashion. We think we run the most successful model for paid journalism in the world.”
This news supports evidence of other publishers forgoing the losing idea of over-reliance on a digital-ad-based revenue stream and returning to what they do best: creating and selling excellent long-form content.
Dave Morris of CBS Interactive agrees.
“Advertising was our core revenue model eight years ago when I joined CBSi,” Morris notes. “We’re at about 50% advertising and 50% “other” revenue today. … There is a future for subscription plus ad-supported revenue and you will see it more in some of the shows we launch this year.”
Publishers like these are indeed setting the tone for the industry. As Kopit Levien notes, “the value of our assets is going up.”
Too many publishers learned the hard way that an ad-supported free content model doesn’t make sense in the digital space. The one-two-three punch of ad blocking, massive digital ad fraud, and “fake news” is just about eliminating any chance of making an ad sales supported case.
The key to making this work, Kopit Levien asserts, is a reliable brand and relationship with your readers.
“News is a relationship business and the purpose of The New York Times brand is to give people understanding. … [But] making great content is hard, expensive and it requires experts in storytelling and finding formats that make people give a damn about the topics [we write about]. That extends into our brand storytelling, too,” she explains.
This bodes well for the future of journalism. Indeed, it’s great to read this news after the last couple of years of native ads, brands giving away their best content, and overreliance on a future that doesn’t exist.
This bodes well for the fourth estate at a time when the world desperately needs insightful information, unbeholden to sponsor influence.
And it bodes well for consumers, hungry for in-depth news they can trust.