One of Europe’s largest newspaper publishers announced it will shut down The New Day newspaper just two months after launch. So does the closure of the experimental paper — which aimed to target readers who had “fallen out of love with print media” — now signify print’s last stand? Wayin’s new CEO, Richard Jones, shares his insights on what it means for the media and publishing industry.
Trinity Mirror, one of the largest newspaper publishers in Europe, has reported a fall of nearly 20% in print ad revenues as it confirmed it is to close its new daily newspaper The New Day, which was launched at the end of February with an upbeat $8m ad campaign, “Seize the New Day”. It will publish its last issue tomorrow. So was the glitz and fanfare of The New Day, the first new daily newspaper in the UK for many years actually print’s last stand? Trinity Mirror confirmed the New Day newspaper’s closure was because the title failed to sell enough copies. The aim had been to sell in excess of 200,000 per day, but it is understood that at closure, sales were hovering around 30,000.
Trinity Mirror’s trading update, for the period from 28 December to 1 May, highlighted the ongoing tough trading conditions faced by newspaper publishers.
The company said print advertising revenues declined by 19% year on year across the period, with newspaper sales falling by 4.5%. However, Trinity Mirror said digital income, grew by 15.7% in the four-month period and by 18.6% in April alone.
We see this trend across the industry, print advertising revenue is declining while digital revenues are skyrocketing. Perhaps Trinity Mirror will indeed be the last publisher to try to buck the trend by launching a new daily newspaper to reinvigorate the print ad market.
Digital advertising copying print
The industry has been growing its digital revenues through investing in the creation and distribution of digital content. Many publishers have built up vast digital audiences consuming their content on publisher websites, across social channels and via mobile apps. However, advertising revenue has typically mimicked print with display ads and sponsored editorials. Whilst this is a good start, I believe it is fundamentally missing the opportunity that digital brings to publishers. You can open up entirely new ways to monetize your audience with innovative new advertiser propositions that are participatory – that’s the beauty of digital. It’s not an opaque content experience, such as reading a paper. People can interact and fully experience your content.
Brands losing power to retailers
Now step back and think about the world from the perspective of brands, the advertising customers of the publishing industry. They are caught in the throws of digital disruption as well. Retailers are squeezing brands hard because they own the consumer relationship. Big TV budgets on advertising don’t mean much anymore in a world where you can fast forward through TV ads. The power has shifted from brand to retailer at an alarming rate. If you own the consumer relationship you are in the driving seat. For example, if you are a food brand, you don’t simply give your products to supermarket chains anymore for them to sell and take a cut of the revenue, you actually have to pay them to be promoted on their online shop, they have media divisions that offer you a set of digital services that eat into your margin. Brands need to own more of the customer relationship to shift power away from retailers.
Brands and the D2C database race
So what are they doing about it? Well, the major global brand groups like Unilever, P&G and Reckitt Benckiser have all stated publicly aggressive multi-billion dollar sales targets for direct to consumer plays. These include everything from utilizing Amazon and eBay branded shops, building out online retail storefronts on branded websites, owning and distributing digital kiosks and setting up subscription services to supply goods to consumers directly at a discount.
What lies at the heart of this move is that brands need to know who their customers are, they need to build out databases of people that are interested in their products and services and they need to market to them directly to drive them either into their D2C retail destinations, or to prove to retailers they can drive the footfall and the purchasing at any retailer of their choice to re-balance power.
So what does this mean for publishers?
It means that they have a unique position. They have built huge digital audiences and have granular understanding of what interests their audiences have. Brands need to continually build out their D2C databases and the best place for them to do that is in partnerships with publishers. It’s here they can access an audience relevant to their interests, it is here they can have the digital real estate to create interactive experiences that engage and offer a value exchange in return for data collection. We recently completed a campaign with a publisher that collected 127 million form submissions on behalf of a brand. Sweepstakes, quizzes, contests, polls, mixed in with brand and editorial content can create some amazing destinations that people love to engage with and brands love to sponsor. The volume of data collection can be staggering.
Here are four compelling examples from this year of how publishers have established data-driven and customer centric relationships with brands:
- How Penguin Books and Joules Used Sweepstakes to Capture Rich Data and Establish Audience Preferences
- How Huff Post Capture Rich Audience Data Using Simple Film Quiz
- How Nat Geo Utilize Instagram Photo Contest To Capture Authentic UGC
- How Empire Magazine Entice Fans To Cast Votes On Jameson Empire Awards
Where else are brands going to go to build out their D2C databases?
Retailers won’t and don’t share any data, they are hugely protective of their consumer relationship, it’s their power base. Facebook and Twitter only have tiny area of real estate for collecting data – Facebook Lead Ads and Twitter Cards just can’t generate volume when all you have is a video or an image and an action button. It’s neither a value exchange or an interactive content experience.
Some brands like Under Armour have gone to extreme lengths to solve the issue of getting closer to the consumer, they have acquired a range of mobile apps and communities in the health and fitness space costing hundreds of millions of dollars. They now even sell advertising to other brands that want to reach that community: http://advertising.underarmour.com
It could be a very smart move, but of course that can’t be a solution for many brands, there just aren’t enough communities to buy and you have to run and maintain the community against competition.
Closer relationship between publishers and brands
Finally, I think the long term future is a much closer relationship between publishers and brands, jointly running interactive advertisement experiences that collect data, contact details and marketing opt-ins for brands to build out their D2C databases and revenue streams. For example, broadcast media companies such as Discovery, Meredith Corporation, Yahoo!7 and TVNZ have forged great partner relationships and delivered successful consumer experiences with household brands this year. Take a look at these:
- How McDonald’s Leverage Video Contest and TV Partnership To Engage New Audiences
- How Gillette Utilize Discovery’s VR To Tell A Compelling Brand Narrative
- How Volkswagen Use Media Partnership To Promote Olympics Involvement
- How Huggies Wipes Use UGC Photo Sweepstakes To Engage Digital Consumers
- In similar fashion, publishers can greatly increase their digital revenues to help balance out the loss of digital revenues, and brands can redress the balance of power with retailers that is widening with digital disruption.
Source: www.wayin.com By Richard Jones, CEO of Wayin