Paid Content – it’s not about ideology but rather strategy and execution

This month the news has been awash with stories about paywalls – particularly the initial results of News International’s experiment with The Times and Sunday Times.

The numbers have been pored over enough by now but I would highlight Clay Shirky’s analysis (together with the comments) as being a ‘go to’ article on the subject. You can also follow a wide range of debate on The Times’ page on TheMediaBriefing.

To my mind though the problem with the paywall debate so far is that it largely seems to be centred on ideology. Murdoch shouts that quality journalism has to be paid for. Alan Rusbridger talks about the ‘mutualisation’ of content at The Guardian. Arianna Huffington stresses the importance of being part of the ‘link economy’. Really the debate has to be about business. Hard cash. Making profits.

So, quietly, and with little fanfare I was interested to read the results of the business publisher Euromoney, released today. There’s been no Twitter frenzy of comments. No polemic pieces about search engines stealing content. In fact I bet the majority of people reading this post would struggle to name either their Chief Executive or any of their major products. As I write this Robert Andrews of PaidContent seems to have been the only journalist or web commentator to cover them.

But, let’s have a look at some of the highlights and key phrases from their statement:

Adjusted profit before tax up 37% to £86.6m – a record

Adjusted operating margin improved from 25% to 30%

The resilience of subscription income, combined with a good recovery in advertising and sponsorship revenues… produce record profits…

These record profits, coming so soon after some of the toughest and most volatile financial markets in many years, underline the success of the group’s strategy to build a more robust and higher quality information business

…strategy continues to be executed through increasing the proportion of revenues derived from subscription products; accelerating the online migration of its print products as well as developing new electronic information services; investing in products of the highest quality that customers will value in tough times as well as good; eliminating products with a low margin or too high a dependence on advertising

In the announcement you’ll see no mention of ideology or waiting to see how business models settle down online. Instead you see a business talking about strategy, implementation and driving profits.

Sure, Euromoney’s traditional business model is in the midst of disruption. They talk about a changing emphasis from advertising to subscriptions and about a migration from print to online. They share many of the challenges that other media businesses face. But the customer-focused approach to these challenges has been to see the opportunity created by a move online and shape the business to take full advantage.

I know a lot of the people at Euromoney, admire the company greatly and have been a long-time shareholder. When higher profile media companies talk about how they can monetise their content online they would be well advised to pay a bit more attention to their B2B cousins. The lessons I would say that newspapers could learn from companies like Euromoney are:

  • Accept that the world has changed and the things that customers will pay for online are very different from those which they did in print.
  • Invest in those new information products and make them of the highest quality.
  • Never set a strategy based upon ideological principles. It must be about profits.
  • Plan for the long-term.
  • Realise that whatever business strategy you do set will ultimately depend on great execution – maybe you should be going out and poaching those B2B marketers and publishers who really understand user-centred product development, detailed subscription acquisition/retention/upsell/cross-sell programmes and lifetime value calculations?

For any media business currently planning their online paid content strategy can I recommend TheMediaBriefing’s first in-depth intelligence report which is published this month. You can request a free executive summary by clicking here “Paywall Strategies for Online Content“. We will also be hosting our first conference on the subject (and hope to have a speaker from Euromoney) at the end of February 2011 – announcements coming soon on the site.



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10 responses to “Paid Content – it’s not about ideology but rather strategy and execution

  1. Spot on Rory. I’d also say its about attitude. It was rather shocking to see ( the Times chief marketing officer Katie Vanneck saying: “We’ve got to re-educate consumers about the value of our product.” V reminiscent of Chinese Communist Party approach to recalcitrant peasants

  2. Rory

    Excellent stuff, I’ve taken the liberty of expanding on your bullet points:

    * Accept that the world has changed and the things that customers will pay for online are very different from those which they did in print. – they will pay for things that add value, ask customers what they are.
    * Invest in those new information products and make them of the highest quality – where quality is defined by customers and in customers’ terms
    * Never set a strategy based upon ideological principles. It must be about profits – to be repeated three times a day, followed by the question “how does what I’m doing now increase profits”
    * Plan for the long-term – act in the short term (digital nimbleness required, look at Agile methodologies for inspiration).
    * Realise that whatever business strategy you do set will ultimately depend on great execution – and remember that bad execution of good ideas is probably more culpable than bad ideas themselves.

    And for goodness sake, please stop setting this in the context of you and your business.

  3. Rory Brown

    Hmmm. I hadn’t seen that article or quotes. I’m also uncertain on reading it if she’s talking about re-educating readers or advertisers in the comment.

    If it’s the former all I’d say is ‘good luck with that’…


  4. Rory Brown


    Thanks for your additional points. Couldn’t agree more.


  5. Pingback: Unique Value and Business Fundamentals: How Euromoney’s Getting It Right and Most Others Won’t « Digital Media Land

  6. Being ex-Euromoney myself I was curious to see exactly where the growth comes from. When you dig below the surface a little you find that although they’ve invested lots in a digital & online subscription transition strategy – undoubtably smart – it’s actually the traditional businesses that have delivered. Sponsorship up 9%; ads up 5%. Subs by contrast up just 1% yoy. Still got to get guys on the phone selling stuff! I’m actually quite pleased about that as the last thing a company needs to do is forgot to actually book a meeting and sell things to other people.

  7. Rory Brown

    Thanks John,

    I also saw the quick rebound in ads and (especially) events revenues.

    I suppose what we’re really talking about in a successful information business is building something that is robust. The joy of subscriptions is that they are stable, money-in- the-bank revenue streams that you can model and plan pretty well in advance.

    Ads and sponsorship are so dependent on the underlying health of the markets you cover that they can disappear in a heartbeat. The flip-side is that they can also bounce fast and year on year comparisons look very impressive.

    If I were running a sizable public company I would certainly want a large proportion of my base to be premium annuity revenue but with a flexible sales and events operation on top. I think that’s the real success story of what Euromoney have done over the past years.

    That’s what has given them the stable base to invest and create new products rather than running around trying to put out fires – as a lot of their competitors have done.


  8. Euromoney has also done two other smart things for their long term health: they’ve closed or sold non-core and/or loss making assets over the last few years (many others would hang on hoping for an Indian Summer for products that just don’t fit or don’t work anymore) and they have rewarded senior staff with big bonuses for long term loyalty, to the point where I understand it’s actually very difficult to leave the company and find as good a package elsewhere. These moves are as key to long term success as product stategy itself. I’m sure Lord Rothermere is delighted .

  9. When I hear about publishers talking about this subject, instantly they are up against by describing the topic as a ‘Pay Wall’

    I have been involved with the internet for many years now learning my trade in the online payment business. Working with online billing means you only work with companies and individuals who have a product or service to sell so a ‘Pay Wall’ was actually not an issue.

    This may be a bold statement though I actually believe that I could take a paper and turn it into a paid model online. What I do not understand is why the media groups have not done it already.

    The first thing any news paper should do is forget about the those who read the printed copy, there is no need to educate or even convert them to internet users.

    I just looked at the times web site, (as I know they have a subscription process), my intention was to take out a subscription though gave up as the process was too long winded, overly complicated and by the time I have done it all my head is now thinking about spending and IF I should not consuming.

    Their billing page is all wrong in my view, they are asking for too much information and effort in return for access to their extranet. Can you imagine if every time you went to the checkout in a shop to buy a paper and you had answer all those questions, you would not buy one.

    Their pricing is also very low giving the impression that the product you will get will be cheap (this is despite the editor saying in video something like the web allows us to even better). How can it be better if it costs so little?

    They have a video tour which explains things but again this is in the wrong place as it just adds to distractions between the seller and buyer. I also think The Times should be pricing their subscription online at no less then £30 per month.

    I would really love to see the their exit traffic figures from the subscription form and get their conversion figures. As premium service they could do more to manage their exit traffic, but they don’t, you just end up in limbo with no where to go.

    I really want to say how this model works and fill in more blanks but if I do every paper in the world will go off and do it, well that’s my fear!

    If anyone from the times online team reads this let me say, Within three clicks, (Right Click to copy your headline, paste into Google search, left click on a competitors website that had the full story) I was reading a full article, it would have taken about at least 20 just to register and heavens knows what other hoops to jump through.

    And finally, News Papers have never had to sell their own product as news agents etc do this. With the internet they now have to manufacture market and sell their product in a market that has millions and millions of pages of content that is freely available.

    Rory I am not journalist so apologies for the quality of my reply.

    Ps In the time I have written this reply I have not been contacted by the Times asking why I never completed the sign up process.

  10. Rory Brown

    Thanks Paul,

    A really interesting perspective. Interesting if they are not following up ‘abandons’ to their registration process.
    We have an event covering all aspects of Paywall Strategies coming up in London at the end of February. At it we will concentrate on the commercial models for monetising content online as well as the marketing/operational challenges of managing a paywall.
    Details are here:

    Thanks for commenting.


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