The Economist - the brand could trigger envious feelings among many publishers, because unlike many other tradition-heavy publications, it also thrives on the web. On the fringes of a promotional event for advertising customers in Geneva, Werbewoche talked to online boss Nick Blunden about current developments. According to Blunden, advertisers are particularly interested in new advertising opportunities on tablets and so-called integrated content. With tablets, "the demand is far more intense than I expected." Whereas previously it was either about branding or direct response, these previously separate things could now be combined on tablets and "far more sophisticated forms of advertising could be practiced."
Offer companies a platform
However, even the Economist has not yet found a resounding answer to the sharp increase in mobile traffic. "Today, one in five users is on the move," says Blunden, although this figure includes tablets. He adds, "What strikes me is that with mobile, it's often not a shift, it's additional media consumption. That's a big opportunity." He acknowledges that the increase in mobile traffic has meant that stationary hits on the site "are not growing as much as they were before." And for him, it's clear: "We're going to have to reinvent the advertising business again for mobile."
Because banner ads are unlikely to be the right offer on such small screens. He is thinking in advance of sponsored content. This concept is not yet being applied to mobile, but is already being practiced successfully on the Web site. Last year, the Economist won an award in this area for a marketing piece with Philips on sound technology, where Philips was able to publish interesting research results on sound quality online as part of the piece. And currently, he said, there is an innovation section on the website in collaboration with Ernst & Young, where their own content is supplemented with their content. It is "very clear to see what comes from us and what comes from Ernst & Young". That's because they don't write content on behalf of advertisers, but allow their content to appear, clearly separated, alongside their own. "That's very well received." For many large and often very complex companies, he says, it is increasingly difficult to show the world how they are different from their competitors. Online is particularly well suited for this compared to other media genres, he says.
Catching subscribers via social media
The Economist also offers interesting insights into the reader market. Over the past ten years, the print edition has experienced rapid growth rates, mainly thanks to expansion in the U.S. as well as Asia. Slight declines in more mature markets have been offset by "continued good growth opportunities" in other regions, particularly Africa and Asia. In addition, there are 127,000 subscribers worldwide exclusively to the digital channels. The majority of these, he said, are genuine newcomers to The Economist who did not previously have a print subscription. Social media channels are also used to attract them, for example to advertise special subscription offers. "These are our best-performing acquisition channels. With these promotions, we convert more people to subscribers at low cost than through any other channel. That's because the cost of doing so is close to zero." Globally, he says, they certainly get several thousand new subscribers a year through social media. Blunden reports that it takes quite a bit of time to convert social media users into subscribers. Whether print customers can also use the online channels with their subscription or have to pay a surcharge for this varies from region to region. However, the same prices are generally charged for print and/or digital subscriptions. Because a significant proportion of print customers also read the Economist via digital channels, a total of 600,000 apps are used on tablets and smartphones every week.
For non-subscribers, a paywall is in operation on the website, which allows a certain number of articles to be read for free (so-called metered model). This, he said, provides a good opportunity to monetize the audience's attention online. "I don't believe in people not being willing to pay for content online." One only has to look at the success of Apple's iTunes Store to see that people are paying for music or movies. If you place the paywall correctly, the content takes over the marketing, and then it is important to prepare and bundle the content so that people want to buy it. For Blunden, it doesn't make sense to put all content behind a paywall right away, because you would then be forced to spend a lot of money to market these services. In contrast, a far more restrictive model is used for apps. Here, users can read only six articles for free, selected by the editorial team.
Daily news is hard bread
Blunden expects to be in the black with the various digital offerings. He is not certain because the editorial team is not divided into a print and an online editorial team and therefore he does not have to take into account the costs for the journalists. "I feel that even if the costs for the journalists were included, we would still be profitable." It's worth noting that the newsroom is about the same size as Tamedia's bilingual Newsnetz newsroom, with about 80 jobs. The focus, however, is not on daily news, but on daily analysis. Being able to analyze and interpret events in real time is a special and a very unique skill, he says. "And we believe we can do that on a daily basis or in real time. " Because more and more, he said, people are not willing to wait a week to see what the Economist has to say about, say, the presidential debates. Publishers that are active in the area of daily news, without focusing on a specific sector such as the financial markets, are competing with social media as a distribution channel on every occasion. After all, in the area of daily news, anyone can be a journalist today. Blunden therefore assesses their business opportunities this way: "It's tough."
Christoph J. Walther