Most of today’s media “success stories” are about digitally “native” companies like Google and Facebook. Meanwhile, many of the great brands of the pre-digital era seem to be struggling for mere survival in the face of digital disruption. And it’s hard to think of a media segment more threatened by digital than newspapers. As advertisers have shifted more of their budget to web and mobile, almost 70% of all newspaper advertising dollars have evaporated over the last 15 years.
Yet something astonishing is happening at the company that President Trump regularly demeans as “the failing New York Times.” NYT stock is up nearly 60% in the last six months to a nine-year high, and in May, the company issued its quarterly earnings report which reflected the profound impact of their efforts at digital transformation.
According to the report, digital subscription revenue increased 40% year-over-year. Furthermore, among The Times’ three million subscribers – a threshold it crossed earlier this year – 2.2 million are paying digital subscribers, representing almost 70% of their total subscriber base. Although print advertising in The Times declined around 18% year-over-year, those losses were more than offset by increases in digital subscriptions and digital advertising, resulting in year-over-year increases in both revenue and profitability. As CEO Mark Thompson said in the Q1 2017 earnings report , “These results show the current strength and future potential of our digital strategy…to deliver substantial revenue.”
That is the Good News. What is the challenge?
We know it is tough moving from a traditional business to a digital business. This is highlighted clearly in the publishing industry where newcomers who are exclusively digital are beating the pants off of traditional publishers. There are many lessons here for all of us. And so, we find an internal report from the New York Times detailing their challenges.
If you are a digital professional or executive committed to digital transformation, it is well worth reading the whole report. Yes, it is 96 pages but it is free and much better than many books on the topic.
A 96-page internal New York Times report, sent to top executives last month by a committee led by the publisher’s son and obtained by BuzzFeed, paints a dark picture of a newsroom struggling more dramatically than is immediately visible to adjust to the digital world, a newsroom that is hampered primarily by its own storied culture.
The report is divided into two sections. The first is Audience Development. The second is Strengthening our Newsroom. Here is a summary:
- Discovery – You can’t assume people will just find your content. You need to design for the web, not your traditional business. We have to make it easy for consumers to find our content.
- Promotion – You just because you have produced something digital, it doesn’t mean any one will find it if you don’t promote it aggressively.
- Connection – Engaging consumers in your digital business is the key. If they find you, is the experience engaging enough that they will come back. We live in a world of connected consumers. This may be the overlooked “secret sauce”.
Strengthening our Newsroom
- Collaborate with the Business Side – Being digital cannot thrive in isolation from the rest of the business. A unified approach that breaks down silos is critical. Silos exist and they can’t be ignored. Creating one more, called digital, is not useful.
- Strategy Team – To focus on content and not strategy can be disastrous. Content or any other digital business function should exist only within the focus of the overall goals and strategies.
- Digital First – It can’t be about taking the “physical business” and making it digital. Other companies that are only thinking digital will eat your lunch. There must be an edict from the CEO that you will be digital first. Period. End of story.
- Wanted: Makers, Entrepreneurs, Reader Advocates and Zeitgeist Watchers – It is all about digital talent. We need to be deeper and broader than anyone else with digital talent.
On the one hand, it may seem jarring that so venerable an institution as the Grey Lady is undergoing such self-scrutiny. However, the fact that they’re taking the time to assess and address the issues themselves – and quite deeply, we might add – is encouraging.
While the Times may not have all of the answers, we think that they raise the appropriate questions and chart a course that is bold and different, rather than the tweaks here and there. Will it be successful? On behalf of journalism and brand newsrooms, we certainly hope so. The Times is a leader and will be viewed as such for a long time.
Brands should pay close attention and give the report a full read. While we live in the era digital era, it’s essential reading for anyone who thinks of himself or herself as a digital leader.