At a time when both online advertising and print advertising are under scrutiny, subscriptions revenue has become a beacon of hope for a large number of publishers. But the pivot to subscriptions requires deep changes to both skill sets and internal culture. Some publishers are just beginning on that journey.
National British newspaper The Telegraph is among them. News emerged this week that the publisher has cut 50 jobs from its commercial team in order to refocus its resources on its subscriptions business. Details of exactly where the cuts have come from are hazy, reported as “customer offers.” The Telegraph wouldn’t confirm which parts of the commercial team they had cut, but a spokesperson stressed the fact that the publisher had outlined plans for heavy investment in its newsroom. That investment has to come from somewhere.
“The No. 1 business priority for The Telegraph is our subscription first-strategy and we are always assessing how we can best support this within our business,” said a spokesperson in an emailed statement. “We continually look to see where a resource is best placed to ensure ongoing investment in both our journalism and our subscription-first strategy.”
After years of relying on advertising as its core revenue stream, The Telegraph outlined its plan to become a subscriptions-first business in 2017 when CEO Nick Hugh took the helm. It generated 3.5 million registered users in 2018, 500,000 more than its target.
Any subscriptions business that embraces subscriptions over ad-funded general news, must dedicate resource into journalists that can create valuable content that converts subscribers. Churning out clickbait-style headlines that get picked up by search engines and perform well on social platforms and attracts fly-by readers, won’t cut it.
“Over the last year or so, the Telegraph has been recognizing the need to re-skill,” said Douglas McCabe, CEO of media analysis firm Enders Analysis. “For a number of years, it had underinvested in quality journalism, and so has tried to address that.”
In 2018, the publisher added 39 new journalism roles, and 44 more will be added over the course of the year, according to The Telegraph. Some of these new roles were added with the launch of a new women’s sports vertical, launched in March.
Publishers have hunted for experts in areas like product design, user retention and data crunching, ever since the pivot to paid started in earnest over the last year or so. Meanwhile, the trend toward subscriptions has created entirely new roles at publishers, like the chief customer officer, with a remit to examine the reader experiences more like multichannel customer experiences.
At most newspapers, sales teams have very different jobs today compared to five years ago. The rise of programmatic advertising has seen to that, as have the rise of multi-device selling. For publishers like The Telegraph, that have refocused their commercial strategy on paid subscriptions, there will likely be a lot more changes to come.
“The function [commercial roles] will likely change by as much again over the next five years,” added McCabe.
Since 2012, The New York Times has changed 85% of its commercial team and 40% of its newsroom: The cultural change of a clearer subscription focus runs very deep in a publishing organization, added McCabe. Switching focus to acquiring and retaining a core audience of paying subscribers requires different editorial, commercial and data skills compared to those needed to build and retain a mass audience outside a paywall. Some of the skills needed for a subscriptions-heavy future are easily translatable from more advertising-focused publishers and roles, and others are new.
The three core areas that need urgent specific skills changes are marketing, editorial and data analytics. These are the areas that will, therefore, see more flux in all publisher prioritizing subscriptions over ad revenue.
Most digital operations will have groups of people — data experts — who are split across the broader digital team, and be shared between marketing, product and ad operations, according to Michael Silberman, svp strategy at subscriptions firm Piano. They’ll spend a lot of time wading through Google Analytics data and doing analysis on ad inventory, making connections between audience size and revenue. “Those folks doing that kind of analysis will have skills that are completely transferable from an ad model to a subscriptions one,” said Silberman.
People doing audience development who may have also worked within the media buying team and so have experience in funneling traffic to help hit ad campaign sales targets, will also have easily transferable skills, he added. “Understanding the audience and finding ways to bring them in for those commercial purposes, and finding lookalike audiences — those skills don’t disappear in a subscriptions model.” They may even become more important in a paywalled environment where a decline in inventory may require knowledge of how to finely tune the ad targeting so that the same level of effectiveness is achieved with a smaller but more engaged audience than it would with a mass one, he added.
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