On his first day at the helm of Maxus Melbourne, Nick Keenan has issued a stern warning to major publishers like News Corp and Fairfax that a lack of investment in marketing is cutting their paywall strategies off at the knees.
His comments come in the wake of another set of depressing Audit Bureau of Circulations figures for the newspaper industry. In particular, the year-on-year comparative numbers for combined print, digital and package sales – currently only available for Fairfax titles – are showing major declines, indicating that digital sales are nowhere near strong enough to offset free-falling print sales.
Keenan said digital sales at the major publishers will never surge until publishers spend the big bucks on online brand loyalty campaigns, suggesting that just because people affiliate themselves with a particular brand in the printed newspaper world, it does not mean they will automatically share the same loyalty online.
He was critical of the major publishers' go-to-market strategy for their paywalls. “They have gone straight into the execution, and said to the market 'Here it is, here's the cost', but they haven't worked on creating an intent to purchase.
“They take all these advertising dollars from brands but have forgotten to market themselves. I'm not saying the content behind these paywalls is bad content, because it's not, but they need to spend on marketing to create an online brand. The problem is that the consumer has been getting it for free, so publishers can't expect that they will suddenly want to pay.
“Here's the big problem: The publishers have just presumed that there is an intent to purchase the product online because people buy the traditional paper. In the physical world, there are people who read the AFR or The Australian or the SMH, they identify will those brands, but does this just translate into online? No. There is no brand loyalty in the online space, and just because they have established brand loyalty in the traditional world, they seem to think it will automatically extend into digital.”
Whether digital sales will ever be able to completely offset the accelerating declines in print circulation is a moot point. Keenan suggested it will happen “only if they learn how to market their digital products”. “I look at what they are doing at the moment with the packaging deals across multiple titles, and I think, first you need to convince me it is worth it.”
Despite his criticisms, Keenan was quite upbeat about the possibility of a turnaround. “If they do invest in marketing, if they position what it is to be a digital subscriber and the identity that it brings, they'll have a successful future. Consumers are realising they have to pay for quality content, but publishers need to convince them that they are buying quality, so they want to pay rather than just enjoying the free stuff.”
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