Noontime Update: Paywalls

  • Mar 10, 2011

Matthew Caylor, Account Executive – Interactive, MANSI Media, and Marie Elena Howe, Communications Manager, PNA

Behind the metered paywall

Presented by Kathy Schwartz , general manager, Times Shamrock Interactive

Dropping revenue, shrinking print circulation, fragmented media … these are the painful terms we hear bandied about the newspaper conference room. Throughout the industry, smart, dedicated people are exploring ways to slow the outgoing flow of revenue. One avenue of exploration has been the idea of a metered paywall. These tollbooths on newspaper websites would require users to pay a subscription fee after a set number of visits to story pages, thus charging the heaviest of news users while allowing the infrequent visitors to continue their viewing habits unaffected.

Why go behind a metered paywall? 

“Consumer attitude to paying for content has changed,” said Kathy Schwartz, general manager at Times Shamrock Interactive. “People are willing to pay.”

The move behind a metered paywall will:

  • Provide a new, previously untapped revenue stream
  • Help newspapers understand who is coming to their website (registered data) and allow for a higher CPM  with additional information

With newspapers at 60% ad inventory sell-out, a small loss in traffic will not affect revenue.

But, the move is not without worry:

  • Will the newspaper experience a dramatic drop in traffic?
  • Will readers move to the competition?
  • Will advertisers move to other media?

At this point, these concerns have gone unrealized on, website of Times Shamrock’s flagship in Scranton, and a number of these concerns can be offset with some preventative care, maintaining the high quality news and service newspapers have been known for through the generations.

“As we ask people to pay, we need to provide more” said Schwartz. 

Avoiding a paywall

Presented by Dan Sarko, senior VP; Arturo Duran, chief digital officer; and Mark Lewis, corporate multi-media editor; Journal Register Company

Journal Register Company’s new “Digital First” commitment has gotten a lot of attention across the industry. In early 2010, the company explored its digital revenue strategy expectations for the next few years, discussing how much money could be raised on a pay model and how much would be risked by doing so. When the company couldn’t find a model that would allow it to recoup the ad dollars it would lose by moving behind a paywall, JRC vowed to continue to create and curate content that would be relevant to readers’ everyday lives and draw them to its products that way.

JRC creates content based on two sources:

  • News – something that happens that is not under the control of the company
  • Information/featured content – more hyperlocal content that is controlled by the company

In its meeting, the company knew one way to engage readers and visitors to its websites was by growing video and mobile. JRC bought flip camps for each of its employees and grew its inventory of videos by 400 percent. About one million 30- to 60-second videos are produced each month and complement stories on the websites. The company also grew its social media presence and now finds that 16 to 20 percent of traffic to its sites comes from social media.

JRC’s properties are regional sites with very local audiences. Those audiences look for a volume of content that is not exactly duplicated from print to digital and vice versa. Additionally, 40 percent of JRC’s traffic comes from search engines. The company maintains that people will find the message they’re searching for elsewhere if JRC makes them pay for content. By focusing less on what the newspaper wants and more on what the reader/user wants, JRC has been able to make its brand more relevant and keep visitors coming to its websites.

Building a paywall

Presented by Gordon Crovitz, co-founder, and Matthew Skibinski, director of affiliate relations, Journalism Online

Journalism Online’s Press+ e-commerce technology enables newspapers, magazines and online publishers to charge for access to their websites through metered models. There are important steps that newspapers can take to effectively grow its metered model.

Step 1: Choose a starting point

The metered model enables publishers to choose how much of their traffic to put in play at each point of the process. Initial decisions do not need to be exact, and Press+ encourages publishers to start small and experiment as they move forward.

Step 2: Install and Launch

Once Press+ has a company’s initial launch decisions, it delivers a single line of JavaScript code to insert into a website. The system is tested to make sure everything works and makes any requested adjustments. A date is sent for launch. If a meter is conservative, most readers are unaffected.

Step 3: Learn and Adjust

More engaged readers begin to exhaust their free access and sign up for subscriptions. Press+ provides reports, analytics and advice to help publishers improve their paid models. Publishers can experiment with their models at this point, adjusting meter settings and introducing premium content.

Press+ provided some overall affiliate experiences:

  • Traffic: Traffic loss from implementing paid models has ranged from 0-20 percent of page views and 0-7 percent of monthly unique visitors.
  • Advertising: No publisher has reported any decline in advertising revenue. This is because most publishers do not sell their entire available inventory. Even with fewer page views, they can maintain current revenue levels.
  • Offers: Customers are opting heavily for annual pricing at 10X monthly price.
  • Print Subscribers: Among publishers charging print subscribers at a discounted rate to receive online access, no angry customers or complaints.
  • Customer Reaction: Customer service not a problem; few complaints from customers about charging for online access.

Read Pay to Play, an article from the March/April edition of American Journalism Review, on paywalls.

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