News models for the future – advice from McKinsey

September 28, 2012 by  

Steven Neubauer (picture by Brie Logsdon)

Steven Neubauer, McKinsey & Company was one of the speakers during the second day of INMA European Conference 2012. He gave a positive outlook for future models of newsmedia business.

The presentation was based on McKinsey’s iConsumer survey. Main takeaways from the study are:


  • Consumer reading preferences – digital continues to increase in relevance
  • Massive generation gap in perception and use of medium will accelerate digital migration
  • Print still has an edge in quality (over 30 percent stressing high quality of the newspaper content)
  • Declining trust in general news website, particularly among the young (it’s an opportunity!)

Publishers should know what sets them apart and focus on what makes their brand and media distinctive. According to McKinsey, paper is not coming back, digital is the only key to the future. Steven Nubauer knows that it’s easier to say than do. Making a living in the digital world is a hard work. The revenues per user hour are much lower online than in the traditional media.

This is why the speaker focused on four best newsmedia models for the future. Those are:

  1. Sponsorship at scale
  2. Use of content to drive sales
  3. Paid content
  4. Digital video


1. Sponsorship at scale
Good news – publishers can still command a premium. Premium display is under pressure though (search still leads in EU online advertising spend)
Sponsorship sales model:
thematic/event tentpoles
category exclusivity

Secret to success: learning from the pros. Example: VICE – large share of revenue from sponsored content. Very successful in monetizing their content, especially among the young.
2. Use of content to drive sales. We’re all in the lead generation business now. Publishers should use their content and audience to drive sales for others:

  • Understand the taste and preference of the audience
  • Capture consumers’ signals of intent
  • Create commerce friendly touchpoints
  • Create deep partnershipswith e-commerce players

Example: Stylebook from Axel Springer – uses its editorial content to direct readers to online retailers

3. Paid content. Consumers will pay for digital content… especially if they’ve been trained by Apple. Owners of iPhone/iPads are more willing to pay for content on
different platforms

Intelligent product and pricing bundles helps (example – New York Times)

4. Digital video – there’s gold in it. It will be a tremendous drive story in Europe. Digital video traffic and ad spending are growing fast in Europe. Online video is
also getting advertisers excited.

Opportunity for publishers:

  • use video to drive incremental engagement
  • ensure high quality’
  • experiment to find your own voice

More and more publishers actively are creating video capability. Only distinctive offerings closely aligned with the brand will capture significant share.

Problem: Professional video tends to be expensive. News companies can find an attractive video audience (example: Wall Street Journal)
How to more than double online revenues. 4 key questions to answer:

  1. Which parts of the content offerings could really constitute sponsorable platforms?
  2. What are the categories that publishers can directly influence spend decision?
  3. What is the share of the audience that would be willing to pay for content?
  4. What is the authentic affordable scalable video content model for the brand?


One Response to “News models for the future – advice from McKinsey”

  1. on October 22nd, 2012 5:42 am

    Additionally, many schools that are primarily traditional in their focuses, also offer hybrid courses in design. Usually these courses require a student to attend class some of the time and to do some of their work online. A visit to a high school career counselor or a search on the internet using “graphic design schools online” as the search phrase will usually turn up the right results.

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