Noise versus signal. Getting change right in “The Economist”
September 27, 2012 by marek.miller
Susan Clark, Group Marketing Director and Managing Director for Continental Europe, Middle East & Africa in The Economist Group was one of the speakers during the INMA European conference in Hague. She spoke about The Economist success story, trying to answer the questions such as how to make sure publishers grab the opportunities and minimise the damage?
In this time of great economic stress, the structural changes in our industry can cause great damage and unlock great opportunities. Susan Clark shared some thoughts on the shift from print to digital and the impact it is having on products, competitors, and readers. She also gave some thoughts on the shift from print to digital and the impact it is having.
The Economist was first ppublished in Sept. 1843, their mission is to focus on trade. In 2001 went on as a full colour publication. The first app was produced at the end in 2010 (quite late relative to what was going on in the publishers’ world). Now it’s available everywhere.
The app was downloaded 13,5 million times (on average a good app is the one downloaded at least 1000 times). There are 600 000 people who read Economist’s content through the apps every week.
In last year they introduced a special China section inside the newspaper. The reason behind being so late was the fact they couldn’t get a visa for a journalist. Economist has great online readership in China.
The total readership of The Economist is 1,6 million readers (both digital and print), they reach 7 million people a month – unique users. The number of Economist Facebook fans passed 2 millions, they also have 2,6 million Twitter followers.
As Susan Clark stated, Economist is not the fastest mover in the world.
She began by stating what Economist hasn’t done. They:
- didn’t cause the rise in globalisation
- didn’t fuel the growth in English as the 2nd language
- didn’t cause the sift to mass intelligence
…but those facts are crucial to their evolution.
The famous graph of newspaper revenue (NAA: 1950-2010) is a bad picture. On the other hand, the mobile app advertising is growing up for The Economist. Unfortunately, the money it is generating is still less than what was lost in print and online. The tablet technology, and its take up has been faster than any other technology ever. Economist is doing their best to remain profitable, to make shareholders happy and guarantee the best return of their investment possible.
The publisher is aware it is in the business of content. Despite the discussion of distributing content on every platform – it’s still content that matters most. It gives enormous opportunities to the publisher. The challenge is about the internal culture inside the organisation.
Who are the audiences of the Economist:
Primary audience: readers, curiuos, educated people. It is said they have wealthy audience but only because education is tightly corelated with income.
The group of curious people is growing – the rise of mass intelligence is real. More and more are working with companies in new sector.
Economist understands the readers. What they want is to understand the world across national boundaries. Susan Clark said: “They explain India to the outside world, and the rest of the world to India, but never explain India to Indians”. The readers want to be intellectually challenged.
Economist is big in Americas and Western Europe. The bad thing is it’s still less than 10 percent of their business is in Asia. Hopefully this will change after introduction of the new China section – they plan to grow in India and other parts of Asia. The digital growth of The Economist is everywhere with notable strength in hard-to-reach spots.
Economist is premium priced except for introductory promotions. They have a porous paywall (99% of users on the site never hit the paywall) and distribute content extensively through social media. They charge high price for print and high price for digital. Noise tells them that people won’t pay for content. But now 88.000 people pay for their digital products and many more who pay for print.
What is the structure of their products? Paid product bundle to readers which includes print, online, digital apps and video. Online they offer debates, video, blogs and the very popular Daily Chart. They’re moving to unbundle the offer so someone can buy single products.
They have a huge choice of offers for advertisers: print pages of varying sizes, colours and formats. Online slots are in a myriad of ways: sponsorship options online and in apps as well. They think of simplyfying that offer for advertisers but there always is a pressure for more options.
The split of money earned is as follows:
- Readers / advertisers split about 50:50
- Print / digital split about 80:20
The reader and digital contribution is growing
Susan Clark stated that if the transition with tablets won’t end the way that print dies after all, the publishers will have a problem. It’s hard to sustain all platforms: print, online, mobile and tablets. Tablet platform is complex and expensive.
The new readers of digital Economist:
- 77% had never had a print subscription before
- 12% are lapsed print subscribers
Clark concluded her speech with a statement: “The best way to succeed is to slow down. You don’t have to be first in the market. Let other make mistakes and learn on them”