FT is set to make more revenue from content sales than from advertising
The Financial Times is set to make more revenue from content sales than from advertising for the first time in its 124-year-history.
Speaking at its own digital media conference in London, the FT Group’s chief executive officer, John Ridding, told delegates that double digital content revenue growth means that its pay walled content sales drive may eclipse advertising sale income this year.
The Media Briefing website reports: “Ridding described the strategy as ‘essentially platform neutral, device-driven and paid for’ - which as most people in the industry might agree, is a nice place to be. Which may be why owner Pearson was keen to pour water on rumours that the FT is for sale.
“But from an FT Group perspective the pink'un newspaper has some catching up to do on the paid content revenue ratio: its parent division made 58% of its £427 million revenue from content sales in 2011.
“Overall profits were up 17% on an underlying basis to £76 million in the same period.
“But that shift away from advertising has long been coming. The FT Group pulls no punches in declaring that ‘advertising was generally weak and volatile with poor visibility’.
While at the same time, online subscriptions were up 29% to 267,000 last year - crucially including another 2,000 corporate subs - with online subscriptions beating print subscriptions in the US for the first time.”
Mobile - or rather, the ability to quickly and easily acquire subscribers via tablets and smartphones appears to be the way forward for the FT -with 70% growth on mobile platforms in the past 12 months.
"Mobile is a complete game changer," Ridding explained. "If you're a global publisher you reach economies of subscale through having to reach so many territories. Now we can reach all our markets internationally at zero cost.
"I've just come back from the US which is our biggest emerging market - the audience potential is huge. But flying newspapers around the Midwest is expensive. Now we don't have to."
The Media Briefing adds: ”Ridding admits he had early misgivings over whether people would want to read something long-form and cerebral like the FT's economics columnist Martin Wolf on a smartphone, and quotes him as saying: "The answer is that they do. As the moderator quipped, whether they understand him is quite another matter”.
Ridding added: "This point about being able to target ads ... At the moment if you're a marketing director you have to prove ROI in a way you didn't before. Now you can prove very clearly who is reading what - you can prove the efficiency of a campaign.
"The real power is in data... we're moving from the dark ages where people would walk into newsagents and we wouldn't know them but now we know pretty much everything about them."