Digital technology is “fundamentally changing” symbiotic relationship between media and marketing, says Economist’s global digital publisher
The evolving digital landscape is “fundamentally changing” the symbiotic relationship between media and marketing, according to The Economist’s global digital publisher Nick Blunden (pictured).
Speaking at Media Briefing’s Digital Media Strategies event in London yesterday Blunden said it is vital publishers take advantage of new opportunities digital technologies create and adapt their commercial strategies accordingly.
“Although our audience has quadrupled over the last 10 years we do not believe advertising revenue alone, whether it be print or digital, is enough to sustain the serious investment required to support quality journalism.
“For over 100 years advertising and media have happily coexisted but this status quo is changing fundamentally and as a result advertising’s share of the overall marketing spend will decrease, despite the fact marketing spend is likely to rise,” he said.
Although advertising still accounts for 50 per cent of the Economist’s overall revenue, with subscriptions revenue accounting for the remaining half, it is vital publishers adopt multichannel revenue streams, according to Blunden. “Advertising is still crucial but there is a realisation now that digital technology is fundamentally changing the symbiotic relationship between media and marketing.
“Advertising is all about engagement and less about reach and frequency and these changes in the ad landscape are creating huge opportunities for publishers. But it is clear the ad landscape is more competitive than ever and a less predictable source of revenue therefore it is important we as a business and media in general pursue other models,” he said.
Blunden said publishers, including the Economist, have traditionally not been good at pricing models. It has now adopted a more flexible pricing strategy which has centred on “unbundling” its digital and print products. It now charges the same price for its print-only and digital-only subscriptions – a plan initially outlined by CEO Andrew Rashbass last year.
Both packages are priced at $127 each, and it also offers a combined bundle which mixes print and digital for $160 – 25 per cent more than the separate bundles. Blunden said half of its total subscribers choose the higher priced bundle, with 25 per cent opting for print-only and the remaining 25 per cent for digital-only subscriptions.
“In a world where we are all struggling to monetise content this shows that age-old adage that people are not willing to pay for digital content is untrue. The are just not willing to pay for commoditised content...We are generating more subscriptions than ever and people are happy to pay for the higher priced bundle. The results of the unbundling project have demonstrated print is clearly not dead. We are just experiencing a shift from single channel to multichannel with more and more people choosing to use the different channels in combination, not separately,” said Blunden.
It will consider offering bundles around its audio product in future, with the view to continuing to build its audio offering as a way of opening new windows in which newspapers and magazines have traditionally had to compete.
“Our audio output is very popular and we generate 1.5 million monthly streams. It lets people consume the content in new ways and at different times. People are accessing them in the gym and while moving around, and some while in the swimming pool using waterproof iPods. This means we no longer have to compete with other newspapers and magazines for people’s work time – we can compete for their free time,” he said.
The Economist has 1.5 million global print subscribers, and 650, 000 active users of its digital editions, with 7 million unique users of economist.com.