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Johnston Press The Independent Online Media

How the Independent’s digital-only strategy can thrive


By Jessica Goodfellow, Media Reporter

February 13, 2016 | 9 min read

The Independent’s decision to become the UK’s first newspaper to go digital-only heaps pressures on its commercial model to grow its audience and monetise its content in order to justify the move.

Under the revamp, the publisher will form 25 new digital content roles and launch a subscription model app alongside the opening of Europe, Middle East and Asia editorial hubs. The challenge for these new arrivals will be whether they can help increase the importance of the title’s editorial and the appeal of its content.

With the growth of ad blocking it’s going to be increasingly difficult for the media business to do this without a responsive site that better balances digital advertising for brands, without alienating their readers.

Ultimately, the success of the Independent’s move to online-only rests on it developing a variety of formats, at a variety of price points all the while utilising data and analytics to ensure its advertisers can deliver results back into their businesses. The lower price point of digital should ensure there is a greater opportunity for the Independent to focus more on working with smaller business owners, and emerging brands that are trying to scale via digital channels, which could become a point of difference to other newspapers.

“It’s absolutely critical that publishers focus on digital ad formats that engage, rather than enrage consumers. That will ensure they generate sufficient digital advertising revenues to pay for the quality journalism which is so important to society,” Justin Taylor, UK managing director of online video advertising company Teads, which holds partnerships with the vast majority of the UK’s premium publishers.

Despite being a daunting prospect, the Independent’s digital drive makes sense according to media buyers interviewed by The Drum. A theme running throughout all their observations is that the publisher will need to undergo significant digital redesigns, and overhaul what it can offer to advertisers in terms of video, native and display content in order to act competitively in this space.

“By migrating to a digital only format, the Independent will be able to sell their inventory more efficiently through programmatic trading and with that comes monetisation of their audience data,” said Celine Saturnino, head of media operations at independent media agency Total Media. “The trend for moving content online is now well established for publishers, who use it to increase their revenues.”

Ian Prager, managing director at MC&C, continued on this point: “The success of this will depend on developing a variety of formats, at a variety of price points - and utilising data and analytics to ensure the brands it works with can deliver results back into their businesses. Alongside this, the lower price point of digital should ensure there is a greater opportunity for the Independent to focus more on working with smaller business owners, and emerging brands that are trying to scale via digital channels, which should be a growth area.”

Creating a profitable proposition quickly will be challenging at a time when publishers across the board are scaling up their own digital offerings in order to grab the ad budgets on offer.

Desktop’s contribution to the media mix is shrinking as spend plateaus and shifts to smaller screens. Mobile’s share of online spend is tipped to hit 35 per cent by the end of the year, according to Warc’s forecasts, which are based on data from the Internet Advertising Bureau and PricewaterhouseCoopers. For display ads, almost half (48 per cent) of all online spend in 2016 is projected to go specifically to mobile, compared to less than a third in 2014.

The Independent probably won’t be the last UK newspaper to cull its print edition. And while print will always exist, there has been a gradual weeding out of the smaller players that benefit more from investing in a digital product.

“With publishers like the Sun recently coming out from behind their paywall, it shows how much you need that online traffic - it's a very competitive market out there and you need to get your content out to as many people as possible,” Liam Mullins, head of trading at independent media agency the7stars.

The Independent's editor, Amol Rajan, was bullish about the title's digital prospects in an editorial on Saturday.

Rajan wrote: "We have huge, global ambitions for our website, backed by multimillion-pound investment from our owners, the Lebedev family. They have invested more than £60m in this great institution over six years. Having sold our stablemate title, i, they have the chance to fund the next chapter in our story. In plotting the next few years, it makes sense for them to invest that money in the digital product."

The Drum has collated more reaction from the industry to the news below.

Michelle Stanistreet, general secretary of the National Union of Journalists (NUJ), said: "The fact that our national newspapers can be shut down overnight with no scrutiny and no ability for their future to be secured through other means, underlines the moral bankruptcy of newspaper ownership in the UK. That needs to be urgently addressed. The NUJ will do all it can to support all members affected."

Laura Davison, NUJ national organiser, said: "The way staff have had to learn about what's happening through the pages of other papers is simply appalling. We are calling on the company to enter into urgent talks with the NUJ, to meet their legal obligations and to treat their staff with humanity."

The NUJ has sent a letter to Steve Auckland, chief executive of the Independent and Evening Standard, demanding talks. The NUJ chapel will be meeting on Monday.

Phil Hall, joint head of investment for Mediacom UK.

"The print sales are low and obviously there is a production cost involved in producing print and this is part of the reason for their shift to a digital business. While they have a decent digital subscriber base, the challenge as it is for any digital business will be to monetise that. There is certainly a possibility that they will look at a subscriber model, or they can hope that the quality of their journalism is such that they will generate more traffic and get a greater return from advertising.

There is also the possibility that they could adopt the Guardian model of opening up bureaus internationally and try and become more of a global news force, which is easier for them as a digital business.

Liam Mullins, head of trading at independent media agency the7stars.

"The Independent first launched with a campaign which challenged readers: “The Independent - It Is - Are You?” But with sources of news from four corners of the globe, opinion from everyone from Trump to Tebbit only a click away online – did the independence of the Independent and the role it once played become irrelevant at worst and just another source at best.

The key now is for Lebedev to really invest in the digital edition and focus on showcasing the clear editorial values and point of view that may have been lost over the years, so it becomes a destination website for readers and a must-have on advertisers’ schedules – but is this a realistic ambition and can it be commercially viable?

With the sale of the i to Johnston Press and the subsequent loss of a national footprint – Lebedev needs to ramp up London and the success of the Evening Standard, focus on London Live and getting their web presence on both sorted to forge ahead in the market."

Aidan Joyce, chief executive and co-founder, Oriel:

"We’re yet again faced with the harsh realities of monetising content in today’s digital world. The only option for the likes of The Independent is to focus on connecting with their audiences through digital channels.

With an online only business model, it will be important to carefully assess digital revenue streams. Advertising is the lifeblood for many publishers, but with revenues being impacted by the rise in ad-blocking, fast action is needed to improve the advertising experience for consumers. For The Independent to survive online, the priority will need to be protecting content and advertising revenue."

Many took to Twitter to voice their opinions including comedian Chris Addison, and Radio Four presenter Tom Sutcliffe.

The Drum has contacted various media buyers and industry experts for comment on the announcement. More to follow.

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