News UK bets big on 'title-led' approach to unearth the crown jewel of its multi-layered audience

Two distinct business models now sit where there used to be one within News UK

Chasing a title-led approach may seem counterintuitive for a publisher in the age of integration, and yet News UK thinks it’s necessary to run The Sun and The Times as separate businesses given both are traveling in different directions.

The reason for the switch is rooted in a very different strategy to what the publisher had 12 months ago, when The Sun’s paywall fell. Two distinct business models now sit where there used to be one, the result of a publisher that has gained a clearer view of two very different audiences over the last year.

Since then, the red top has launched a betting business,debuted on Snapchat and is quietly testing a loyalty scheme Sun Savers, set to launch in the New Year. At the same time, The Times changed how it publishes news online, introduced tiered subscription-based apps and doubled down on digital editions.

Now, there is increasingly less in common with the marketing and business development of both these titles. So much so that “focusing on having one business and how you grow it is probably the right way to go,” says Chris Duncan, the recently appointed managing director of The Times and The Sunday Times.

“We continually re-jig responsibility to reflect whatever the company needs to achieve, we work in short bursts and reconfigure as we go. There is a lot of change it needs to be structured around,” he continues.

“If you think of all the change in the last three years in terms of platforms, in terms of how do you react to changes in Facebook, Google, Amazon, changes in voice, the growth of Snapchat – if your company stays entirely still and the world changes around it you are going to be at a disadvantage.”

But the problem with this strategy is that unlike Google and Facebook, News UK is carrying the costs of a local newspaper network. The publisher simply does not have the cash to pump into Google-style ‘moon-shot projects’ that take years to pay off. Instead of a handful of big bets, it is trying to build in small steps as seen by how Ben Walmsley, News UK’s digital commercial director, has spent his first six months at the business.

His efforts to date are clearest in how the publisher is trying to gauge the value of every impression on its suite of properties. Staff there explain how much of its time has been spent trying to work out whether or not programmatic technologies can value the quality of journalism on one of its sites versus the other.

For instance, is a pair of eyeballs worth more when reading an article on The Times, compared to the same set of person when they are reading an article on The Sun to a particular advertiser?

Concerns over the spread of fake news highlight just how important premium brands such as the Sun and The Times could become over the next year – both for readers looking for a trusted source and advertisers wanting guarantees for viewability and fraud.

Commercialising this opportunity must be different to “broad distribution” where publishers are chasing audiences around the internet “with very little visibility and transparency about whether that advertising is being seen”, says Duncan.

It is a thought shared by many of his peers, and will likely see more direct deals programmatically delivered to known environments in partnership rather than a “broad close your eyes and hope for the best”.

Walmsley expanded on this point: “We envisage a point where display is increasingly traded programmatically. We see certain agencies declare public ambitions to move everything in that direction. What’s important is that we weave it throughout the ethos of the entire sales team. We need all our digital teams to be fully versed in programmatic and have it as a skill that’s embedded throughout the organisation.”

The former adtech executive wants programmatic to not just be intrinsic to its digital offering but a “huge part” of what it does, eyeing gains in audience extension and automated guaranteed deals. He added: “We see programmatic not just as waterfall setups or being used to sweep up stuff [remnant inventory] in the way we sell and start to look at premium automated guaranteed deals and talk to clients about where their priorities should be.”

News UK’s success will come down to whether or not it can monetise attention and not the ‘news’. For all the talk of fake stories and echo-chambers there is still a desire for high-quality journalism, though examples of how it can be monetised at scale are few and far between. Indeed, the publisher thinks the opportunity to exploit attention exists beyond its advertising and circulation revenues as seen by the formation of its revamped commercial arm The Bridge at the start of the year.

As David Robinson managing director of The Sun, and The Sun on Sunday explains: “The Sun is a scale play, it is a big beast and ultimately we want to make as much noise and have as much relevance in as big an audience as we can. With that comes opportunity to monetise audiences. That has been the huge benefit for us with Sun Bets, if you can build out significant scale and can recognise you have niche audiences you can build out revenue from that. Audience first, revenue opportunities second.”

Some 19 million people read The Sun in print and online each month, according to Comscore, and of that 46% who visit the site are aged 15- and 34-years old. Whereas The Times attracts around 16 million readers a month, 15% of which are subscribers (18,000 people). What’s more, News UK says it is sitting on a “treasure trove of data”, with 7 million registered users across The Sun, The Times and Sunday Times.

Having that scale and influence with younger readers on The Sun alongside the deep relationships with The Times subscribers, makes it easier to carve out new revenue streams in both businesses. For The Sun, much of these developments will be wrapped around video, mobile, branded content and programmatic. Hence why the tabloid is currently on the hunt for experts such as a head of programmatic, and is why it toured the country’s most powerful media agencies earlier this year to trumpet its wares.

Details of what those discussions focused on are sketchy but what The Drum does know is that News UK wants to pioneer mobile formats as teased by the vertical video formats it launched earlier this summer.

Plans are also underway to produce more original content for The Sun than ever before in 2017 to reach more users on mobile where 88% of its readers already access its content. There are similar hopes for branded content, which steered by creative content director Tiffanie Darke, to make a bigger play for retail budgets after successful deals with Tesco and Morrisons.

So much change and there is still more to come; News UK’s sealed its £200m takeover of TalkSport owner Wireless Group in September, giving access to audio media for the first time. Described as the “crown jewel” in News UK’s sports proposition by chief operating officer David Dinsmore, TalkSport’s listeners overlap with those readers of The Sun and (somewhat surprisingly) The Times, reveals Duncan.

“We always had massive penetration in Dublin for the commute, now we have just added radio penetration for anyone who drives a car,” adds Duncan.

“If you want to speak to anyone in Dublin in the morning, the combination of Wireless and the news titles are starting to get this huge reach. The Bridge is there to tell that story to advertising customers. This latest change is about thinking; how do we define ourselves more broadly in what we offer to our readers?”

He goes on to say: “We have a fabulous brand in the Times and the Sunday Times but we can do more and we are going to have to do more over time as advertising becomes a tougher market to figure out; where can we generate additional revenue from the use of those brands. That is the big shift in this latest change. The Bridge continues as is.”

A little over a year since News UK chief executive Rebekah Brook’s return sparked a year’s worth of changes at News UK and the business is once again set for more upheaval. From Unruly to Wireless Group, its in-house agency Pulse Creative to a revamped commercial offer, the publisher is bringing more strategic rigour to how all these facets work together, mindful that huge audiences don’t matter in the absence of a business model.

Additional reporting by Jessica Goodfellow.

The Drum is hosting Programmatic Punch find out more on adblocking, the changing agency buying model and much more on 8th December

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