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Deeper, stronger connections with audiences key to news media survival: Reuters

For long-term survival, publishers are looking to develop “stronger and deeper connections” with their audiences online via quality paid content, curated e-newsletters and podcasts, according to Reuters’ latest report.

The Reuters Institute for the Study of Journalism Digital News Report 2020 provides new insight into digital news consumption based on a survey of over 80,000 online news consumers across 40 countries. While the report focuses on news media, many of the findings are relevant to magazine publishers with news-focused websites. 

Much of the data for the report was collected before the global impact of the coronavirus, but to present a bigger picture, Reuters repeated key parts of its survey in six countries (UK, USA, Germany, Spain, South Korea, and Argentina) in early April. 

Based on this, the report provides insight into the impact of the coronavirus pandemic on news consumption and economic prospects for publishers, including the progress on paid online business models and the popularity of curated editorial products like podcasts and email newsletters.  

Senior Research Associate at the Institute, Nic Newman, says that thanks to COVID-19, “Journalism matters and is in demand again. But one problem for publishers is that this extra interest is producing even less income – as advertisers brace for an inevitable recession and print revenue dips.” 

COVID-19 has also changed the way that consumers engage with media, with more people choosing to source their news online, while the print production and distribution of news has been impacted by the rapid spread of the virus. Isolation restrictions have also accelerated the use of new digital tools, with many consumers joining online groups (51 per cent) or participating in video conferencing for the first time. 

“Against this background it is likely we’ll see a further drive towards digital subscription and other reader payment models which have shown considerable promise in the last few years,” says Newman. 

Reader revenue models increase

The Reuters report finds increases in the number of consumers paying for online news in a range of countries, driven by more publishers starting to charge for their content and tightening paywalls over the last 12 months, but no market has yet achieved a majority in paying online subscribers. 

The proportion of consumers that pay for online news, by country. Source: Reuters Institute for the Study of Journalism Digital News Report 2020.

For those that subscribe, the most important factor in paying for content is the “distinctiveness” and quality of the content. 

“Subscribers believe they are getting better information. However, a large number of people are perfectly content with the news they can access for free and we observe a very high proportion of non-subscribers (40 per cent in the USA and 50 per cent in the UK) who say that nothing could persuade them to pay,” the report states. 

In countries with higher levels of paid subscribers, for example the USA and Norway, between a third and half of all subscriptions are with just a few big national brands. 

Reuters suggests that “winner-takes-most dynamics are persisting”, but also acknowledges that, in both these countries, a significant minority (37 and 38 per cent respectively) are now taking out more than one subscription, often adding a magazine or specialist publication.

The report also finds that a growing number of publications are asking for donations to fund their news content. 

The impact of digital platforms

According to the report, online news habits continue to become more distributed as more and more people embrace digital platforms, such as Facebook, Google and other social media platforms, and apps. 

Across all countries, just over a quarter of consumers (28 per cent) prefer to start their news journeys with a website or app, followed by social media (26 per cent) – up two percentage points on Reuters 2019 Digital News Report. 

Generation Z (those aged 18-24) buck the trend with a much weaker direct connection with news brands (16 per cent). The 2020 report finds that these consumers are twice as likely to access news via social media (38 per cent), which puts pressure on news providers and their business models. 

“If younger groups cannot be persuaded to come to specific websites and apps, publishers may need to focus more on how to build audiences through third-party platforms like Facebook, Twitter, YouTube, and Snapchat,” states Reuters, while warning that “aggregated environments have not yet proved a good environment to build the loyalty and attribution that will be needed for long-term relationships”.

The return of the e-newsletter 

To combat the growing “power of platforms”, Reuters says that publishers have been building direct connections with their consumers via email. 

The report finds that, across countries, around one in six (16 per cent) access news each week via email, with most of these (60 per cent) accessing a news briefing, often sent in the morning. But publishers have been extending the range of formats, increasingly offering ‘pop up emails’ on topical subjects that are ‘chaired’ by senior journalists. 

“Emails have proved effective in attracting potential new subscribers, as well as encouraging existing users to come back more frequently,” says Reuters. 

On average, Australians receive three emails from different news providers per day, whereas Americans get four. Across countries, almost half (44 per cent) say they read most of their news emails. 

Podcasts build connection and habit

The 2020 report finds that news media are also using podcasts as a channel for driving loyalty to news brands, with the main strategic aim being to “attract new subscribers and to build habit with existing ones”. 

While podcast listening has increased to 31 per cent (three percentage points up on the preivous report), some podcast listening reportedly fell by up to 20 per cent during the COVID-19 isolation period, “a reminder of how integral podcasts have become to commuting habits and other activities outside the home”. 

The report says that podcast listeners tend to be younger and mainly listen via headphones/mobile phones.

Podcast listening habits by topic and age. Source: Reuters Institute for the Study of Journalism Digital News Report 2020.

Across countries, half of all survey respondents (50 per cent) feel that podcasts provide more depth and understanding than other types of media. 

“The deep connection that many podcasts seem to create could be opening up opportunities for paid podcasts, alongside advertising-driven models. Almost four in ten Australians (39 per cent) said they would be prepared to pay for podcasts they liked,” states Reuters. 

What does this mean for news media business models?

The increased use of digital platforms to source news and information plus the changes in media habits brought about by the coronavirus put pressure on publishing business models. 

Newman says “After the 2008 economic crash many publishers saw advertising revenues drop by around a third and many worry that the aftermath of the COVID-19 pandemic could be even worse. Online subscriptions and donations may make up for some of this…but for most publishers, any extra reader revenue won’t be nearly sufficient. 

“Industry expectations need to be realistic as many people are likely to have less disposable income and the majority of non-payers are still broadly happy with free sources.”

Reuters believes it is too early to predict the full impact of the COVID-19 crisis on the news industry but it is “almost certain to be a catalyst for more cost-cutting, consolidation, and even faster changes in business models”. 

The report says that this puts more focus on developing online reader payment models, including subscription, membership, donation, and micropayment. But it notes that for these to be successful, there needs to be a deep trust and connection with audiences

“Looking to the future, publishers are increasingly recognising that long-term survival is likely to involve stronger and deeper connection with audiences online, which is why we have also examined the growing importance of emails and podcasts, formats that are being deployed in greater numbers to increase engagement and loyalty,” says Newman.  

To read the Reuters Institute for the Study of Journalism Digital News Report 2020 in full, click here

Written by Lyndsie Clark

Niche Publishing Network Founder and Editor Lyndsie Clark has over 10 years of niche publishing experience, working in a variety of roles spanning B2B editorial, sales, operations, events, BD, and management.

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