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Online Publishing: Challenges and Opportunities of Digitization

Newspapers and publishers are facing a multitude of new challenges in the digital age. Online journalism needs to demonstrate innovation in order to stay competitive. Where is the industry currently and what do publishers need to do to prepare for the future?

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Table of Contents

The status quo of the publishing market

Hardly any other industry has been hit by digitization as hard as journalism, as a study from the German-based market association Bitkom shows.

  • 72% of all media companies are changing their business model in order to keep pace with the digital transformation. In the rest of the economy, the average is only 64%.
  • 85% of media companies are adapting their existing products and services, 80% are offering completely new ones. For comparison: in the overall market, the numbers are only 57% and 40% respectively.

Nevertheless, many publishers are being forced to cut jobs and dismiss journalists. This includes many digital publishing companies, such as BuzzFeed and Vice Media. Publishers and online journalists seem to be under much greater pressure to reposition themselves. How can we explain the developments of the past years? Where have publishers been particularly vulnerable? And with which strategies can they prevail in the future?

Circulation and advertising revenues decline

Up to the turn of the millennium, sales and thus investments in the market increased. With billions of dollars in US advertising revenue and a margin of some 30-40%, the media industry had been extremely profitable.


Emerging digital offerings led to a rapid decline in the growth rate and also put advertising – the publisher’s second main source of income – at risk. What is the reason for these developments?

What are the biggest threats for publishers?

The biggest threats to publishers are that they’ve spent too long trying to simply transfer the classic business model from print to online, without making any adjustments. This doesn’t work, because the online market is fundamentally different from the offline one.

  1. The online market is far more complex: Entirely new players and business models attract and retain users with new offers and better user experiences.
  2. The needs, the demands and the behavior of the users differ fundamentally from those in the print industry.

Here are the top four threats to publishers:

1. Users no longer show their classifieds in newspapers

The first two pillars of publisher revenue – advertising and distribution – have been looked at above. In addition, classifieds made up a large part of their revenue. Readers would pay high fees for these advertisements, in order to sell or buy something, or if looking for a job or partner. Today, hardly anyone uses these publishers for classified ads, turning instead to specialized online platforms.

The company Craigslist has fueled this paradigm shift and is considered a prime example of the development. Craigslist’s pricing model was unbeatable: instead of hefty fees, most ads were free. With community activity posts, lost property ads, and discussion forums, Craigslist also offered more features, replacing publishers with virtually any ad-serving functionality.

The company was so successful that it even became a scapegoat for the crisis facing online journalism. Many American media companies saw Craigslist’s increasing success as a cause of the decline in their own revenue from classifieds.

2. Google and Facebook dominate the online advertising market

Advertising revenues for media companies have also fallen dramatically. Classic print advertising can not be easily translated into digital publishing, as new competitors fill the online space. In addition to other digital publishers, search engines, social media, classified ads and job portals are also competing for their own slice of the online media market.

The biggest threat comes from platforms like Google and Facebook, which dominate the online advertising market. This development shows that traditional display advertising of publisher websites has no chance against social media and search engine advertising.

* From 2013, the revenues of US newspapers are estimates.

The reasons for this are above all the vanishingly low average CTR for display ads of 0.05% and the now commonplace use of adblockers, which prevent ads being displayed to users. Publishers can no longer rely on this revenue stream.

3. Distribution: Readers are spoiled with free content

The declining circulation figures show that readers barely buy print publications. In the past, it was common for people to subscribe to one or two daily newspapers, but now, especially amongst the younger generation, subscription numbers are falling lower and lower.

This applies both offline and online. Readers are so used to free content that – according to the German Bitkom-study – the willingness to pay for online items is low. To convert silent readers to paying customers, innovative billing models are required:.

4. Readers consume news differently

The internet has become the main source of news for many. According to the Reuters Institute’s Digital News Report 2019, the smartphone is the most frequently used device for reading news at 44%.

However, user behavior on desktops and smartphones is fundamentally different from print. On the screen, we read more slowly and more impatiently, we skim or skip paragraphs and look for overviews. Often we are on the bus, train or in the bakery queue and we can be easily distracted. We don’t have time to leisurely browse through an article, we want clear structures for efficient information collection and a smooth user journey.

Accordingly, online readers are no longer fond of classic text editing and user experience, and they are quick to exit a page. Google interprets these user signals and ranks digital media for the relevant topics instead of traditional print publications.

At the same time, readers no longer rely on just one source to collect all their information. They access their news in many ways – through apps, social media, email newsletters, or other aggregators.

What strategies can publishers use?

According to the German Bitkom study, 90% of media companies believe that advertising and sales revenue are no longer enough to finance traditional print media. The market for digital publishing has become more and more complex over the past decades and the advancing digitization demands that editors rethink their approach. So what strategies should media companies follow to remain successful?

Optimize content for search engines

The Digital News Report 2019, published by the Reuters Institute, illustrates the ways in which readers access online media: According to the resport, they focu on the brand – be it via the app, the website or direct search in search engines. However, publishers should not rest on the laurels of their high brand awareness: social media and organic search are just as important for acquiring readers.

Media companies have long recognized this fact: In a survey of the Trend Report 2019 of the Reuters Institute, about 9 out of 10 media companies rate Google as a “very” or “extremely” important platform for their medium. Apple News and Facebook trail some way behind with 43%, YouTube with 42%.

In order for Google to find and properly classify content, publishers need to optimize their website and products for the search engine. In addition to technical optimization of the website, this also includes content optimization.

While users of social networks or the apps of publishers or aggregators have news suggested to them, search engine users have a very precise intent when searching around a particular topic.

Media companies also need to understand how users interact with language assistants, how they ask questions, and how their questions can be answered in message formats appropriate to algorithms and machine interpretatin. With optimization for voice search, digital publishing has to adapt to this new kind of user behavior.

Think journalism as a user experience

For Google to be effective as a channel, publishers have to offer an optimized user experience. The user-friendliness of the website is part of search engine optimization: The user must – on desktop, tablet and mobile devices – to be able to navigate the website smoothly, to know at each point where they are and to be able to clearly understand the structure.

Google includes a list of essential dos and don’ts, specifically for online media, in the Google UX playbook for news and content sites. According to this, a smooth user experience consists of the quality and optimization of the following components:

  1. Home page
  2. Menu and navigation
  3. Search bar
  4. Category pages
  5. Article pages
  6. Sign up and subscription options

In addition to example cases that can be used as best practice, Google provides specific recommendations for each action point, along with appropriate KPIs.

From an easy-to-skip homepage to an always-visible search bar to the clear breakdown of articles into categories: what sounds natural is not always properly thought through by many publishers. The following applies: If you consider the needs of your target group, then you have a good chance of keeping them on your site.

Find new revenue models

For years, subscriber numbers have fallen for many newspapers, not least because of the amount of free online content. As a result, publishers are experimenting with different payment models to generate revenue beyond the traditional subscription.

  • Paywall & Freemium: The New York Times is the world leader when it comes to the number of paid subscriptions for an online publisher. You can read 5 NYT articles for free every moth, and have to register to read more. As of August 2019, 3.8 million people are paying for the publisher’s online products.
  • Contributions: Even the free model can be used profitably. The British Guardian renounces paywalls, but asks readers for voluntary donations, which can be set up either as a one-time transfer or as a standing order. With success: This model saw the Guardian’s 2018 accounts enter the black for the first time since 1998.

This means that publishers should try out different revenue models and innovate until they find the right model for their readership.

Try out new formats and open up digital channels

80% of media companies claim to have tested new products and services as part of their digital transformation. To avoid the threats in the distribution and advertising market, innovative models are needed that appeal to readers in a new way. These formats and channels have been growing for several years and are particularly suitable for digital publishing due to their content focus. Here are the five most important sources of income:

  1. Content commerce: Online editors curate affiliate links in articles, often on topics such as “10 products for the summer” or “The best deals of the week”. Important: continuous optimization instead of “Publish and Forget”.
  2. Platform strategy: The main medium is expanded and fanned out to separate the formats and generate traffic at the same time.
  3. Sponsored content: In doing so, a third-party company commissions items or provides them themself. These usually link to one of the company’s landing pages.
  4. Video: Videos are particularly user-friendly and can be a visual version of sponsored content and content commerce.
  5. Audio: Numerous users and visits can be gained in the form of podcasts or voice search, via Apple’s Siri or Amazon Alexa. Many publishers are already using podcasts, or offering the news as an Amazon Skill for the language assistant Alexa.

Conclusion: publishers must remain innovative

Despite all the challenges, 94% of all media companies see digitization as an opportunity. For this it is essential to develop creative strategies and innovations that sustainably strengthen the publisher. Online editors need to rethink journalism and adapt it to the needs and habits of their readers. This requires the right know-how for digital techniques.

Contact our consulting for a website audit!