How have news companies’ monetization strategies evolved in the past year? - Reuters News Agency

How have news companies’ monetization strategies evolved in the past year?

Within a year, ad-blockers are rising again

By  Sarah Emler | Monetization | Sep 05, 2018

The 2017 Digital News Report talked about a halt in the use of installed ad-blockers, recording 21% usage on computers and only 7% on Smartphones. In 2018, usage has rocketed.

Digital News Report 2018 reported a 3% rise in use of ad-blockers on smartphones and a staggering 31% increase on computers. More than a quarter now ad-block on any device (27%). In addition, the move from Facebook’s feed to messaging apps has gathered pace – a pattern visible in last year’s report that has developed into a significant trend in 2018.

The proportion for using messaging apps for news has increased up to 26% in total”

Digital News Report 2018, Reuters Institute for the Study of Journalism

The proportion using messaging apps adds another challenge for newsrooms looking to attract ad revenue. Luckily, there is a greater willingness to pay for news.

“In the United States, last year’s Trump Bump in subscriptions has been maintained with a headline rate of 16% paying for some kind of online news.” Although, Nordic Countries are leading in paid online-news, with an increase of 5% in Norway and 6% in Sweden over the last year. However, whether the payment is donation based or via subscription varies demographically.

Let’s take a look at how newsrooms’ strategies to attract payment for online news varied from 2017 to 2018.

Nordic Countries are leading in paid online-news, with an increase of 5% in Norway and 6% in Sweden over the last year. 

Donation or donation-based memberships are small but growing

Some news companies started asking for donations years ago.

In the United States, NPR has financed its business via donations for decades, with audiences donating money to local NPR stations directly. Not so long ago, The Guardian also adopted a successful, donation-based monetization strategy.

At the beginning of 2018 the Guardian US announced that they’d reached over 300,000 supporters. Out of these, 73,000 (24%) are recurring payers.”

At the beginning of 2018 the Guardian US announced that they’d reached over 300,000 supporters. Out of these, 73,000 are recurring payers. However, most of the donations for the Guardian come from the US, according to the report.

Overall, we find that the percentage of people donating to news organizations is small, just 1% in the UK rising to 3% in the US. On Average, a quarter of our sample (22%) say they might be prepared to donate to a news organization in the future if they felt it could not cover their costs in other ways.”

On average, a quarter of our sample (22%) say they might be prepared to donate to a news organization in the future if they felt it could not cover their costs in other ways”

Choice matters

Donations primarily come from the younger generation. “As our own research into paying for news showed last year, many younger people are reluctant to sign up for just one subscription for fear of missing out on being able to pick and choose sources.”

Subscribe, subscribe, subscribe

Other news organizations rely on paywalls. Nordic countries in particular seem to succeed with this monetization strategy.

According to the 2018 report, this might be because of the small number of publishers and “the added benefit of coming from wealthy societies that value news, have a strong subscription tradition, and where language and the small size of their market protects them from foreign competition.” Now 30% pay for news in Norway, which is an increase of 5% compared to last year.

The added benefit of coming from wealthy societies (Nordic countries) that value news, have a strong subscription tradition, and where language and the small size of their market protects them from foreign competition.”

Hybrid-Paywall: strike the balance for the amount of freemium content

The report observed that many newspapers in Norway use a hybrid paywall or metered wall. Here the audience can access a limited number of articles monthly before subscribing.

Norway’s AftenPosten introduced a metered wall in 2015, increasing it’s digital subscribers from 30,000 to 100, 000 within two years.

Norway’s AftenPosten introduced a metered wall in 2015, increasing it’s digital subscribers from 30,000 to 100, 000 within two years.

The difficulty is finding the right amount of freemium content –– the articles everyone has access to without paying.

“With 20 free articles per device per monthonly 9% of the users actually hit the paywall and a very small percentage of these actually purchased subscriptions,” explained Siri Holstad Johannessen in a blog post. Now the AftenPosten offers six to eight articles per week, about a quarter of them are on the front page.

The Digital News Report 2018 finds that “across all countries, donations are increasingly asked for, and increasingly given. Part of the motivation is to support fact-based journalism in an era of ‘fake news’ and support a greater variety of independent voices.” However, it is primarily the younger generation who is more willing to pay for news.