In an age where most news publications are struggling to stay profitable, The New York Times (NYT) offers a beacon of hope.
It returned to profit this year, having made roughly $240m in adjusted operating profit in the year to 25 December 2016. The NYT has also managed to grow revenues 6.8% in the first three quarters of this year and now has 2.1 million digital-only subscribers.
Print advertising used to make up between 75% and 80% of all revenue, but now accounts for only 17%, while reader revenue from both print and digital now makes up 62% of the total, compared to about 44% when CEO Mark Thompson took on the top job in 2012.
Thompson was on stage last week at the Marketing Society’s 2017 Brave Conference to talk about the success of this “subscriber-first” strategy. But the big question is, would it have worked so well if Donald Trump had not become the US President?
That might seem like a strange question to ask. Trump has turned on many of the big US newspapers since he took office, singling out media organisations including The NYT on Twitter or banning them from press briefings.
But all this does, says Thompson, is lead to a spike in new subscriptions – a trend he describes as a “visceral reaction” by people in the US.
That means that despite Donald Trump’s attempts to label the publication’s journalism as “fake news” and argue that the media company is on its way down, its subscriber growth is actually accelerating. Before the US election, The NYT would add between around 23,000 and 33,000 subscribers a quarter; this has now increased to roughly 100,000.
While Thompson says subscriptions are “building very nicely” on the back of Trump’s outbursts, it has also led to a growing feeling that the brand was being defined by both its attackers and defenders, rather than telling its own story. And so Thompson decided to hand over $10m to its marketing team for a new campaign to try to rectify the issue.
‘The truth is hard’ campaign is the result. Thompson says is not an “anti-Trump campaign, but [a recognition] that there is now a fundamental debate going on about the facts and what to make of them – and that’s where we come in”.
Not being an opposition party
Speaking exclusively to Marketing Week after his talk, Thompson seems keen to reiterate that the media brand is not “defined by Trump”. Instead, it wants to portray itself as an impartial examiner of the facts.
“We certainly don’t see ourselves as an opposition party. We are not a political party, we are here to report. If you read Hillary Clinton’s recent book, she has a really bitter section on The NYT that broke the story on her server at home. She felt that our coverage was excessive and was a really serious problem for her. But our job is to report the news, it’s not to support one party or individual,” he says.
That basic, very disruptive world is a very rich environment for journalism and also tends to spike demand for journalism. Trump is not unusual in that.
Mark Thompson, the NYT
When pressed further on whether Trump has generally been good for the newspaper industry or not, Thompson says the US President is part of a wider environment of “uncertainty and disruption”.
“We’re in one of those industries, like being a firefighter, where you do your work when things go wrong. And intense new cycles, which often means periods of high controversy or periods of terrible events, tend to be the periods where people are more focused on the news, spend more time and maybe spend more money on news.
“That basic, very disruptive world is a very rich environment for journalism and also tends to spike demand for journalism. Trump is not unusual in that,” he says.
Crucial to the success of the publication returning to profitability has been Thompson’s ‘subscriber-first’ policy. The NYT faces the economic challenge of growing digital revenue fast enough to offset the pressures on print. Despite the fact that 1.1 million people still buy its Sunday edition, print advertising is falling fast.
“That’s why the point of growing total revenue is an important one. [We’re] trying to make sure the whole funnel is healthy where we’re not just harvesting people who are already very familiar and heavy users of The NYT, but encouraging people who are light users to become heavier users and to take them on a journey of consideration of why they should become subscribers. And this will [heavily] involve our news room thinking about our audiences and journalism,” he explains.
We don’t have many competitors who we can learn from – I wish we had more.
Thompson also wants to better run its digital subscription business, which has been going since 2011. However, he says a lack of direct competitors is making this more challenging, with the publication looking to other industries for inspiration.
“We don’t have many competitors who we can learn from – I wish we had more. Although we are continually watching others, and are often impressed by what they do, we also look quite hard at the Netflixes and Spotifys of this world to see what adjacent industries are doing,” he says.
While The NYT predominantly believes in “very extensive” sampling of its journalism, it is keen that is not seen as a way to get its content for free, although there are exceptions.
“There are moments where we change our rules as we think it’s important that the information gets out there. Some stories, like the Harvey Weinstein one, we believe should go to the entire world. But what we want to do is try and encourage people to sample our journalism, get to like it, then get to rely on it, then persuade them that serious journalism needs to be paid for,” he adds.
Evolving from ad sales to marketing solutions
Despite its ardent focus on subscribers, Thompson is quick to dismiss the idea that it does not want close advertiser relationships.
Like many other media companies, The NYT is eager to highlight the advantages of advertising to a “deeply engaged and valuable” audience, and doing so in a safe environment.
“The obviously new digital advertising dollars are going to very big digital platforms, but they would be the first to not take responsibility for the quality of the content. That has been a problem with YouTube. But we think we can make a very strong case to some discerning advertisers that it’s a great and relatively safe place to be and with a great audience,” he says.
One example of how it has looked to change the way it works with brands is with ‘The Daily 360’ campaign, in which the newsroom uses Samsung cameras to bring news stories from across the globe to life. It has also been looking to use virtual reality and artificial reality to tell its stories differently.
“We think we can offer a differentiated environment. Essentially, we are inside our company, trying to redefine what was once an advertising sales department to a marketing solutions department. We now have twice as many people in our advertising department involved in content creation as we do in sales,” he concludes.