Four steps to finding new revenue streams for journalism

“Be the best at serving your audience, because when the user wins, you win,” Rebekah Monson.

Rebekah is not your typical news CEO. She does “a lot of post-it stuff” and loves “colour coding”. She is the co-founder of Whereby.us, a new model for local media focused on curation and ‘sticky’ communities, enabled by smart technology. Newsletters are at the core of her business.

At our News Impact Academy in Lisbon, Rebekah joined fellow experts Lucia Adams, part of the 2010 paywall team at The Times and The Sunday Times, and Carolyn Morgan, a digital strategist with 20 years of experience in the media business, in tackling challenges around business model innovation in the news industry.

They revealed four main steps essential to start diversifying your news organisation’s revenue streams right away.

1. Know your audience

“If you’re trying to please everyone, you will please no one,” said Lucia, as she explained how her team moved away from a free newspaper — with commodity content driven by advertising — to a paid-for niche product with differentiated content. “This required a fundamental redefining of value,” said Lucia, ”we needed to develop a culture of deeply empathising with readers.”

The days of the lucrative subscription/advertising print market are gone and many news organisations now focus on reader revenue. But readers have countless options in the digital news market and only a small portion of the audience is used to and/or willing to pay for news.

That’s why we need to get more specific, more targeted. If you want to grow your audience, you need to know who your readers are. Create personas defined by certain characteristics — not necessarily demographics. How do readers consume your stories? Who are they? When do they read your news?

“The challenge is to really understand the customer perspective,” Lucia Adams.

Rebekah’s team at Whereby.us seized the opportunity to build a business on strong, direct relationships with audiences. “User research is a habit for our entire team as a way to design products better and make more money,” she said.

Prioritising readers is working for them as their audience is growing strongly with less than 2% churn. The editorial team learns with the help of user experience from the marketing team — through surveys and user interviews. “This cross-knowledge is essential,” said Monson.

Although not all newsrooms are built this way, you can start making audience research a priority by leveraging the data you do have, engaging with readers during events, and interacting with them through newsletters. Do your research, ask the right questions, talk to them, interview them.

2. What’s the purpose of your organisation?

“You need a clear proposition,” said Digital Strategist Carolyn Morgan, who got us up to speed with the latest trends in subscriptions, podcasts, events, advertising, crowdfunding, donations and more.

“You need to know why your proposition is necessary and valuable to your audience,” said Carolyn, “then you can show that you’re able to offer this good content over the long term and build engagement.”

The Business Model Canvas, a go-to tool for product development, helps organisations focus and measure success.

Our participants found this exercise very useful in getting under the skin of their audience to understand what value they add to their lives. “This could be a very good exercise for our team, so the journalists also see the bigger picture,” said one participant.

3. Test, test, test!

If you have plenty of ideas for new revenue streams, but limited resources, you’ll need to find a quick way to test what’s worth pursuing. The javelin board, a customer-centred approach, helps you identify your organisation’s most important opportunity.

An example from our workshop:

• One participant offers a free print newspaper that is distributed each month at local hairdressers, doctor’s practises, through door-to-door delivery, and it’s sent to readers who are signed up as members.
• She decided to focus on the type of customer she describes as the ‘engaged local reader’. They love her newspaper, but the problem is: they often can’t find a physical copy of it, especially by the end of the month.
• She identified some of her organisation’s assumptions: 1) readers visit the distribution locations; 2) readers prefer the print newspaper over the digital version.
• The next step was to decide on the riskiest assumption — the one that’s critical to the viability of the business and has the least amount of data available. It’s the assumption you’re most unsure about.
• She will now design a small, manageable experiment to find out if her riskiest assumption is true. For example, interviewing ‘engaged local readers’ to find out if they actually visit the distribution locations.
• With the newly acquired knowledge, she’ll know if it’s worth offering the newspaper at different distribution locations or setting up a campaign to have readers sign up as members.

The idea behind this exercise is not to look for the ‘perfect’ solution, but to speed up the process of finding partial solutions by defining the most critical mismatch in your current activities.

You may not even need new activities. Perhaps you just need to go deeper to find a way to monetise your current activities.

It’s a constant learning cycle that requires continuous redefining of your product. Focus your attention, embrace a culture of experimentation, and start small: test, fine-tune, test again, and refine as you go along.

“Do some low-cost tests. If something works, invest in it. If it doesn’t fly, kill it,” Carolyn Morgan.

4. Cultivate an innovation mindset

“Old-fashioned management who are not very enthusiastic and resist innovation is an issue,” said one participant. But business model innovation is absolutely crucial and urgent for the news industry and the last thing we need is resistance from within.

Journalists are often wary of the influence a publisher’s business model may have on their editorial strategy. Fundraising is sometimes considered merely an add-on activity to journalism. And many news organisations are reluctant to ask for money.

However, if we want to see high-quality, independent journalism thrive, we need to use all the tools in our toolbox to make that happen. There is no quick fix to the complex revenue challenges we’re facing and securing long-term sustainable revenue streams is going to be hard.

Luckily, there are steps we can take to drive revenue and it doesn’t have to interfere with our pursuit for independent journalism.

“We have agile workflows and very focused goals so we can grow consistently with very limited resources,” Rebekah Monson.

Don’t shy away from asking for money, because people will support journalism if you ask. “There are people who are willing to pay for news, you just need to find them,” said Carolyn, taking the Guardian’s donation scheme as an example. “People thought it would never work, but now they’re making a profit!”

The goal is to build engagement with your audience, create a great user experience, and design an offer that persuades readers to pay for journalism. To make that happen, we need to foster a culture of innovation in which people are allowed to test and fail.

At the News Impact Academy, we strongly encourage innovative thinking by providing a space for collaboration, knowledge-sharing, innovation, shared frustration, and idea-generation.

Our participants often realise they face similar challenges in different countries. Many of them work with limited resources, but come up with new ideas that don’t necessarily require large monetary investments—rather, a different way of thinking.

Our goal is to find ways for our participants to bring the learnings back to their newsrooms so they can make a difference in ensuring the future of independent journalism in Europe.

The News Impact Academy is organised by the European Journalism Centre and powered by the Google News Initiative.

If you’re interested in joining our News Impact Academy to take two full days away from your newsroom and reflect on your strategy, please visit our website for more information on our upcoming editions:

• Newsroom leadership on 26/27 September in Copenhagen
• Audience Development on 21/22 October in Bucharest

Further reading

• Six questions you should ask yourself before launching a membership model
• Why newsrooms pursue membership when it’s a fraction of their revenue
• New funding for journalists to put global health topics in the spotlight
• More than meets the eye: tips to find EU funding for journalism
• Building resilience into journalism: our focus for 2019