Month: February 2020

The Google News Initiative was created in March 2018 with the goal to create sustainability in journalism. After Google ended its controversial first-click free policy in October 2017, which required subscription-based publishers to allow readers to access at least three free articles in order to have the publishers’ content surfaced in search, Monnie said there was an emphasis on finding ways to help media companies strengthen their digital businesses. Google invested $300 million over three years into GNI, starting in 2018.

Early initiatives from GNI seemed focused on building tools that would be being quick, one-step solutions for publishers to grow a portion of their business. They were also generally focused on helping subscription publishers, including its Subscribe with Google subscription tool that was launched across McClatchy’s network of 30 local sites and other larger news publishers. And last year, GNI created a new second-screen engagement tool with Cosmopolitan.

The GNI Subscription Lab still focuses on developing diversified revenue streams from digital subscriptions, however, it not only ran 10 months but it was focused on developing long term strategies for the publishers involved to make up for the declining print revenues and build sustainable, digital-first businesses. The cohort also consisted of several smaller publishers that Monnie said were chosen in order prevent the emerging news deserts that came out of local newspapers shuttering.

“The impetus [for FTI Consulting’s involvement] was a recognition that local news publishers could move towards a sustainable business model. We wanted to build a program that would grow them in strategy and execution,” said the consultancy’s project lead Pete Doucette, who serves as a managing director in its telecom, media and technology practice.

Google was the sole benefactor of the project and paid FTI Consulting’s fees for 10 months of its services, which clocked in at around 1,000 hours of work, as well as the various tools and benchmarking capabilities that the consultancy built out for the project.

While he wouldn’t disclose how much Google paid FTI for the partnership, Doucette said “the level of support that we were able to provide the publishers is typically not something that [the publishers] could afford on their own.”

Three of the publishers who participated in the initiative said that implementing price hikes for their digital subscriptions made the greatest impact on their business.

One example of this that The Buffalo News found successful was increasing its trial period offer from being $0 to $.99 per week for four weeks, according to Brian Connolly, vp of innovation and business development at The Buffalo News. By the end of the project, the publisher had a 79% year-over-year increase in digital subscribers and in revenue from digital subscriptions, he said.

“You can still have a print newspaper and advertising and all of these businesses that are their own P&L, but the foundation [of your business] can be digital subscriptions,” Connolly said.

The Charleston Post & Courier president and publisher PJ Browning said the most valuable take away she got out of the Subs Lab was reassurance. “It wasn’t a guess before, but it was a gut check. This provided us with the confidence” needed to grow its digital subscriptions business, she said.

Prior to the project, Browning said her team estimated that there was a market of 20,000 potential digital subscribers in the Charleston, South Carolina area and GNI and FTI tested this hypothesis and estimated the potential was between 18,000 and 37,000 subscribers. Ten months later, she said its site has 8,500 subscribers, up 45% from start to finish in the Lab. Consumer revenue also increased by 56% year over year as a result, she added.

Lisa DeSisto, CEO of Maine Today, said that in October, for the first time in at least the last five years, the publisher had net positive growth where the digital business increase offset the print decrease. As a result of the Subs Lab, DeSisto reported a 67% increase in average monthly digital consumer revenue with digital subs increasing by 70% over 2018 to a total of over 10,000 digital subscribers in January 2020.

Monnie said the next goal is to distribute the program’s findings to other publishers, so far by releasing a subscriptions playbook and critical benchmarks report, as well as leading various workshops and panel discussions at industry conferences. In Europe, a version of the Subscriptions Lab will be taking place starting this year.

In January, Google made clear its intention to stop supporting third-party cookie tracking tools. The ripple effects of that announcement have been more substantial than Safari or Firefox as Chrome is the most popular browser with a 67% market share as of January 2020, per Net Marketshare data. The limited shelf life of the third-party cookie tracker has publishers worried and tech companies in limbo. Advertisers, meanwhile, are generally taking a wait-and-see approach as there is no industry standard for a replacement to the cookie and it’s unclear exactly what Google will do. Some media buyers say that their clients are leaning more into the walled gardens, where they can use first-party data, or that they are leaning more into contextual targeting. Others say their clients are looking into more brand-building campaigns and top of the funnel advertising as the effectiveness of mid-funnel and lower-funnel advertising becomes trickier to track.

“We’ve been talking to clients about how data is not going away, it’s just changing,” said a media buyer for a digital agency. “That’s the message that’s been resonating a little bit more. Still, we’re leaning into walled gardens. If you look at our strategic partners they’re the Googles, Verizons, the Amazons, people with differentiated data and inventory capabilities that have holdings on multiple areas so those targeting capabilities aren’t diminished.”

Leaning into the walled gardens will likely be common for advertisers, especially those that don’t have access to their own first-party data. Buyers expect the death of the cookie to impact consumer packaged goods and household goods companies, essentially companies without direct fulfillment to be affected more seriously than others. Without being able to gather first-party data via e-commerce, those companies will be at a disadvantage than those with a deep well of first-party data. From those companies, there will likely be a push for more brand building and brand awareness campaigns, according to Becky Prindable, vp and group director at Havas Media, adding that the agency has been helping clients do audits of their own data to figure out what they have access to outside of the companies curbing access to cookie tracking and that some clients have been building their own “clean rooms.”

“Almost certainly we will see a bigger push towards brand building, although it will likely be at the expense of targeting within the top and middle of the funnel, rather than super-targeted bottom of the funnel campaigns given the ability for targeting immediately following interactions on site,” wrote Simon Poulton, vice president of digital intelligence at WPromote, in an email. “Additionally, we are seeing a greater push towards collecting user information to re-engage them later. The writing is likely on the wall for almost all targeted prospecting media though, and the future will very much be focused on contextual targeting.”

Overall, buyers believe that contextual targeting will be on the rise. “Most clients are aware of this topic and have been for some time with the updates to Safari and Firefox cookie tracking,” said a media buyer at a digital agency. “There seems to be a heavier shift into contextual targeting with the cookie ‘apocalypse’ and moving away from (or never venturing into) one-to-one messaging and a common theme amongst advertisers in the space.”

Still, even as clients lean into contextual targeting or walled gardens, there’s a sense that much is still unknown when it comes to how advertisers will deal with Google’s changes and the impending the death of the cookie. “There is some unease with most clients given the lack of clarity around future solutions and what will be possible,” wrote Poulton. “Given we have a two-year timeline provided by Google, it will be a bit of a waiting game.”

“Not enough is being done because the industry hasn’t decided what will replace the cookie,” said Nick Venezia, managing director at Social Outlier. “We’re being forced to innovate and no one wants to innovate. Everyone is waiting to see what Google does.”