Ken Doctor’s analysis of the “newsonomics” of The Boston Globe’s pending sale continues to yield rich insights. One part I find particularly interesting is his estimate that the Globe’s natural ceiling for digital subscriptions is probably in the vicinity of 105,000. It’s currently 28,000.
(As I’ve explained before, the auditors also give the Globe credit for seven-day print subscribers who access BostonGlobe.com at least once a week, which means the paper currently reports having 50,000 digital subscribers.)
The Globe charges about $15 a month for digital subscriptions, with or without home delivery of the Sunday print edition. Yes, there are a lot of discounts in there, but just as a quick math exercise, let’s pretend there aren’t. So:
105,000 x $15 x 12 months = $18.9 million per year
If you figure an average of $100,000 in pay and benefits per employee, that adds up to 189 people — about half of the paper’s 365 journalists.
I’m leaving out a lot of expenses (including, most significantly, non-newsroom employees), but I’m also leaving out other revenue sources — mainly seven-day print circulation, print and online advertising, and commercial printing of other newspapers, including the Boston Herald, currently issuing daily predictions of the Globe’s imminent demise.
It also seems to me that one underexploited opportunity is online advertising at BostonGlobe.com. Yes, it’s nice to give paying customers a clean, uncluttered reading experience. But surely there could be a few more ads without devolving into flashing banners, pop-up windows and stuff floating across the page. I like ads. “Ads are content,” as Howard Owens says. They contribute to a sense of community and vitality.
Globe spokeswoman Ellen Clegg recently told me that the Globe’s total number of unique monthly visitors is 7.5 million — 6 million at the free Boston.com site and 1.5 million at BostonGlobe.com. I would think you could sell a decent amount of advertising to an online audience of 1.5 million. Currently, though, when you read articles you can often find white space where an ad ought to be.
One caution is the Globe’s new policy of limiting social sharing on BostonGlobe.com and cutting the amount of Globe content on Boston.com. Editor Brian McGrory has said that the goal is to boost digital subscriptions. The danger is that the restrictions:
- may fail to turn all but a tiny handful non-subscribers into paying customers;
- may hurt Boston.com’s traffic by making the site less enticing; and
- may (actually, will) reduce unpaid traffic to BostonGlobe.com, thus making it a less desirable platform for advertisers.
Fortunately, the restrictions can be tightened or eased depending on whether or not they are working as intended.
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the hard subscription-only wall on the Globe site is off-putting; better they should adopt the NYT model of 10 (or so) free hits/mo
i think if the Globe wants to increase their digital presence and hence subscriptions, they need to increase the options for digital sharing. They took away the RSS feeds sometime ago. Once they did that, I was no longer able to share the occasional article they did write about Franklin with my Franklin Matters readers.
If they do succeed, it will be by going purely local and that means staying within the bounds of Boston.They can leave the outer areas to the local citizen journalists like myself. If they don’t solve their problem, however they try, their days are surely numbered.
Note – I have a paid subscription (for the sake of the family) to the Globe for four days and rarely visit their digital page.
1. I’d suggest the most significant expense you are omitting is the printing and delivery of the paper itself.
2. Many major sites (Facebook among them) are now trying to sell the concept of impressions rather than clicks. They seem to recognize that buyers are wise to the relative worthlessness of clicking through, and that either way the click-through number will inherently be much smaller than the impressions figure.
Yet advertisers in many spaces are getting more sophisticated and looking for audiences that align to their specific product, rather than just a “number.” Said advertisers might well be willing to pay a premium for paywall traffic, knowing that it is more likely to reflect a known demographic, as opposed to a bunch of otherwise bogus hits from people clicking on a photo of a missing kitten. If that’s the case, the paywall might actually serve to boost the Globe’s ad yields. Less overall revenue, but more profitable revenue.
@Mike: (1) Yes, of course, but as long as the Globe is generating a large percentage of its revenue from the print edition, the costs of printing and delivering it are not a large concern; (2) a number of smaller sites, including the nonprofit New Haven Independent and the for-profit Batavian, charge flat rates for the advertising: here’s our traffic, here’s our price. Might work for larger enterprises, too.
Mike, on 2, I think you are right, and I want to point out (you probably are aware of this) that click-through rate often says more about the quality of the ad than the quality of the website.
If I had a dollar for every website owner who thinks that a low click-through rate means that their website needs “fixing”, I’d be a millionare, but what is so bizarre about their thinking is that if people aren’t clicking the ad, it doesn’t follow logically that the website is always at fault.
I like how the NHI and other news sites go straight off impressions, and leave it up to the advertiser to craft an ad that people will want to click on.
No one has ever clicked on an ad except by mistake.
One thing I have noticed in Google searches when doing research is, for local Boston area issues, if articles are tucked behind a Globe paywall, those articles won’t come up in Google searches, same with WSJ pay-articles. And the Herald throws its articles in the garbage, I mean, “archives,” which one has to pay for, so good luck to the Herald in getting its articles to ever show up when someone is Googling for info. (At least, that has been my experience in recent months. Maybe others have different experiences.)
That means fewer hits via searches for both the Herald and the Globe. Websites intentionally put certain keywords in their HTML meta tags because they WANT more new readers, but search engines mainly do not have access to material hiding behind a paywall.
Lately, I’ve been finding links to WBZ, Channel 7, WBUR and the Patch for articles on recent news (such as Deval Patrick’s fascist gun-grabbing and order to ban driving on all roads, etc.). I have more or less stopped linking to the Globe or the Herald.