“Newspaper circulations were in decline before the recession, most newspapers are frozen in time, there is no impetus for radical action.”
British newspaper groups have fared the recession better than their American counterparts because they have made significant changes to their business by sharing services & streamlining operations. But they have also missed many more opportunities to leverage economies of scale because it is still difficult to mobilise support for business change from senior stakeholders.
The recession should have encouraged newspapers to develop a considered & far reaching strategy for business change. Instead what we often see is a knee jerk reaction, a frantic search for a silver bullet that will save them. Restructuring & then building an iPhone or iPad App is not innovative nor is it a foundation for competition in a digital age.
A few newspapers have started to adopt some of the same goals pursued by blue chip retailers. The primary goal these retailers share is to be able to continue the same conversation with their customers regardless of what channel/ product they use. The Times provide a great example of how newspapers might implement try to adopt these goals. Their readers are able to manage their delivery subscription online, subscribers are also offered access to exclusive content & promotional offers that match their interests. Other newspapers may be more sophisticated in certain areas (e.g. the New York Times allow users to manage their online registration and their email & home delivery subscriptions from within one online account), but The Times seem to be the only newspaper looking to offer both better customer service & to improve customer retention.
CRM, customer retention & the development of genuine multichannel propositions should be the aspiration of every newspaper. If newspapers implement the tools to have a direct relationship with their customers they can start to have a conversation, by having an ongoing conversation with their customers they can build loyalty & loyalty will increase the lifetime value of every customer.
Increasing customer lifetime value & retention are critical in a digital space where they can switch from one product to another almost instantly & where most of the products are free. Content is obviously a key factor, but customers are also motivated by perceived influence, recognition & reward.
Retailers & banks have already rationalised many of the tools & techniques required to do these things, the question is whether the newspaper industry are ready to use them.
For most newspapers every time a reader dies, they are not being replaced. It is important to develop techniques to retain the customers they already have, otherwise they end up wasting money trying to win back the same shrinking pool of customers over & over again. Equally significant is the impetus to transform the newspaper industry because people are less willing to pay for general news so circulation revenues will continue to decline. Operations need to be optimised if newspapers are to continue being profitable.
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