Posts Tagged ‘Northstar Blog’

How the iPad demonstrates the problem with putting yourself in respondents’ shoes

Published on May 27th, 2010 by Chris

At last the iPad launches in the UK tomorrow, Apple are opening stores early and you can guarantee they’ll be more media coverage than is really warranted for the launch of such a device.

Newspapers in particular are desperate for it to succeed as they desperately try to find a revenue stream for the 21st century (click here for a discussion of this) leading to some running articles that wouldn’t have been more positive had Mr Jobs written them himself  (edit: perhaps they struck a deal to feature in the picture above taken from the front page of Apple’s webpage)

Outside the publishing world though people are confused about what it is for. Is it a small computer or is it a giant iPhone? People have struggled to understand what they would use it for if they had one, which has resulted in the predictions that it won’t be a success

Market researchers have to be careful of falling into this trap, it is all too easy to put oneself in respondent’s shoes and think “What would I do with the iPad?”

Looking at the facts, Apple has grown phenomenally in recent years, re-inventing portable music players, phones and in the process changing from a company valued at less than 3% of Microsoft to being worth more than Microsoft in 10 years. In the US over a million iPads were sold in 28 days. But still people predict it won’t be a success.

So my friends and colleagues are telling me they don’ think it’ll succeed, personally I don’t really see the need for the iPad and my intuition tells me it is more likely to be the new Apple Newton than the new Apple iMegaproduct. However, my prediction is still that the iPad will be a huge success.

Read all about it… and then pay us for it….please?

Published on May 26th, 2010 by Chris

When News International announced its intention to charge £2 a week to read the Times and Sunday Times newspapers online, their competitors were falling over themselves to deride its decision and point out that nobody would be willing to pay. They make a fair point that content that is unique or specialist is suited to a paying model and that content that is easily replaceable (by them) isn’t suitable. However, are they being short-sighted in thinking they won’t have to charge in the future? Or are they hoping to sneak it in later? The Times can’t be the only paper to have watched the music and film industries struggle recently and thought ‘What are we going to do?’

News content is popular enough, with the most popular new website Mail online recording 2.16 million unique browsers per day in Jan 2010 and others such as the Guardian not far behind (1.9 million). The problems is that these sites make little money in their own rights and who wants to pay for something they’re used to getting for free?

The internet is getting more social and mobile by the day, Google’s head of global advertising operations John Herlihy predicted desktops would be irrelevant in three years, while in the United States Facebook got more hits that Google for the first time in March. Publishers recognise this, the UK association of online publishers report that 75% of its members will be increasing investing in mobile development this year. There are opportunities there for the other newspapers but how can they profit from this?

1)       Stay free Online

Going on the circulation figures for print versions of newspapers (Guardian down 15.76% year on year, The Times down 17.69%, Daily Telegraph down 11.76%) and figures from the Newspaper Association of America showing that print adverts accounted for 90% of advertising revenues for newspapers, the drop in revenue over the coming years is going to be rather significant. However, E-versions such as phone apps and iPad/ tablet versions will increase circulation whilst slashing distribution costs. Advertising on these internet enabled devices offers far greater potential than print ads (clickable links, video, etc) if advertising agencies utilise them to their full potential. Electronic versions could stay free or charge a minimal one-off fee for their app and take advantage of reduced production costs and increased ad revenues.

2)       Freemium

Many sites successfully utilise the freemium model, some content is free but beyond a certain level there is a charge for access. Magazines have embraced this, giving their print subscribers access to more content online, or letting people pay for an online only subscription. Which? The Economist and Runners World amongst many others, have been operating this model successfully. New readers are still attracted and given just enough to wet their appetite while the publisher can still make money for their content. The Wall Street Journal successfully operates the freemium model but they are the only major newspaper to do so and here’s the difference, the magazines and WSJ are specialists. They don’t have competitors offering the same content in the same way. The NY Times on the other hand does have similar competitors and their freemium attempt failed in 2007, though they are trying again from January 2011. Whilst our own Times is being priced more reasonably is that enough for it to succeed where the NY Times failed?

3)        Something new altogether

The idea of paying a monthly premium for credits that you then spend in your own time is nothing new; look at pay as you go phones or prepay meters for gas and electric. Parting with your cash quicker than you can say ‘parting with your cash’ is being popularised by Barclays with their One Pulse touch payment credit card and online payments are soaring thanks to companies like PayPal. So what happens when you cross all three? A monthly subscription service that allows you to spend credits on the articles you like when you like.

Perhaps this is the answer that newspapers are looking for? Not only does it give them a chance to finally earn money for their online content, but the data they capture on their customers would be a goldmine for editors and advertisers alike. The editor knows exactly who likes what content and who doesn’t. But the real advantage is for advertisers, when you register for an account you could get free credits for filling in more information about yourself, and the more details you divulge the more credits you get. Remember that online ads can be tailored to each user. Think of the value to DeBeers of being able to target their ads at men in their twenties and thirties who live with a partner but aren’t married? How much more would Mercedes pay to advertise to director level readers who have stated they are likely to buy a car in the next year?

But don’t stop there, get your readers to publicise your stories for you. Hit the like button (which Facebook are currently trying to push onto every other website out there) share on Facebook, Twitter, LinkedIn and get a credit for anyone that follows the link and pays credits for the articles. (see mflow for a similar music concept launching soon)

Is a credits system the answer newspapers have been waiting for? Let us know your thoughts in the comments below.