Easy does it: Detroit Free Press converts subscribers from print to digital
Summary: The Detroit Free Press & Detroit News, located in perhaps the most
economically depressed markets in the country, is one of the first newspapers to make substantial changes to its business model by cutting days of the newspaper's home delivery and giving subscribers access to the e-paper. So far executives say the experiment is paying off.
Challenge: With the Detroit economy in long term shambles and the newspaper industry in decline, publishers of Detroit’s largest newspaper group faced a difficult decision: Embark on radical change or face bankruptcy.
Strategy: On March 30, 2009 the Free Press and Detroit News became the first major newspaper group to convert to a "hybrid model":
*Home delivery of the newspaper was cut back to Thursday, Friday and Sunday.
*Subscribers have access to the e-edition seven days per week at a combined price of $12 a month.
*The single copy edition is still available seven days a week.
*The general web site is free.
*The Free Press and Detroit News also has a contract with Kindle and entered into a deal with Plastic logic.
*The company backed the conversion with a massive promotional campaign both in paper on on television.
According to Janet Hasson, Senior Vice President, Audience Development, "In a subscription model it is all the same paid content; what we are really talking about is the platform. You take a portion of your paper and put it online a have pay a wall or you can deliver it through an e-reader. There are different rates obviously.
In my mind we are trying to provide our content on a lot of different platforms, some of them are paid in that, yes, you have to subscribe."
Results: So far the project is ahead of projections:
*Since last April, the Free Press has lost about 6% or their subscribers due to the model change, they projected 9%.
*Web site traffic increased by 10 to 15% as of February, 2010.
*Single copy sales increased, especially on Sundays. Prior to raising the daily single copy prices to $1 in October, daily single copy sales on non home delivery days were averaging 25% ahead of prior year. Sunday sales were 7% ahead of last year.
*According to the 2009 September Publisher’s Statement, Sunday net paid circulation totals 560,188, with 2,283 e-edition copies included in the total.
*E-edition traffic still averages 27,000 visitors a day on non-home
delivery days, one of the highest in the country.
*The combined daily net paid totals 437,578 with 126,692 e-editions included in the total. Power days are Thursday/Friday combined total 494,630 net paid and include 22,451 e-editions.
The e-edition is an exact replica of the newspaper each day and can only be accessed via a subscription. The web sites general web sites (freep.com & detnews.com) often contain different content from the print edition in the form of video, blogs, and photo galleries, are also updated 24/7 and available for no charge.
*Free Press and Detroit News have sold a combined sale of 5,600 copies and accumulated 712 subscribers on Kindle through 2009.
*The Plastic Logic agreement has not yet been executed.
Lessons learned: A key lesson learned is that subscribers will adapt to the
availability of news on different platforms. "Traditional newspaper readers still like print and until you deprive them of that option they will still choose print. Your reader is 55 and 60 year old and they like a copy to the paper. If you are are going to change that some will adapt to the new platforms and some will not," Hasson said.
The cost savings from cutting papers on the days that most subscribers are not reading was essentialy to creating a profitable model. Readers have also shown a tendency to convert to single copy readership, rather than increasing use of the e-edition.
"The future is e-reader,” Hasson contends. The Detroit Media Partnership is working with several vendors such as Olive to become ready for these formats.
The author, Alisa Cromer is publisher of a variety of online media, including LocalMediaInsider and MediaExecsTech, developed while on a fellowship with the Reynolds Journalism Institute and which has evolved into a leading marketing company for media technology start-ups. In 2017 she founded Worldstir.com, an online magazine, to showcases perspectives from around the world on new topic each month, translated from and to the top five languages in the world.
