Nic Hodges, Head of innovation and technology at MediaCom Australia, looks at the rise of paywalls Down Under and explains why 'clickbait' tactics from publishers could be a turn-off for advertisers.
Paywalls were meant to be the saviour of journalism. Finally all the time and effort that went into investigating and reporting the news would be fully rewarded.
Consumers would pay a fair rate and businesses would once again have a sustainable financial model allowing them to invest and make a reasonable profit.
That, at least, is the theory. And if that’s going to work anywhere, it’ll be Australia. This is a country where the news is owned by two big organisations, Rupert Murdoch’s News Corp and Fairfax.
When it comes to print, the International Media Concentration Research Project from Columbia University found these two organisations are responsible for 86 per cent of newspaper sales in Australia.
Last year both put all their content behind a paywall. Consumers were encouraged to sign up with offers of free first month access and 50 per cent discounts for subsequent months if they subscribed.
All in all, four of the top 10 newspapers in Australia are now seeking money for access (representing 45 per cent of visitors across the top 10, according to Nielsen).
At the end of August News announced they had signed up 100,000 paid subscribers. Around the same time Fairfax announced it had attracted 68,000 subscribers.
While this looks a pretty positive performance and it is early days, there are some grumblings as to the validity of these numbers. News for instance, includes readers who have paid A$1, once, to access a digital edition of a paper for one day.
Official data from Nielsen shows that in the three months since introducing paywalls, Fairfax’s key sites (SMH.com.au and TheAge.com.au) saw an 18 per cent decline in page views.
That’s not good news because no one likes to lose traffic. From an editorial point of view it hits your influence and from a commercial point of view, less traffic means less advertising revenue.
The response has been to continue to seek ways of getting those visitors who do come to the site clicking, content that drives higher page views, and in the case of the metered paywall, driving them closer to becoming paying customers.
It is no surprise then that listicles, linkbait and slideshow content is all on the rise at mainstream publishers.
These are classic tactics to keep page views high, and the ad revenue rolling in. Much as the algorithm-driven world of online ads has caused a decline in the quality of advertising, paywalls – and the desperate desire for more page views – have caused a noticeable decline in the quality of news content.
This trend was apparent both before the introduction of paywalls (when ad revenue was the main income stream) but has continued since their introduction. Our analysis shows that Fairfax – home of SMH and The Age – has massively ramped up the number of slideshows or photo galleries (each picture counts as a separate page view), for example.
By tracking the number of slideshows in its top four categories – National, World, Lifestyle and Sport – we’ve found a massive increase in recent years. In fact, in Q3 2013 they ran nearly 700 such slideshows (although some may have been published in multiple sections). Since Q3 2009, the number of such shows across these four sections is up more than 250 per cent.
Publishers may be happy that paywalls are finally delivering some of the revenue that has been lost to the free content web, but they need to remain aware of the long-term viability and reputation of their sites.
Readers visit these sites because they are trusted sources. Similarly advertisers gravitate towards these sites not just because of their large reach, but because they are seen as premium environments to be in.
If the traditional craft of writing and researching great stories becomes overwhelmed by clickbait, publishers may find advertisers increasingly happy to look elsewhere.
First published on pressgazette.co.uk, 8th January 2014