26 Oct 2010

The Times' Paywall: A Health Warning

Nielsen estimate The Times has just over 360,000 unique users behind it's paywall (these are people who have registered and been through the payment gateway to the other side of the wall).   The Nielsen figures include traffic generated by users who were given free online trials, or get free web access thrown in with their print subscription to the Times' publications.

A health warning in terms of the accuracy of the figures is appropriate. Nielsen measures these things slightly differently to, say, a report from the pay engine or conventional web analytics services. In addition you should bear in mind that some 'users' are people who have paid for one-off access (£1 to access The Times sites for one day) and therefore of little value down the line.   

  • Nielsen state that The Times and Sunday Times websites experienced an 88% drop in unique users (UK only) since the erection of the paywall
  • The Times had 3.1 million UK unique users in the second quarter of 2010 according to Nielsen. This figure has fallen to 1.78 million overall now, and it is on the basis of this differential that Nielsen estimates the number of paying subscribers
  • Nielsen estimate that one in five subscribers have paid a £1 (or one days' access).

Clearly the initial figures will include many who have trialled it (me included). We don’t know how many of these people go on to become subscribers (I know I didn't).

The 362,000 unique users figure Nielsen has reached seems to be quite high, in my view. News International has yet to release any data. It would be interesting to know how they pitch their reach to advertisers for example. Targeting and personalisation have been mentioned. After all, signing up to the Times paywall online involves nine required fields of personal data.

The Times' argument is that the very act of subscribing online suggests a more engaged audience. Nielsen attempt to corroborate this by suggesting that in Q3 Times paywall visitors averaged 42% more pages per person a month than the average Q2 pre-paywall visitors .

Whilst the argument that subscribers' data enables better targeting and value might be true for, say, FT.com (where the scale is subscribers is indisputable) I suggest it has dubious value based on the figures we are discussing here. I doubt that the fall-off in ad revenues is matched by an uplift in subscription revenues – the product just isn't that unique.

According to Nielsen, the over 50s account for 52% of the paywall group; the over 65s account for 16%. The footprint of the over 50s group has increased whilst that of the 25-34 year old age group is now 13% of the paywall group compared to 22% of the general audience - a big fall. Nielsen goes on to say that households earning between £50,000 and £80,000 make up a larger part of the paywall group at the expense of those earning less than £20,000 and that paywall audience also tends to be older.

So, an older and wealthier audience is always good (look at the success of the Telegraph and Mail). However, this audience is also very demanding of quality, a lack of gimicks and faultless customer service . . . they want a Rolls Royce. As we all know, Rolls Royces cost. Add to this the advertising campaigns The Times has engaged in and the sweeteners it has doled out, more costs. The door on social media sharing is firmly closed, so there is no low-cost marketing effort designed to bait (younger?) users with targeted content. It just doesn't stack up in my view.

This suggests what we all probably knew anyway, that young people will not pay for this type of content. It is freely available everywhere. 'Opinion' pieces from a right-wing commentariat will not attract young audiences.

Advertisers and agencies are right to be concerned. According to John Baylon, group digital trading director at Starcom MediaVest, of most concern will be the dip in the number of those 25- to 34-year-old visitors.

  • Where is the future audience? 
  • Where is the diversity in The Times' appeal? 
  • Should advertisers looking at broad based brand campaigns really spend the big bucks with The Times?

1 comment:

  1. Nielsen estimates The Times has just over 360,000 people "accessing content behind it's paywall". Not the same as "paying subscribers".