The New York Times Is Winning at Digital
Most of today’s media “success stories” are about digitally “native” companies like Google and Facebook. Meanwhile, many of the great brands of the pre-digital era seem to be struggling for mere survival in the face of digital disruption. The rise of free, digital-only news sites and a shift in eyeballs toward social media is significantly hurting newspapers’ circulation and advertising revenues. And it’s hard to think of a media segment more threatened by digital than newspapers. Yet The New York Times (NYT) has used digital innovation to maintain its quality and reached new subscription highs despite significant headwinds in the newspaper industry. Amidst these headwinds, the NYT has risen above its incumbent competitors as an example of a successful digital transformation.
This result shows the current strength and future potential of the NYT’s digital strategy to deliver substantial revenue. In order to understand the key principles behind their digital turnaround, five key themes emerged that form the basis of the approach the NYT has pursued, and which, has thus far exceeded their forecasts and expectations. These five themes are not unique to newspaper or media companies but can be applied to most companies looking for the path to successful digital transformation.
Leveraging customer data to increase subscriptions
The NYT attributed the boom in subscriptions to efforts to better leverage customer data across marketing. They’ve professionalized the way in which they manage the funnel, essentially how they get people to the point where they subscribe. The NYT has become a very data-driven company. They’ve built a very productive partnership between data, technology and their partners in consumer revenue to actually put more control in their hands as well.
This type of personalized data-driven sales funnel is par for the course for digital leaders such as Google and Amazon but is typically far less sophisticated at pre-digital media companies. The benefits the NYT have delivered via this approach are instructive to those hesitating to make the investment to become world class in this area.
A new mindset of agile product experimentation
The mindset shift has led to far more experimentation around product development, including the NYT’s new Cooking and Crossword apps that have significantly contributed to new subscriptions. These fresh products emerged from an internal incubator group, named Beta, which has been charged with bringing to market a variety of new products.
One of the challenges of any transformation is the engrained thinking. One of the challenges in pushing forward into new terrain is being ready to see what aspects of past behavior can be abandoned because technology has moved on. The NYT has the new willingness to experiment with different formats. They’ve done that with 360 video. They’ve done that with VR. They launched an audio product called The Daily, a news podcast, a brand new format for the NYT that’s been enormously successful. It has received both in the audience that is listening to it as well as from professionals from across the industry, all kinds of accolades. One of the NYT’s bigger new product launches has been their standalone subscription-based Cooking app, which gives access to decades of recipes from their database.
Intense leadership focus on digital
Today, many companies find themselves in a situation similar to the NYT in that, while digital appears to be the future, the vast majority of revenue is still coming from legacy products and distribution channels. This leads to the question of how much focus an organization should put on the declining but still sizable legacy business and how much focus to put on digital businesses which, while future-oriented, might not yet be near the scale of the traditional business. In fact, this is clearly playing out at the NYT where although almost 70% of their subscribers are digital, almost 70% of their revenue comes from print.
The NYT has taken a bold and future-oriented approach to this conundrum, which seems to be paying off. Despite the fact that around two-thirds of their total revenue still comes from print, the NYT has put together an executive committee that spends the vast preponderance of its time discussing where the company is going from a digital perspective. The executive committee has 14 members and has assigned to an extremely skilled operator the responsibility for making sure that print stays on track. The other 13 members of the executive team are thinking first and foremost about digital.(https://www.daowen.com)
Cross-silo collaboration built on trust
While the NYT level of leadership focus on digital is impressive, the digital aspiration of many companies is foiled despite leadership’s desires. This is due to the failure of different teams, departments or other silos to effectively work together to create effective digital businesses. The NYT credits a big part of success to the effectiveness of collaboration across units within the organization. They now have teams actually sitting together, cross-functionally, making sure that their designers are on the team with the engineers, with the scrum masters, and constantly pushing to break down silos across different teams and business units.
This type of Kumbaya moment may sound like a fairy tale to many enterprise digital executives who may also create cross-divisional working groups and yet who still spend so much of their time in turf wars and budget battles with their colleagues. Each team in the NYT now has goals and roadmaps, which align with the vision and strategy of the company. All roadmaps are transparent and public to everybody within the company. In essence, the tactics and collaboration have evolved tremendously, and having everyone more involved in the process has really helped to build trust culturally.
A complete rebuild of the technical stack
But even with great process and leadership, rapidly building and testing a stream of digital products requires a modern technical stack. The NYT has been undergoing a major rebuild of many of its core tools and systems. They’ve had to undertake a big systems transformation in order to truly drive a cross-platform experience for their customers that delights.
Today, they are running the core website on six different platforms and six different code stacks. So two desktop, one tablet, one iOS mobile, one Android, one mobile web, and so it doesn’t take much to imagine how hard it is to manage future development across those stacks if that’s what the state of play is. They got about a third of their budget reserved for that underlying architecture and also completely re-architected their data environment and moved to Google BigQuery.
The NYT seems to have identified a set of effective key principles of leadership focus, cross-organizational trust, product experimentation, data-driven marketing and modern technology architecture. But perhaps more important, the NYT has figured out how to make these things a practical working reality within their specific culture, organization, and business model. Their earnings report shows clearly that their strategy is working so far. Hopefully, the details of their path to success can serve as a recipe that might apply to a wide range of other organizations.
Words & Expressions
headwind：逆风，阻力
incumbent：现任者
par：标准，常规
incubator：孵化器
accolade：嘉奖，荣誉
conundrum：难题，复杂难解的问题
preponderance：优势
Kumbaya moment：和谐时刻
[1] Who killed the newspaper[EB/OL].(2006-08-24)[2022-01-09].https://www.economist.com/leaders/2006/08/24/who-killed-the-newspaper.
[2] The print apocalypse and how to survive it[EB/OL].(2016-11-03)[2022-01-11].https://www.theatlantic.com/business/archive/2016/11/the-print-apocalypse-and-how-to-survive-it/506429.
[3] TIERSKY H. The New York Times is winning at digital[EB/OL].(2017-06-08)[2022-01-15].https://www.cio.com/article/230145/the-new-york-times-is-winning-at-digital.html.