This is 2012. Blockbuster is dead. Best Buy is a showroom for Amazon products. HMV barely sells music these days. Borders is gone. Chapters is selling kitschy housewares. EB Games gets maybe 10% of their profit from new game sales.
More and more, the crunch is coming. Newsrooms shrink, unable to sustain their talent. It’s a problem. It’s the problem, if you work in media. You look, and you see, and you take a little breath, and you work, and you keep an eye out for good jobs for good people. Print media is seeing it first, but I don’t think they’ll be alone in facing the crunch.
So how do we tackle the problem? Because it can be tackled, in my opinion. But tackling it will first require a precise set of realizations:
1. News publications are products. We’re forcing them to become a service.
We know what newspapers are. We know, even if the glory days are gone. They’re still here. Inch upon inch of silversmithed words dissecting the day’s events in a digestible way. A well-crafted product, a new one each day.
It is nearly impossible to produce products with the same level of craftsmanship 24/7 — and that’s what we’re demanding of newspapers today. We demand permanent access to the latest information on our own terms. That’s a service, more akin to a library than a bookstore.
Compounding this transition is the simple fact that…
2. Online service providers are better and more effective than offline ones, when they’ve got the pricing down.
Remember that list of crippled retailers I provided above? They’re in that sorry state because online companies are providing a better service, hands down.
Why rent a movie when you can pay Netflix eight bucks a month for every movie? Why bother with physical books when you can buy a Kindle and every book? I can’t recall the last time I played music directly from a CD in anything but my car. It’s all iTunes, all the time.
(Even in the car, I should note, I’ve taken to playing music from my iPod using an adapter. Nothing is safe.)
The media is seeing a crunch for the same reason: it makes no apparent sense to bother with physical product — even virtual product, in the case of television — when they can satisfy much more demand online, and in many cases with less people. But how do you monetize it? Because as it stands…
3. News publications don’t have the pricing down, so on top of the above, they’re facing Vlasic’s “gallon jar of pickles” problem all over again.
It’s a famous story, but permit me a brief summary:
Vlasic spent years and years becoming the leading provider of pickles in the US. Their stuff was excellent, their expertise was top-notch. Wal-Mart wanted in on that. Vlasic said hell yes, we want the nation’s leading retailer to sell our stuff. So Vlasic produced a gallon jar of pickles, and Wal-Mart priced it at $2.97.
Sales were incredible. People couldn’t believe they were getting this much stuff at that price. Wal-Mart and Vlasic moved mountains of product. Happy times all around, right?
Wrong. At that price, Vlasic was making mere pennies on every gallon jar. Sales were up, but profits were shrinking. They couldn’t provide the quality product people wanted at the price people were willing to pay. Vlasic’s incredible numbers were killing them.
Per the Fast Company article I linked above (fascinating read, btw), Wal-Mart eventually decided that they “killed” the pickle market and started selling Vlasic’s stuff at $2.97 a quart instead of $2.97 a gallon. It became a premium, luxury product again. And Vlasic, eventually, survived.
Conclusion: Here’s what I’m willing to pay for.
I’ll be direct: nine times out of ten, I only buy print media when I expect to be out of cell service for a while. And since it’ll be a while, I lean towards newsmagazines over newspapers. If I’m going to be reading physical media, I want it to be a.) worth my while, and b.) something where the product is a bit of a luxury, and not stuff I can digest in ten seconds when I get Twitter back.
So if you want me to pay for something, and you’re asking me how to make something I’d pay for, here’s what I’ll tell you: make it a luxury and make it better than Twitter.
Make an official app and official website where the day’s news is constantly updated. Make a premium magazine at the end of the week with exclusive columns from the experts, and mail it out. Then tie them together with subscription packages that let people get what they want. Throw a few ads in there. Test the market. Leverage what you find out. Maybe discount the app as a loss leader for the magazine. Or do it the other way ’round. Whatever works.
Bottom line: develop luxury products, figure out what they’re worth, subsidize it with unobtrusive advertising, and I will hand over my credit card.