World Association of Newspapers and News Publishers


A new pricing model

World News Publishing Focus

World News Publishing Focus
Your Guide to the Changing Media Landscape

A new pricing model

“We need to calculate daily reach: readership data and daily circulation data,” says Helge Holbæk-Hanssen, Marketing Director at MBL, the Norwegian Media Businesses' Association.

He is discussing the background for creating a new pricing model for advertisements, which began with a new survey of Norwegian newspapers.

“In 2010 we introduced a new NRS study of the Norwegian market,” says Mr. Holbæk-Hanssen. “This new survey started a discussion among the newspaper companies to establish a new price model.”

Why do we need a new model?

Mr. Holbæk-Hanssen suggests the following four reasons: “One, new readership data could in itself call for a change. Two, we have seen an increase in price pressure because of increasing cost per thousand (CPT). Three, more comparable currencies would strengthen cross-platform advertising sales. Four, competitiveness with other media channels."

He says this has been a journey in three stages:

The first step was to increase the sample size from 30,000 to 45,000 interviews a year; larger sample sizes pave the way for greater accuracy. The second step is they are now measuring both paper and online for all titles – even smaller publications. The third and most important step is to get accurate and sophisticated readership data through a combined survey approach with integration of page traffic data into the readership data.

Mr. Holbæk-Hanssen says the benefit is, “Newspapers are still delivering the same number of readers, but with a more precise measure of how many are within reach of seeing the advertising.”

“We are now in the process of documenting what we have known for ages – that not everyone reads everything,” he adds.

“Today's model is what we could define as net-based,” says Mr. Holbæk-Hanssen, “where you charge a price per ad. A future model could be gross-based like most other media, were price per exposure (or GRP) is the relevant unit. Such a model will also help us calculate the total exposure delivery of a cross-media campaign.”

Author

Brian Veseling's picture

Brian Veseling

Date

2012-03-02 17:54

Author information

About 200 newspaper advertising experts will attend the 22nd World Newspaper Advertising Conference in Prague on 1st and 2nd March. WAN-IFRA will provide summaries of each speaker's presentation during the event. Check back on our blog for the latest updates.


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