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How Germany’s Bild evaluated Instant Articles

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How Germany’s Bild evaluated Instant Articles

This case study about "Decision-making at Axel Springer" is an excerpt from WAN-IFRA's recently published report titled "Reality check - making money with Facebook," which is available free for download to WAN-IFRA Members, and can be purchased by non-members.

Germany-based operations in the Paid Models segment of Axel Springer (which include Bild and Die Welt) generated $1.3 billion in revenue in 2016 and enjoyed a 16% EBITDA margin. Although the combined revenue from circulation (print and online) at Bild is higher than its revenue from advertising, the latter remains the main source of revenue for its online business. The company’s conference presentations show that the average revenue per user (ARPU) of a BILDplus subscriber is 15 times higher than the ARPU of a non-subscribing user. But Bild doesn’t disclose the current or expected revenue breakdown.

Bild has a robust presence on digital platforms, with more than 70 Facebook pages, more than 20 Twitter channels, as well as distribution via Google AMP, Instagram, Snapchat and YouTube. In terms of external referral traffic, Google is still the biggest source, but Bild benefits from its strong brand positioning and receives more than 75% of its traffic via direct visits.

In 2016, Bild’s team developed a list of core requirements for content distribution on external platforms:

Editorial freedom (e.g. from censorship by the platforms);
Editorial curation of content (Bild selects the stories to be published);
Control over advertising strategy;
Access to targeting data;
Support for paid-content models; and
Access to tracking data and analytics.

No platform met all requirements

None of the initiatives from the major platforms met all those requirements. For example, Facebook shared data on usage but not on individual users of Bild content, nor did it support paid content.

The publisher did control advertising strategy but flexibility of advertising formats and placements was limited, and referral traffic depended on the constantly-changing News Feed algorithms.

The algorithms also decided which stories end users saw, counter to the publisher’s expectation of maintaining editorial control over curation of the contents.

Having such a list of requirements made it easier to evaluate various platforms using the same criteria, and to track changes. It also helped Bild hold more-effective talks with representatives of the platforms, who approached them to test new initiatives.

“We showed them the requirements,” explained Stefan Betzold, Bild’s managing director. “And we said, ‘We can test your new product, but these are the criteria important for us. We need to work with you on meeting them all. If you don’t improve, we will pull out’.”

While testing Google AMP and Instant Articles, Bild was also improving its decision-making process. This year, the newspaper adopted a so-called “Distributed platform value framework.”

Bild revised the requirements and put them into an economic model, allowing the paper to calculate whether there is a business case for Instant Articles or Google AMP. It could also compare the scores for different platforms in a structured and rigorous way.

The revised variables were:

  • Brand expression;
  • User engagement;
  • Attracting new users;
  • Relative monetisation; and
  • Opportunity to subscribe.

The model followed:

The framework adopted by Bild would be useless if the newspaper had not tested different platforms, for there would be no data to put into the model.

As Facebook revealed in early 2017, Bild was invited to experiment with the platform in driving digital subscriptions. The first reported experiments included streamlining sign-ups for free trial subscriptions. Future developments may include payment integration.

“Am I happy? On some requirements, yes. On others, no,” said Betzold in an interview. “But I’d rather work with Facebook to improve things. That’s a better position for me than rejecting Instant Articles and saying that it’s just not working.”

Since 2016, Axel Springer CEO Mathias Doepfner has put a great deal of effort into building a special relationship with Facebook founder Mark Zuckerberg. Doepfner presented Zuckerberg the first-ever Axel Springer Award, interviewed him personally for Die Welt newspaper, and visited the platform’s headquarters in Menlo Park, California.

Who makes the decisions?

Who makes decisions about platform strategies? The frameworks proposed in this report require joint assessment by representatives of the editorial, marketing, product and technology teams. That reflects the complexity of considerations regarding platform strategies.

In the past, decisions as to whether to join Facebook, or Twitter, or Snapchat might have been delegated to social-media editors or to marketers alone. Having considered the potentially disruptive implications of those decisions on a publisher’s digital business, however, we argue that more stakeholders need to be engaged in the decision-making process.

The WAN-IFRA Member Survey finds that many publishers have already noticed the importance of platform strategy, and have moved responsibility for decision-making upward in the company hierarchy.

Today, the survey reveals, even the tactical matter of adopting or dropping Instant Articles might be discussed at the board level. But in most cases it is the top management; six out of 10 (61%) publishers said the final decision was or would be made by the CEO, COO, publisher or editor-in-chief.

UPDATE: In late October, Facebook announced that it was launching a test of new subscription models for Instant Articles together with a group of publishers across the United States and Europe.

Bild is among the publishers taking part. Others include The Boston Globe, The Los Angeles Times, The Washington Post in the US and The Economist and The Telegraph in the UK, as well as Italy's La Repubblica, and Le Parisien in France.

Stay tuned: WAN-IFRA will report about the results of these tests as we learn more about them.

Author

Grzegorz Piechota

Date

2017-10-25 12:31

Author information

The World Editors Forum is the organisation within the World Association of Newspapers devoted to newspaper editors worldwide. The Editors Weblog (www.editorsweblog.org), launched in January 2004, is a WEF initiative designed to facilitate the diffusion of information relevant to newspapers and their editors.

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