News publishers are struggling to survive. Over a 12-year period to 2024, industry revenues are expected to decline nearly 74 percent across print and magazine ads (GroupM). Mergers are also happening virtually every week—large media organizations are buying independent and local publishers, sometimes dismantling them completely. Add to these challenges the uncertain times we currently live in, and you could lose your legacy within the next 10 years.
The choice is clear: Publishers either embark on digital transformation or risk perishing.
Watch the webinar recording to hear exactly how Pamplin Media Group and Star Tribune accelerated their online sales.
However, shifting from selling print ads to digital media sales isn’t something that happens overnight at a news publisher. It’s a journey that involves bumps and bruises, but one that’s necessary to ensure the long-term viability of a publication in the face of declining ad revenue.
How can your news organization transition to digital in order to survive? By embracing digital trends and learning from peers who have already made the transition.
Two sales leaders, Shelli Lundgren, Digital Sales Director at Pamplin Media Group and Chas Van Slyke, Director of Client Strategies at Star Tribune, discuss how they steered their news organizations towards digital sales, successfully generated new revenue streams, and managed change. They also provide actionable insights and tactics you can implement in your own media organization to create a digital-first culture.
Top challenges for transitioning to digital revenue streams
The mindset shift to include more digital products and services for local clients in traditional media establishments is not new. In fact, there’s been a seismic shift to digital since the 2000s.
However, many news organizations resist digital, while others want to transition but don’t know how. Still, others are trying to go digital but are only having moderate success.
For a lot of print publishers, the longer you’ve been in the business, the harder it is to make that turn.
Various surveys suggest there are five main barriers to digital transformation in the news industry:
- Print-rooted culture: Organizations are still too dedicated to their print publication
- Organizational alignment: Not everyone believes in going digital
- Risk aversion: A publication is too scared to go digital
- Leadership: There isn’t buy-in at the top level of the organization
- Budget: You might have all the willpower to go digital but your resources are finite and you don’t know how to go about it
Lundgren explains that, at Pamplin Media Group, the print-rooted culture was centered around the special sections: “The sales reps would wait for their flyers, so they could sell their special sections this month and next month. It took a while to turn this around and take those special sections and make sure we’re adding digital components to them.”
Lundgren goes on to explain that they ensure their flyers are marketing opportunities with digital attached to them. Rather than getting rid of the special sections altogether, they’ve added advertorials and newspaper.com to them.
This also speaks to risk aversion. There was this mindset of “this is how we’ve always done it.” “Pulling them away from that focus was my first step when I got here,” explains Lundgren.
For Van Slyke at Star Tribune, organizational alignment was the toughest challenge. He explains that they were too reliant on national advertisers, and when that started to dry up, they did a full-scale evaluation. As a result, they realized they didn’t need a national team, and they ended up doing away with all of their siloed teams except for obituaries.
“Everyone sells everything, and that was a big change for us,” says Van Slyke. To help spur this change along, the news organization created the role of digital lead. “Digital leads are co-sellers, and to the point of budget and risk aversion, that was a challenge for senior leadership because you’re double-paying salespeople.”
He continues, “We structured it in a way that co-sellers worked with 5-6 reps and they had a responsibility to make sure their reps achieved their digital numbers. They were able to recognize the opportunity that each of those reps had in their territory. It was co-selling and training that really helped change the culture and align the organization structure with what we wanted our end goals to be, which were growth and digital selling.”
Empowering your salesforce to take a digital-first approach
Once a news organization gets buy-in for digital change at the higher level, though, another challenge still remains: executing the new digital strategy among the sales team.
Creating a digital-first sales culture comes down to two things: motivating the sales team and building out digital commission structures.
When asked how she motivates someone who has sold print much of their life to sell digital, Lundgren says it’s all about getting them excited about learning new things and showing them how successful it can be. Unlike print, you can actually show customers that their digital ads and marketing are working, and that’s exciting.
Digital commission structure
At Star Tribune, Van Slyke was able to change their commission structure to make digital one of their pillars. He explains, “When we went through this change, we only had one pay plan for salespeople: We had a comp plan base and incentive pay. Now, rather than just overall revenue, we have three revenue targets to maximize their pay.”
Now, 40 percent of a sales rep’s incentive pay at the Star Tribune is tied to these 3 pillars:
- Overall revenue 60 percent
- New business revenue 20 percent
- Digital revenue 20 percent
This new commission structure motivates sales reps to sell digital because it hits all three targets: If a rep gets a new digital advertiser then they’re getting overall revenue, new business revenue, and digital revenue, which will maximize their pay.
The organization also initiated the Diamond Club, predicated on achieving those three pillars, to recognize successful salespeople.
Van Slyke goes on to say that, “the people who couldn’t make that shift self-selected out and chose to find a new career.” What’s more, this changed how the Star Tribune now recruits. “We’re looking at agencies and people who haven’t necessarily sold advertising but are selling software-as-a-service and other intangible products.”
Creating new digital revenue streams
Moving from solely selling print ads to digital media sales creates an opportunity for publishers to generate more revenue. With ad revenues declining significantly, this is a welcome opportunity for media leaders.
Lundgren and Van Slyke share the digital revenue streams that have proven the most effective for their sales reps.
Lundgren says she’s doing a lot of native advertising. “Don’t be afraid of native. In the past, it was a big deal to have anything that looked like news show up in an advertising situation. But it offers great value to our customers and helps them get found online, and it’s something we can really charge for,” she explains.
Monetizing your audience
She goes on to emphasize that you also need to have a good relationship with your circulation director in order to capture that digital audience and monetize it: “If you’re not working hard on getting email addresses and information through your paywall and using that on the advertising side, you’re losing out…The more you own that audience, the more you can use that audience to sell to.”
Van Slyke, on the other hand, has created a seven-figure strategy by transforming news deserts as an opportunity to expand the Star Tribune’s footprint, which costs much less for a news organization that’s now mostly digital. He explains, “In those communities suffering from a news desert, we went to the business community and we said, ‘if you can help us fund a reporter, we’ll start reporting on your community.’ Now everyone in the community has better news sources. It’s not just that local community reading about local community news. The rest of the state is too,” he explains.
Storytelling as a strategy
The second digital revenue stream Van Slyke says has proven effective for their organization is storytelling as a strategy. With over 150 years of storytelling experience, they realized that they should start storytelling for their advertisers, too, with sponsored content. The younger consumers, he explains, want to have a relationship with a brand—not be advertised to. The best way to do that is to tell a story.
Search engine marketing (SEM)
When it comes to their approach to online search engines, Lundgren and Van Slyke agree: you have to sell search engine marketing (SEM).
If at all possible, own search and every aspect of it. Search is what Yellow Pages was 100 years ago…That’s what Google is now.
At Star Tribune, SEM is managed in house, and although margins for this service are thin after factoring in costs, owning it offers them security by allowing them to demonstrate the value of it to the client and showing the proof of search results.
Lundgren, on the other hand, uses a partner for SEM. She says, “We basically break even. That being said, it’s really important to sell it whether you make money or not. It needs to be part of your marketing plan or it puts you at a different level of authority as a digital expert.”
Disrupt your news organization: Get started with the digital transformation
Media leaders Lundgren and Van Slyke have actionable insights to offer news organizations looking to get started with digital transformation.
Lundgren says, “You need to have a website as the first step, and then monetize that. I’m using Broadstreet to deliver ads and I think they’re perfect for both small and large organizations for delivering ads.” She goes on to explain that you should get a partner who knows what they’re doing to get your feet wet. The more confident you get, you’re ready to move on and maybe start investing in staff.” She also suggests you find a partner that can help with targeted display and geofencing, so you can offer a few things other than your own audience.
Van Slyke agrees that trusted partners are important. He also adds that one of the changes you’ll need to make is to talk about your audience and their demographics. When selling print, it was all about the section: Do you want to be in the local section or the variety section? Now, that doesn’t matter. You have to get your reps to recognize that we’re talking about audiences and specific demographics now.
The most important part in getting started in digital transformation though? Just getting started.