In a good post on the challenges facing online newspapers, Judy Sims notes:
News execs still aren't looking to understand their users or to seek gaps in the marketplace, but instead they are trying to do the same old thing only now get paid for what has become free. It's all about existing products (i.e. news and features), nothing new. What about data? What about helping users to make or save time or money? What about niche content that is rare or specialized enough to command payment? [...]
There are 4 P's of marketing. Product, Promotion, Place and Price. [Newspaper execs] just want to talk about price. That's because they're not thinking of their websites as products.
I share her diagnosis but not her prescription. Yes, it is undoubtedly true that newspaper people are too fixed on their content and need to think more broadly about their product and their customers. I wrote about this at length in an earlier post.
But a (much needed) renewed focus on customers need not mean a push into product development. It should start, first and foremost, with an effort to understand your current product – the website you already have and the people who use it.
There is an old school of thought in industrial design that says that you should design products "phenomenologically" – that is, by "bracketing" the thing itself out of your mind and focusing on what people do around it. Only then you can fill in the blanks and design the product itself. Or, to put it more succinctly, the product is the activity. (This fascinating book by Brenda Laurel touches on some of this).
Now back to online newspapers. If your product is the activities that people perform around it, do you know what your product is? For papers, the answer is generally "no".
Sure, anyone can think of some typical activities – e.g. the loyal reader who visits your front page every day, skims the headlines and chooses three articles to read, or the clueless reader who arrives via Google by accident. But what about the reader who visits the Drudge Report every day and once in a while follows a link to one of your articles? Or a reader who checks her Twitter feed throughout the day and every now and then follows a link, when she can steal a minute? Or the busy employee who suddenly receives an email from his boss telling him to read a certain article?
These activities are all very different: competitors' websites are relevant for some but not for others; they address different needs (some are about distraction while others are about self-imposed routine); and for some branding is important for while for others it isn't. In other words, each has a different value for your readers.
If you think of these activities as your products, you can ask how much pricing power you have for each. And if you segment your audience in terms of the activities they perform, you can begin to get an idea of how much money you could make. Yes, most of these "products" will have to be free, but you may be able to charge for some of them.
Of course you could apply the same kind of thinking to print publications as well. You could commission ethnographers to study how people use your print paper. But at the end of the day, with print you have no way to enforce a premium price on key activities, because you have no control over what people do with your paper once they've bought it. So you are forced to set a uniform price for the thing itself – the content. And if you transport that thinking to the web you are forced to either charge all your readers for some or all of your content – a risky proposition.
But the web is different. Here you know, in real time, exactly how your customers are using your content. And at any time you can step in and say "excuse me, but for that kind of activity you have to pay".
This is the inspiration for much of what we are doing at The Publishing Project. Of course the devil is in the detail.