Jul 30 2009

It's not HOW to get people to pay for news, it's WHEN

Here is the news

Here is the news

A few months ago I suggested Waitrose as a solution to the problem of finding a new business model for journalism. I was trying to make a more general point about journalism being delivered in different ways but I am increasingly convinced that I may have hit upon something, partly thanks to some interesting comments from a clever chap at Stanford.

When we consider the technicalities of getting income from the consumer,  the secret may not be HOW to get people to pay for news, it’s WHEN that counts. Let me explain, although bear in mind that I am economically illiterate. Like most journalists.

The idea of the Waitrose model was that the John Lewis’ supermarket shares the same community and values as Guardian readers. North London, liberal, organic, quality, cosmopolitan, over-priced etc. So why shouldn’t Waitrose buy up the Guardian and deliver news as part of the groceries and a series of other services for the Guardianistas such as fringe theatre tickets, French film DVDs, Fairtrade banking etc? I already get a Times newspaper with my Ocado delivery, so why not go the whole (free range) hog?

I suggested this partly because I wanted to make a point about news being part of our identity and lifestyle as much as a separate, distinct product. That is why I am so sceptical of the various schemes to make us pay for news such as pay walls or donation buttons. Those mechanisms simply replicate the old cover price or subscription model. It’s the same relationship whereby one of lot of people make something that another lot of people purchase. The Internet’s ability to give us free content has made that simple cash-for-product exchange impotent when it comes to journalism. With the Waitrose model what I am suggesting is akin to the old advertising relationship where people sold stuff around news, but this time we do it without the advertising.

I have found some boffin-type support from an interview with Dr. B.J. Fogg, an expert in “persuasive technology” who heads up Stanford University’s Persuasive Technology Lab (no kidding). He is very unenthusiastic about the various ‘click read and pay’ ideas floating around at the moment. He points out what we knew, that people have learnt to get journalism for free. But if they are to work, he stresses, you have to ask people to pay when they are in a paying mood:

“Getting online users to pay for content online (whether by mandatory payment or voluntary donation) works best when you hit the user at a time when he or she already is in payment mode, which of course is no easy task when the user is reading news for free online.

Amazon.com can succeed in getting people to buy additional related products when they’re about to buy something; a consumer ordering a Nikon camera is presented with other photography goodies during the ordering process and increases the amount spent. Google Adwords ads work so well because the user is in search mode; a contextually matched text ad shown with search results can result in more clicks and purchases because the user already is in search-and-acquire mode.

An example of hitting consumers at the right time to pay for news (this would be limited to nonprofit news providers) would be if a news organization like MinnPost.com, a nonprofit news entity that serves the state of Minnesota, was able to get on a list of optional charities that taxpayers can give to when they’re filling out their state tax forms. As Fogg points out, they’re already in the mode to write a check (or know that they’re getting a refund), so that’s an ideal time to hit them up for a small extra donation to MinnPost and support public-interest journalism.”

Well, surely getting us to pay for our news alongside our bread (wholemeal stoneground) and butter (Normandy unsalted) is exactly that?

[Thanks to @rcnee for putting me onto Dr Fogg]

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8 Responses to It's not HOW to get people to pay for news, it's WHEN

  1. Tom says:

    Hi Charlie.

    I’m afraid I can see a few holes in this idea.

    (1) you’re starting with a horribly reductive premise which, even if it were true, is something that The Guardian or any newspaper would probably prefer *not* to base a business model on:

    “the John Lewis’ supermarket shares the same community and values as Guardian readers. North London, liberal, organic, quality, cosmopolitan, over-priced etc…fringe theatre tickets, French film DVDs, Fairtrade banking etc”

    It’s probably not a great idea to take a letters-page caricature of a ‘Guardianista’ as the basis for a business idea in the first place. For one thing, I understand that around a third of the Guardian’s online readership is actually in the USA, and I’m almost certain the other two-thirds don’t all live in Islington.

    (b) and I could be wrong here, as I don’t buy food on the internet – isn’t it usually the case that people use online supermarket delivery once or perhaps twice a week, at most? The pace and immediacy of online news, on the other hand, lends itself to more frequent use. Personally I’ll check news sites once at day at the very least. More often than not it’s more often than that.

    (iii) You and Doc Fogg say that “you have to ask people to pay when they are in a paying mood”. Unfortunately it’s in the very nature of online shopping that, at that same moment, you’re asking people to pay when they’re literally two clicks away from an entire world of (mostly free) online news content. What’s more, paying for goods online is a bit of a hassle at the best of times; surely it becomes even less appealing when the alternative is both less hassle and a lot more free.

    Lastly, I suppose my main problem is that you basically seem to be advocating an update of an old (and, I think, very successful) version of ‘persuasive technology’, the idea of putting the sweeties by the checkout in the supermarket. I’ve a feeling it was actually Waitrose who were the first to ditch this technique after complaints from parents’ groups. What I’m getting at, I think, is that the ‘persuasive’ part of ‘persuasive technology’ is one that not everyone is entirely comfortable with.

    Cheers.

  2. CharlieBeckett says:

    Hi Tom,
    Everything you say is valid – but you are taking my idea too seriously – which is flattering!
    The original point of the Waitrose formula was part joke (about myself) and partly to get people to think much more widely about how news is delivered and the shape of the organisations that will do that job. Even the persuasive technology debate regarding journalism is still stuck in the mindframe that you describe of sweeties by the checkout when the customer isn’t even in the supermarket anymore! (My Waitrose schema works better with Ocado of course).
    Thanks for your highly perceptive comment,
    cheers
    Charlie

  3. Tom says:

    Fair play Charlie, I didn’t quite catch the tone. Sorry for the dissertation.

    As a reader, though, I have to hope that ‘persuasive technology’ isn’t the field that solves this problem for the newspapers. I want to *want* to pay for it, because it’s worth it. Sort of like Waitrose, come to think of it…

  4. Elliott says:

    Interesting!

    I’d add that what makes the ‘paying mood’ theory strong in the context of newspapers, and which your Waitrose joke implicitly points out, is also how the seller tries to flog you a certain ‘experience’ or ‘lifestyle’ at the time of the sale – “Mr. X, we at Amazon think you are the kind of gentleman that would enjoy the following expensive books…”. Surely this is something newspapers could be very good at exploiting.

    LeMonde.fr requires a monthly paid subscription to access any article that’s more than two weeks old. What started out as a one-off need for archive material – for which I paid that month’s 6€ – has now turned into a monthly subscription. They have me hooked thanks to a handful of dubious perks: I get the next day’s headlines the previous afternoon and, when I log on to the website, I am greeted by name in gold letters! I haven’t needed to use the archive again since that one-off occasion.

    It would be interesting to hear how you think papers could seriously exploit peoples’ inclination to the ‘paying mood’ in a UK-specific context. I might be wrong, but it seems to me that this quickly brings us back to the paywall debate?

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