Feature Article: Published in PANPA Bulletin
With daily newspapers the world over suffering circulation decreases, publishers have become savvier in a bid to attract the elusive market of young adult professionals. A host of free (or ‘lite’) stand-alone dailies or brand-extending versions of the existing product have been launched to reach the 30-something professionals of the planet. The gamble has paid off handsomely for many, providing an additional revenue source through new advertisers for their businesses.
The revolution started with the launch of Metro in Stockholm in 1995 and there is now a Metro newspaper almost every major city in the world. Metro International publishes 59 editions in 83 cities including New York, Hong Kong, Paris, St Petersburg, Prague and Santiago. There is also a Metro distributed in London and other major UK cities, but it is published by Associated Newspapers.
Australia’s Own Niche Freebies
Full-colour lifestyle publication mX was launched in Melbourne five years ago and eight months ago in Sydney. It is based on the successful model of the free daily metropolitan newspapers around the world, like Metro. Published by News Limited, mX covers important issues to both citys’ populations in a “concise, upbeat, funky, intelligent and sexy way,” said mX Melbourne editor Toni Hetherington. It has a circulation of 92,000 in each city and reaches at least 240,000 people in Sydney and Melbourne each day, Ms Hetherington said.
“mX follows on from commuter newspapers around the world and in Australia mX is unique.
“We rely solely on advertising as income, which is always difficult to live by in the newspaper world.
“We target a unique audience – our content focuses on 18-35 year-olds. This, and full colour, sets us apart. Advertisers recognise this and fully support the product.
“Advertising has never been better in Melbourne but there is always a fine balance to consider and you have to be mindful of costs. We have to create opportunities without compromising our readership,” she said.
mX is designed to be snappy and concise so readers can get through all the sections they love by the time they get to their stop.
“People commute so it’s easier to read [a paper like mX] in that environment. They can get through the lot by their station,” Ms Hetherington said.
Throughout Melbourne and Sydney mX is distributed by samplers who hand out the papers to commuters and via boxes, fixed in Melbourne and portable in Sydney, that are positioned at key points throughout the cities.
While many publishers were scared off free products thinking they may affect the paid publications, News Limited didn’t baulk at the prospect. When mX launched in Melbourne it had the support of News Limited, and still does, Ms Hetherington said.
“They made a full commitment to back and run mX and they are still tremendously supportive of it, especially now it is in Sydney,” she said.
“We have received additional backing in terms of advertising. mX hasn’t cannibalised the Herald Sun’s circulation at all. In fact it’s gone up. Maybe more people are enjoying reading newspapers now and are picking up the Herald Sun as a result.”
The objectives behind mX are to inform and entertain commuters and hold them on the way home from work.
“We keep them informed of the breaking news since they went to work that morning,” Ms Hetherington said.
“Our aim is to continue giving to readers a paper to use in everyday life, to help them utilise their city better and know what goes on in it.
“From news, sport and business through to features focusing on health needs, entertainment, gossip, travel and the latest in IT, mX is designed for getting the most out of life,” she said.
mX is targeted at an audience of highly influential and affluent young people who are time-starved and getting harder and harder to reach using traditional media. While the mX reader is primarily 18-35 years, the papers are also popular with readers aged between 12 and 80 years.
“We aim at the 18-35 demographic but think the others read mX because is keeps them young or makes them feel older because they are reading the same paper as a 20-year-old,” Ms Hetherington said.
“We are mindful of this when putting content in the paper.”
The typical mX reader enjoys life and is success driven. Their interests include bars/clubs, dining in restaurants/cafes, shopping or travelling and new experiences making their attention very difficult to catch.
“mX has the mix just right, proving itself as the clear leader in its field in both content and popularity,” Ms Hetherington said.
“We will continue to bring readers more of the innovations that have become synonymous with mX.”
Metro Sets the Tone
Metro International has adapted its formula to suit different cultures and now has more than 15 million readers around the world, including a combined circulation of 5.1m in Europe. Metro targets young urban professionals that advertisers want and so has seen its revenues soar from A$13.2m in 1995 to $414m last year.
Metro has a standardised editorial style and design in all countries, ensuring each publication is homogenous for the advertisers’ benefit. Once distributed via public transport, Metros are now found where commuters are, such shopping centres, offices, universities, libraries and coffee shops. Distribution is modified to suit each market. There are 7m copies printed each night at 53 plants and then delivered by 500 trucks to 3200 hand distributors and 22,000 racks. Metro International managing director Pelle Tornberg describes his publications as “glocal”.
“Metro has the same editorial line, layout, template [around the world], but every Metro is perceived as being a local newspaper,” Mr Tornberg said.
Metro banks on the notion that news is free, like the Internet. Mr Tornberg believes paid-for newspapers will survive if they become niche publications with higher cover prices and accept smaller circulations. He predicted that while paid-for papers provided unrivalled opinion, comment and analysis, a time could come when readers picked up free papers during the week and only paid for a paper at the weekend.
After conquering most of Europe, Metro International has set its sights on the tough market of Germany, as well as China and more cities in Russia the US and South America. The company has ruled out Singapore and Australia as potential markets because of their restrictive foreign media ownership laws and the competitive markets.
Metro International expects profit in each market it enters within three years and in markets where it has been established for longer, the papers typically have a 22 per cent revenue growth and 10 per cent profit growth. The company is also looking at additional revenue streams, such as real estate and car supplements, and increasing its online presence.
When the Only Option is Going Free
After experiencing a 21 per cent drop in circulation one of London’s oldest paid-for titles, The Bromley Times, converted to a free publication. The Bromley Times’, which is published by Archant London, circulation was down to 2466, but the paper will now go out to 80,000 homes. It had an upmarket relaunch and will still be available as a paid-for paper priced at 50p. As a result of the conversion The Bromley Times replaced the existing free paper in the area, The Bromley Express.
As part of the relaunch the paper is now more issues-led with expanded news, business and travel in the city sections for commuters, as well as sports covering local teams and top London clubs. There are also more comment, opinions and letters pages.
Many paid London newspapers have had problems with circulation and Archant London managing director Enzo Testa’s plan is to turn some of the most problematic titles in to a mix of paid and free publications to reach a wider audience.
“We are not reaching the market and that’s why we’re doing what we’re doing. There’s no point in my guys doing a fantastic job and then a few thousand people buy the paper. That particular marketplace has changed and the existing titles are predominantly free,” Mr Testa said.
“This way we reach more people and saturate the Bromley market and also have it available for paid-for.”
The International Newspaper Marketing Association (INMA) has recognised the trend towards these new publications and published a report called “Free and ‘Lite’ Newspapers: The Answer For a New Generation?” It examines how these publications find their way into the lives of readers who often prefer the Internet to a newspaper, how they are distributed and how they are competing in the daily market.
INMA project manager James Khattak looks at more than 20 free and lite newspapers, explains their rationale, and focuses on what makes them unique in the report, which was released on February 14.
Case Study: Canberra’s CityNews
The free niche publication model has worked extremely well for Canberra’s weekly magazine CityNews. The free full-gloss news and lifestyle publication is now a joint venture between editor and former owner Michael Hawke and Macquarie Publishing chairman Ian Meikle, after Mr Hawke sold half his share in the business at the end of last year.
After looking at their product the pair decided to start the New Year with a fresh vision for the publication and increased the circulation by 14 per cent to 40,000. Its readership stands at 100,000+, which is very loyal and has a very supportive and solid advertising base, Mr Hawke said. While many other paid publications are suffering declining circulation figures, including the Canberra Times which dropped by three per cent between June and December 2005, Mr Meikle said it made good business sense to increase CityNews’ numbers.
“We were sick of seeing empty baskets,” he said.
“We have a dual approach to delivery. Half of the magazines go to inner north and south suburbs via letterboxes and the other half are distributed in government offices, shopping centres and real estate agents.”
CityNews has been revamped and this is paying dividends.
“We came into the year with a fresh approach and were rewarded by a higher level of interest. We have made a more conscious approach to presenting a more aspirational view of life to target our principal readership – the female market,” Mr Meikle said.
“In Canberra a high percentage of the workforce is smart, switched-on women and men.
“The cover is more aspirational, with pointers and is livelier and our content is targeted to an audience a little more aspirational than before,” he said.
With distribution to the city’s 28 highest socio-economic suburbs and throughout the business hub, the publication’s readership certainly has the means to spend on more desirable products. According to CityNews’ own Media Buyer’s Guide “Canberrans are paid well in excess of the national average and spend well above the national average. Full-time adult average weekly ordinary time earnings in the ACT are $1194.10, which is 16.7 per cent higher than the national figure.”
CityNews holds a very enviable spot as a niche publication with little competition as it is Canberra’s only weekly publication in full-colour gloss. Mr Meikle, who used to be the managing director of the Canberra Times, said the Times was a newsprint publication where CityNews was printed on glossy stock.
“That differentiates us and allows us to target a market that other publishers can’t provide,” he said.
“We don’t have any direct competition but live in differentiated harmony with the Canberra Times.”
Mr Meikle said the reason CityNews has succeeded so well as a business model was because of it’s differentiated position in the marketplace.
“It has an intimacy with the city of Canberra and is the accepted brand in town,” he said.
“I used to run the Canberra Times and it’s a fun business to be in. I don’t have to worry so much about circulation.”
CityNews was established in 1994 and is an independent publication in a similar vein to Melbourne Weekly Magazine, The Melbourne Times and Sydney’s Courier publications. It is published on Thursdays and delivered on Thursdays and Fridays. CityNews covers major issues affecting Canberra’s population, interviews with local identities, business announcements, as well as dining, arts, entertainment, cultural events, book reviews, fashion, sport, employment and property. Its dedicated sections are: CityProperty, TheCanberraReview, CityMotoring, CityTravel and CityFeatures.
Australian Bureau of Statistics census data reported that CityNews‘ demographic circulation area comprised educated, professional and high-income people including senior public servants, managers, business people and the tertiary educated. Independent market research has shown CityNews has a 95 per cent awareness level among its target audience, of which 93 per cent are readers of the publication. Like many publishers, Macquarie Publishing is exploring new revenue streams and readers who live outside the CityNews delivery area can subscribe to the magazine for $96 for 12 months (48 editions).
Monthly gloss magazine Queensland Retiree is another from the Macquarie Publishing stable to receive the New Year makeover. Mr Meikle said the company mostly concentrated on niche publications in the ACT but was “always looking for new things” to widen its audience.