Rates For Tablet Ads The Same As Print...La Presse Case Study

Jun 24, 2015 by Mark Maier

Canada has given us Castanet.net and the huge revenue success that digital can achieve and now the Great White North gives the newspaper industry a case study in what is working for an App driven publisher focussed on serving the content on tablets...

"If a “death of newspapers” narrative still mires the industry, then here might be a Lazarus story. 

It’s hard to avoid such hyperbolic comparisons when talking about La Presse, a 131-year-old French-language newspaper here with Quebec-wide reach, because practically everything about its transformation is radical and audacious. This is the story of a newspaper that sought to reinvent itself as a tablet app and recapture long daily engagements with its readers, all the while retreating from print and moving toward a future of digital-only revenue from its advertising clients.

In so doing, it has challenged every notion of newsroom production, distribution, advertising and marketing still standing. And two years after the public rollout of this transformation began, La Presse is on the road to reaching all of its objectives for revenue and audience engagement, if its publisher’s claims are to be believed.

For now, Guy Crevier, its publisher and president, as well as president of its parent company Gesca, seems to be standing alone in his faith that tablets are the delivery vehicle for newspapers’ salvation. But at the same time, he has infused an undeniable faith among La Presse’s staffers, its competitors and would-be critics of La Presse+, the paper’s app and now primary daily product. Crevier has convinced them that not only do newspapers have a vibrant future in front of them, but he may have landed on the form and function of that future already.

Over the five stories in this Digital Deep Dive, we will explore each of the key components of the La Presse+ experiment: the research, development and design process behind it; the corporate adjustments and union concessions that enabled it; the marketing and advertising tactical moves that carried readers and advertisers through the transition; and the radical changes to newsroom workflow and story production that have had their own revolutionary implications for journalism.

But the La Presse+ story begins with Crevier himself – his impetus for change, his mandate for a reimagined La Presse and the results his gamble is netting so far.

‘We Want To Stay In Mass Media.’

If newspaper publishers ever enjoyed a baronial era, its last, elegant vestiges might be found in Crevier’s office at the paper’s headquarters in Montreal’s

Old Port. When we first met there last May, it was over a breakfast served on fine china in a room richly appointed with antique furniture and paintings, about as far away from the hustle of the newsroom — or the 21 ^st century, for that matter — as one can imagine.

And yet Crevier is attuned to newspapers’ 21^st century problems. Canadian papers may not have seen the starkly precipitous declines of their U.S. counterparts, but the losses have still been keen.

“Let’s take an example,” he says. “You have $100 million in revenue, and you’re losing 17% this year. You’re going to be at $83 million. Where are you going to be next year? Should you do something to protect your profitability or should you wait until you’re at the end with $40 million?”

Back in 2010, Crevier, a former telecom executive, opted not to wait. The paper had already ceased printing a Sunday edition in 2009 to reduce production and distribution costs. Intrigued by the form factor of the iPad (which itself was still in development at that time), he saw a possibility for reinvigorating the content of the paper and recapturing the long engagement periods that readers used to spend with it. He also saw the potential to create new advertising units that could show clients measurable results, ultimately transitioning to an app rate card that would equal that of his print edition.

And so Crevier made a U.S. $36 million bet, conducting extensive audience research and hiring a digital team of 100 developers, designers and analysts to essentially build a new future for La Presse.(The source of that investment is the subject of a story on the paper and its corporate owner, Power Corp., on Wednesday). 

Unlike most U.S. publishers, Crevier has no patience with aggregating numerous digital revenue streams to try to replace print revenue losses. “You cannot go to 25 different strategies, I don’t think,” he says in French-inflected English. “We want to stay in mass media. I don’t see any value in not being mass media. I don’t see how you can survive long term.”

Remaining a mass medium, he argues, was predicated on three factors. One was the value of the newspaper’s brand — La Presse enjoys a long reputation for thoughtful journalism, articulate commentary, strong design and a Federalist tilt in fiercely independent Quebec.

Another was recapturing the ritual of daily newspaper reading, where readers would spend upwards of 20 minutes with the paper instead of the hit-and-run consumption more common to its website or smartphone apps. For that goal, the tablet’s screen size was key, as Crevier believes that smartphones’ smaller screens inhibit longer-term engagement periods.

The third factor is the one likeliest to rub his fellow publishers the wrong way: Crevier insisted on removing any kind of cost whatsoever for the app, because he doesn’t believe in paywalls. “Younger readers are not willing to pay,” he says.

Success By The Numbers

Two years on, Caroline Jamet, president of Éditions La Presse and Éditions Gesca and VP of communications for La Presse, says that more than 60% of the paper’s total advertising revenue is coming from La Presse+. The app has been downloaded more than 600,000 times as of November 2014 (the paper no longer releases information on downloads).

According to its internal metrics, its open rates by unique tablets are impressive: 180,000 daily openings, 300,000 weekly and 400,000 monthly. La Presse also estimates more than 450,000 people read the app each week based on the number of unique tablets used to open at least one edition during the week of March 30- April 5, 2015 (302,638 tablets multiplied by a coefficient of 1.5 users per tablet).

Engagement times, Crevier’s real brass ring, have been remarkable: Users average 40 minutes of time spent with the app on weekdays, 60 minutes on Saturdays and 50 minutes on Sundays — a dramatic departure from the global industry average of 16.3 minutes per reader per day last year according to a recent ZenithOptimedia report.

La Presse+’s reader profile finds 63% of its readers in the 25-54-year-old cohort compared to 52% in the Quebec population and 48% in the paper’s print edition. And 50% of the app’s users were not initially readers of the paper in print.

“We reach more 25-49-year-olds than anyone else,” Crevier says. “That’s exactly the demographic advertisers are looking for.”

As to total market share of audience, the latest NADbank report results show that La Presse is No. 1 in its market, with 705,500 daily readers getting their news from La Presse+, the lapresse.ca site, its mobile app or print edition.

Advertisers, for their part, have been moving steadily over to the app, incentivized at first by a transition process. The first step was what Crevier called “a tasting” – convincing advertisers to place 40% of their overall print ad spend into La Presse+ to give advertisers a feel for the new medium, gradually carrying them over to the app through a combination buy.

 

Today, La Presse inventory is sold in packages that include a combination of ads on the tablet — most of which feature some kind of interactive component — and in print, according to VP of Sales Luc Tremblay (the Times of London recently revealed that its advertisers are paying the same rate for their tablet edition as print , a breakthrough for tablet ads).

National ad sales have also been positively affected. The 20 clients that comprise 80% of La Presse’s national revenue spent more in the app’s first year by 4-5% than the previous year, Crevier says.

Last December, La Presse+ also became the first tablet-based news platform to have its ad impressions certified by the Alliance for Audited Media, marking an important third party validation for its advertisers.

All of this has emboldened Crevier to do something else most of his fellow publishers are loathe to do: publicly speculate on the eventual end of La Presse’s print run altogether. A renewed contract with its printer ends in 2018, a date at which the paper has flirted with stopping the presses. “I want to stop the printed paper,” Crevier says. “It’s too expensive.”

In March, Gesca, the Power Corp.-owned division under which La Presse operates, sold its six other regional newspapers to a former Liberal cabinet minister. Crevier said the other papers didn’t fit the tablet-based business model for a number of reasons, and the sale would allow the company to focus entirely on La Presse’s digital platform.

Sharing The Technology

Meanwhile, part of Crevier’s longer-term strategy is to share the technology that he’s built with other papers to help offset his still-considerable expenses there.

Last November, he found his first white label client in the Torstar Corp.-owned Toronto Star. “From the first moment we saw it — and we saw it very early in the process of development — it was just so much better than what others were doing,” says John Cruickshank, the Star’s publisher.

The Star is bulking up its own staff by 60 additional journalists and designers as it readies its own version of the app, according to a memo leaked in January, but Cruickshank says he’s not following exactly the same tablet-centric road as La Presse.

“It really seems like an important level for transition,” he says, “especially for our editorial capabilities.” And yet, Cruickshank says La Presse’s yen to wean print subscribers on to the tablet is not his own endgame. “What’s attractive about the tablet is not to replace the print audience, but to complement it with what is clearly a potentially younger and larger audience.

“Unlike La Presse, I’m not convinced that this is a terminal technology,” he adds, “and I’m not sure that they really are either.”

The financial terms of the deal haven’t been disclosed, but Cruickshank says the Star isn’t simply licensing technology. Rather, it’s getting a range of services including newsroom training and a continued commitment to technological development.

The two papers will also be selling ads in partnership, as a significant number of customers span both the French-language Quebec and English-language Ontario markets, and nationwide opportunities are growing as La Presse has already spent two years “greasing the wheels” for interactive ads in the app.

“What we’re looking for above all is a new story to tell advertisers,” Cruickshank says.

The Star is targeting a debut of its own version of the app this fall.

Outside Views

Back in Montreal, La Presse+ has won respect from competitors and critics. Its main French-language competitors are Le Journal de Montreal, a tabloid whose circulation numbers are no longer audited by the AAM, and Le Devoir, a separatist-oriented daily with a 34,220 daily circulation according to the AAM.

The English-language, Post Media-owned Montreal Gazette (with a daily circulation of 83,471 according to AAM) also considers itself competition because of bilingual readers, and its editor-in-chief is unqualified in its respect for what the app has achieved.

“Theirs is an approach that has been as ambitious as anything that has been tried,” says Lucinda Chodan, the editor. She posits that the Gazette has significant overlaps with French readers, but for La Presse, “on the Francophone side, they are the standard and have done groundbreaking things on an international level.”

Since the app’s launch, Post Media has rolled out its own four-platform approach at eight of the chain’s 10 major dailies that will involve content differentiation by platform.

Chodan says La Presse+ has set the bar high. “It’s a very strong product in a market where there are a lot of alternatives,” she says. “Obviously it’s a very bold move, and they’re doing a great job. That’s always inspiring.”

Local media blogger Steve Faguy, who had plenty of initial skepticism about La Presse’s moves, says they have given way to more qualified respect. “As to the larger question of whether this is crazy or has legs, I think both,” he says. “When I met with Crevier, he knew what he was talking about.”

Lisa Lynch, an associate professor of journalism at Concordia University who has studied La Presse and its history, says of Crevier, “he generally represents himself as a confident visionary” — an image that has been largely unchallenged elsewhere among local media and its watchers. “I haven’t really seen anybody take him down.”

Crevier himself is unequivocal about the road ahead, one in which La Presse will kill its print edition the moment it’s feasible to do so. “We don’t believe in that business model anymore,” he says. “A private company delivering a paper day-to-day is a non-sustainable model.”

Other publishers can avoid looking to a print sunset, he says, “but what they do is push the end. We’re trying to change the model.”

Read all five parts of this Digital Deep Dive here."

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