Charging for online content – deal with the perception problem first

Another burst of coverage for the issue of payment for online content recently.  Ken Freer wrote a post here, Lance Wiggs wrote one here, new research from the Guardian indicates that only 5% of people would continue to access their favourite news site if required to pay and Mumbrella spoke to a group of senior Australian industry figures on the subject.

I believe that at a really basic level there’s a perception problem that has to be dealt with. It’s a classic positioning issue. And one that offers some interesting parallels between the publishing and advertising industries.

I think most people acknowledge that quality journalists are a valuable part of a questioning society.  I also think most people believe that good journalists help us make sense of the world around us.  And, for an admittedly smaller group of people, that good journalists produce work that informs, entertains and inspires.

So all logic would suggest that people would be prepared to pay something to ensure that we continue to benefit from the work those journalists do.  But as a society it seems clear we’re not prepared to do that – we actively begrudge being asked to do so.  Why?

The common view is simply that it’s a backlash against being asked to pay for something that was once free.  We’ve been taught that news online doesn’t cost anything. Understandably, we like that state of affairs.

Importantly, our experience of being charged for something that was previously free is that we’re being discouraged from using it. Think inner-city parking or toll-roads.  The key in this situation is to offer something better in a demonstrably different form – parking buildings that are safer places to leave your car, or less-congested toll-roads.  The form of delivery has to change to allow people to rationalise the cost. Because to pay for something that used to be free is stupid. And people don’t like to feel stupid. So maybe we need to give more thought to how we change the delivery of news if we expect people to pay for it – a change that’s small enough that it doesn’t add much cost, but significant enough that it adds much value.

But I think at least part of the issue is that we don’t believe we’re actually paying for journalists to do what they do. We believe we’re paying Rupert Murdoch and Barry Colman to own yachts.

It’s not accurate, but it is understandable.  These people have made huge sums of money from media ownership.  It’s inescapable.  They’re amongst the richest people in our nations, and very publicly so.  And that’s where we believe our money goes. Not to journalists who do work we admire and appreciate, but to media owners who live lives we envy and resent.

So if I were working for a media provider I think I’d be looking for ways to update the form of delivery and to make the journalist, as much as the title itself, the focus.  The first step lets me feel better about what I’m paying for, the second lets me feel better about who I’m paying.

And I think this is an interesting parallel for the advertising industry. We battle the same perception issue. Clients still believe we are spectacularly overpaid as individuals and hugely profitable as businesses.  We know it’s not true (and hasn’t been for a very long time).  When we try and negotiate remuneration we come up against a very similar problem. Such is the nature of procurement processes, we outline the staff who will work on behalf of a client, proportions of their time to be applied, and propose appropriate costs, allowing for salary, overheads and profit margins. But just like the journalists, I don’t believe most clients believe this is where their money goes. They believe it goes to the agency executives and their AMG Mercedes, international conferences and ridiculous, oversized watches.

Which isn’t fair or right, but it’s the perception.  What people value isn’t actually what they believe they’re paying for. And that’s the positioning challenge that both the advertising and media industries share.

I believe there’s also a second parallel.  Most people acknowledge the value of journalists. They appreciate the work the best of the best do – the stories they uncover, the tenacity they show, the enjoyment they deliver.  But it’s only a very small proportion of people who are interested enough to be able to make a judgement on this.  For the majority of people, it’s a case of pretty good is good enough.  While they understand that there are outstanding journalists out there, they see what they do as the exception, and as something that’s only marginally more valuable than the average.  Which isn’t something they’re prepared to pay for.

Which also seems to be true of advertising.  There are a few agencies that are capable of being genuinely, show-stoppingly, game-changingly brilliant. And then there are lots of agencies that are capable of being quite good.  At the risk of being a little unkind, I’m not convinced most clients are interested in making the distinction.  And they’re even less interested in paying for it. Because, as with the journalism business, the outstanding is considered only marginally more valuable than the average.

Which I think is the primary challenge, for both the publishing and advertising industries.  Again, it’s a perception issue we’re dealing with. The perception is that average journalism and average advertising are plenty good enough in most instances.  Success lies in making a much stronger distinction between outstanding and average, and the value that outstanding delivers.  Because I have to appreciate the value of what I’m getting before I’m prepared to pay for it.

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Charging for online content – deal with the perception problem first

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