The New York Times continued its digital growth in the second quarter of 2018, adding 109,000 digital-only subscribers. With that rise came an increase in revenue that counteracted a decline in print advertising.
The company said on Wednesday that revenue from digital subscriptions rose to $99 million in the second quarter, a jump of nearly 20 percent compared with the same period a year ago. Over all for the second quarter, total revenue increased 2 percent, to $415 million, and the company reported a profit of almost $24 million.
The Times now has 2.9 million digital-only subscribers, out of 3.8 million total.
“Subscription revenues accounted for nearly two-thirds of the company’s revenues, a trend we expect to continue,” Mark Thompson, the company’s chief executive, said in a news release. “We continue to believe that there is significant runway to expand that base substantially.”
Why it’s HOT:
As a “newspaper” media company, the New York Times now has significantly more digital-only subscribers than print subscribers. 76% of its subscribers are digital-only.
Also, subscription revenues are now two-thirds of the company’s revenues which means the company doesn’t rely on advertising for revenues as much as it did in the decades past.
The advertising industry is currently enthralled by a prophet of its imminent demise. Scott Galloway is a professor at New York University’s Stern School of Business, and founder of a marketing consultancy. In a much-shared YouTube video, he delivers a talk entitled “The Death of the Advertising-Industrial Complex” to an audience of young marketers. In it, he argues that businesses can no longer rely on advertising to compensate for mediocre products.
Until the 1990s, says Galloway, the path to success lay in taking “an average beer, average car, or average suit” and wrapping it in appealing associations – this one makes you feel more elegant, this one makes you feel younger. Now, we live in an age in which the intangible haze of soft-sell is no longer necessary, and the battle for market share comes down to the raw strength of your product. “The sun has passed midday on brand,” he says.
The ad industry, run by people who pride themselves on creativity, is being displaced by the ad business, which prides itself on efficiency. Clients are spending less on the kind of entertaining, seductive, fame-generating campaigns in which ad agencies specialize, and more on the ads that flash and wink on your smartphone screen.
Why it’s HOT:
Modern media technology, more educated consumers, and the democratization of information have transformed the advertising business like no other. Today’s advertising agencies may not be able to help clients market mediocre products like they could have in a much simpler time.