De Correspondent Thought Online Subscriptions Through
The Dutch site’s entire business model is optimized for the web. Here’s what to like.
The Dutch website De Correspondent has a very interesting approach to journalism. Its model is fully build on the presumption of the internet and the underlying mechanics at work there. I had the site vaguely on my radar from its crowdfunding days but didn’t follow it closely, due to the language barrier. This, however, is set to change as the site is preparing its US launch.
Reason enough for me to look at the company in some depth. It’s going to be a two part series. In this part I’m going to explain why De Correspondent gets a lot right conceptually. The second installment will focus on the economics and the plan to conquer the US market.
If you aren’t familiar with the site, let me give you a brief summary of how it operates:
- It’s a completely ad-free site; they use a subscription model instead
- It doesn’t focus on breaking news but deeply-researched, longform stories
- It is build around its writers — the correspondents — and their relationships with readers
There have been many attempts to create subscription-based news publications and it has proven to be a difficult business. Even the New York Times, which started prioritizing subscriptions over ads with its 2020 report, is heavily relying on ad dollars. However, there are several things which set De Correspondent apart from other sites.
Building a Catalogue
First, the company doesn’t focus on news — which readers can get everywhere — but on stories that have a longer shelf life. Lately, I’ve written a lot about the music industry and how labels managed to use their catalogues as leverage against the streaming services. Creating differentiated stories that are valuable to readers for more than a few days is the equivalent of building such a catalogue. It is the opposite of the approach traditionally taken by news organizations. But it is critical for building a subscription business.
The heuristic goes like that: In order to have a successful content subscription business, you need to own content that is highly differentiated and worth paying for. It sounds straight-forward but is actually tough, particularly in news/journalistic media. The first problem is pretty straight forward: it is expensive to create. Ignoring news, thus, means De Correspondent focuses its limited resources. That is likely the better long-term choice than creating a bit of a buzz by having a breaking news story.
Alas, this doesn’t do away with the second problem: You can’t predict longevity with a high degree of certainty. Thus, publishers need to increase their chances by creating a lot of content that has the potential to fulfill that criteria. That’s very challenging in the beginning, as it is a race against your finite resources. On the flipside, any company that manages to succeed at it is well suited to build a sustainable subscription business.
That, by the way, is why it’s consequential to branch out into other forms of content like video, workshops or conferences: It creates additional pathways to monetize the “intellectual property” you created. De Correspondent is aware of this and, as a result, building a book publishing business on the side.
An Aggregator of Writers
The second reason to be bullish on De Correspondent is that they have gotten one key thing about online publishing right. It is a central topic of mine around here: The modern attention economy is centered around people or “personalities”. As I have written before:
In the print age journalists where mostly anonymous bylines. Only hardcore media consumers — that is: mostly media professionals — could name more than a handful of journalists. What mattered was the brand of the outlet. Those days are over. Today, writers have become personal brands. The best exceed at creating a following. Among regular people.
The internet gave journalists a face (first in the form of pictures, now increasingly also videos) and a voice. As people relate to people first and foremost, it’s almost natural that once we had a choice between brand and person we went with the latter.
Another way to look at it is from the perspective of bundling vs. unbundling. In print media, most texts were served in the form of newspapers or magazines. This was necessary because the need to distribute a physical product rendered serving individual texts unreasonable.
The internet, however, changed the game and unbundled texts. Online, the vehicle to distribute a text (or content more broadly) is the URL. That— in conjunction with new tools for publishing and discovery (particularly social and search) — made it viable for readers to follow the individuals who a) covered precisely the topics they cared about and b) whose knowledge and perspectives they valued.
As a result, the new bundle is the writer. That is why a blogger like Ben Thompson can successfully sell subscriptions and make a living as an entrepreneurial writer. This model, however, doesn’t lend itself to all kinds of writing. Also, not every writer wants to take the risk. This is where a company comes in. Yet, the reason why a publishing company exists on the web is very different from old media: It is a means to distribute said risk and enable writers to do projects they couldn’t on their own. It doesn’t exist to serve as the publication in a traditional sense. It’s not valuable because it is the bundle but because it functions as an aggregator of great writing.
De Correspondent understood that and put the writers front and center. The “correspondents” are prominently featured on the home page. Every writer has his/her own newsletter. Plus, all of them are expected to keep readers involved, e.g. by sharing information about work-in-progress or even inviting them to participate in the process. Which, of course, only strengthens the relationship between reader and author. Co-founder Ernst-Jan Pfauth told The Drum (emphasize mine):
“And, of course, there are business advantages because we turn those readers into more loyal readers. When they participate that leads to a stronger bond between the journalist and the reader.”
Most publishers would have made that statement with “our brand” instead of “the journalist”.
All those measures in conjunction appear almost as if De Correspondent is willfully unbundling itself. Managers in traditional publishing houses would certainly regard that as “suicidal to the brand”. Yet, it is only consequential. The Correspondent does what the internet’s logic dictates — and turns it into a strength. They allow readers to easily and selectively follow the writers and topics they care about. The company basically acts as a vertical of writers and thereby acknowledges that these are essential to their business.
Culture as a Competitive Advantage
One of the founders core ideas was to build an organization on the readers’ trust. In a time when media is in a credibility crisis, that is a good idea for journalistic reasons. But it’s also a smart business decision. Subscription-based publications rely heavily on trust. Because trusting individuals (if they have a track record) comes more natural than trusting brands, it’s smart to put your writers at the heart of your operation.
Writers at De Correspondent can freely pick their projects, they are allowed to voice their perspective and they are prominently featured (allowing them to build their own brand). Note that this isn’t nice-to-have. It’s mission-critical. This writer-centered culture serves another purpose: It doubles as a recruiting pitch.
In a business that fully relies on the quality of the writers it is essential to attract the very best talent. The fact that De Correspondent’s business model is totally aligned with its mode of operation and its culture is, thus, a valuable asset.
“There is no platform I can think of that combines all these things together. There’s no author-centered, beat-oriented, ad-free, member community, a knowledge community that’s an interactive, member-funded platform — one that does all these things together.”
This statement nicely summarizes the reasons why De Correspondent is, at the very least, a good case study if you are looking for interesting business models in online publishing. Not everything is perfect — as I will cover in the next part coming up later this week — but there are several things to like about the Dutch startup.
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