Which news strategy to adopt in a disrupted, technology driven environment?

What are digital innovators doing right and what to learn from them.

Digital transitions are notoriously difficult and frustrating processes for newsrooms struggling to remain relevant in a less than clement climate towards legacy media. What are digital innovators doing right and what can be emulated by all newsrooms? Lucy Küng, author of ‘Innovators in digital news’ and a fully revised version of ‘Strategic Management in the Media Industry — From Theory to Practice’, gives her insights on the news industry relentless search for the ideal digital strategy. She will also speak on the panel ‘Digital Disruption — A Roadmap for Reinvention’ at the GEN Summit 2017 in Vienna 21–23 June with Clemens Pig, CEO of the Austrian Press Agency and Dmitry Shishkin, Digital Development Editor at the BBC .

GEN: Since the first edition of Strategic Management in the Media Industry: Theory to Practice was published in 2008, what are the most prominent changes you have witnessed in the news ecosystem? And how are legacy media faring tackling these changes?

Lucy Küng: The huge change between the first and second editions is the ascendancy of technology in the media industry. Tech is no longer the ‘plumbing’ that allows news organisations to get their content out to audiences, it is now absolutely intrinsic to the creation of content, to the distribution of that content, to the quality of that content, to building a relationship with audiences, and to scale and therefore competitive sustainability. Many successful new players, like BuzzFeed or Netflix, are essentially tech companies with a media layer on top. Convergence theories predicted that media, tech and telecoms would gradually move closer together forming a mammoth new sector. In fact, the media industry seems to be slowly being ingested by the tech sector.

Inside companies we see this playing out in the gradual blurring of technology, editorial and commercial activities. There are leaders and laggards in this respect — not least because it’s a difficult integration to pull off. Workspaces, team structures, products, formats and tech systems all need to be changed, but more fundamentally a shift in culture is required, which is in turn a very significant leadership issue. It requires an approach that is on the one hand nuanced and respects the smarts of the individuals that create news, but on the other is relentless about increasing agility and the imperative of pushing forward towards a sustainable future.

The Guardian new strategy, kicked off last year, has ushered in successful evolutions as they went from 15,000 to 200,000 subscribers in a year. What can be learnt from their new model? How can other news publication emulate them?

The Guardian has a new leadership team and a new strategy which has yet to be fully implemented, so it’s probably too early to judge how they are faring or to extract key learnings. Like the New York Times and the Washington Post, the Guardian certainly profited from a ‘Trump bump’, so some of the uptick in reader income can be put down to that.

More fundamentally, the change in the Guardian’s strategy is part of a wider industry-wide shift where the religion of reach has been replaced by a focus on maximising revenue from users. This in turn is a response to the dominance of the platforms and their massive share of digital advertising revenues. The Guardian’s positioning here differs from that of many of its competitors because it is seeking to grow ‘members’ and ‘supporters’ rather than ‘subscribers’. This reflects its own distinct culture and editorial voice, and also its initial stance that content should be free — both of which make a classic subscription model and paywall strategy difficult.

Considering the model and practices of digital natives Buzzfeed, Quartz and Vice, what can legacy media learn from them?

The pure plays like BuzzFeed, Quartz, Vox are 100% digital. From inception they have been exploring how to use the evolving panoply of digital storytelling tools to create content with impact. Legacy media are retrofitting this capability, but part of their culture and systems are still focused on traditional journalistic processes and forms, so they have an inbuilt disadvantage right there.

Similarly, the pure plays have data analytics engines at the heart of their businesses, which means their content creation is permanently informed by insights on user behaviour and preferences. Again, legacy media are acquiring this capability as a priority, but it needs to be fitted into existing systems and processes, and into their journalistic culture.

And lastly, and possibly most critically, it’s important to remember that these new players are often magnificently funded. While legacy media are, essentially, all trying to do more with less, and effectively running two businesses, the old and the new, the digital pure plays benefit from very generous private backing, often venture capital. This not only allows them to move fast and hard into new areas in search of scale, but the VC sector is in general much friendlier towards risk. The entire sector is predicated on making intelligent bets, and recognising that not all of them will pay off. This in turn ‘de-sensitises’ experimentation and failure, both of which are much more charged issues for cash-strapped established businesses.

Strategic Management in the Media-Theory to Practice by Lucy Küng

What should be the role of active culture management in a pertinent organisational strategy?

Culture and agility are the issues for legacy companies — and closely interlinked. Agility is necessary if legacy media are to all those opportunities in digital economy that new players seem better at grasping, and agility is only possible if the culture permits it.

However, culture change is very difficult. The culture of an organisation is analogous to the personality of an individual, and we all know how difficult it is to change anyone’s basic personality. But that having been said, culture change is possible, and central to building a sustainable future.

An intriguing difference between pure plays and legacy firms is how they view culture. Obviously, the start-up culture is an entrepreneurial culture, but the difference runs far deeper than that. Many of the legacy organisations I have researched and worked with seem resigned that culture will be an inevitable barrier to their change ambitions, while new digital startups see culture as, first, something that needs to be actively managed, and, second, as a key performance driver.

Culture is a tricky issue in news organisations because journalism has a strong moral core. A deep commitment to the civic importance of quality journalism has powered many legacy players through a very difficult decade. But this also creates a sensitivity to anything that smacks of manipulation. Couple that with journalists’ allergy to management jargon, and it becomes clear that the task of shifting culture needs to be approached with both integrity and sensitivity. Crass culture change initiatives mired in management-speak will be rejected, and all culture change work needs to start with a recognition of how powerful a force culture is and how hard it is to change. But it needs to happen: culture is highly strategic, and organisations need to get smarter and more systematic about shaping their cultures and crafting the cultural dimensions of key change initiatives, otherwise they will be outperformed by the digital disrupters.

What are the main factors that should guide a news organisation digital strategy?

Strategy is highly context-dependent. All media organisations are different and their strategic options reflect their resource base, ownership and the characteristics of the home market. But all media organisations are also the same in that they are crafting digital strategies in disrupted, technology driven environments. The key factors I would keep in mind are:

  • Release strategy in beta too. The principles of agile product design have long been applied to news products, but they apply to strategy also. The digital media sector is a ‘non-steady state’ environment — in strategic terms things can change very fundamentally and very fast. This means strategy processes need to have an inbuilt expectation that of iteration, revision, testing (see the next bullet), and change.
  • When making big strategic bets, know what you don’t know. This means try to pinpoint the critical assumptions you are basing these decisions on and double check their validity before you move. Once resources have been invested it will become hard to reverse the decision. Be especially careful if assuming the new will automatically replace the old.
  • Know your endgame. Strategy needs to be more strategic. The velocity and sheer toughness of recent years meant that for many organisations, deep strategy work was hi-jacked by shorter term innovation projects. These were strategic certainly, but not a strategy. Rather, they were a series of opportunistic, often reactive projects that in retrospect made up a strategy but didn’t feel like that at the time. The new disruptive competitors started out with an end-game in mind. They may pivot frequently and change their goal, but the long term considerations guide current actions, and this is especially the case for digital pure plays backed by venture capital. Deep reflection on the endgame is critical. How can legacy players create a sustainable future? Where do they find scale?
  • Master the pivot, or (in the words of a pure player interviewee) “if it isn’t working, call it quits and move on quickly”. The pivot is part of Silicon Valley jargon, but under the hype lurks an important point. The pivot is a systematised way of capitalising on shifts in the market or reacting to strategies that don’t work, and examples of pivots are legion, and often forgotten: Twitter was originally a podcasting business, YouTube a video dating site and BuzzFeed, serial pivoter, has moved from tech provider to content play, from full-stack vertical integration to intelligent multi-platform network. A pivot does not replace the long-term strategic thinking discussed above, but is a competence that needs to partner it. Pivoting means shifting resources, and exiting areas with limited potential — both of which can be painful and complex processes for legacy organisations.

About Lucy Küng

Lucy Küng is a Senior Research Fellow at the Reuters Institute for the Study of Journalism, University of Oxford. She splits her time between researching strategy, innovation and leadership in the media and working in the industry. She is a Visiting Professor of Media Innovation at the University of Oslo and sits on the supervisory board of SRG, the Swiss public service broadcaster . She holds a PhD and Habilitation from the University of St Gallen, Switzerland and is the author of a fully revised version of ‘Strategy in the Media — From Theory to Practice’, of ‘Innovators in digital news’ and Inside the BBC and CNN — Managing Media Organisations.

Marc de Leuw — Isebox

“While most digital newsrooms look great — far too many lack the functionality and content to do a good job.” (Mississippi Business Journal, 5 May 2016)

Mike Wilson—Dallas Morning News

“We embarked on a project to assess the way we did our reporting and to see what our capabilities were as journalists. We needed to be a digital newsroom that also made a paper, not just a paper that incidentally had a website.” (Knight Center for Journalism, 21 February 2017)

Jason Alcorn—MediaShift

“Bragging about metrics got us talking about metrics and about what readers cared about. Win-win in my book.” (MediaShift, 16 August 2016)

Lauren Brown—Quartz

“The thing about special projects is they look and feel different, and they’re a bit unique in the unifying concept or principle, but at the end of the day, a good story is still a good story.” (Journalism.co.uk, 22 July 2016)
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