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“The best year since the 1990s”: Swedish daily Dagens Nyheter looks at 50% increase in operating profit

Swedish daily Dagens Nyheter is on its way to increasing operating profit by about 50% to nearly SKr180M ($20M) this year. This marks the publisher’s best performance since the 1990s, the Financial Times reports

It’s an incredible feat in a year when newspapers around the world have been struggling with declining revenues. Even The New York Times which has signed up a record number of subscribers announced decline in overall revenue

“Being a digital-first organisation has helped us a lot”

“Financially, we’re heading for one of our best years, maybe the best year, since the 1990s. If somebody had told me that at the start of the pandemic, I would not have believed it,” says Editor Peter Wolodarski. 

This has to do with digitalisation. If you’re well positioned in this environment then what the pandemic has done is accelerated existing trends. 

Peter Wolodarski, Editor, Dagens Nyheter

The publisher saw a surge in subscriptions during the pandemic. Non-subscribers were given free access to the DN website at different points during the crisis in return for their email addresses. It led to nearly 200,000 registrations, around 25% to 30% of which became paid subscribers. 

However, the daily was already doing well in that area, having focused on prioritising reader revenues since 2015. DN had more digital subscribers compared to print (56:44%) before the crisis began. “The number of digital-only subscribers had increased over three years by 182%,” said Martin Jönsson, Head of Editorial Development at DN at a WAN-IFRA webinar in April.

“Being a digital-first organisation has helped us a lot,” he added. 

“It’s easier to see what works and what doesn’t”

DN has completely overhauled its newsroom’s structure and culture in the past 5 years to focus on digital reader revenue. Teams started working cross-functionally with everyone in the newsroom contributing towards growing the audience.

“For us, it’s logical not unnatural,” Jönsson told Digiday last year. “The way we used to run the marketing department, there was no interaction between different parts of reader revenue, between those acquiring readers, retaining them and journalists.” 

“Now we’re more integrated, it’s easier to see what works and what doesn’t.”

Martin Jönsson, Head of Editorial Development at DN

In 2015, DN’s business model was completely dependent on print. It had a miniscule percentage of digital subscribers. 

Between 2015-2019 its total number of subscribers increased by 26%, in spite of print subscriptions dropping by 43%. Meanwhile digital-only reader revenue increased by 40-70 % annually. In 2019, reader revenue exceeded 70% of total revenue.

Source:WAN-IFRA

“We focus on the value, not the paywall”

The other key factor in DN’s success has been a multi-pronged paywall strategy. 

The publisher uses three different paywall models: a metered model, a premium model, and a dynamic dashboard model. The last one is the most important as it drives more than half of all conversions. 

In this model, specific content is made free to access to drive traffic. After it has reached a certain traffic level, it is put behind the paywall. The process is driven by a combination of algorithms and editorial judgement.

“Trying to distribute a story to get people to talk about it and share it, and then putting it behind the paywall is key,” explained Jönsson.

He also sees value in marking articles for subscribers, rather than highlighting when they’re locked. “We focus on the value, not the paywall,” he told Journalist Lucinda Southern. 

“I think there’s been the wrong perspective in the business to say that content is not available or locked; this is wrong. We show where we give value, it’s more positive. For us, it’s important to attract with quality of content.”

The most misleading words in the debate of paywalls are probably “pay” and “wall” and the debate would be more constructive if we focused on terms like “value” and “access”.

Martin Jönsson, Head of Editorial Development at DN

“Our most important KPI”

However, conversion is only the first step as keeping readers interested is also critical. The publisher experiments with various products including the app, daily e-paper, audio articles, newsletters and push notifications to build readers habits. It prioritises longer reading times and frequent visits over other KPIs such as page views.

Source: WAN-IFRA

“Our most important KPI is always the total amount of time spent on a story,” explained Jönsson. “Anything you can do to get people to create new daily habits, such as listen to a new daily podcast, or opening a daily newsletter for instance, is very, very important to creating the kind of daily habits that you want to keep them around for a long time.”

The publisher was able to lower churn from 15% to 7% between 2017 and 2019. 

While logical, such a transformation isn’t easy for legacy print titles. A lot hinges on culture and leadership, according to Southern. 

“You have to state very clearly that survival depends on how well you handle that transformation to digital subscribers,” said Jönsson. 

“It’s a matter of survival for us; you have to take it seriously with a clear focus.”

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