The New York Times is looking to create "significantly more" video to meet the demand of readers, a move that will also help it scoop up lucrative ad dollars.
Top brass at the Times Co. discussed the video strategy during its second-quarter earnings call on Thursday, when it reported a 6% decline in advertising revenue. Digital ad revenue declined 2.7% and print retreated 6.8% from the year prior, the company said.
In addition to video reporting, the Times has produced a branded documentary series and aggregated videos from Retro Report, an outside organization that looks at major news stories of the past few decades.
It has only attached advertising to some of its web video, though. Video reports on certain breaking news events -- such as events surrounding the Boston bombing and the selection of the new pope -- have largely been off limits to advertisers, the company said.
The Times began offering unlimited access to video during the second quarter, allowing viewers to avoid its metered pay wall.
"The appetite, specifically from advertisers, for opportunities to do video advertising on The New York Times is so great that we think the chance we have to grow our share of the video ad market is large indeed, even if rates over time, come down," said Mark Thompson, president and CEO of the Times Co., during the earnings call.
New revenue efforts
The Times Co. is facing an industry-wide ad slump as businesses shift their marketing budgets online, where the inventory is wide and programmatic buying pushes down ad rates -- a point the Times' executives acknowledged Thursday. Although increases in the number of digital subscribers has helped offset some of these declines, they haven't grown quickly enough.
Digital subscriptions to The New York Times, The International Herald Tribune and the Boston Globe increased 5.1% to 738,000 in the second quarter compared to a year earlier.
Overall revenue slipped nearly 1% to $485.4 million from $489.8 million in the second quarter of 2012. Excluding some items, profits were 14 cents a share, beating analysts expectations of 13 cents a share, according to Bloomberg.
The Times has outlined or introduced several efforts to help generate revenue. New paid (and mostly cheaper) products are slated for release in early 2014. The Times also introduced standardized rich-media ad units for its iPad apps, which it sells at a premium price. And several brand extensions -- including a games business associated with the paper's crossword puzzle, e-commerce and a growing conference business -- are also in the works, the company said.
But video appears to be the surest way for the Times to capture more ad dollars in the near term.
"They've got the advertising relationships and the demand," said Ken Doctor, an analyst. "They need the inventory."
"That is money they can bring in before the introduction of the new paid products," he added.
Developing and monetizing video has fallen on Rebecca Howard, who the Times hired from Aol to serve as general manager of video in February. Ms. Howard reports to Jill Abramson, the Times' executive editor, and to Denise Warren, the executive vice president of digital products.
Last month, the Times also hired Meredith Kopit Levien from Forbes to serve as head of advertising. She's scheduled to start next week.
"We are very keen to improve the performance of The New York Times Co. in digital advertising," Mr. Thompson said on the call. "And I actually do not think that we should be satisfied with a continued contraction of digital advertising revenue. We're looking for solutions, and that's an area where we want to restore to growth."
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