What The NYT's head of ads thinks about being 'subscription-first'
In a digital media landscape littered with layoffs, mergers, acquisitions and bankruptcy, the "failing" New York Times remains a bright spot.
Last week, The Times reported adding more than a quarter-million new digital-only subscriptions in its earnings call. CEO Mark Thompson announced an accelerated long-term goal of more than doubling its total subscriber count to 10 million by 2025. Digital advertising also surpassed print for the first time, jumping 23 percent to $103 million in the fourth quarter.
The gains are the fruits of a strategic shift first articulated in a 2015 document called "Our Path Forward," in which the Gray Lady made public its intention to adopt a subscription-first model.
Which invites the question: What does a subscription-first model mean for the paper's ads business?
"For a business that predominantly traded on scale, it scared some of us," says Sebastian Tomich, global head of advertising for The New York Times. "Digital advertising hadn't traded on metrics like engagement and talk about talent and journalism."
When the goal was to make money on scale, says Tomich, the tool was programmatic advertising. For every previous year he had been at The Times — and before that, Forbes — the automated buying and selling of ads meant more ads on pages, which meant more revenue. Re-orienting the publisher around subscriptions and a direct connection to its readers meant programmatic "was no longer a tool for growth."
Tomich is the most recent guest on the "Ad Lib" podcast, where he discusses The Times' transformation, on both the editorial side and the business side, especially as the latter pertains to its brand marketing unit. T Brand Studio, which launched in 2014 to create content for brands, has morphed into a fully fledged marketing services company with subsidiaries HelloSociety (an events/experiential company) and Fake Love (social media marketing).
The Times as an advertising company
"The point is we have a broader portfolio of businesses than we did in the past," Tomich says. He points to the work The Times has done with marketers like HP over the last three years, building a brand newsroom and consulting on how to create their own studio. He also points to the fact that T Brand Studio has hired as executives Amber Guild, a former managing director of the Martin Agency's New York office, and Kathleen Diamantakis, formerly of Kirshenbaum Bond Senecal & Partners.
"We're not trying to replicate the WPP of the past. We're trying to build something new," Tomich says. "I am convinced no matter where the future heads, marketers are going to want to create moments, develop high-quality creative and convene a lot of people to specific places at once."
We discuss that, plus the runaway success of The Times' podcast "The Daily," a daily conversation with reporters and sources behind the paper's biggest stories of the day.
The Times as a podcaster
"'The Daily' has revolutionized our business," Tomich says. "It's the first product I've ever sold that has more demand than supply."
A nice place to be. For now.
For now, says Tomich, the economics work in that The Times owns the content and sells the ad space itself. But he also cautions that podcasts in general are in the midst of a gold rush.
"Any betting person," he says, would wager that "the platforms will move to a paywalled approach, which means we will have to do the same. Then it becomes much more about direct connections."
The success of "The Daily" has also convinced The Times to get into TV. Beginning in June, the paper will launch "The Weekly" on FX and Hulu. The weekly 30-minute documentary show will be anchor-less, featuring instead a new reporter every week discussing the big story he or she is working on. It's also a new way for The Times to get its brand in front of new audiences.
"It's 80 million net new households," Tomich says. "The idea is, lets get a New York Times product in their hands. At worst we make them passionate about journalism. At best we make them passionate about the New York Times."
On platforms -- and the president
You won't see it on Facebook Watch, though. The Times maintains a skepticism about the platform approach of putting its content where it doesn't own the experience — or the audience. The publisher has limited engagement with Apple News, for example, and has pulled out of Facebook Instant Articles.
"Our relationships with the platforms are tricky because they have the same goals we do," says Tomich. "We want a large, engaged audience on our platform; they want a large, engaged audience on their platform."
We also discuss consolidation in the media space and the paper's antagonistic relationship with a certain sitting president, who often dismisses The Times as "failing."
"It's hard to separate the rise of Trump with the rise of interest in journalism and the success of subscription-funded journalism broadly," says Tomich.
"Even though advertisers never come in and say, 'I want to be right next to Trump, right next to your political coverage,' they do have a lot more interest in working with The Times. It's so much more of a current brand than it was three-plus years ago."