FT: Keeping up with the times?
How FT has managed to remain relevant, even as the news becomes commoditized.
The Financial Times (FT) is probably one of the most respected international newspapers, particularly in business circles where the paper provides extensive business, economic, financial and political coverage. The FT has managed to survive the threat of commoditization of news content from social media and news aggregators, and has managed to remain a relevant player in the news space, even with what may appear to be discouraging trends in terms of news consumption.
For instance, the modern news consumer has a large number of sources of news content. Social media is an increasingly popular source for news, with users of the likes of Facebook and Twitter often obtaining their news by clicking through from a link on their newsfeed. Twitter, has itself become a medium for transmitting breaking news almost immediately, including through its use as a platform for citizen journalism, and is able to generate public opinion pretty quickly once a feed starts to trend. While a Tweet can hardly be characterized as having the same in-depth content as an analysis piece in the FT at 140 characters long, one could wonder whether there will still be space in the market for the FT in the not-so-distant future.
This is further complicated by the emergence of news aggregators such as theSkimm and Daily Pnut, which provide a daily digest of the latest news from around the world, often linking to a wide range of sources for subscribers to read more. These news aggregators address the modern consumer’s desire to get a condensed summary of the top news of the day that can be easily consumed in a short period of time. The FT’s own daily ‘Briefing’ could be perceived as relatively dry, merely providing a headline and one line describing the article’s content.
Well, there is some genius in the FT’s approach. Firstly, the newspaper creates immense value for its readers by providing high quality, financial and business-relevant content, which businessmen (and their expense accounts) will happily pay for. Yes, the digitally savvy generation of 20-somethings seems to have a penchant for free, bite-sized morsels of news content, as delivered in Tweets or by news aggregators. However, this is not necessarily the FT’s current target market. Business leaders need to not only have information in their back pockets of what is going on in the world, they also need to have a handle on the implications thereof, which FT can address through the analyses, commentary and data it provides to paid subscribers. Furthermore, advertisers seem very willing to pay to get access to a captive audience of corporate FT subscribers. Therefore, FT is also able to capture significant value from subscriptions and from advertising.
In a world in which many were predicting the death of the newspaper industry, the FT continues to be an incredibly strong brand and highly profitable. In terms of circulation, its digital subscriptions accounted for 70% of FT’s total paying audience in 2014 – a testament to how FT is a digital winner.
Really enjoyed reading this post (I am a fan of FT myself). I completely agree that the content FT is providing is quite unique and cannot be fully compared with Skimm or other services. The audience FT is targeting is really specific and their needs for depth and length are quite different. FT seems to have recognized it early on with introduction of paid subscriptions, somehow earlier than its competitors. And the content is definitely there. However, I am wondering if FT has won already. If you look at NYTimes and compare the changes they made to the format, content and presentation, FT seems to be a bit behind. I had the mobile FT app for a while but delete it due to low performance. I hope with recent acquisition of FT by Nikkei will give the company enough breathing room to implement even more changes, especially to format and delivery. Thanks for posting!
I feel like papers like FT probably benefit from their specialization – it can be a bit more difficult to have access to quality specialized content vs. headline stories free. As you mention, free online information is characterized by quantity and brevity so it makes that deeper analysis of valuable content creates value readers are willing to pay for. It would also be interesting to look at the FT’s overall revenue evolution over time as it is not entirely clear from your post that they have indeed won.
It was an interesting post. As a fan of FT, I think FT will continue to lead the news paper industry’s digital transformation because of its ability to produce high-quality content and its strong brand name among its target customer base. I am still not 100% sure about whether Nikkei’s acquisition of FT would create synergy success, however, considering that FT and Nikkei know each other well thanks had a multi-faceted partnership since 2013 covering content syndication, licensing, training, events, China business, etc., I think that FT can comfortably pursue its strategy initiative without much changes in management or strategic direction.