One Month In, Detroit E-Editions Surge, Print Cancellations Fewer Than Expected
One month into Detroit's reduced delivery experiment, readership of the e-edition is up -- a lot -- and cancellations of print and online combo subscriptions haven't been as massive as feared.
Nobody's popping any champagne (that was last week, when the Detroit Free Press won a Pulitzer), but the results suggest the potential and limitations of a hybrid solution to the challenging transition between print and digital.
Here's some of what's happened since the Free Press and Detroit News began limiting home delivery to Thursday, Friday and Sunday editions on March 30:
- Only about half as many customers as projected have walked away, and the papers are re-starting canceled subscriptions at a rate of more than 100 a day.
- Many more people than expected –- about 6,300 –- are opting to triple their subscription price and get the paper delivered by mail on days when home delivery is not offered.
- The papers' e-edition (Detroit News and Detroit Free Press), not to be confused with the Web sites of the News and Free Press, are attracting about 30,000 people a day, generating about 3 million page views a week. The e-editions provide PDF replicas of the printed paper and enable users to print and e-mail articles.
- Traffic to the papers' Web sites has grown modestly during the month, perhaps more a reflection of big news about the auto industry than anything related to delivery options.
"Four weeks do not make a trend for the year," said Janet Hasson, senior vice president for audience development and strategy at the Detroit Media Partnership, which runs business operations of both the Free Press and the News.
The key question at the heart of the papers' big gamble: Will readers lose the habit of reading a local daily paper if they're deprived of home delivery of the printed edition four days a week?
The tentative answer suggested by early results: Maybe not.
DMP CEO and Free Press Publisher David Hunke, who was named president and publisher of USA Today on Tuesday, says the Detroit papers must achieve positive cash flow by year's end for the plan to succeed. Hunke will retain oversight of the Free Press as part of his USA Today role. Both papers are owned by Gannett.
As Hasson points out, critical to positive cash flow is advertising.
"We will achieve the savings we projected (from reduced newsprint and delivery costs) and we will achieve the circulation revenue that we're committed to," she said in a telephone interview Tuesday, "but advertising is the wild card."
The uncertainty on that front has more to do with the dismal performance of advertising in general than spending cuts prompted by the reduced delivery plan, she said.
Many advertisers care most about the Thursday, Friday and Sunday papers, which account for about 80 percent of the ad revenue, and about audience retention, especially on those days. The reduced delivery plan is designed to cut costs as much as possible on days that matter least to advertising -- and to hang onto as much of the audience as possible. (See this AP story by Anick Jesdanun for especially good tracking of the Detroit operation's revenues and expenses as it headed into this experiment last month.)
Somewhere in the ballpark of 10,000 people (between 2 and 3 percent of home delivery customers) have canceled the Free Press or the News since the new distribution system was introduced last month. But that's less than half the number projected, according to Hasson, and growth in single copy sales has made up much of the gap.
And Hasson says many of those departed readers are returning to the ranks of subscribers. Under the new system, a subscription costs $12 for the combination of three days home delivery and everyday access to the E-edition. The price is the same for Sunday-only delivery and E-edition access.
"Every day, we're re-starting over 100 of those people who have stopped," Hasson said. "We're calling them, we're offering two weeks free, we're telling them, 'We want you back,' " she said. "I have this feeling that we're going to whittle away at this and that (the new delivery system) will not have a major impact on our home delivery volume."
Hasson acknowledged that circulation may very well drop for other reasons –- "people losing their jobs, people moving out of Michigan," etc.
Before the switch, the two papers sold nearly 500,000 copies during the week, most of them delivered to homes. The objective of the new system is to reduce that total -- on the four days with the least advertising -- to 200,000 copies, none of them delivered to homes. Hasson said single copy sales from 18,000 retailers appear to be supporting the 200,000 goal.
One surprise has been the number of people opting for expensive same-day mail delivery on Mondays, Tuesdays, Wednesdays and Saturdays when the papers are droped off in bundles at convenience stores and gas stations but not delivered to people's driveways.
"Currently we have 6,300 same day mail subscribers," Hasson said in an e-mail Wednesday, "so ... the number has held steady" since the papers offered the option last month. Four-day postal delivery adds nearly $20 to the $12-a-month subscription fee.
She said the papers hope to introduce the e-edition, now available only on the Web, on Amazon's Kindle by mid-May and to begin testing it on the new Plastic Logic platform some time this summer.
The first sign of the e-edition's new popularity emerged on a very big news day that also happened to be the first Monday without home-delivered papers. GM Chairman Rick Wagoner had been forced out by the White House the day before, and thousands of readers went to the e-edition to read the story.
"They completely overloaded the e-edition and the servers went down for about 30 minutes," Hasson said. "The vendor was shocked at how much traffic we were pulling in."
Before the delivery cutbacks, the papers were attracting 5,000 to 6,000 visitors to the e-edition. Currently, Hasson said about 30,000 people are viewing it on the so-called Express Days –- Mondays, Tuesdays, Wednesdays and Saturdays.
"Readers are flipping through the pages, they're printing the puzzles, they're looking at obits," she said. Interviews with users before the plan was launched indicated that many appreciated the "finished" nature of the e-edition as opposed to the constant updates of the Web site.
Since the average age of News and Free Press readers is mid-50s, Hasson acknowledged that the preference for a model emulating print may be largely generational.
"The 20-somethings are impatient and go the Web site," she said, while older readers describe the E-edition as easier to read than the Web site, which some of them describe as "all jumbled up so they can't find things."
Some personal disclosure is in order, reflecting my hope that the Detroit papers succeed with their print/digital hybrid. I worked for the Free Press for nearly 20 years until 1992, and early that year led the paper's first foray into alternate publishing platforms. Free Press Plus included audiotext (call the toll-free line for late scores from Tigers games on the West Coast), fax (get missing tax forms delivered at the last minute to your office fax machine) and online (read and discuss stories on CompuServe).
A generation later, in December 2008, my grandson decried the impending disappearance of the Free Press from his breakfast table in a piece on Poynter Online and the Free Press op-ed page. And this week, my daughter, a Free Press home delivery customer, e-mailed me a couple of status updates from her Facebook friends that reflect some of the bumps in the transition from print to digital. (Publication OK'd by the authors below.)
April 20 at 9:16pm
Paula Hampton at 9:55am April 21
I agree with Paul, I feel completely clueless without the paper and I refuse to sit and read it on the computer!
Nevertheless, Hasson said traffic to the papers' Web sites on non-delivery days is "trending upwards."
The AP reports that about 80 papers around the country have dropped at least one day of home delivery. Many others are considering such a move in the future. Detroit's special circumstances –- especially the region's crippled economy, the auto industry's ongoing crisis, the high stakes of local news –- suggest caution in drawing too many lessons for papers in other markets.
But Hasson said she's been surprised at how much readers have adapted.
"I knew we had a very loyal readership," said Hasson, who worked at Gannett papers in Rochester, N.Y. and Cincinnati before coming to Detroit four years ago. "I didn't know how far you can push subscribers. I've been through many price increases and I can predict what will happen in those cases. But there's never been something like this."
In addition to the Detroit papers' extensive efforts to let readers and advertisers know what was coming, she said they benefited from the good timing of bad news about newspapers.
"If we had done this two years ago, I don't know if the tolerance would have been there," she said. "We announced this in December and then there was a slew of papers that either said they were entering bankruptcy or they were getting ready to close ... People seemed to be telling us, 'If this is going to ensure you'll survive, I'll try to change with you.' "