Overseas Advertisers as Revenue Source

By: Steve Outing

Many online news industry observers thought the strategy was odd. (And I include myself in that group.) The New York Times on the Web, until three months ago, allowed U.S. users to access the site without charge. But non-U.S. site visitors were asked to pay about $40 per month for the privilege of reading the New York Times online.

Back in June, the Times gave up on that experiment, and now the site is open to the world — for free. And while non-U.S. users remain a small portion of the site’s total traffic, foreign registrants for the site in the last three months have been growing at a faster clip than for domestic U.S. users. (The Times requires users to register and provide some demographic information before access to the site is granted.)

The Times site is one of only a handful of U.S. news Web sites that truly has significant potential for a large overseas audience. New York Times Electronic Media Co. president Martin Nisenholtz says that there’s considerable pent-up demand outside the U.S. for Times content. A current Sunday Times print edition in Japan can cost as much as $30, he points out, which weighed into the reasoning for the old strategy to charge non-U.S. Web users to access the site.

Nisenholtz won’t quote the number of foreigners who were willing to pony up the money to access the Web site under the subscription plan, but acknowledges it was modest. The site now gets as many new registrants in a typical day as it got paid foreign subscribers over the course of three years. New York Times On the Web is the second busiest newspaper site, averaging 70-80 million page views a month, behind USA Today Online. (Nisenholtz points out that USA Today does not require registration for visitors to access, and he believes the registration required on his site does depress site visits somewhat.)

The growing international audience for the Times site — which is, of course, tracked by way of the registration process — is starting to turn into a viable advertising vehicle. Interest in advertising on the Web site from overseas companies is “significant,” says vice president and director of sales and marketing Chris Neimeth, and the site’s internal sales staff already has placed several ads from non-U.S. companies. A Citibank UK ad was targeted at site visitors from the United Kingdom, and the response rate to that campaign was higher than the typical campaign that runs on the site, he says. The Times site also has run ads for Buecher.de, a German online bookseller.

To date, Neimeth and his Web site sales crew have not sold any ads to companies wishing to reach a worldwide audience — though he has identified a number of companies that are interested. Most non-U.S. advertisers will rather opt for campaigns that serve ads only to Web users from specific regions or countries.

The potential is there to find companies that could benefit from a worldwide audience for their Web ads, however. Nisenholtz points out that as e-commerce grows as a business, companies selling goods on the Web will want their message to reach more than just an American audience. A bookseller like Amazon.com, for instance, can benefit from targeting Web users on other continents — and the Times’ literate, English-reading audience represents a logical placement.

Nisenholtz says that the idea of marketing to overseas advertisers is still in its infancy, with only a handful of advertisers responding to date. The Times’ internal sales staff has not yet marketed aggressively to overseas companies, though that day will eventually come when the site’s foreign readership numbers grow significantly. (Currently, the site has just over 5 million registered users.)

The Times does have an overseas ad sales force in the form of its relationship with the Swiss advertising services company Publigroupe. Neimeth won’t reveal terms of that relationship, but non-U.S. ad sales will come from both Publigroupe and the Times internal sales staff. He notes that some international ads have come through online inquiries, rather than sales calls by either staff or agency salespeople.

Is international Web advertising important to the Times site? It’s not yet a significant portion of the site’s revenues, but the newspaper’s electronic media executives think it will grow in importance now that the site’s doors have been opened to the world. Check back next year, they say.

European Web publishing award

A new award series has been announced for European Web publishers. Called “IP TOP,” the awards will identify the leading interactive publishing activities in Europe. Organizers of the competition are the Swiss publishing house Ringier EuropeMedia and the Interactive Publishing conference. Winners will be announced on November 12 at the IP conference in Zurich, Switzerland.

A nomination form is available on the Web.

(Editor & Publisher — host of this column — also conducts a similar award series, called the EPpy’s, which honors the best U.S. and international interactive news publishing ventures. Deadline for entries to that competition is November 1.)

USA Today e-mail news

In a sign that news publishers are taking e-mail content services more seriously, USA Today Online this week announced that it has entered an agreement with Email Publishing (Boulder, Colorado) for the e-mail services company to handle back-end duties for its e-mail subscription services. The company will deliver twice-a-week e-mail updates on NFL top stories, columns and special packages. The HTML content delivery service, called Endzone E-news, is free.

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Steve

Got a tip? Let me know about it

If you have a newsworthy item about the newspaper new media business, please send me a note.

This column is written by Steve Outing for Editor & Publisher Interactive. Tips, letters and feedback can be sent to Steve at steve@planetarynews.com

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