The Guardian’s financial problems
The Guardian, based in London, along with numerous other print media has faced the issue of the downturn in advertising and circulation of print media as more and more news outlets publish on the Internet. The loss of revenue from print ads is often difficult to make up through ads on digital versions of papers especially with the advent of ad-blockers.
The loss of revenue from the decline of subscribers to print versions of media has led to many newspapers to charge for access to articles setting up what is called a paywall. The Guardian has chosen not to go that route so far but is depending on reader support.
A reader can subscribe to the Guardian digital version, print version or both as described on this site. However, there is also a membership plan that involves a fee each month. Unlike many newspapers there are so far no restrictions on access to articles that one might reach through links.
Some newspapers require that one answer some questions before one can access an article others allow one to read so many free articles per month. No doubt the Guardian may increase its readership as many top newspapers are now behind a pay wall,
The drive to become international
Another reason that the Guardian ran into financial difficulties was that it launched an ambitious plan to expand internationally especially after it won the Pulitzer prize in 2014 and gained much attention internationally with its coverage of Edward Snowden’s files on NSA spying.
The Guardian decided that it would use what CEO Andrew Miller called “membership propositions.” to grow the necessary revenue to cover their increasing expenses rather than trying to force readers who were not subscribed to pay more through erecting a pay wall.
Developing membership schemes to provide financial support
Andrew Miller former Guardian Media Group CEO explained the reasoning behind the scheme that began in 2014 :
“Will it be a wall between the reader and the content? No, it won’t be. It’ll be adding more value for people who want to get more involved in the Guardian, who feel passionate about the Guardian.We recognize we have to get more direct-to-consumer revenue over time, and the way we will do that is through membership-type propositions, but it’s going to be much more than a paywall. A paywall is to me an inverse loyalty scheme, where the more you consume the more you pay, which doesn’t seem to work.”
The Guardian took other measures to better its financial situation. In 2016 it began a plan to cut its spending by 20 percent over 3 years. However, it also worked on enhancing its membership plan.
A small team was set up to envision a new plan. 12,000 thousand members had already signed up but many of the events involved were in London providing no incentive to join for those further away let alone living in other countries.
Natalie Hanman membership editor and Ananda Michel, deputy director of membership were key members of the team. Michel had developed community engagement skills while working with ProPublica and Huffington Post.
Hanman said that the Panama Papers investigation by the Guardian was the first test of some of their new ideas:
“It was in April last year that Amanda and I did the first experiment basically using a carrot, not a stick, to support the Guardian’s journalists. We were really drawing the link between time and effort and skill we put into that investigation, working with these organizations around the world and asking people if you value this, please contribute toward this.”
Reader revenues surpass ad revenues by the end of 2016
Reader revenues include not just memberships but subscriptions, newsstand sales and contributions.
Katharine Viner, editor in chief in announcing the historic event noted that 500,000 individuals contributed monthly as members and subscribers of the print and digital edition. Another 300,000 one time donations have also added to revenues from supporters.
The Guardian has various grades of members with various incentives for each rank. Supporters pay 5 pounds per month; partners 15 pounds; or patrons at 60 pounds a month.
The change in strategy of the team helped increase the number of members from 12,000 at the beginning of 2016 to 300,000 now.
Explaining the problem and asking for support
Apparently many readers simply fail to understand the problems facing print journalistic organizations according to Hanman and Michel. In April of 2016 they placed an appeal noting the time effort and skill put into making the investigation. They then asked for support from those readers who value such journalism. This together with the fact that good journalism draws many readers has worked to increase membership and support.
An article by the editor Katherine Viner on Guardian coverage of Brexit is a prime example of this sort of appeal.
Guardian wants to ensure members feel valued
Hanman said that the paper wanted to keep growing its membership base and also wanted to ensure that members felt valued. Feeling valued would no doubt contribute to members staying as members and even contributing more.
Supporters receive a weekly newsletter and a weekly story production series. There is even a podcast with supporters’ calls and questions.
Michel said: “The last year has really been a foundational year. It’s about creating a network of colleagues across the Guardian to develop essentially a shared experience and expertise. Now that we have the foundation we can start becoming more creative. We’ve moved away from the traditional transactional model to a more emotional one that’s rooted in our journalism.”
Guardian has a long history
The Guardian a daily UK newspaper was originally known as the Manchester Guardian from 1821 right up until 1959.
The Guardian is part of the Guardian Media Group owned by the Scott Trust that was created in 1936. It is designed “to secure the financial and editorial independence of the Guardian in perpetuity and to safeguard the journalistic freedom and liberal values of the Guardian free from political interference.”
Profits from the Guardian are reinvested in journalism rather than being used to benefit an owner or shareholders.
The paper has published many important investigations including of the Panama Papers and also the PRISM surveillance program based on data leaked by Edward Snowden.