Bundles and bundles of coupons

How much are we missing by not bundling channels together and giving customers choice and flexibility? As a lapsed newspaper subscriber, I reckon I’d be fairly representative of the sort of customer who could be enticed back to a subscription with the right kind of offer.

I’m not talking about offers of CDs, or the first three months free on a year’s print subscription. I don’t want the paper every day. But I do want it on the weekend. Most weekends. The rest of the week I’ll read online.

That makes me one of the mass of promiscuous online news consumers who mostly have little or no brand loyalty apart from, perhaps, to Google. And then there are mobile and tablet apps. As we add new channels, and start charging for some of them separately, we’re contributing to brand disaggregation.

So, why not have our brands everywhere bundled for flexibility and consumer choice?

One subs price for all access.

I can choose to get a paper delivered on Fri and Saturday, I can have access to the app on tablet and mobile, and when the paywall goes up on the web site I’ll have access to that too. (In the meantime, free web sites will continue to be a problem for subscription models).

By emphasising brand and presenting consumers with a package that is flexible enough to be customised for individual preferences we’ll be putting the customer first and will reap the benefits.

The digital trend of the last six months is group buying, a la Groupon.com.

There are more than a dozen sizable group-buying sites in the Australian market. They have grown from virtually nothing to a sector likely to generate more than $100m per year, according to a report in The Australian.

As far as diversifying revenue away from reliance on display advertising, this one is a doozy. With audiences to distribute to and sales teams to deliver deals, low overheads and high margins, it sounds like a great business model for publishers.

It’s also a great deal for advertisers. It works as a powerful customer acquisition tool, for some businesses much more so than display advertising.

And there’s the rub. It’s a disruptor to traditional ad sales businesses. But a lucrative one.

Cudo has seen the most dramatic growth over the last five months.

Spreets and Living Social have seen steadier growth over a longer period of time.

Publishers have been a bit slow off the mark.

APN has had some success with GrabOne in New Zealand and is making inroads in Australia.

The momentum is with pure plays, Yahoo!7 and Nine Entertainment. In January, Yahoo!7 acquired Spreets for A$40m. Cudo are backed by Nine Entertainment.

Publishers have the infrastructure and resources to take advantage of this opportunity. Despite the challenge it presents to traditional media business models, it would be a mistake to leave this new market to others.

Hugh Martin is a media consultant based in Australia.

Leave a comment