Covering the most powerful media companies to the smartest startups, former Independent media editor Ian Burrell examines the fraught problem of how news is funded today. Follow Ian @iburrell.
The Independent is targeting political advertising spend to propel its US expansion
The Independent is to chase US political advertising dollars ahead of the 2020 presidential election as part of a major commercial push into what is now its largest market.
The digital-only news brand believes that the charged political atmosphere of Donald Trump’s presidency offers a “massive opportunity” for its business in the United States, where it has built a monthly audience of 30 million users, well in excess of its following in its home market of the UK.
Publisher ESI Media is ramping up The Independent’s commercial team in New York under Blair Tapper, who it recruited this month from the Daily Mail to be its SVP, North America.
In an interview with The Drum, ESI Media’s chief digital revenue officer, Andy Morley, said Tapper would head a sales team of six at The Independent’s US offices in New York’s Union Square, where it has a 12-strong newsroom. He said that the publisher, which employs two political journalists in Washington, plans a new editorial and commercial operation in Los Angeles.
“We do believe we are going to see significant growth in the US because of our very firm position in terms of the political news agenda in the States,” he said.
The Independent’s expansion in the US comes after a turbulent year for ESI Media in which sister title the Evening Standard reported losses of £11.7m amid tough advertising conditions for a product that relies heavily on its freely distributed print newspaper. ESI Media also underwent a government-ordered inquiry into its acceptance of Saudi investment, amid concerns that the editorial independence of the two titles could be compromised. The probe was dropped last month.
Building an 'attractive brand' for political advertisers
Part of the thinking behind the US push is the surge in ad spend anticipated ahead of the US election, due on 3 November next year. Just over $10bn was spent in advertising at the 2016 election, with $7bn of that going to television, $1bn on digital and $0.85bn on press.
“Given the nature of our audience we believe that we will become quite an attractive brand for political advertising dollars,” says Morley. “The research that we have had…shows that, in North America, The Independent reader will tend to be an influencer amongst their social group. That’s an important stat for us to lead on when we are talking to the political parties and the agencies and consultants that represent how they spend their money, of which there is going to be a significant amount coming through in the next 12 months.”
Although Morley argues that The Independent’s traditional lack of political affiliation is an essential brand value, he says its strident editorial hostility to President Trump and his policies has been central to its American success. Trump’s occupation of the White House is “the gift that keeps on giving”, he says. “The human being inside me just wants to see the back of the nightmare that is Donald Trump…but actually from a news brand’s point of view and how it drives my audience it is absolute manna from heaven.”
America’s political discourse has rarely been so polarised and The Independent shows little inclination for neutrality in its coverage. “Although we are independent, that doesn’t suggest we will sit on the fence, far from it, we will take a very firm position on the matters of the day,” says Morley. “We take a very anti-Trump position on pretty much everything that he does because we believe [his policies are] illiberal and anti-progressive and something we have to fight and be very vocal against in order to fulfil our editorial position.”
It’s hard to imagine Republicans queuing up to spend ad money with the Indy, except to counter the anti-Trump message.
By contrast, the title takes a positive view of figures on the Democrat left, notably the US congresswoman Alexandria Ocasio-Cortez. “Every time she speaks in Congress we cover that in great detail because we believe that a lot of the things she is saying resonate very strongly with our editorial brand values.”
A battle for recognition – and ad dollars
US audiences are well-served by a culture of high-quality written journalism from papers with impeccable liberal values and well-defined journalistic practices, such as The New York Times and Washington Post. The Independent’s noisy uncompromising stance is designed to get it noticed. “The New York Times will see itself as being the newspaper of record from a political point of view; I would describe it as incredibly well-written but a little bit worthy,” says Morley. “We are a digital brand and not a broadsheet newspaper and we like to get to the crux of the story a bit quicker and make a decision on where we stand on that story in a way that perhaps The New York Times would be loath to do.”
Morley pointed out that The Independent’s ComScore data showed it had a larger North American audience than many high-profile US digital news outlets. “Just recently we have eclipsed both Vox and Vice in North America.” It is also outperforming some larger UK publishers that have invested more heavily in America. The Indy’s North American audience is “effectively double the size” of his former employer, The Telegraph, which operates a restricted access premium model.
Globally, The Independent’s reach is 90 million a month. While the UK market remains “sacrosanct in terms of its commercial importance”, the audience there (23 million a month according to Pamco data) is now somewhat less than that across the Atlantic.
But monetising that US following is another challenge altogether.
A first obstacle to overcome is the assumption that most of these readers are “English ex-pats living in New York”, Morley says. “Far from it. More than 95% are US citizens. This is about intelligent, high-net-worth individuals, college-educated, living in big cities in the States.”
Morley accepts that the US advertising industry remains largely ignorant of this reach and of his brand. “Awareness at the ad agencies of the brand and what we deliver in terms of audiences is negligible currently. I see that as pushing on a massive open door.”
It’s why he hired Tapper, a New Jersey native who has spent the past six years helping to build the Daily Mail into a brand that American audiences recognise and that advertisers value. When Tapper began that mission “people thought the Daily Mail was a postal service website not a news site”, says Morley, who hopes she will be able to “rinse and repeat” her Mail strategy for The Independent. “I feel confident that with her stewardship we will be able to change our business very, very quickly.”
The US expansion playbook
During Morley’s first six months at ESI Media, he has been on three trips to the US and says: “We think about our US opportunity a lot.” Tapper will be expected to negotiate the direct advertising deals that can transform a business that currently depends almost entirely on programmatic inventory traded on the open market. “The machines already find us very attractive,” Morley says.
Doing direct deals will become easier when agencies and clients understand that The Independent is not merely a political news platform but a publisher with a heritage in lifestyle and entertainment publishing (the source of half its traffic in the UK), he believes. US advertisers will also see value in explaining their corporate social responsibility positions to an audience of “socially conscious consumers” that puts a premium on ethical products. “That’s not people who want to live in teepees in the desert and turn their back on capitalism, that’s not what we are about. We have always been very comfortable with wealth and fashion and feeling good.”
Climate crisis coverage is another area where The Independent has a tradition dating back to its days as a broadsheet newspaper. “It’s a very authentic position because 30 years ago we were campaigning around climate change when really it was just us and Sting.”
Setting up a base in LA, he believes, would allow The Independent to connect with an important advertising market and better serve an empathetic west coast readership. “I feel part of our US spiritual home will be in LA.” After California, he wants a presence in Chicago to target the midwest.
He claims that The Independent’s experience of producing Middle Eastern editions (controversially with the help of a Saudi-based publishing partner) in Arabic, Turkish, Persian and Urdu, has put it in a strong position to launch a new Spanish-language service aimed at the Latino audience in the US and key markets in Latin America.
In its North American adventure, The Independent (where I worked until 2016) has trailed behind its better-resourced rival The Guardian, which is now a respected fixture in the US media landscape.
But this more gradual approach has allowed it to learn from The Guardian’s experience and avoid costly mistakes. Morley admits to being interested in replicating some of The Guardian’s success in persuading American readers to contribute donations towards campaigning journalism that chimes with their values. “There are big and favourable tax implications for donating. That’s why it’s a model that seems to work in the States – so it’s something that we are considering.”
But in the short term, his “absolute focus” is on advertising, whether that comes from political campaigns or from lifestyle brands and other more mainstream clients.
As he and Tapper seek to make their introductory pitches to American advertising folk, they do so in the knowledge that they already have a 30 million audience and a lucrative relationship with the ‘machines’ that generate programmatic income. It’s a “unique position”, Morley says. “We are like a startup because it feels like we are starting from scratch but yet we have got million-dollar revenues flowing through the open marketplace.”
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