Transformation endgame (part 1) - the next 5 years decide

The newspaper business has evolved predictably in recent years:

• Print circulation shrank between 1 and 4 percent a year, depending on the publisher and region, and largely uniformly
• In the advertising market, the budgets of national customers migrated to the platforms
• To compensate for these losses as costs rose, subscription prices were increased by a few percentage points each year for everyone

But currently publishers are feeling increased momentum in the decline of print circulation - it will lead to a dramatic change in the overall structure in the very short term. The driver of this development is the age structure of print subscribers, which is once again significantly higher than the German population, which is known to be old. According to our analyses, 40 percent of print subscriptions will be at risk in the next few years. Currently, many publishers are recording subscription declines of -8 to -10 percent - figures that were previously unimaginable. They are the first signs of a dramatic tear-down that newspaper publishers are facing. In the next few years, we will see even sharper declines in subscriptions.

What is special about this situation is that tried and tested countermeasures of recent years are no longer sufficient or are even exacerbating the problem:

• General price increases are not accepted by more and more subscribers
• Reduction of volumes and issue structures lead to "perceived" quality losses and cancellations
• Proactive conversions from print to e-paper subscriptions with the aim of increasing the digitization rate lead to rising unit costs in delivery

All these logical measures accelerate the decline in print subscriptions and lead to exploding unit costs in logistics. This is because the distance paid decreases only marginally as volumes fall. To compensate for this, districts are taken out of delivery, which in turn accelerates the decline in circulation. Effects multiply.

In the next few years, there will be more "stalls" in the print business. Profits from print will drop dramatically and the print business will become negative. By then at the latest, the results from the digital business must be large enough to continue to operate the "newspaper business model".

Newspaper publishers must honestly answer three questions:

1. How much time do we have left to act at all?
2. How much change do we dare to implement?
3. What does our individual roadmap look like?

It is the biggest challenge of the last 90 years for publishers and media managers. It is not to be addressed editorially, sales-wise, logistically or commercially, but is comprehensive and complex due to numerous interactions:

Highberg helps you take effective action at the right time and develop the individual master plan for your publishing house. We are inspired by countless national and international projects and have good experience with systematic project design:

So far, only a few, mostly international media houses show that digital change can succeed. However, some framework conditions are different in Germany - and every publishing house has a different starting position. Best practices cannot be adopted 1:1 - each media house must find its own way.

If you are looking for a pathfinder, we would be happy to help.