BPN 1174 FT: working on the holy grail

Pearson, the UK holding company of the Financial Times Group, published it quarterly figures this week. The press release said on the Financial Times Group, that it made 17 per cent on 2007 sales and 25 per cent of operating profit. “The FT Group is on track to achieve continued profit growth this year. FT Publishing has shown sustained growth in subscription, circulation and advertising revenues (up 2%) in the first half. Future advertising revenues remain difficult to predict, but we continue to expect to increase profit at FT Publishing even without any growth in advertising revenue”.

But there is a more interesting trend to be discovered in the figures: there are more online registered users than readers of the print edition. In figures: the daily circulation of the print edition remains constant on 450.000 copies, while more than half a million users have registered for access to the site. Online registered users are not equal to online subscribers, of which there are 100.00 subscribers.

So where does FT pick up its profit online. The number of subscribers is hardly enough to present a profit. Yet the online registered users are the money makers for FT as they are the collateral for the advertisers. Online subscriptions and online advertisement yield 63 per cent of the turn-over of the FT Group. In 2000 online subscriptions and online advertisement accounted only for 20 per cent.

The rise of the registered online user came after a change in policy by the FT at the end of last year. The visitors of the site are now allowed to read four stories a month for free and have access to the three-year archive. To read six or more stories with a limit of 30 stories per month, visitors will have to register themselves and log in; they have access to the five-year archive. An annual standard online subscription will cost the subscriber 119 euro and a premium one 319 euro. Pearson did not present figures about the non-registered consultation and the number of page views.

Yet it is clear that FT has found a way to make a profit from online. Of course, FT is a global, need-to-know newspaper for the financial world and a global, nice-to-know paper for an even wider group of users. Marketing wise the company has now a nice pond of fish to start upselling subscriptions to various products. In the meantime, the registered online user is a perfect audience for advertisers.

The online strategy can not just be transposed on the local newspaper of Almere or any other place. There is a certain algorithm in the numbers of FT: 500.000 registered users and 100.000 online subscribers. Projecting these figures to both sides, there are most likely 5 million people who occasionally visit the FT site in a year, while there are only 10.000 premium subscribers. FT hopes to increase its profit margin in the online business over the rest of 2008.

Blog Posting Number: 1174

Tags: online newspaper, newspaper