The paywall erected by The New York Times is widely portrayed as a measure to raise circulation revenue, by getting heavy users to pay for some of the content they consume, as opposed to an advertising play.
But in a complex digital world, it can actually be both. A new ad from Lincoln offers a select group of heavy users free, unlimited access to the Web site for the rest of 2011.
This strategy relies on precise targeting enabled by the NYT customer database. Lincoln is only showing the ads to heavy online users that are not already entitled to free access by virtue of subscribing to the print newspaper.
According to Ad Age, which first reported the news, the offer is only going out to about 200,000 heavy users. Perhaps 100,000 will avail themselves of the special promotion -- a value of $135 for April-December, at $15 per month.
While this innovative offer is sure to attract a lot of attention, it should not involve much sacrifice on the part of the NYT, which has previously estimated the total number of heavy users at somewhere around 6 million. If Lincoln's projections are correct, the NYT will be giving up at most 2.2% of its potential heavy user base -- not all of whom would have agreed to subscribe anyway.
Analysts have described a 5% conversion rate from the NYT's heavy user base as "modest;" assuming a 10% conversion rate, the NYT might expect to have 600,000 customers buying digital subscriptions. To keep the door open for new readers, the newspaper is also allowing free access to people who arrive at stories via search engines, blogs and other outside platforms.