Commentary

Reuters' Plan For Paywall Is Good Sales Strategy

Reuters is said to be planning an online paywall that will go into effect in February, another sign of how news organizations are developing revenue strategies aside from advertising sales.

It's the right move for Reuters, considering its professional audience will treat subscription fees as another cost of doing business.

The storied news organization, which is owned by Thomson Reuters Corp., last month announced the plans for a paywall in a memo to employees, according to a report in The Information, the tech news site with one of the strongest paywalls around.

Its coverage of industries, including energy and sustainability, along with its Breaking Views op-ed section, will be some of sections to go behind the paywall, The Information reported. Reuters is a dominant provider of news about commodity markets, which should give it an advantage in charging readers for value-added news and analysis.

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Reuters will be joining other business news publishers in walling off sections of their websites.

The Wall Street Journal has had a paywall almost since the dawn of the commercialized internet in the mid-1990s. Bloomberg, Business Insider and Fortune  also have started charging for access in the past couple of years.

However, Reuters isn't giving up entirely on revenue from sponsors and plans to redesign its home page to showcase digital advertising. It also won't use outside ad-tech companies to help target readers who visit the site, The Information reported.

That lesser reliance on outside companies is understandable, with technology companies like Google and Apple giving consumers more privacy controls. Google in January announced plans to stop using tracking technologies, namely third-party cookies, in the next couple of years. The change will make it harder for advertisers to track people as they move from website to website.

Amid these changes, publishers like Reuters will have to develop their own sources of audience data collected directly from readers. That first-party data can include information collected when readers sign up, followed by occasional surveys about consumer preferences or purchase intent. Publishers also can keep an eye on topics of most interesting to readers who research products and services.

While publishers need to be mindful of reader privacy, they can collect first-party information that supports their advertising sales efforts. In this way, asking people to pay for a subscription can start a virtuous cycle of building a personalized relationship with readers that's the basis for other revenue strategies.

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