Reuters’ Tim Faircliff: Leading new innovations in the world’s oldest news agency

Whatever happens and wherever it happens Reuters is never far away. Like the tree that falls in the forest, arguably it doesn’t even ‘happen’ until Reuters reports it. While every news media company touts ‘trust’ in its brand values, Reuters is the one source they all unquestionably place their trust in. For over 150 years, Reuters has built its business model on selling trusted news and data to media groups and financial institutions, and now that business model is changing.

Change agents

Tim Faircliff is tasked with architecting that change in the UK, and building a new business model out of the oldest of media businesses. While the merger with Thomson has swelled the group’s turnover to $13bn - and its staffing to 50,000 - Reuters.co.uk has had to find a way to behave with the youth and energy of an agile start-up.

“Change hasn’t been easy. We had to find new ways to work, creating small teams and decentralising responsibility to them”, explains Faircliff. “We had to change processes and structures, creating a new ways of working. We had to change some of our people, bringing in fresh thinking. And we had to do it fast.”

An accountant by training, Faircliff moved into managing digital businesses over a decade ago when the dotcom frenzy was at its height. What strikes you about him is the solid approach, financial thinking and focus on process. “Without the right processes our business doesn’t innovate – this is as much about change management as web publishing.”

Competing against itself?

By going direct to consumers, Reuters is setting out to create a mainstream consumer-facing brand and an advertising funded business around it. Although it’s had consumer websites since the late 90s, what’s different now is it has the weight of the company aligned behind that consumer offering: a massive company, massive resources, massive momentum. The scale of content is mushrooming, and the design, channels and personalisation tools of the Reuters sites are designed for an audience of business individuals rather than their corporations. Faircliff’s team form the gateway to the whole of Thomson Reuters, and that gateway needs rigid stewardship.

The speed of taking news to market has been key to Reuters since its business began. News is known for being perishable. The cliché goes that ‘today’s newspapers are tomorrow’s fish-and-chip wrapping’, but the perishability is more complex than this. In the moment a natural disaster strikes, a government coup is discovered, a government policy is announced or a company’s fortunes change, there is massive commercial advantage in acting on that news. From today’s stock market prices to the next decade’s futures’ trading, the value in Reuters’ information is in the speed of its delivery and the way people and organsiations apply this. “Two minutes later and it’s simply not news”, says Faircliff.

The consumer website only scratches the surface of the services available to their media customers, but the collapsing newspaper business model has clearly removed resistance publishers may have had to Reuters going direct. The is web notorious for disrupting value chains so it seems only inevitable that Reuters should go direct.

He refuses to be drawn on the future of newspapers, but it’s clear that a consumer-facing Reuters news service will rival only the BBC in breadth of coverage and quality of reporting. From the Middle East to North America, Australasia to Scandinavia, Reuters’ new digital direction will change the media markets by offering consistently powerful national coverage. Once the model is proved, it leads Reuters into the new markets of national news broadcasting as well as web publishing. With many print publishers outsourcing acres of page make-up to centralised news agencies and listings providers, it could see Reuters develop a stronger publishing business as well. Faircliff is modest about the future, with a dry wit that simply acknowledges: “yes, we’re in it for the long haul.”

Business models and charging for content

“While the website is free to consumers, we do not see this as giving content away,” he says. ”It’s simply that an advertising based revenue model is best suited to meet our consumers’ demand in today’s market.” This ad funded approach is a fundamental shift for Reuters and Faircliff is confident about the need to challenge conventions: “When I worked in newspapers, I was always being told, ‘Tim, you have to align your website to our business model’ – I’d say ‘why?’”

Reuters’ decision to launch a free to use website comes at the climax of the paid-for content debate. Opting for the ad-supported model clearly shows where the group sees its revenue growth coming from, but also implies where their business analysts see the media industry’s strongest approach. On the shallowness of the ‘charging for content’ debate (championed as the ‘saviour’ of newspapers), Faircliff is clearly weary. “At Reuters we’ve been in the charging-for-content business for over 150 years: most commentators seem to forget this. That doesn’t mean we’re putting a paywall around the front page of Reuters.co.uk, but it does mean that for sophisticated customers who want even more data and information from us, the website will act as a gateway to those paid-for services.”

New website; new approach; new advertising

Over the past five years, Reuters’ websites have become hot online ad properties. More than 30 million people use them each month, and they give advertisers a high-end experience, as well as the brand halo effect of being in the Reuters environment and around the very latest news.
“We’re deliberately after the high end business user. There’s massive over supply of ad inventory at the low and mid levels of the market, but a surprising shortage here at the top”. Faircliff readily admits Reuters “has to go out and sell the story, because most agencies don’t know the property because they’ve never had access to the brand before.”

For this to work, the format of content had to broaden. “We knew there was a need to innovate the product far beyond text and photo feeds. The new Reuters.co.uk site is heavy on multimedia content, videos and financial charting. We needed to create a content experience that people find what they need straight away; an experience that can be part of the filter they need in an information overloaded culture.”

Multi-channel; platform independent

There’s much chest-beating in media groups about how multi-channel they are. It’s been the stuff of press releases since the first websites launched, and with a new platform arriving every few months there’s never a shortage of opportunities to be among the first. Faircliff and I meet in a week where the number of iPad apps from British media groups seems to be ten times the number of British iPads. When he talks about multi-channel, I challenge on what it means for Reuters.

“There’s a lot of talk about mobile, but in practice, for most companies, the numbers don’t stack up. We’re a committed multi-channel provider with a great outdoor business as well as strong mobile platforms on Nokia, Android, Palm and iPhone. This is a market we’ve been at the heart of for years. Mobile is a game-changer.” It’s the immediacy of news creation and the timeliness of mobile browsing that provides the natural fit.

For Faircliff the iPad takes mobile much further. “This is a step-change in the way people read. It gives them the nearest thing to e-paper that we have in the mainstream consumer markets today. Reuters is creating a great iPad experience and had 40,000 downloads in the first week, but it’s the way this is woven into the rest of our mobile and digital outdoor business that will make it work for us.”

Structuring for continued innovation

Leading change in media groups is uncomfortable. Business models, content delivery, value chains and market demand continue to change simultaneously. Faircliff’s approach is characteristically level-headed, and focussed on the people, structures and financials. Under his stewardship, Reuters is charting a new direction and building a new type of business that will be the springboard for a consumer facing brand. Audiences are sure to come fast.

Links
The Reuters strategy: Opinion
Reuters website relaunch: News
Digital Minds: 60 seconds with Tim Faircliff
Today’s news on www.Reuters.co.uk

Danny has been coaching firms in digital marketing for over 15 years. More than 45,000 people have attended his talks and courses in over 30 countries. He set up and ran the UK and European IAB trade associations for almost 10 years, was the pioneering publisher of Telegraph.co.uk, held the Vice Presidency of NBC’s European internet business, and has been a government policy advisor in the UK. He is chairman of the Digital Training Academy that coaches marketing teams to improve their ROI and founder of the Digital Strategy Consulting practice that creates internet marketing strategies for brands. He is a Commissioner at the digital marketing regulator in the UK, and the publisher of Netimperative and Digital Intelligence. He now coaches management teams, helping them accelerate their businesses and transform their organizations. Contact him on Danny@DigitalStrategyConsulting.com or http://uk.linkedin.com/in/dannymeadowsklue

Comments from out guests:

In the next few months, we are going to see pay walls tested as the answer to publishing's financial challenges created by the shift to online. I am convinced that this will largely fail for mainstream news organisations. This should lead to greater scrutiny of the potential for advertising to deliver higher returns. Some publishers will roll-up their sleeves and begin the hard work of increasing audience share through greater engagement of individuals online and increased advertising yield from better targeting of rich media and video ads. This will in turn create even more pressure on advertising operations that will need to sell and manage these new advertising types -- and/or pressure on advertising agencies to innovate.

David Lane
Managing Director
EMEA, Mediaspectrum
www.mediaspectrum.net

The death of print

I disagree that the growth of digital and online news heralds the death of traditional print journalism. People said the same thing about radio with the advent of television. What actually happened is that radio’s market share dropped dramatically and then readjusted to a new level of demand. I would venture to say that the same is happening with print nowadays. Newspapers are in the process of having to adjust to a much smaller market, with the lion’s share of readers shifting towards online consumption. Digital has the added advantage of being able to host video and other multimedia content which newspapers just cannot provide. That said, I doubt print will ever go away completely.

Pay models for online sites

I do not think paid subscriptions for access to online sites is a viable commercial model for news outlets across the board. The reason it has worked so well for the FT online is because it is niche, top level business journalism geared towards a wealthy readership, who have money to spend and find value in the subscription. It offers editorial and financial commentary that nobody else has, and therein lies the value. News is ubiquitous; if the Telegraph Online started charging for access to general news they would rapidly lose readers to the Guardian Online. The only way they might get away with a pay barrier is if they implement it for specific editorial commentary. Ardent followers of specific journalists might find enough value in their editorial to pay a monthly subscription to continue to read them online.

Dan Montalbano
Project Manager- Media
The Newsmarket
www.thenewsmarket.com

Tim’s insight into Reuters and their tireless innovation, product development and agile team work is truly inspiring. Their product conveys trust, quality and speed which are required for todays decision makers who are overloaded with information. In addition the Reuters philosphy doesn’t try to dominate the user and trap them within their eco-system. The new redesign of Reuters launched today seems far more user friendly and I am confident their conversions rates will rise as a consequence. In addition I enjoyed the hosting of Netimperative and the type of questions raised by Danny.”

Danny Bluestone
Founder
CyberDuck
www.cyber-duck.co.uk