Going digital only - not the walk of shame it once was

How going digital-only became a positive move for publishers.

Going digital-only was once seen as a last desperate throw of the dice for a dying print brand. But not any more.*

Take Auto Trader as a for-instance. If anyone was going to be sunk by the rise of digital media it was a magazine based almost purely on classified motor vehicle advertising. For those who haven’t noticed – the advertising of cars, houses and jobs has now moved almost exclusively online, with devastating consequences for newspapers (and to a lesser extent magazines) large and small.

Trader Media Group (joint owned by Guardian News and Media and Apax) is the ultimate example of how an old-fashioned print business can not only survive but really thrive in the digital age.

Back in 2000 Auto Trader was selling 368,000 copies a week and helping Trader Media achieve revenues of £220m a year. (It was an early adopter to online by the way and at that point claimed to be attracting 28m ‘page impressions’ a month.)

In 2005/2006 (reckoned by many to be the high water-mark of print newspaper profitability in the UK) it reported turnover of £303.3m and delivered an operating profit of £119.5m. (By this stage it was attracting 6.6 million unique users to its website a month).

This week Trader Media Group announced that its dwindling print edition would be scrapped at the end of June. At last count it sold 27,000 copies a week compared with claimed website traffic of 11m unique website visitors a month.

In the financial year to April 2012, Trader Media Group achieved turnover of £257.2m and an EBITDA profit figure of £142.9m.

Now the profit figures may not be directly comparable. But nonetheless, I would be surprised if any other big media brand can claim to be actually making more money today than they did in 2005. Apart from the little matter of digital disruption we are now five years in to the biggest media downturn in history.

Auto Trader has succeeded by being the very best at what it does. Its free-to-air website is supercharged with an array of digital tools which make it the perfect place to buy and sell your car.
Ebay has made some in-roads into this market, but most of us still feel that a decision on which car to buy is too important to trust to a general auction website. So the market is still dominated by Auto Trader and the other specialist sites.

I’m sure Auto Trader has also been enormously helped in its move to becoming a digital-only business by the print heritage which has made it a trusted brand. Its success shows that you don’t always swap print pounds for digital pennies when you move from being a paid-for newspaper or magazine to a free website.

*Declaration of interest: Press Gazette went digital-only at end of last year.

Photograph: Getty Images

Dominic Ponsford is editor of Press Gazette

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What type of Brexit did we vote for? 150,000 Conservative members will decide

As Michael Gove launches his leadership bid, what Leave looks like will be decided by Conservative activists.

Why did 17 million people vote to the leave the European Union, and what did they want? That’s the question that will shape the direction of British politics and economics for the next half-century, perhaps longer.

Vote Leave triumphed in part because they fought a campaign that combined ruthless precision about what the European Union would do – the illusory £350m a week that could be clawed back with a Brexit vote, the imagined 75 million Turks who would rock up to Britain in the days after a Remain vote – with calculated ambiguity about what exit would look like.

Now that ambiguity will be clarified – by just 150,000 people.

 That’s part of why the initial Brexit losses on the stock market have been clawed back – there is still some expectation that we may end up with a more diluted version of a Leave vote than the version offered by Vote Leave. Within the Treasury, the expectation is that the initial “Brexit shock” has been pushed back until the last quarter of the year, when the election of a new Conservative leader will give markets an idea of what to expect.  

Michael Gove, who kicked off his surprise bid today, is running as the “full-fat” version offered by Vote Leave: exit from not just the European Union but from the single market, a cash bounty for Britain’s public services, more investment in science and education. Make Britain great again!

Although my reading of the Conservative parliamentary party is that Gove’s chances of getting to the top two are receding, with Andrea Leadsom the likely beneficiary. She, too, will offer something close to the unadulterated version of exit that Gove is running on. That is the version that is making officials in Whitehall and the Bank of England most nervous, as they expect it means exit on World Trade Organisation terms, followed by lengthy and severe recession.

Elsewhere, both Stephen Crabb and Theresa May, who supported a Remain vote, have kicked off their campaigns with a promise that “Brexit means Brexit” in the words of May, while Crabb has conceded that, in his view, the Leave vote means that Britain will have to take more control of its borders as part of any exit deal. May has made retaining Britain’s single market access a priority, Crabb has not.

On the Labour side, John McDonnell has set out his red lines in a Brexit negotiation, and again remaining in the single market is a red line, alongside access to the European Investment Bank, and the maintenance of “social Europe”. But he, too, has stated that Brexit means the “end of free movement”.

My reading – and indeed the reading within McDonnell’s circle – is that it is the loyalists who are likely to emerge victorious in Labour’s power struggle, although it could yet be under a different leader. (Serious figures in that camp are thinking about whether Clive Lewis might be the solution to the party’s woes.) Even if they don’t, the rebels’ alternate is likely either to be drawn from the party’s Brownite tendency or to have that faction acting as its guarantors, making an end to free movement a near-certainty on the Labour side.

Why does that matter? Well, the emerging consensus on Whitehall is that, provided you were willing to sacrifice the bulk of Britain’s financial services to Frankfurt and Paris, there is a deal to be struck in which Britain remains subject to only three of the four freedoms – free movement of goods, services, capital and people – but retains access to the single market. 

That means that what Brexit actually looks like remains a matter of conjecture, a subject of considerable consternation for British officials. For staff at the Bank of England,  who have to make a judgement call in their August inflation report as to what the impact of an out vote will be. The Office of Budget Responsibility expects that it will be heavily led by the Bank. Britain's short-term economic future will be driven not by elected politicians but by polls of the Conservative membership. A tense few months await. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.