Why candid communicators should articulate the value they create? | The Humane Club Made with Humane Club
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I've 15 years of experience in media, product & technology. By day, I work at a mainstream news site. On weekends, I read & write on media products. Most recently, I was a Knight Fellow w/ International Center for Journalists for 3.5 years.
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I've 15 years of experience in media, product & technology. By day, I work at a mainstream news site. On weekends, I read & write on media products. Most recently, I was a Knight Fellow w/ International Center for Journalists for 3.5 years.

Why candid communicators should articulate the value they create?

Published Mar 19, 2022
Updated Mar 24, 2022

Historically, content online has always been free. It is only now that news products are asking audiences to pay for news. To drive this behavioral shift, subscription news products must know what differential value they create for audiences, how best to articulate it, and finally what would value-based pricing look like?

The big picture: Subscription news products are intermediaries between writers (staff or external contributors) and audiences.

  • And just like any intermediary, news products justify their existence by adding value to the output of writers before audiences consume it.
  • If the value add done by news products isn’t clear to the writers and audiences, then they will just directly connect with on online platforms like Substack, Twitter Super Follows, Patreon, Locals, Medium.

Value-based Framework: We’ll build on Professor Felix Oberholzer-Gee’s Value Stick framework to breakdown the value created by news products into four components:

  • The maximum price that audiences would pay for your news product is willingness to pay (WTP).
  • The subscription price you charge has to be lower than WTP. A paisa more, and the audience is better off not purchasing.
  • Willingness to sell (WTS) is the least compensation that writers would accept for their articles.
  • Writer’s compensation is the amount that you pay to writers.

Value created by a News Product: The value created in this transaction is the difference between WTP and WTS, and the value is split between three stakeholders:

  • Audience delight is the difference between WTP and subscription price — value that you leave on the table. Hence, audiences get a better deal.
  • Writer’s delight is the difference between writer’s compensation and WTS.
  • Your firm’s margin is the difference between subscription price and writer’s compensation.

Do companies leave value on the table?: Yes! Most successful project management products, like Asana, charge per user. In contrast, Basecamp, another successful project-management product, leaves value on the table. It demands a flat fee of $99 per month irrespective of the number of users. 


Incessant focus on price is unsustainable

News companies have used both of these tactics liberally. As a result, journalist salaries have not kept up with market rates, and it is common to see discounted products.

Unsustainable: Short-term, all business operators change prices and salaries — two variables in their immediate control — to meet this quarter’s topline goals. However, sustained use of these tactics harms the business because these methods do not create new value and simply redistribute existing value.

Audience-side: If you increase prices, you reduce customer delight. If you give discounts, you increase customer delight but lessen the firm’s margin.

Value Stick Framework: Drop or increase the price.

Writer-side: Similarly, you can attract better writers by shelling out more cash but you’ll reduce the firm’s margin. Conversely, you can onboard lower-quality writers to improve the firm’s margin.

Value Stick Framework: Drop or increase salaries.

Create new value for Audiences

A more long-term sustainable game is to raise the audience’s willingness to pay by:

  • Creating new differentiated value for your audience
  • And articulating and marketing it

If the value is not differentiated and your value stick and your competitor’s value stick looks similar then the only way to compete will again be price. Hence, it is important to not play catch up and focus on what makes you different.

Value Stick Framework: Strategic interventions.

Create new value for Writers

Similarly, news products should also invest in creating value for writers. This could involve:

  • Training to become better writers
  • Onboarding experts, academics, and researchers who are not writers
  • Some ideological news outlets have a strong enough branding moat that experts with a similar ideological bent will be willing to write pro-bono.
Value Stick Framework: Strategic interventions.

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