The foreign connection: does it matter that over a quarter of Stuff and Herald online readers are located abroad?—UPDATED

  • Media
  • November 10, 2015
  • Damien Venuto
The foreign connection: does it matter that over a quarter of Stuff and Herald online readers are located abroad?—UPDATED

Research from Nielsen shows approximately 25 percent of unique online visitors to the Stuff website and 29 percent to the NZ Herald in the month of October came from readers located outside New Zealand. 

The data provides that 283,0000 average daily unique browsers visited Stuff from abroad and 239,000 visited the Herald, while the domestic numbers for the publications were 833,000 and 592,000, respectively.

NZME group revenue director Laura Maxwell interprets the high number of international visitors as a positive thing, saying it’s indicative of brand loyalty.

“The New Zealand Herald brand has such strong brand values as a credible news source so expats continue to visit the site on an ongoing basis as well as New Zealanders travelling overseas on holiday and business,” Maxwell says.

But are advertisers aware of the high proportion of international visitors and are they taking it into account when purchasing ads on these news sites?  

Foodstuffs group general manager of marketing Steve Bayliss says the numbers are higher than he expected but that this is still unlikely to influence his ad buying on either of these sites.   

“We were certainly aware of a material proportion of site traffic at all New Zealand websites coming from offshore,” Bayliss says. “The data indicating our news site traffic from overseas may be as high as 30 percent is above our estimates, but not so much it causes material concern. In terms of factoring in media rates for these sites we already build in an offshore buffer, and while digital is growing it is still not the main media channel we rely on to drive core consumer messages. As such, all things considered, the extra depreciation won’t have an immediate impact on our media strategy.”

Countdown general manager of marketing Bridget Lamont mirrors these sentiments, saying: “It is not surprising to us that there are visitors to New Zealand websites, particularly news sites, that come from overseas. These will likely include a number of expat Kiwis, and/or Kiwi travellers, checking up with news at home. That being said, at Countdown we generally buy (and therefore target our online ads) against a New Zealand audience.”

Like Bayliss and Lamont, most advertisers buying spots on a major news site will be aware that at least some of the audience will be derived from international eyeballs. 

And ZenithOptimedia business director says that those who buy programmatically have the ability to cut out this international audience entirely (if this is what they want to do).

“With the targeting of New Zealand eyeballs, this becomes almost moot,” says Lawson. “It’s interesting to know [in terms of gauging] opportunity, but it isn’t a negative unless you’re buying blind. I would assume most agencies would apply this basic level of targeting as a matter of course. It may be of concern to those buying direct who just assumed that all impressions would be going domestically.”

This really places the onus on advertisers to find out more about the audiences available on the sites, and Vivaki head of digital Nick Boulstridge encourages advertisers to ask for additional information if there is any uncertainty.   

“Publishers don’t have to disclose this on account of the targeting parameters but I’m certain they would share this information if asked,” Boulstridge says. 

From the perspective of the publishers, brand loyalty from international readers isn’t a bad thing, but the reality is that most local advertisers simply aren’t interested in reaching international eyeballs—meaning it can be difficult to make money from this audience.

However, Maxwell says NZME has found clients who are interested in this offshore audience.  

“We monetise international users via our direct sales team based overseas, advertising networks or New Zealand advertisers who want to reach this audience, for example real estate agencies, airlines, tourism and government departments,” says Maxwell.

Lawson also confirms that international audiences can be valuable, pointing to a Steinlager campaign he managed earlier this year that targeted Kiwis at the Rugby World Cup.    

“There may be times that it’s relevant for us to want to buy overseas audiences,” he says.

But not all publishers are convinced that selling ads targeting international eyeballs is sustainable.

Because the group of advertisers interested in international eyeballs is relatively finite and because the circumstances under which local advertisers would want to reach international target groups is quite limited, US publication Slate magazine recently took the paywall route in an effort to monetise its international audience.

Under the new Slate policy, those who visit the site from abroad will only be able to view five articles, after which they will be prompted to pay a subscription fee of US$5 per month or US$50 per year. 

Slate editor in chief Julia Turner explained this decision was largely because US advertisers were simply not interested in targeting the international audience: 

Slate is an ad-supported business. The majority of our revenue comes from the ads you see around the site. The money advertisers give us to run these ads pays for the salaries of our writers, editors, designers, photo editors, and technologists. But there’s a problem: Our U.S.-based sales team sells primarily to domestic advertisers, many of whom only want to reach a domestic audience. This may sound provincial, but there are decent business reasons for it: Maybe the car company buying ads on our site doesn’t sell the model it’s advertising in your country. Or maybe the marketing strategy where you live is different. Whatever you think of the logic, the fact is inescapable: Many U.S. advertisers won’t pay us to reach readers outside of the United States. The end result is that, outside the United States, we are not covering our costs. That leaves us, as a business, with two choices: either make up for low ad rates by increasing the number of ads on the site, or turn to our readers to pay a fair share of the costs of producing the site. We’ve opted to do the latter.”
  
Asked whether NZME would consider incorporating something similar on the Herald, Maxwell said: “Nothing is off the table and we are constantly monitoring ways to monetise our audiences.”

Other commentators in the industry were, however, sceptical about employing Slate’s approach to either Stuff or the Herald

“Publishers will be already monetising this inventory by selling it on the open exchange to advertisers that wish to speak to international eyeballs,” says Boulstridge. “Putting a paywall in front of them would likely to be more detrimental to revenue as a result.”

It’s worth noting the Slate's success isn’t based on being first with news. The publication is simply too small to compete with the likes of Fox or CNN. Instead, Slate attempts to provide an original twist on current affairs, often weaving opinion and additional research into its reportage. And because these pieces are focused on an international superpower (rather than an island nation with around four million people), they have the potential to appeal to an audience beyond the publication’s national borders. However, whether a significant number of readers are willing to pay for the content is yet to be seen. 

While both the Herald and Stuff also provide opinion and long-form pieces, the primary focus of both these publications is to be first with the news. And for this reason, Acquire Online media director Anthony Ord believes incorporating a paywall on the local publications would achieve little beyond driving those audiences elsewhere. 

“If the New Zealand Herald and Stuff were to enforce an international paywall access then it would just be a boom for the Otago Daily Times and any other publisher reporting local New Zealand news and sports results,” says Ord. “They are better off developing specialised online content so commercially desirable that people are prepared to pay, from anywhere in the world.”

The emergence of international audiences has in many ways added a new source of revenue potential for the nation’s major news publishers. Whereas print publications were previously largely restricted to New Zealand, both Fairfax and NZME today have legions of international readers that log in daily to access the content they publish. And as their digital properties continue to evolve, they will find new ways to capitalise on readers who might not lie within local borders.       

  • Fairfax did not respond to questions for this article.    

Update: Fairfax digital director Becky Saunders sent through the following statement earlier today: "At Fairfax, we have both a domestic and an international rate card - and we're completely transparent with our numbers.  Our default buy is domestic - but we also offer international audience products on request. Clarity around audience composition really isn't an issue for the premium publishers, like Fairfax Media."

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