While revenue diversification has become a top priority for a growing number of news outlets, it’s worth remembering there are also many publishers that are achieving significant success by concentrating on just a few core activities.
South China Morning Post (SCMP), a more than 120-year-old premium news publisher headquartered in Hong Kong, has two main target audiences: locals and international “China watchers,” said Catherine So, SCMP’s Chief Executive Officer.
“On one hand, we are the newspaper of record for people who live in Hong Kong.
“But equally important, we are known for our balanced and authoritative reporting on China to our global readers,” she said.
Having begun as a single-page publication in 1903, SCMP now reaches 35 million monthly active users across multiple platforms. The audience make-up is global: 44% come from North America, 40% from Asia Pacific and 16% from Europe and the rest of the world.
Since the publisher began a rapid digital transformation process in 2016, the share of digital revenue has grown from 10% to 40% today. Meanwhile, its global reach has increased eight-fold.
Last year, “we were able to achieve yet another double-digit growth on both top and bottom line,” So said.
Ad strategy based on ‘content and community -led approach’
SCMP is deliberately pursuing a “very simple” business model, So said, with the following current breakdown of revenue sources:
- 60% from advertising
- 30% from subscriptions
- 10% from events and other activities
“Our strategy is to stay focused on just these key revenue streams and be world-class at what we do,” she said, adding that they expect growth to come from across all three areas in the coming year.
Over the past few years, SCMP has been innovating in each of these buckets.
Its advertising business “has gone through three phases” since 2018, So said. The company initially offered display and marketing solutions but in 2020 started to lean into ad tech and data capabilities. But realising that premium programmatic advertising wasn’t generating enough growth to support their global ambitions, SCMP pivoted in 2023 to a “content and community -led approach”.
“We realised our biggest strength is our ability to tell stories and reaching the most influential people in the world,“ So said.
SCMP has since revamped its content product portfolio to better support both readers’ and advertisers’ needs.
“Brand safety is very important for our advertisers. So what we’ve done is we’ve created content products around the main newspaper,” including magazines about fashion, arts and restaurants, she said.
SCMP has also created a studio that produces branded content in various formats, including video. The pieces of branded content that are produced in-house “sit alongside the editorial content and are produced in an authentic voice that integrates well with the rest of the platform,” So said.
Thanks to SCMP’s brand and strong network, they can also get C-suite experts and opinion leaders to be featured in their branded content, So added: “This is something that our advertisers cannot do on their own.”
Events supporting editorial focus
In terms of its events business, SCMP’s strategy is to focus on “fewer but higher quality” events rather than volume, So said. Flagship events such as the Family Business Summit, the China Conference and the Redefining Hong Kong series of events are a particular focus.
While the company has reduced the number of events it organises, it has managed to significantly grow the revenue and profitability of its events business.
All of SCMP’s events are designed to support the “the core editorial expertise” of the company, So said, with a focus on Hong Kong and mainland China.
“We see these events as an extension of our news platform. For example, the China conference helped our audience gain first-hand insights from the high-level government officials on transformative policies and regulatory development shaping China’s future.
“Redefining Hong Kong provides the opportunity for the business community to get together, to share thought-provoking conversations. And our Family Business Summit is a gathering of the world’s 100 top family owners and subject matter experts from across the globe,” she said.
Special subscription products for ‘China watchers,’ young readers
The final piece of SCMP’s business model – subscriptions – has seen the company invest heavily in building a product portfolio that matches the “sometimes competing needs of our advertisers, our general news readers, and our global premium readers,” So said.
This process involved three steps:
- Three years ago, SCMP launched its standard digital subscription product.
- Last year, they added a digital + print bundle product, which has been helpful in retaining print subscribers.
- In May this year, the company launched SCMP Plus, a premium product “tailored to our China watchers across the globe” with analysis, summaries, fact sheets, opinion and more.
SCMP has also launched education products, one aimed for primary school children and another for 12–18-year-olds. These are branding tools that help connect with the next generation of readers, but they are also successful subscription products in their own right, with “immediate as well as long-term significance to the overall business,” So said.
“Adults are sometimes reluctant to pay for content that they read themselves. But adults, especially adults and parents in Asia, care a lot about their students’ and their kids’ needs,” she said.
“When it comes to providing the next generation with better quality content, the price elasticity is very high.”
Finally, So talked about how the close collaboration between SCMP’s editorial and business teams has powered the publisher’s success.
“Nothing that I’ve mentioned would have been possible or successful without the business and the newsroom being in lock-step in every part of the journey. That collaboration and working together is really important to long-term success.
“I am very proud to share that we have a workforce of 30 different nationalities. We really value diversity and polarity of voices. And we believe innovation comes from having a very diverse team,” she said.
