Digital Transformation – The New York Times Story

The greatest digital transformation success stories are typically confined to the technology firms who seem to have control over our lives and livelihood. The likes of Google, Facebook, Microsoft, Amazon, Netflix etc. are the first ones to invariably come into our minds when we think about “digital transformation”. This makes it all the more difficult to imagine if any non tech firm could come close to the insurmountable success recorded by these tech giants. Chances are slim but the digital transformation story of the New York Times, in an industry that does not even come close to the high and mighty of the digital natives, stands out.

The digital roadmap of Times was ignited during 1995, the beginning of the internet bubble, when Steve Luciani from the Times’ information systems group understood the importance of riding the internet bandwagon. A year later, the Times launched its first website from its Manhattan office which allowed all the users to access the contents of the website for free after registration. The registration process was simple and captured basic demographic information which would later be the cornerstone for targeted advertisements. To ensure business and cultural alignment, the company ensured that the web unit, NYTimes.com was seen as an extension of the newspaper unit and not as a separate entity. This was a part of the digital strategy to ensure that the ‘core’ of the publication was preserved by all the entities and divisions within the firm. Once this was decided, investments were pumped in to ensure a more holistic, technologically oriented, interactive experience through audio, visual, slideshow, pictures etc. This laid the foundation to the launch of a few entities such as New York Times Digital (NYTD) in 1999, a separate business unit consisting of all the digital operations, Times Reader in 2006, Paywall in 2011 and Beta in 2013.

The Times has been one of the best known success stories not only of a successful digital transformation strategy but a lesson to the corporate world on business adaptability and sustainability. Listed below are some of the core reason of the success of the Times in its digital transformation journey.

1. Strengthening the core with a unified digital strategy

The premise of the Times has been unchanged since it was first founded in 1851 and that is to “seek the truth and help people understand the world”. This has been the bedrock for the formulation of its digital strategy since it always wanted to deliver quality news to its readers.

The question that the leadership was faced with was “how could the Times transition to a digital model knowing very well that more than 70% of its revenues came from the legacy print business?”  What was needed to be planned and achieved to embark on the digital transformation roadmap to ensure business continuity? Was there a case to significantly alter their core? How could they enhance it while exploring newer avenues to expand readerships and subscriptions? Would there be a cultural collision between the legacy and digital businesses posing serious threats to the culture of  the Times? What kind of additional revenue streams were needed to be explored to drive sustainability and be relevancy? Do these revenue streams pose a threat to the brand of Times, what were the risks?

To find answers to these questions, the Times put forth an executive committee to look into these specific questions and the road to be traversed knowing very well that if they had to succeed, synergies had to be established across departments, domains, functions, people etc. More importantly, the journalists, newsroom, developers, engineers, sales and the revenue team had to work cohesively towards a unified, technology driven, journalist centric, lifestyle model.

2. Data driven insights and decision making

The digital transformation success of the New York Times has been attributed to a number of forward looking decisions and deployment of technology. Case in point being how the Times used data and analytics to drive key subscription based decision making. There needed to be a complete revamp on how data was to be deployed and how intelligent insights could play a major role in increasing revenues. For this to fructify, the Times had to transform itself into a data and analytics company and view subscriptions much like how SaaS entities looks at renewals. By structuring its data and analytics infrastructure into a modern technologically enhanced environment, it was able to assimilate consumer demographics, understand consumer behavior and actions and leverage analytics, which enabled the firm to predict what it took to renew their subscriptions.

3. Entry into new segments and markets

With the unified digital strategy in place, The Times saw a change in the mindset  and there was enthusiasm on active experimentation, new market and segment analysis, product development etc. This exuberance led to the initiation of numerous projects. By 2013, the Times forayed into the world of mobile apps made possible by the launch of their internal product innovation project called Beta. Beta’s role in Times was that of a present day start-up incubator serving as the source of new ideas, hypothesis, products and later translating them into minimum value propositions to test their business viability. As per reports, Beta released a series of products such as the NYT Now, the new aggregation app in 2014, NYT Opinion, NYT Cooking, NYT Crossword to name a few. With a slew of products and apps launched over the next few years, the Times was able to spread its wings to larger audiences with content that was relevant to the lives of the readers and not just fuel their appetite for quality news. While Beta may not been an all-out success, it definitely provided a much needed boost to the revenues from digital operations fueled by rise in subscribers and users. 

4. Leveraging archives to drive monetization

After Beta launched the NYT Cooking app, the Times saw a massive influx of interest, downloads and subscriptions which has culminated to more than 4 million subscribers till date. One of the interesting facts of the revenue model has been to reanimate more than 17000 recipes from the archives and produce them in the app and help users solve for their cooking interests.

5. Augmenting the Ecosystem Infrastructure

Decisions for digital transformation cannot be taken in silos. In other words, they cannot be confined to one specific department or function while others wait for their turn. Such models are not only inefficient but can drain resources. The Times seemed to have understood the same and hence took a unified approach to build an ecosystem where the people, processes and technology thrived in a cohesive manner. When Times launched their digital operations, there was a strong management decision to ensure the culture was preserved across segments and business units. An ecosystem where all the individuals from the various departments such as newsroom, technology, development, sales, marketing worked as one cohesive unit was important to prevent them from spiraling out into their own worlds. From a technology point of view, there was a need to have an integrated and communicative technical stack and not be limited by disparate ones. The intent towards this path is visible in their efforts to re-imagine and re-architect their technology stack with a deployment of a sizable budget towards this goal. As per a report by CIO, a web publication, Times has now moved to Google BigQuery for their data environment, migrated to Google Cloud, use GraphQL and React to deliver their digital experience.