Globe publisher Crawley on the ‘fakery’ and frustrations of digital advertising

Digital subscriptions—not advertising—represent the future of The Globe and Mail, according to publisher and CEO Phillip Crawley. And data science is playing a fundamental role in its ability to attract readers with the right stories before converting them into subscribers.

Speaking at a lunch-and-learn event hosted by the Direct Marketing Association of Canada this week, Crawley said that the Globe‘s use of data to determine the stories that best resonate with readers is contributing to yearly growth of more than 20% for its digital subscription business. “That’s the future of our business, clearly,” he said.

The Globe currently has approximately 120,000 print subscribers and 110,000 digital subscribers. In typically blunt fashion, Crawley boasted that the national daily has the best subscription business of any traditional newspaper in the country.

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Phillip Crawley

“People are coming to us because they expect us to have something that is different than what other [outlets] have; they can get insight, commentary and opinions,” he said. “That’s what we’re effectively selling on.”

Subscriptions are now “by far” the largest revenue source for the Globe, said Crawley, acknowledging that the newspaper industry was too slow in recognizing the systemic changes to its business created by digital. Advertising, meanwhile, has fallen from 70% to 42% of overall revenue as clients shift their ad dollars towards digital sources like Google and Facebook.

Crawley also accused the industry of willfully ignoring the “fakery, the falsehoods [and] lies” that exist within the digital advertising ecosystem, while failing to acknowledge the importance of publisher audits.

“It’s very frustrating when you’re sitting in a room full of publishers who say ‘We don’t need to have audits anymore. The advertisers are not interested [and] they don’t need to see those numbers. Or we’ll just produce our own numbers, somebody will rubber-stamp them and they will be accepted.’

“In our industry there are a lot of people putting out their own numbers and saying ‘Here they are, trust us’ and apparently nobody is asking to validate that. When I see the work that the [Alliance for Audited Media] is doing to say ‘We can show that those numbers are real and not based on non-existent [readers], you wonder why more people aren’t saying ‘I won’t spend the money unless I see that.’ There’s a lot of turning a blind eye going on.”

AAM chair Ted Boyd, CEO of the knowledge sharing app Magnifi, said that the rise of ad networks that ushered in the notion of buying audiences rather than environments is a fundamental cause of the fraud that has permeated the programmatic ecosystem.

“Fraudsters were able to penetrate the ecosystem and plug into demand-side platforms and supply-side platforms and really start to game the system,” he said. “If you’re buying audience of any kind, from anybody… you are almost certainly buying bot traffic. That’s how we got here.”

Boyd called publisher audits a “foundational missing piece” and the “last best step” before inventory moves towards an advertiser. “If you have corrupt inventory that’s being sold by a publisher, in many cases unwittingly…all of your core metrics are out the window. We need a publisher audit protocol across the North American spectrum in order for this [problem] to be meaningfully reduced.”

The discussion also addressed the symbiotic nature of advertising and news media, with Crawley and others warning about the “democratic deficit” created when newspapers, starved of advertising revenue, no longer have the resources required to cover important stories.

“If you see an area where there is poor scrutiny, bad things are going to happen,” he said, pointing to the Globe‘s recent investigative series on Thunder Bay detailing systemic racism against the Indigenous population.

“Journalism makes a difference and it’s why the Thomson [family] owns us,” he said. “They’re not waiting for the cheque from The Globe and Mail. They have that faith that journalism can actually move policy makers, can affect government, and have a benefit.”

Speaking with The Message after the discussion, Crawley was pragmatic about the ability of the AAM’s publisher audits to help repatriate lost advertising revenue, while noting that print advertising still constitutes a “very important chunk” of the Globe‘s total revenue.

“In terms of volume, print advertising is still greater than digital,” he said. “We do very nicely on programmatic, but it’s still small dollars compared to the big margins we get from print. We want to protect print because it’s an important part of what subscribers want.”

Crawley also rued what he described as the “revolving door syndrome” within media agencies, with senior leaders coming and going at a much faster rate than they did in the past.

“It’s harder to maintain relationships with senior people because [of] companies being merged into a conglomerate, presidents that have been there for years suddenly gone,” he said. “I find it harder to maintain those relationships just because of that turmoil and change. The disruption has been a bit chaotic, and you don’t have the longstanding relationships you might have had.”

While the Globe recently offered voluntary buyouts to staff (across all departments) in advance of another planned round of layoffs, Crawley said that “right-sizing” its business is fundamental to its success. The Globe currently employs 260 journalists, he said, while other major dailies continue to gut news operations.

Chris Powell