Newspaper executives around the world are at their wit’s end trying to figure out ways to cope with the onslaught of the internet. With readers and advertising dollars migrating to the online world, the print media’s very survival is at stake. So, what can save the industry now? Well, in a twist of irony, it is e-commerce giant Alibaba that appears to have a solution in China.
In an initiative that could prompt more people to buy newspapers, Alibaba has partnered with 12 different newspapers across China, aiming to use the papers as offline promotion channels to reach more customers and boost the group’s online shopping business.
The campaign, which began on April 1, took up the front pages of all the 12 papers, sending a very strong signal to readers of Alibaba’s plan to leverage the print media to lure more shoppers into the Taobao online mall. The partner newspapers include Guangzhou Daily, Beijing News, Jinghua Times and Chengdu Commercial Daily.
According to Alibaba, the new service will use the Quick response code (QR Code) technology as a tool to link sellers, buyers and logistic service providers. Alibaba will promote selected merchandise on the newspapers with a QR Code; newspapers readers can use the Taobao smartphone app to scan the QR code of the products they like to place orders and settle the transactions. Logistic service providers will then deliver the product immediately.
Discount offers and other incentives will be part of the strategy to lure more eyeballs to the newspaper campaigns.
The more orders the readers place, the higher will be the revenue share of the newspapers from Alibaba Group, which is gearing up for a US initial public offering.
Newspaper participation in a retail initiative is not a really new phenomenon. Hong Kong’s Next Media (00282.HK), which publishes the Apple Daily newspaper, had launched an online supermarket admart in Hong Kong a decade ago, but it was shut down after making huge loss. Many foreign newspapers also offers online shopping services as reader service.
But there is nothing quite like the scale this time in China. Given Alibaba’s strong brand and its expertise in marketing, this could turn out to be a sustainable new income source for newspapers, rather than just being a one-off ad space buying contract.
However, the success of the Alibaba-newspaper integration will still very much depend on the product quality and the pricing.
While such partnership may open a new revenue stream for newspapers, especially through mobile internet, it can also make the newspapers rely too much on Alibaba for revenue dollars. That could affect the publications’ credibility in the society. Also, customers may lose a channel to complain about the bad business practices of online retailers, as newspapers may avoid carrying negative stories that could upset Alibaba and jeopardize the partnership.
To gain more independence and add value, newspapers should set up their own systems to monitor customer spending pattern and user behavior. Getting to know the readers better will be the ultimate payoff.
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