What newspapers need to learn from the disruption in the auto industry

Gigaom

Newspapers might like to think that their challenges and woes are unique to the print media business, but there are some broad similarities between the disruption that journalism and the news industry have been experiencing and the upheaval in other industries — including the automotive manufacturing business. As Micheline Maynard, a journalism professor and the former Detroit bureau chief for the New York Times, points out in a perceptive post, there is a lot that newspaper publishers can learn from what automakers have experienced.

As Maynard notes, there are a number of disruptive effects in the media industry that parallel what happened to car-makers — including the outsourcing of non-core functions, something the Chicago Sun-Times did rather dramatically last week by laying off its entire 28-person photography desk. The attempts by newspapers such as the Chicago Tribune to outsource hyperlocal news gathering through third-party providers like Journatic would be another example.

Outsourcing is a reality

This is roughly similar to what happened to car-makers, Maynard says, who found that it was cheaper to outsource the production of their vehicles:

“These days, car companies can find others to do virtually every aspect of an automobile. They can contract out design and engineering work, hire marketing companies, find manufacturers who have the capacity to build their products. Except for Tesla, they’ve already turned selling their vehicles over to franchisees.”

Media companies — and the journalists who work for them — don’t like to think of their business as being similar to manufacturing, but in a broad sense it is: the newspaper is a product that is stamped out at the end of an assembly-line style process that functions much the same way it has for 50 years, with some slight differences. And many of the legacy costs that have driven some newspaper companies into bankruptcy come from that industrial process.

Like Maynard, disruption expert Clay Christensen has also talked about how the automakers learned from their newer competitors and became more flexible, both through outsourcing and other means. In a major research paper he wrote along with Harvard fellow David Skok, Christensen looked at how the newspaper business is being dismantled, and what it can do to survive.

Focus on what customers want from you

What’s really interesting about the disruption in the auto business, as Maynard notes, is that everything didn’t get outsourced. What car-makers discovered was that they needed to retain control over some things in order to achieve the kind of design or performance or reliability demanded by their customers — the things that were crucial to their brand.

In the newspaper business, customers are called readers, but the overall principle is the same, Maynard argues: a company has to decide (or learn) what they offer that is unique or outstanding when compared to their competitors, and then focus like a laser on that thing. If you’re the New York Times, maybe it’s foreign reporting — if you’re BuzzFeed it’s probably cats, or at least humor. Which raises the question: Who is the Tesla of the media industry?

“Car companies realized that what they absolutely must do themselves is provide brand character, which is essentially the promise that the company makes to its customers. It doesn’t matter where a BMW is built, whether Germany or South Carolina or South Africa. It does matter how it drives.”

Post and thumbnail photos courtesy of Shutterstock / Donskarpo




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