Stuff’s evolution from digital swamp to king of the jungle

Twenty years ago the web in New Zealand was still a bit wet. A little like a primordial digital swamp, there were still signs of afterbirth and a few short-lived corpses in the wake of the 1998/99 dotbomb crash.

While Tim Berners-Lee had invented the worldwide web 10 years earlier, New Zealanders were slow adopters. Xenophobic in our outlook and throttled in our access, there was no digital superhighway in 2000.

According to census figures, fewer than half (47 per cent) of New Zealand households had a computer and only a third had access to the internet.

Of those web-enabled Kiwis, 71 per cent got online via a dial-up modem, a 56k jobbie if they were lucky. If you are over 40 you can probably still hear the shrill chirp and see the disco lights.

Digital TVs were just starting to be released, and while you could access the web on some mobile phones, it was painful. The iPhone was seven years away and apps weren’t even eye twinkles.

Into this digital petrie dish Independent Newspapers (then owned by News Corp Australia) decided to launch its first news website. With support from massive print advertising and big canvas billboards proclaiming ‘‘Stuff Knows’’, www.stuff.co. nz launched at a cybercafe in Auckland.

With a name conceived by Saatchi and Saatchi, the founding internet manager,

Mark Wierzbicki, noted: ‘‘It’s not without risk, especially if we stuff it up.’’

A month later, the site notched up 120,000 unique browsers. A not inconsiderable achievement given there were none of the online lead generation tools available now. Facebook didn’t even exist. Google was just four years old.

Fast forward three years and INL sold its very profitable stable of newspapers and the Stuff website to Australian-owned Fairfax Media.

Under the leadership of David Kirk, Fairfax saw digital as the future and doubled down on investment in Stuff in the same way it had with the Sydney Morning Herald and AFR websites.

Unable to compete with Trade Me’s classified verticals, Kirk bought Trade Me in 2006 and for the next five years Stuff and Trade Me would share a digital masthead.

Stuff had major facelifts in 2006 and 2008. A mobile site appeared soon after.

Then things came to a grinding halt thanks to boardroom bloodletting at Fairfax. Kirk got the unceremonious boot in 2009 and for the next few years Stuff suffered from under-investment and unnatural bundling with print assets.

In 2012 the pragmatic Greg Hywood was made chief executive. Hywood saw the writing on the wall and encouraged his team to put their foot down on digital. And here in New Zealand that meant Stuff , so the investment tap was turned back on at the same time as newspaper readers were becoming online content consumers.

Unsurprisingly then, today Stuff is not just a website but the name of the holding company for all the former Fairfax New Zealand assets. The whole shooting match – once valued at $280 million – was picked up two months ago by chief executive Sinead Boucher in a $1 management buyout deal. So what a story!

The question is where does the story go? The challenge here is threefold.

First, to wrap your content around the needs of your customers. Second, to put in place a cost base that reflects your revenue. Third, to move to a paywall.

In recent years Stuff has taken a broad rather than deep approach to content. So there is remarkable breadth of pieces, with fluffier content that theoretically should appeal to Gen Y and millennials.

I think Stuff would benefit from going deeper. They’ve started this with Stuff Circuit (video-led investigative journalism) and a series of special reports. They’ve also entered content sharing agreements with Ma¯ ori TV, TVNZ and RNZ. But they need to go further.

Interestingly, a couple of former Stuff

writers have set up their own ventures which take a deeper approach.

Former business editor Bernard Hickey and former columnist Pattrick Smellie have set up Newsroom and Business Desk

respectively. Both are subscriber-only, indepth services which seem to be wiping their faces, based on their continued hires.

This leads to the second challenge, putting in place a cost base that reflects your revenue sources. Hickey and Smellie started from scratch with no legacy costs or regional network. So every cost they incur relates directly to the creation and distribution of digital copy.

Stuff doesn’t have this luxury, despite various restructurings that have dramatically reduced the regional network. This means having to make hard decisions.

Talking of hard decisions, that’s number three for Boucher and her crew. Making the move to a paywall. Stuff has enjoyed a last mover advantage by being the last newspaper company to provide free access to online content.

That’s helped it become the most visited local website in the country, with 2 million unique browsers a month. But it’s just not commercially sustainable.

Twenty years ago Stuff rose up out of the primordial digital swamp, and today is local king of the internet food chain. But as fans of Darwin will know, it’s not the strongest that survive, it’s those that are most responsive to change.

Mike ‘‘MOD’’ O’Donnell is a professional director, writer and strategic advisor. His Twitter handle is @modsta. This column is his personal opinion, but it’s noted he is a director of Radio New Zealand, is host of TVNZ show Start Me Up and was chief operating officer of Trade Me for 10 years.