Archive for the ‘Magazines’ Category

New Analysis: Old Media Magazines Losing Share Online Despite Their Great Brands

22 Jun
2010

by Ben Elowitz

Despite their coveted value, the great brands of old media aren’t proving out to be much of an asset online.  And to the extent old media is relying on the value of their brands to ensure a digital future, they are headed in the wrong direction.

For this new analysis for Digital Quarters, we measured audience and visits (from comScore) for sites across the major media categories, comparing the metrics of sites operated under old media brands (e.g. ABC, Entertainment Weekly) in each category to those of new upstarts.  Over the past year old media brands lost share of online audience to new media in nearly all of the traditional magazine categories (TV, entertainment, business, fashion, tech, and teens), while the offline brands in the News category grew share during that same period.    Although total visits were up 5% for old media, new media visits grew far faster — 10% — from April 2009 to April 2010, leading to share loss for old media in six out of the eight categories that we tracked.

Old Media Share Online

Overall visit growth was positive in all media categories other than TV, but despite this, old media brands experienced an absolute visit decline in Entertainment News and Teens which are rapidly shifting towards new media sources.

Conventional wisdom has held that building a brand is a momentous challenge in developed spaces such as media; and that disproportionate returns accrue to the most established brands. But my new analysis shows that legacy brands are on the defensive, far more threatened by new entrants than the other way around.  The upshot appears to be that upstarts’ execution is earning new audiences (and building their new brands), drawing audience on average away from more established players.

The reason for this shift, and the dominance of new media in categories such as Tech News is simply that the old media magazine model is ill equipped to compete with more nimble online competitors.  For the most part, weekly and monthly publications are struggling to keep up with the new pace of information exchange and social interaction demanded on the web.  Understandably, the value to consumers of days, weeks, or months-old “news” on fashion trends, celebrity gossip, and technology is far lower in the presence of up-to-the-minute coverage from new sites.

comScore April YOY Visits Growth

However, the success of offline brands in the News category offers hope for other old media brands.  Companies such as The New York Times, BBC, and ABCNews have grown their online presence and are clearly investing in digital as core to their business.    They are actively experimenting with rich media, social marketing, and engaging their audience.    But while news outlets have always operated on a fast pace, magazines are at a particular disadvantage in that they are not structured to turn information around quickly.  For old media magazine brands to maintain or grow share, they’ll need to go further by transforming their organizations, incentives, and sources and embracing the new definitions of publishing quality to provide the experiences that consumers are now seeking online.  With online share falling — in some cases dramatically — now is the time for offline legacy publishers to take action and get their brands working harder before it’s too late.

Methodology

Source: comScore panel-only visit data for April 2009, July 2009, September 2009 (panel only was unavailable for October), January 2010, and April 2010, including only properties with more than 500,000 monthly unique users.   Properties were manually categorized into old media if they originated offline, and new media if they are entirely online or originated online (e.g. TMZ and MSNBC are considered new media).  comScore category names: Business News/Research (Bus News); Entertainment – News (Ent News); Beauty/Fashion/Style (Fashion); Lifestyles;  News/Information (News); and Technology – News (Tech News); Teens; Entertainment  TV (TV).

Smart Move: Glamour Publisher Puts Its Brand To Work Making Matches

7 Jun
2010

by Ben Elowitz

What’s the point of developing a great brand if you don’t take advantage of it?  In the consumer products industry, the norm is to develop a great brand, then perform line extensions.  Crest lends its name to Crest White Strips so consumers will trust them more.  Disney’s trademarked princesses adorn adhesive bandages to spur kids to cover imaginary wounds; and Ralph Lauren finds his way into the paint aisle of Home Depot so I can be sure my new wall colors will be fashionable.

But these sorts of licensing and line extension deals have been more scarce in publishing.  And it’s great to see that change.

According to reports from Russell Adams at The Wall Street Journal, bucking its historical resistance, Glamour has decided to seek more revenue by leveraging its brand into new product lines by partnering with IAC’s Match.com for the Glamour Matchmaker dating site, with IAC’s HSN on a new jewelry line, and with Like.com for an “Ask The Stylist“ app.

This is great news, and it bucks the recent countertrend in publishing of focusing on reducing costs.  While others have been seduced by the allure of commodity content, Conde Nast is instead increasing its commitment to its premium brand.  That’s the right move.  For the leaders in digital media, their future success will be far better served by increasing the value of their premium brands and destinations — and by leveraging that value into new territory.  Smart partnerships not only create more revenues, but also create broader reach for their brands and the opportunity to move beyond serving as just titles of published properties into more meaningful sector or lifestyle brands.  And that means developing long-term deep relationships with consumers — which will be even more valuable in then feeding back into premium advertising rates based on increased reach and goodwill.  It’s a formula that companies like Disney have mastered, with original content, experiences, and licensed products virtuously cycling to create more and more value.

For publishers like Conde Nast, now is a great time to set their brands free to do more.  As a premium publisher, they invest in creating outstanding, differentiating content and experiences for their audiences.  And they are doing a benefit to their consumers by extending their credentials to other categories.

My bet:  Over the next 12 months, we’ll see other publishers following Conde Nast’s lead.

Online Experience for Publishers: Innovate or Die

12 May
2010

by Ben Elowitz

We need an experience revolution.Revolution Fist

Each week, we hear of major publications and traditional broadcasters who are struggling to stay afloat in a digital age with new economics and new expectations.  Despite the promise of interactivity made with the internet revolution over the last 15 years, most publishers have done little more than replicate dead trees online, with zero innovation beyond the hyperlink, the slideshow, and an embedded video now and then.

And yet we can see from the rising successes of the last decade like Facebook, Google, Zynga, YouTube, and others that what catches audience attention is interactivity.

To earn loyal audiences today, publishers need to go beyond content creation:  they need to produce compelling experiences that distinguish them and get the consumer coming back for more.  The Pew Internet & American Life Project concluded that “when asked whether they have a favorite online news source, the majority of online news users (65%) say they do not.”  In an era where the consumer’s cost to switch is the flick of a click, publishers must offer compelling, differentiated experiences to earn loyalty.  Choices abound consumers:  there are scads of publishers online in every category; content suggestions offered constantly via social networks; and blue links proffered by search engines dozens of times per day per reader.  In an environment of choice, as brand experts have known for years, nothing builds loyalty like a great experience.

And now is the perfect time to create those breakthrough experiences.  The enabling technologies for the digital customer experience have improved considerably in recent years: we now have ubiquitous broadband, flash and other streaming video, plus HTML5 and maturing mobile application platforms.   Add to that personalization, targeting and social graph access, and there are some amazing opportunities to innovate.

It’s not just consumers that are thirsty for upgraded experiences.  Advertisers are showing that they will pay more for immersive interaction over basic display ads next to text.   Video ads during full TV episodes on ABC.com, Hulu, and others, or mid-day live sporting broadcasts command many times the CPM of typical display ads. Indeed, according to Michael Learmonth at AdAge, The Wall Street Journal’s online video content is bringing in envy-inspiring CPMs at $75 – $100.

But video is not the only way to create an immersive customer experience online.  Online sites of traditional publishers like Better Homes and Gardens are experience train wrecks (to be fair, they’re not alone in that regard).   Contrast that with the much more successful (certainly from an ad rate perspective) MarthaStewart.com which has many of the same elements – a top stories slideshow, cross-promotions for the print magazine, etc., and it’s a substantially better experience due to the focus on design and usability that is expected of the Martha Stewart Omnimedia (MSO) brand.

Even still, much more can be done with today’s technology to put the consumer’s needs and interests first.  The latest example I’ve seen of true creativity in user experience design is Microsoft’s (MSFT) Glo.    There are additional signs of greatness in the tablet demo that Time Warner (TWX) built for its Sports Illustrated brand.   And The New York Times (NYT) continues to excel in their applications and interactive graphics which enjoy significant pass around (bit.ly shows over 5,000 social media clicks to a recent budget infographic and today’s “A Moment in Time” project has already generated over 100 tweets in the first 15 hours).  But too few companies are making similar efforts to distinguish themselves.  The opportunities are there, and we need to step up.

Consumers will decide which brands deserve their loyalty and content alone won’t cut it.  We are on the brink of a total revolution of experience.  For publishers, it’s reinvent or fail.

Do you know additional examples of publishers innovating?

The New Rules For Judging ‘Quality’ In Published Content

11 May
2010

by Ben Elowitz

This article by Ben Elowitz originally appeared as a guest post on paidContentEngaging Readers Online

Last week, I explained why the traditional ways of judging “quality” in published content are useless in the digital age. Judging by readers response to that piece, those dated values (which I labeled credential, correctness, objectivity and craftsmanship) are still sacred to many people. But here’s the problem: They simply aren’t enough to win audiences, drive financial success, or, for that matter, ensure viability. The demise of institutions like Newsweek proves that—and shows that publishers that don’t move beyond these anachronistic measures of success will perish.

So this week, I’m offering part two of my take on the changing definition of quality in published content. Here are the four new rules of quality that publishers must obey to flourish. The biggest difference between the old and new definitions of quality are who’s doing the judging. In the era of Publishing 1.0, when production costs were high, alternatives low and time ample, the editor deemed something quality or not. But today, content isn’t scarce at all—in fact, it is in oversupply. And it is the audience that judges quality directly, dozens of times per day.

So, according to the audience, what is quality?  It comes down to these four characteristics:

—Relevance. Read the rest of this entry »

Traditional Ways Of Judging ‘Quality’ In Published Content Are Now Useless

3 May
2010

by Ben Elowitz

This article by Ben Elowitz originally appeared as a guest post on paidContent

Old MediaIf old-media traditionalists can be relied on for one thing as the world digitizes, it’s to bemoan the loss of what they call “quality.” In fact, the quality of published content has never been better. So why does traditional media get it wrong here? Because they’re using a definition of quality that made sense for the world of Publishing 1.0, from Gutenberg until 1995. But for Publishing 2.0, it’s about as useful as the cubit is in modern architecture.

The traditional-media definition of quality is based on four key criteria – and all of them have fundamentally changed and become invalid. Here they are, along with an explanation of why they’re no longer useful. Next week, I’ll do a follow-up piece on how quality should be defined in the digital era. Read the rest of this entry »

People StyleWatch: Print Magazine Learns Five Lessons From Digital Media

30 Apr
2010

by Ben Elowitz

People StyleWatchDespite the significant economic pressure they are under, it’s all too rare to see a print magazine let go of tradition and embrace a new model.  So I was delighted to find that at least one Time Inc. magazine is doing just that.

Stephanie Clifford’s article about People StyleWatch in the New York Times last week shows what happens when offline executives adopt a digital mindset.  Clifford points to a number of things that Susan Kaufman, People StyleWatch’s editor, is doing well, and notes the results:  8.6% circulation growth in the second half of 2009 and 130% growth in ad pages in the first quarter, easily besting a shrinking industry.

Although I wouldn’t call it top-tier journalism (does “Find Your Perfect T-Shirt Bra!” really merit an exclamation point?), People StyleWatch replaces an elitist, artistic view of its subject with a pragmatic appreciation of what their audience likes.  It’s a habit learned online and applied offline.

Here are five lessons from online media that the publication is successfully bringing to print:

  1. The text is brief.  Photo-heavy pages with short captions work.  They make for easy scanning, moreover it’s a fashion shopping magazine; ultimately readers care more about the products than a writer’s description of them.  Ironically, although the content is brief, it is resulting in 93 minutes average engagement, with each easily consumable section leading to the next.
  2. The content is advertiser-friendly.  Any web site that is ad-sponsored knows how important it is to create “context” and targeting for advertisers in order to add value and charge higher rates.   Shopping is one of those brilliant subject choices where advertising is content and vice-versa.  It is analogous to paid search online: because searchers are often looking for businesses, their click throughs and effective CPMs are far above internet average.  Moreover, People StyleWatch is open to creating pseudo-editorial sections with featured retailers (such as the recently announced JCPenney partnership).
  3. They offer exclusive discounts. Consumers love to get a deal, and coupon / discount web services (including the recently hyped group-coupon genre) are very popular with women online.   People StyleWatch goes beyond the celebrity watching and fashion trends to become part of their readers’ lives, changing the value proposition from just entertainment to a great way to get more for less.  In so doing, they are enhancing the reader’s experience.
  4. There is a clear call to action.  Most of the products include not only pricing information, but web sites, 800 numbers, and in some cases, text messaging options for buying information.   This is beneficial for both readers and advertisers.
  5. Content costs are low. Some of the most successful online properties such as Facebook, YouTube, and Yelp rely primarily on user-generated content.  Successful online publications like The Huffington Post regularly feature guest bloggers.    Traditional high-cost content is increasingly difficult to support profitably with advertising given the fragmentation of media consumption in recent years.  People StyleWatch features lower cost content, with research consisting of quick calls to publicists or product marketers, and images from paparazzi or retailers rather than expensive celebrity photo shoots.

This is more than just flexing editorial styles to meet the expectations of web-addicted younger readers.   The magazine is embracing a new business model with lower costs and more attractive content for advertisers that allows it to grow in an otherwise contracting space.  They are hitting on one of the key success factors for Publishing 2.0, namely an adaptive business model.  Time Inc. CEO Ann Moore, who has led the People brand for more than a decade in various roles, no doubt is taking notice.

Regardless of your personal opinions of the content, the results – in both readership and profitability – are hard to dispute.

The Inescapable Inertia of Old Media

18 Dec
2009

by Ben Elowitz

Head in Sand

I had dinner recently with a friend at a big traditional magazine publishing house.  We talked about the predicament of the majors: circulations in decline; ad rates falling; a reduction in the number of pages per issue. The traditional publishing model is hanging by a thread.  And as we’ve all seen, blue-chip magazines are closing their doors as they can’t make ends meet in the new world of media.

My friend works in the online division, and has lots of exposure to senior company executives.  And one thing he told me surprised me:  When he talks with his higher-ups, they just plain don’t acknowledge that online is the future of their business.  They’re too preoccupied trying to figure out how to save their bread and butter versus figuring out how it will morph to completely different model – an online one.

Now don’t get me wrong.  I’m not saying that online is going to save the traditional magazine.  It’s not.  The economics of online publishing are arguably even worse than traditional publishing.  But that doesn’t change the fact that consumption of content is moving rapidly and unstoppably from offline to the web and mobile web; and that means that the offline publishing business is in inevitable decline.

The options for an old-school publisher are simple:  they can harvest their declining businesses; or begin the hard journey of building a new business to replace them.  But what is very clear is that the two cannot be done at the same time.  Inevitably, the companies that will succeed in the new digital economy are the ones that are willing to make sacrifices to their existing businesses.

My favorite example of a company that is committed to this sacrifice comes from the world of semiconductors.  For years, Intel demonstrated the philosophy of obsolescing their own products by creating new ones – before their competitors did.  Each generation of microprocessor they produced put the prior one – just a year or two old – out of business.  This is a survival skill in a fast-changing industry like semiconductors.

But decades-old publishers, steeped in their own business heritage, act as though they their world is not changing; when in fact it is changing as fast as microprocessors themselves.  Is it that they don’t know, or that they don’t care?

Cheers To Time Warner… At Least Someone Besides Apple Is Reinventing The Magazine

3 Dec
2009

by Ben Elowitz

Time Warner has set one of the best examples of a media company willing to break with old habits in order to find a path to a better place:  Not only have they initiated an industry joint venture, but they did it the right way.

Now, they’re showing some early fruits of those decisions to bust loose, in this demo video of the prototype they developed with Wonderfactory, the agency hired for product concepting and development of the tablet.

Let’s look at some of the things that Time Warner has done right.  These can be something of a cheat sheet for other companies who are willing to take big risks.

  • They didn’t wait. They saw how successful Kindle is based on all the buzz, and realized that it demonstrates an opportunity area.
  • They freed it from constraints. They broke off into a separate organization with a separate charter, to break free of existing course-of-business requirements.
  • They went off the reservation. To get truly “no constraints” thinking, they turned to an outside agency.  Smart move, since startup-within-a-BigCo projects can be hampered by all kinds of unstated — and false — assumptions from old “lessons learned” that no longer apply; and from an implicit imperative that new efforts should align with the old.

And, most importantly:

  • They are creating a new experience for consumers. More and more, content, like it or not, is a commodity.  But experiences are unique and irreplicable.  That makes them rise above, and gives consumers a reason to be excited, to buy, to use, and to come back again and again.

Whether or not the device is successful itself, this will give Time Warner an organizational advantage:  they are demonstrating not accepting the false constraints of maintaining old paradigms or riding the curve down.  That DNA impact is enormous, as it creates the license for others at that company to take risks.

Ultimately, the publishing industry is facing the problem that their “content” is relatively undifferentiated.  Time Warner has shown that they’re willing to take the risks to create a new experience that is worth noticing for consumers.

And Time Warner is further separating itself from the other media companies who are too frozen to do what it takes to try creating breakthrough consumer experiences.  Those companies will ultimately suffer, since the best path to a thriving audience — and new revenue streams — is by winning consumers over.


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