Wetpaint CEO Ben Elowitz on the Future of Digital Media
“Content is king” has been a long-lived mantra of media. And in the 1990s and early 2000s, it was true.
But over the last several years, the Internet has upheaved the aphorism.
It used to be that media was linear. And in that world, content and distribution were married. The HBO channel had HBO content. A New York Times subscription bought you New York Times content. And Vogue and Cosmopolitan each month delivered exclusive and proprietary content from … Vogue and Cosmopolitan.
Until the Internet came along. In every single one of the varied businesses the Internet has touched — from commerce to media to communications to payments — there has been one common impact: disaggregation.
Content and distribution have parted
In the case of the hundreds-of-years-old media business, the Internet has fundamentally separated content from distribution. Today I can watch hundreds of South Park and Jon Stewart clips, all without a cable box — on my Apple TV, my Android phone, or YouTube on my desktop.
But wait, South Park and Jon Stewart? Content is king, you say. It’s now even more free to reign, unfettered by distribution channels!
No; because content is no longer enough. Content has always been a means to an end. And the end has always been audience.
Content isn’t the goal. Audience is.
When it comes to the business of media, there’s no question: advertisers don’t pay to reach content. They pay to reach an audience.
What’s the first item in every brief from every advertiser? It’s not Target Content, it’s Target Audience.
Media has been slow to adjust to this new dynamic. Companies have sunk billions into content management systems — using CMS as the cornerstone of their modernization — under the impression that they traffic in content.
But they don’t. They traffic in audience. And how much have they spent on audience development systems? Not much, if any at all.
Now that distribution of content to audience is no longer linear, distribution decisions are suddenly more complicated. And, at the same time, they are immensely more important — and more dynamic — to create the impact media companies are looking for: drawing an audience! Social distribution can outperform search, if you use it wisely. Day-parting your postings can boost post performance by 100 percent or more. Packaging can triple the effectiveness of content in reaching an audience.
And yet, few in media have even begun to optimize these decisions.
Who’s your Chief Audience Officer?
Distribution decisions are just as important as content decisions in building and serving an audience, and yet they are being largely ignored. Everyone has an Editor-In-Chief or a Chief Creative Officer. But how many have a Distributor-In-Chief? Or a Chief Audience Officer? A Head of Digital Programming?
The myopic focus on content over distribution is widespread, and it’s a bad business decision. It ignores a critical access of leverage, and one of competitive advantage.
The smartest media companies will do three things to take control of their digital opportunity:
1. Put someone in charge of audience development.
Give them latitude to think about the interplay between distribution and content, so that they can marry the two. Like a head of programming for a cable network, they should be tasked to realize the full potential of your digital channels. They should support the delivery of your content, and they should also provide back pressure to your content creators. Don’t merge it into your editorial jobs — that’s too precarious. Make it its own discipline.
2. Adopt an audience development strategy.
There are three basic components you have to master: insights (know your audience segments, and what each one will like); channel selection (identify the highest value distribution outlets for your brand, whether it’s search, social, YouTube, Hulu, or your own channels); and optimization (use data to create a feedback loop and tune your content, packaging, and timing to what works for your audience).
3. Systematize it.
You have sunk millions into content management systems. But how much have you spent on your most monetizable asset, your audience? You should be as systematic in audience development as you are in content creation, if not more so. Whether it’s with established processes or dedicated algorithms, make audience development a competitive advantage. Get so good at it that you truly know how to maximize every piece of content you create — and multiply your ROI. Use technology for what it does best: Systematize your advantages over your competitors.
With the rise of new distribution platforms like Facebook, YouTube and Hulu, there’s no question that the next generation of digital media is as much about distribution as it is about content. Media companies that orient their organizations to prize audience development above all (with distribution as a key component) will catch the upside of these tectonic shifts. And they will be the ones that survive and thrive in the digital age. After all, audience is the ruler of media companies’ fortunes.
Last week I shared how most publishers are realizing just a fraction of their potential audience because they lack a social distribution strategy, and showed which topics are most likely to be shared by connected audiences.
But is topic the only aspect of content that influences sharing? Could articles with topics as disparate as gardening and bull fighting share some other characteristic that would make them both go viral?
The Journal of Marketing Research published the study What Makes Online Content Viral? in 2011 to appease inquiring minds. Researchers analyzed 7,000 New York Times articles over 2 months to determine what factors made an article more likely to earn a place on the Times’ “most-emailed” list.
But wait a minute…are the factors that predict email sharing the same as those that predict Facebook or Twitter sharing? Here’s where we run into the difference between broadcasting and “narrowcasting.” Remember that purple rash I mentioned last week? I’ll email that WebMD article to my significant other (anxiety! practical value!) but I most certainly won’t tweet about it.
I looked again at the Most Shared Articles on Facebook in 2011 to see which of the study’s findings held up on the social networking stage.
Sound familiar? It mirrors the formula for success that Nieman Lab found Buzzfeed using to achieve record results. And, notably, practical value, the #2 driver of email virality, falls all the way down to the bottom of the list on Facebook.
In social network sharing, emotion is king. As Jonah Lehrer of Wired puts it:
“We don’t want to share facts – we want to share feelings. Because people have a deep need to share their emotions, there will always be an insatiable demand for funny baby videos, angry political rants and Justin Bieber songs.”
Before you go and replace all of your content with funny baby videos and Justin Bieber songs, remember that this isn’t about sacrificing the integrity of content for traffic. It doesn’t work that way. This is about engaging readers on the most important axis of all: the axis of significance. Emotional content helps us connect with friends online in a deeper way than a how-to video might.
But what if you’re a publisher of practical content? No need to despair:
“The future is going to be about combining informational content with social and emotional content,” says Jonah Peretti (founder of Buzzfeed).
We all have a powerful emotional drive to live a great life, and getting there means knowing how to be healthy, how to fix a leaky faucet and how to maintain successful relationships. Oprah’s tagline “Live Your Best Life” is a beautiful example – no one is better at linking home décor and health advice to something far greater and more aspirational. Publishers in the midst of developing a social distribution strategy (especially those of us not lucky enough to traffic in Bieber songs) will be wise to follow her lead.
If you’re Buzzfeed and your raison d’etre is to find and distribute viral content, then it’s fair to assume that you should be getting the majority of your traffic from social (and indeed, they do). But what if you’re Parenting Magazine? Or Consumer Reports?
While we know that social traffic is increasing as a referral source for publishers, it stands to reason that social traffic would be more relevant to some publishers and less to others. When I search “how to get rid of a purple rash,” I may find an extremely useful article on WebMD (and I may even forward it to a friend with a similar problem). But am I going to post it to my Facebook wall? Doubtful.
If you’re a publisher, you know how much social traffic you are drawing right now. But how much should you be drawing, relative to your competitors? To know this, we need to understand what types of content are highly shareable (and which are less so).
Pew Research studied the distribution of topics on Twitter and compared them with the distribution in traditional news sources. To add one more dimension, I broke down the Most Shared Articles on Facebook in 2011 by topic and threw those into the mix.
The conclusions are striking:
None of this is to say that traditional news isn’t getting social traffic; in fact, 53% of Facebook’s Top 40 came from four very traditional news sources: CNN, New York Times, The Washington Post and The Wall Street Journal. But while much of the most shareable content comes from newspapers, the average story ends up pretty lonely.
As for the most-shared topics, if you’re a publisher on the subject of parenting, you should be rolling in Facebook traffic. SEVEN of the top 40 shared articles on Facebook are about parenting (e.g. “How to Talk to Little Girls” and “Dads, Wake the Hell Up!”) If you’re a tech news publisher, well, Twitter wants to take you out for a lobster dinner and introduce you to his parents.
The wheels are greased, but are these publishers living up to their social potential?
Let’s just say there’s room for improvement.
GigaOM gets a shockingly small amount of social traffic for a specialty publisher directly aligned with the interests of social users. Parents.com fares better and beats traditional news, but lags far behind People (even though parenting as a topic is 2x more shareable on Facebook than celebrity news).
I would venture to say, of course, that ALL of these publishers should be getting more social traffic than they are right now (traditional news and celebrity gossip included). But if you’re lagging behind other publishers with less shareable content, you especially need to get smarter about using distribution channels like Facebook and Twitter. The social networks are ready for you – are you ready for them?
At Wetpaint, we’ve been rapidly ramping up our social traffic (from 14% to well over 20% in the last two months) by constantly refining our social distribution system. Having content that lines up with what people like to share is only half the battle; you need to be savvy about packaging and delivering that content into the social feed. That takes not only a great editorial savvy to understand your audience, but a tech mindset to help get it into the social groove.
Now that’s good news for GigaOM, Parents.com, and everyone else as well: Your content is highly shareable. Don’t let it go to waste.
This piece from Jason Hirschhorn is the sixth in a series of 10 posts about the future of the media industry contained in a report titled: Rebooting Media: The Digital Publishing Revolution for a Fully Social Web.
Q: How does the rise of Facebook change the relationship between media and its audience?
Facebook is obviously a transformative platform. It’s a disruption in the distribution of content. The social endorsement in “sharing” or “liking” a piece of content on a platform like Facebook is almost as important as the content itself. And while they like the digital “word of mouth” I think this scares the film, TV and publishing industries. Why? Because, unlike in the past, they are not controlling the distribution and conversation the way they used to. The “feed” is taking on search, too, because users are ultimately using it as a discovery platform. You may go to Google to find what you already knew you wanted but now the content streams deliver you content you had no idea you wanted, and with an endorsement from someone you know or follow. This social endorsement changes the way you discover and consume content.
Q: What’s changed fundamentally about media with the rise of the social Web, and what do publishers need to do to adapt?
It’s clear that media is becoming unbundled. It’s also multi-platform as the access points are fragmented. It’s real time or archived and it’s on-demand. This sets the trend for what and where people consume. In today’s new and evolving social environment, the packaging and distribution are under less control. Again, the social endorsement of content is just as important as who created the content or what it’s about. Our interests widen on Facebook or Twitter, and we’re able to see the tastes and interests of people we respect or know. We used to turn to TV, radio and print for all our cues, but we’re now going to Facebook or Twitter or Tumblr… to our friends and the people we follow. Traditional media seems slightly hindered because it holds on to its traditional standards. Whether it is scheduling in television, definitions of journalism, and creators as curators or controlling the entirety of your brand. But things are slowly changing. New forms of media bring spontaneity, serendipity and personalization. There are always surprises within your content stream. I realize now I only know a little about the things I like. The fun is in discovering those things you never knew you’d be interested in. That’s what I like about it.
Q: We’ve gone from SEO (Search Engine Optimization) to SMO (Social Media Optimization), so how will search change as the Web becomes more social?
My personal view is that search is falling down. People are now using it more for navigation than discovery. “Where is the thing that I want?” Maybe search isn’t about real discovery. I use search less today because of Facebook and Twitter, which are becoming significant parts of my content decision-making process. I’m interested in seeing the news that my friends are reading today. That would keep me on Facebook even longer, and add to the discovery element. Despite its huge impact, though, Facebook and Twitter haven’t even begun to really take advantage of content discovery experiences. They will. It’s going to be a great evolution to watch and positively disruptive.
Those changes will be a perfect match between gathering or discovery technologies and a truly human filter. Ultimately, content discovery needs to have human layers. Without them, it has no “life”, no context. This is where Google has fallen down as a product company. Algorithms vs. Humans. When it comes to content, which always has an emotional bent, humans always beat the computer. Clearly Google+ is trying to address some of that, but they have a ways to go.
Going forward, I believe we need to see more influencer targeting and noise-level targeting. How do you help people or companies find those who are moving the social media mountain? How do you find these influencers and deliver highly relevant and personalized content without infringing on their privacy or conversation and then let them run with it? That will be a key part of the new optimization. These changes will revolutionize advertising and make media spends way more efficient. What it takes to get “lift” will be far different and mediums like television will need to fall in line and adapt.
Q: How do you build a brand in publishing when, with greater frequency, media is distributed through social channels?
From my point of view, curation is the next great layer of value on the Internet. In a world where everything is available, Curating content helps users sift through everything. Trusted sources are coming back. The New York Times is curating when it decides what it will cover. But they don’t seem to curate other’s work. And yet the journalists at The Times pass around links and stories on Twitter that are written by other sources. Those journalists are trusted sources and now curators. I think publications should be establishing relationships with curators; and then they can re-package and re- bundle content into new and important layers. You can build big and important brands with curation today. I know I’m going to try.
Q: What are the critical success factors in publishing as we look to 2020; and who will be the winners?
There are five areas I’d touch on here:
1. Curation, for the reasons I’ve explained above.
2. Form factors. Content should be allowed to shape shift.
3. How you distribute. Your site to RSS to email to Flipboard to Twitter and beyond.
4. How you allow social media inside your content.
5. How smart your paywall strategy is. The New York Times has done the best in this area.
Allowing for social media linkages while continuing to build a pay-model.
Jason Hirschhorn, a media and technology entrepreneur, is the curator of Media ReDEFined (@MediaReDEF), a free daily news feed covering the changing world of media, communications, entertainment, marketing and technology. The former President of MySpace, Hirschhorn has also served as President of Sling Media, Chief Digital Officer at MTV Networks and is on the Board of Directors of MGM Studios.
To download the complete report, please click here: “Rebooting Media: The Digital Publishing Revolution for a Fully Social Web”
Back by popular demand is an updated ranking of the Media Industry Social Leaderboard. As a reminder, my company and I are obsessively focused on data about the social web – so much so, that we decided to track and publish not only our own results, but those of the top 50 media companies. This is all captured in the chart below which profiles the top 50 web publishers’ effectiveness at driving traffic from social media.
For the inquisitive among us, you’ll note that we determine the top 50 relevant web publishers; then, using data from Compete.com, we determine and chart how much of their traffic is from Facebook and Twitter.
One important note is that Facebook’s changes in its algorithms launched at F8 impacted nearly all publishers in this ranking – more on that in a moment.
But first, let’s get to the results:
Facebook Traffic Down by 13%.
The first thing you’ll notice is that the bars are lower this month. In fact, over 90% of the top 50 web publishers saw a decreased percentage of their visits coming from Facebook and Twitter in October, with the bars shortening on average by 50 basis points.
In terms of aggregate performance, if you sum the total Facebook visits for all properties, they’re down 7.1% October vs. September, and 12.8% comparing October vs. the pre-F8 August highs. We believe this trend is the direct result of the F8 algorithm changes made in mid-September. Savvy social publishers (ourselves included) have been battling to reclaim previous highs since the F8 changes; but by October few had recovered. The chart below highlights the reduction in referrals from Facebook to publishers over the course of their algorithmic change.
Winners and Losers: CBS down; People, MTV, Wetpaint up
CBS has continued to fall in social traffic composition (-3.7% September-over-August, -5.5% Octocber-over-September), moving from the top rank on the Media Industry Social Leaderboard to number 4. Unclear what has caused this decline although one hypothesis could be an increase in either SEO or paid audience acquisition. If you have any insight here, shoot me a note.
Closer to home, People, MTV, and Wetpaint maintained their relative rankings and have moved to the top 3 spots. At Wetpaint, we credit our climb up the ladder to our relentless A/B testing that has allowed us to understand what our audience desires in a deep way, and inform our editors with this insight. The result is that we are creating, packaging, and distributing the right content, at the right time and our audience has voted with clicks, likes, and shares.
As I have shared previously, our goal at Wetpaint is to be the leader in building media properties on the social Web. That’s because I am seeing the web’s nature fundamentally change to become fully social.
It’s not just theory – it’s data.
As I shared recently at AllThingsD.com, the social Web is capturing a dramatically increasing share of users’ attention – with internet users collectively increasing the amount of time they spend per month on Facebook by 69% over a one-year period – while usage for the entire rest of the Web, excluding Facebook, shrank by 9% over the same period.
Social is the most strategic medium for our industry. And yet we haven’t established how to track our collective progress.
So, I’d like to introduce to you the first industry effort to do so. I’ve released it this week, so that we can all compare ourselves with other top publishers and see our individual and collective progress.
Below you’ll find the “Media Industry Social Leaderboard”, a scoreboard and chart that was developed by tabulating the top 50 media publishers, based on monthly unique visitors, and then determining which were best at generating traffic from Facebook and Twitter. Of course, I’ve included Wetpaint Entertainment on the list because we are so committed to social that we are going to make our progress public. (And it doesn’t hurt that we are already significantly better at reaching audiences on these two key social platforms than many major media brands such as The New York Times, The Huffington Post, CNN, Fox News, TMZ and others. My mother should finally be proud!)
This Month’s Findings
This month, we found that MTV’s website leads the pack with 14.3% of its traffic from Facebook and Twitter, indicating the shareability of their content (especially video, which is inherently more viral), and the heavily socialized audience they serve – not to mention their great execution. In fact, MTV beat average performance by a factor of two, and were one of only four out of the top 50 that were in the double digits. Sadly, over half of the Web’s top 50 had less than 4% of their traffic from social, making them menial performers on the medium.
Social Success Could Triple Your Audience’s Value
Lest you think that MTV’s 14.3% is anything to sneeze at, we dug a bit deeper to look at the true value of social. Beyond the boost to audience attraction, we also looked at audience retention. Measuring the visit frequency to each of the publishers (excluding the portals), we found a striking correlation to their sociability. The performers above median in social saw an average of more than five times as many “addicts” (visitors who come 30+ times per month) as a proportion of their audience, according to data from Quantcast, compared to those below the median; and they saw a corresponding reduction in their “passers-by” (visitors who come only once) by 16 percentage points. These patterns map overall into more than three times the visit frequency per audience member overall for these top performers. That’s three times the value per unique.
A Leading Indicator of Long-Term Success
One thing is clear from the growth trends of the social web: Those publishers that figure out how to capture and maintain a leadership position in social will win over the next decade. For Wetpaint, it’s a critical strategy for us to be a leader among the media industry. Which would make my mother very proud.
Speaking of which, in this debut month, my company Wetpaint came in #4, bested only by MTV, People, and ESPN. Not bad for a debut… we’ll be #1 within six months.
For those interested, detailed rankings of all Top 50 are included below.
|Rank||Name of Publisher (Owner)||URL||Monthly Uniques||% from Social|
|8||Major League Baseball||mlb.com||15,552,415||7.9%|
|12||IGN (News Corp)||ign.com||10,112,530||6.1%|
|15||FOX News (News Corp)||foxnews.com||26,900,038||5.0%|
|18||Nickelodeon (MTV Networks)||nick.com||10,716,354||4.6%|
|19||The New York Times||nytimes.com||33,034,269||4.4%|
|24||Cartoon Network (Turner)||cartoonnetwork.com||10,794,764||4.2%|
|25||The Washington Post||washingtonpost.com||17,818,260||4.1%|
|26||New York Daily News||nydailynews.com||9,931,052||3.9%|
|29||Food Networks (Scripps)||foodnetwork.com||14,324,933||3.5%|
|30||Allrecipes (Readers Digest)||allrecipes.com||17,986,031||3.4%|
|31||The Huffington Post||huffingtonpost.com||36,701,275||3.3%|
|32||TODAY / MSN (NBC/Microsoft)||today.com||23,323,684||3.3%|
|33||Los Angeles Times (Tribune)||latimes.com||18,618,265||3.2%|
|35||The Wall Street Journal||wsj.com||16,643,499||2.5%|
|38||USA Today / Gannett||usatoday.com||16,979,964||2.2%|
|41||CNET (CBS Interactive)||cnet.com||27,602,379||2.1%|
|42||Sports Illustrated (Time Inc.)||si.com||9,304,012||2.1%|
|43||LIVESTRONG / (Demand Media)||livestrong.com||9,650,128||2.0%|
|44||MSNBC Digital Network||msnbc.com||44,198,985||1.9%|
|45||About.com / NY Times||about.com||36,978,618||1.4%|
|48||eHow (Demand Media)||ehow.com||48,624,976||1.0%|
Source: Wetpaint.com analysis, comScore, Compete.com.
One of the most important questions publishers are grappling with today is whether they oversee a media company or a technology company. In the following article, which appeared originally in my Media Success newsletter and was subsequently republished at AllThingsD, I explain why every media company has to be a technology company. Then I offer several keys to success in the current digital environment, which is dominated by the rise and evolution of the new social Web. Please take a read, and let me know what you think.
Let’s start with two truths.
First, publishers need cutting-edge technology to hook an audience through today’s digital media channels of the Web, mobile, social, and search.
And, second, the breakthrough technology can’t just be about product design – it’s got to go beyond to create distribution advantages on the new connected Web.
Okay, now that we have the truth out of the way, let me ask you a question:
“Is your company a media company, or a technology company?”
I love getting asked this question. And every digital media leader I know hates answering it.
Discomfort, Uneasiness, Anxiety, Fear
The uneasiness begins with the mistaken idea that the two are separable. And they were – back in the 15th century, when Gutenberg first worked his printing magic, and up until a few years ago. But we all know digital technology has inserted itself inextricably into the guts of publishing, replacing ink with bytes and paper with pipes. And now, over the last two years, technology has transformed the basis of publishers’ relationships with their audience, by connecting them through social operating systems, as we discussed last month.
And yet, our uneasiness escalates to anxiety when we realize we still don’t fully understand the new technology’s potential or impact on our business.
That is a scary thought.
Technology Drives Media
I think we all need to collectively swallow our fear. We know every media company must be a technology company today.
In the first generations of digital media, it was easy. In AOL’s past, technology’s key role was simply to provide basic Internet access over dial-up lines. Today, while that access provides cash flow, it no longer has any strategic value in media. Similarly, Yahoo’s early technology prowess was applied to create significant products like Yahoo Mail. But while Mail still drives 73 percent of the audience to Yahoo’s media properties, it won’t secure Yahoo’s future ability to be a great media destination.
These two companies – as well as the rest of us – need to use technology for something more advanced than access and ancillary products. We need to put it right into the heart of media so that we can create breakthrough user experiences and new connections with audiences.
Millions of Ways to Engage
To do that, let’s start by recognizing what’s changed about the medium itself: In analog days, publishers’ products were two-dimensional; and all we had to work with was ink and some paper. And similarly, distribution was mostly two-dimensional; a subscription list and newsstand sales was all there was to it.
But now, consumers have access to millions of sources at their fingertips, and each one can be rich and interactive, reaching us through several different digital channels. Both our product experiences and our distribution can be much more intricate – and much more valuable. And combining the two gives media the chance to do something it’s always aspired to do before, but never been able to.
The Future Will Be Personalized
We have recently become ready for a whole new vision for media.
And that’s giving every audience member the right content in the right place at the right time.
To do this takes a combination of data – from the social operating system – coupled with media’s greatest power, that of creating experiences and distributing them.
To achieve this, though, we need technology to do more than output HTML pages; instead, it has to chaperone customized content to every individual.
This is a big change from the original Internetization of media, which was, like generations of offline media before it: “If you publish it they will come.” That worked when directories like Yahoo and search engines like Google matched consumers to content. But that attitude was passive; and today’s social Web is anything but. So publishers now have the opportunity – and the challenge – of taking charge of their distribution.
The key is using the emerging social Web to get signals from, and connect to, the audience. And when we do this, we are putting technology in the role of relating uniquely to every consumer in order to create the ultimate experiences they crave.
Now that’s a refreshing concept for media.
Three Ways to Get Ahead
But what does this mean, practically speaking?
I believe the role of technology in media success must embody these three things:
We’ve already seen this at Wetpaint, and the results are still getting better each week. Our database of everything we publish tracks all the distribution causes and effects, so we know what works. We also pay attention to who the influencers are, with technology that identifies them as well as who their influencers are; and now we’re building a “CRM”-like system to help us know more about these individuals and win them over.
Technology Changes Businesses
Let’s circle back to the discussion of whether you’re a media or technology company.
By its very nature, digital publishing is a technical medium. But, beyond that, what makes technology interesting isn’t its ability to carry bits; it’s its ability to change businesses. And we need to change our own by updating our sense of audience, distribution, and experience creation to provide thousands of times more precision than media ever has before.
When we do that, we’re making the content thousands of times more relevant. And I believe that’s how you build a thriving digital media business in the next decade.
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.
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.
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.
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).
It’s been a week of dancing for Apple and The New York Times as they played hokey pokey with an app that offers a new, fun way for consumers to experience media: First, Steve Jobs put the acclaimed Pulse News app into his Worldwide Developers Conference talk, then took it out of the app store, and then put it back in again, but only after the developers took The New York Times out of it.
But as fun as it is to watch them dance, I can’t help but notice that The New York Times missed the opportunity right in front of Sr. VP Martin Nisenholtz’s eyes: the Pulse team is exactly the kind of talent that the company should be acquiring, not shunting. The Pulse founders made an app with a great consumer experience for media, did it in just a few weeks, managed to get the attention of the premier technology tastemaker in the world, Steve Jobs, and even made some money.
Message to Martin: Instead of cutting them down and pushing them into someone else’s arms, make nice and go hire (or acquire) the Pulse team. Or, as my mother once said to my older brother when he was dating someone she actually liked, “There are better men out there than you: You better marry her before someone else does!”
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?