Media Sites – Facebook’s Beachhead in the War Against Google

Peter Kafka’s very interesting column in All Things Digital reveals that a number of media sites are seeing their referrals from Google decline while those from Facebook increase. Indeed, as a nice chart in Peter’s piece indicates, Google’s influence has diminished among 80 percent of the top media sites in the last year.

This isn’t surprising, and it makes perfect sense to me.

Using martial metaphors (how apt and appropriate these days!), media is the beachhead for Facebook’s entry into all Web browsing and all matching between visitors and what’s visited – and Facebook is quickly taking over that territory from Google.

Think about it.

Media is where it all starts, but certainly not where it ends.

Media sites are the most reactive to serendipity on the Web. And they’re  the most “frictionless” of any product we consume online or off:  The only cost is the click of a finger and a few seconds of load time. It doesn’t cost money to read a link; you don’t have to enter any shipping or billing information; you don’t have wait time while a freight company delivers it; and you don’t need a sharp implement to open it – or a place to put it.

The most viral media consumption is emotionally driven, too. And it  generally offers high entertainment value, and is associated with some urgency because people want to be “in the know” in order to earn social currency. And, finally, like many products, it’s taste-based.

All of this helps explain why Facebook is gaining influence among media sites. And why, whenever Facebook offers a link to a media site that is worthy of consumption, there’s a very high probability that it will, in fact, be consumed.

Commerce sites are the next frontier for Facebook. As I mentioned above, commerce is harder, because there’s more friction, and there are more impediments that get in the way of buying / consuming.

But these are just degrees of friction.

As Facebook gets better at knowing me, who I share taste with, what products I need, and what people like – both people in general and people I’m likely to share taste with – it will be able to overcome that friction.

And, one can easily imagine Facebook doing everything it can to grease the commerce skids by facilitating frictionless login (Facebook Open Graph and Instant Personalization), payment (Facebook Credits), and more to reduce the underlying friction, so that commerce sites will follow closely behind media sites and start leaving the Google orbit.

Google is still driving traffic to many Web sites. But that is clearly changing. And Facebook’s assault is starting to succeed.

Don’t Depend On Google’s Algorithm: SEO Slaves, Rise Up – And Revolt!

Move on from the Algorithm

Early reports are in confirming the results of Google’s index changes.  Yahoo’s Luke Beatty says two-thirds of Associated Content pages have lost traffic, while I’ve heard that total volume declines from Google search have reached 70% on some properties.

For sites like eHow and About.com, which get somewhere between 65%-70% of their traffic from search, the concentrated risk exposure that comes from Google engineers changing the algorithm makes for an unstable and uncontrollable business model.

Never in the history of media has there been such a precarious model for distribution, and the bad decision by SEO-focused sites to try and build a relationship with an algorithm looks worse and worse. The SEO-focused sites kowtow to the algorithm’s desires, as best as they can interpret them.  They game their moves internally, based on what they think the algorithm wants, not what the customer wants. And they rely on the white hats, as well as all of the blackest hats they can stomach, just to please the algorithm.

But, unfortunately, the algorithm is capricious and unreliable.

What these companies should do is form relationships with consumers.

That means providing consumers what they want – and where they want it, which increasingly means in their Facebook or Twitter feed, and on their mobile phone.

In the end, this is the only way to create great experiences that are branded in the consumer’s mind today.

My advice, then, is simple.

SEO slaves, rise up – and revolt!  Throw out the false God of the search algorithm and, in its place, focus on building valuable content and experiences. Win the audience, not the search.

Arianna and Tim – A Media Match Made in Heaven?

Tim Armstrong, AOL’s CEO, has rebooted AOL with a talk-track of branded destinations, A-level journalism and sizzling original content; and early Monday morning, a full week before Valentine’s Day, his romantic media vision was considerably enhanced, when Arianna Huffington announced that she was selling Huffington Post to AOL for $300 million in cash and $15 million in stock.

For the record, that’s quite a premium price – 10 x Huffington Post’s $31 million in revenues.

Despite the cost, however, Armstrong is a very lucky man, and he received a wonderful gift from Huffington, whose hugely successful and much-talked-about Web site is a perfect match that helps “complete” AOL.

Indeed, the relationship between Armstrong and Huffington comes not a minute too soon for AOL, which is finally bringing on real creative assets and talent – including Arianna Huffington, herself, as chief editorial taste-maker.

To be honest, the media industry has been wondering whether Armstrong could actually pull off a deal like this. (True Confession: I’ve been among the doubters.)

And there’s good reason for the skepticism.

The problem, in large part, has been strategic. Since he assumed the CEO’s post, Armstrong has talked with clarity about his vision for an AOL made up of destination media brands, the way Time Inc. and Conde Nast have built their portfolios.  But to date, his build-out of this city on a hill has fallen short. Instead of buildings gilded with leading journalism that attracts fame and eyeballs, his properties have largely been constructed by plumbers and mechanics laying a foundation for search engine rankings.

That’s why AOL’s recently leaked master plan, “The AOL Way,” is heavily oriented toward users’ search queries.  The playbook emphasizes volume of content, page-views per post, and production cost per-piece.  And, while “The AOL Way” is punctuated by periodic reminders like “quality content at scale,” the reader of the plan is left with the distinct impression that quality is a guardrail, not a compass direction for the journey to ROI nirvana.

Indeed, without a voice or a purpose other than page-views, “The AOL Way” comes off as soulless. Instead of emphasizing audience interests, an editorial point of view, or premium differentiation, it’s a volume strategy: the plan calls for the number of stories to jump from 33,000 to 55,000 a month; with median performance to go from 1,512 page-views per article to 7,000 within the quarter; all while gross margins rocket from 35 percent to 50 percent.

This Google-ingratiating strategy, at least from my perspective, is wrong-headed and short-sighted.  It doesn’t do anything to help build a unique and long-lasting brand that is meaningful for audiences.  And, as a result, it does very little to encourage people to eagerly and voluntarily type “AOL.com” into their browser’s destination bar.  With this playbook, consumers don’t go to AOL; they merely end up there.

There’s a solid lesson here for all of us.

AOL – like everybody else in the media business – is clearly jealous of Facebook’s gravity-defying results.  But it takes time for a proper media brand to achieve such stratospheric numbers.  The great brands – The New York Times, ESPN, CNN, Wall Street Journal – have shown us that you build audience loyalty one positive interaction, one ambitious story, and one rich consumer experience at a time.  To be sure, Huffington Post has shown us that, building its audience to a reported 25 million uniques over a well-paced five years.

So, it doesn’t happen overnight, and it certainly doesn’t happen if you’re just playing for quick search engine results.

Looking forward, it will be interesting to see whether Huffington – a savvy and independent thought leader who has always leaned forward – chooses to embrace “The AOL Way.”

My sense is that she will continue to follow her well-honed consumer-focused instincts instead.  She brings a strong point of view, a decidedly human nose for news, and a variety of social strategies for distribution – not to mention her considerable star power.  And that’s a good thing for AOL.

It’s important to recognize Armstrong’s considerable achievements.  He saw that AOL’s subscription model was a non-starter; he chose areas of core content concentration for AOL; and, unlike Yahoo!, for example, he pared AOL’s portfolio quite dramatically.

But the pre-Valentine’s Day courtship and consummation with Huffington will mean very little in the consumer marketplace if Armstrong doesn’t get rid of his seemingly unshakable Google obsession – and very soon.

Here’s hoping that Arianna can help nurture Tim’s AOL, and turn it into a true media destination.

Associated Content is Yahoo’s First Big Media Move. Here’s What Should Come Next

With yesterday’s announcement of the acquisition of Associated Content, Yahoo CEO Carol Bartz has sent a loud message:  Yahoo is investing in becoming a new kind of digital media company for the new age of digital media.   Cheers to Yahoo for recognizing that their “1.0” model needs an upgrade to be more effective in a 2.0 world.  The only problem is that this move gets Yahoo just one step toward where it needs to go.  It could be a powerful first step to add content and audience to their network, but will only be strategically valuable for Yahoo if it is layered with additional new investments to build true destination media sites with premium positioning.

Let’s explore what Yahoo gets from AC first, and then cover what Yahoo must do from here if it is serious about winning in media.

1. Yahoo gets commodity content at commodity cost. With Associated Content’s marketplace, first and foremost Yahoo can source commodity content – i.e. the kind of content that doesn’t need a particularly differentiated author, original reporting, or other hard-to-find talent – cost effectively.

2. Yahoo can improve time (and value) on network. In this age of deteriorating portal power, users come to portals primarily for one reason:  mail.  (According to data from comScore, 73% of Yahoo’s viewers of its most valuable real estate – the home page – are Yahoo Mail users.)  Once they arrive, however, there is far more money to be made by vectoring them to networked media properties like Yahoo Finance, Sports, and Entertainment than by serving additional pages of poorly-monetizing email.  So, by beefing up the available content in the network, Yahoo receives the benefit of extending visits at low cost.

3. Yahoo increases its audience by drawing traffic from Google. Yahoo’s made the strategic decision to move its focus out of the search game and onto media.  And so rather than just feeding them from mail and search, Yahoo needs its content properties to draw audience on their own.   The AC content marketplace can produce thousands of pages per day of content – each one baiting more search engine traffic, and all produced at modest cost.  A recent EConsultancy interview with CEO Patrick Keane revealed that the bulk-buy strategy works:  “80-90% of our audience is driven through natural search,” and according to comScore data, nearly 50% of the traffic that AC’s content sees each month is incremental to Yahoo’s core audience that comes for mail most days.

All three of these improvements have financial benefits to Yahoo – both in increasing revenues with greater reach and traffic; and in bringing down average cost of content. But they miss out on the strategic positioning that Yahoo absolutely must own if it wants to ensure a leader as a top digital media company:

Yahoo needs to be a premium destination; and the AC acquisition message undermines that positioning. Continue reading

USA Today Embraces Commodity Content with Demand Media

Commodity ContentNo publisher wants to believe that content is a commodity.  But by introducing a new web Travel Tips section powered by Demand Media, USA Today is taking the bold and necessary move in admitting just that.

It’s a turning point for the publishing industry to concede that not every column inch is vying for a Pulitzer, and to act accordingly.  Let’s face it:  certain types of content — in this case, detailed travel tips, deals, and the like — do not require nor merit the talents of their highly capable (and highly paid) editorial staff.

It’s also clear from Nat Ives’ report at AdAge that the new section is an opportunity for the USA Today brand to capitalize on search engine optimization (SEO) to capture prospective travelers who search for specific advice, such as “hotels with toddler pools in Maui”.   Demand Media will analyze search trends and engage writers in its content marketplace to address topics with the greatest commercial potential.  Meanwhile, USA Today lends their brand to the equation to generate new audiences from search engines and revenue for both parties.  For USA Today, this solves the problem of how to add more to their user experience and grow their audience, with little to no cost.

It also solves Demand Media’s problem:  they have a whole lot of content with no place to put it, and this deal opens up distribution for a broad new category.  Demand Media clearly has its sites on ‘movin’ on up’, and they are dating up a tier on the social ladder with this deal, as it helps them move upscale into a more premium environment under the halo of the USA Today brand name.  This provides further momentum on the heels of the news that CEO Richard Rosenblatt convinced online heavy-hitter Joanne Bradford to join Demand Media as chief revenue officer.

Will the content be up to the typical editorial standards of the USA Today?  Almost certainly not.  But travel tips don’t require particular expertise or training, so this category is an excellent candidate for commoditized content.  Moreover, it’s important to understand that the primary consumer quite likely is not a current USA Today enthusiast.  It is a web searcher who may or may not have any relationship with the brand.   And given the topic, the value-add of a highly paid writer could easily be lost.   One doesn’t need to wax poetically about a toddler pool after all.

Most publishers will turn their noses up at this as “farmed” content.  But to do so would be foolish.  This is a great example of a top brand recognizing where they do and do not make a difference, and focusing their investments where they matter.

For the USA Today online team, led by Jeff Webber, this is a smart move.  Now, other publishers need to do what people in other industries have done for decades:  focus on your core competencies and economize on those things that do not differentiate your product.    The publishing world has been all too slow to recognize this Econ-101 reality, and it’s time for a wake-up call.

What are your thoughts on low cost, commodity content?