Content Is No Longer King

This article was selected from Ben Elowitz’s Media Success newsletter as a special feature for AllThingsD’s Voices column.

“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.

You Can’t Spell Media Without “Me”

This article was published as a guest post at TechCrunch, and is republished here for Digital Quarters readers.

Without question, one of the greatest gifts of the human species is our ability to communicate.  We can create, transmit, and absorb ideas with immense freedom in pictures, speech, writing, music, and more.  And yet, from the earliest days of man until very recently, the state of the art of media has been about as sophisticated as cave paintings.

Taking this a step further:

Truly great communicators don’t start out by focusing on their message.  They start with their audience.  They research, observe, and monitor every knowable detail – from background facts beforehand to micro-reactions during the conversation – and adjust their content and delivery precisely, so it will make an impact.  But it’s not like this is a secret formula.  Even toddlers do it, carefully measuring parents’ reactions and perpetually tuning in to the behavior patterns that get them the attention they want.  That tuning is carefully optimized to achieve maximum effect from each individualized recipient.

Meanwhile, media has virtually ignored its audiences.

But it’s finally beginning to open its eyes and ears to them through personalization. I believe that personalization has the greatest potential to transform the media business.

But before we get to that, let’s start with what’s gone wrong in media that has made us blind to our audiences’ cues.

In the world of print and broadcast, there was fundamentally no data about audience interests or reactions.  It was impossible to “read the room,” because the room was pitch black.  If media leaders’ eyes were closed, I’d be hard pressed to blame them; there was nothing to see.

As a result, there were two operating principles that made sense at the time, but which have since become outdated anachronisms.

First, that an editor should serve as oracle for what the audience desires (I call this the “Editor Fallacy”); and second, that content created in that vacuum of data should then be distributed as broadly as possible (let’s call this the “Broadcast Assumption”).

These two assumptions – even though they came from the print and broadcast legacy businesses – have errantly managed to drive the entire Web media mentality.

And the resulting misguided formula – across the board – has been Prophesize, Publish and Proliferate.

The big hope with this media Ouija Board has been that the guesses will be right, and that those who broadcast widely will then draw a big audience.  When the guesses miss the mark with audiences (no surprise there), publishers turn up the volume or amp up the sensationalism. To some degree, this is why the Huffington Post succeeds with its brash and blaring headlines, and it explains why, thanks to Henry, we’ve collectively Blodgetized Web 1.0 media.

But to make room for the new media model of the next 100 years, we need to let these old assumptions fall by the wayside.  The new vision is for media to start doing the work that each member of the audience already does; and that means deliberately selecting and contextualizing the media we each consume.

Putting it simply: media’s great opportunity is to bring the right content to the right person at the right place and time.

And this is where things get very interesting.

Bring Me My Very Own World

The social transformation of the Web has already taken us half way down the road toward a personalized future.

We finally recognize that the Web is made up of people, and Facebook and others have made people and relationships the key “nodes and edges in the graph” of the Web, replacing pages and links.  The social Web is now people-centric; and, increasingly, social is becoming the operating system for the Web at large.  Most impressively, “what my friends like” is already proving to be a good starting point to predict “what I like,” and so much of the Web is beginning to get at least a clue of how to serve us.

Despite this tremendous progress, however, when you go behind the scenes, the Web is still organized by data, not by people. Server data is affiliated with accounts; cookies are associated with Web browsers; and activity logs are tethered by IP addresses.

And yet, as the social revolution has proven, the real value of the transformation has been to stop looking at me as an IP address, a browser, or an account; and to start holistically realizing that I’m a person – I am me.

So, the great opportunity is to move from a Web of sites to “my” Web of me.

Media is at a critical transition point today, because we are about to completely redefine our sense of the audience. Starting now, the audience is no longer one massive opaque agglomeration. It’s not a “them” or an “us”; it’s a lot of individual “me’s.”  (This must-watch from Monty Python paints the picture.)

In this context, the Broadcast Assumption of content creators is completely out of touch with the 21st century zeitgeist.  It revolves around the played-out maxim of “create once, distribute everywhere,” which made sense when audiences were opaque and distribution channels were just big dumb pipes.  But it totally ignores the “me’s” in the audience – when it comes to both creation and distribution.

The bottom line, then, is that media experiences, which used to be one-size-fits-all, must now be customized so they’re just for me.

In other words, the media experience of the future must take a cue from Facebook, and bring my world to me – regardless of where it originated. 

The Six Elements of Ultimate Digital Personalization

Social represents progress toward this vision of fully personalized media, but it’s only one part of the game.

In my view, there are six key elements that contribute to ultimate digital personalization – and these elements are the basis for the ultimate success model in digital media:

  • It’s social – What happens to people close to me is important, because these people are important to me.
  • It’s curated – People aren’t just content sources themselves; they’re also curators. To know me is to know my tastemakers.
  • It’s an experience, not just a stream –Newsfeeds and timelines are a meager start.  Twitter’s 140-character format is great for insiders, but it’s inscrutable for Grandpa. Personalized media should come in all formats – not just a feed.  And it will be more powerful (and more profitable) when it creates an immersive experience.
  • It’s incredibly, incredibly smart about what it recommends, and what it doesn’t – But better than today’s Facebook and Twitter, it brings me the right content, not all content. I trust it to filter the world for me, and to highlight what’s important to me out of billions of pieces of information.
  • It’s self-refining – Speaking for myself, it would know to bring me news about digital media; about my company; about my friends’ reviews of great restaurants in Seattle, LA, and New York; and, in the winter, a helpful article or two on snowboarding tips would be greatly appreciated. It would also turn down articles about Glenn Beck, and turn up the latest find from Brian Stelter. And, before you cry (or scream) “filter bubble,” let’s get it straight that this is what I do already.
  • It’s not just the content that’s personalized – It’s the advertising, too. Today’s version is very primitive: I go to a Web site once and its ads follow me around for weeks. But, instead, my demographics, interests and intent should all combine to inform what ads to show – and not show – me.

After considering these six elements as a whole, I’m most inspired (and encouraged) by Facebook, Twitter, AOL Editions, the recent Flipboard clones, NetFlix, and the potential of a new Siri-powered Apple TV.

Each of these demonstrates the central aspect of this new vision for media: bringing my world to me.

Data Is the Currency of Personalization

To be successful, we all need to be data companies – as data is the clear way to know what our audience wants.  Data is the currency of personalization, and so it is our best path to delighting our audience.

News sites should know by now what topics and stories to program for whom; and no sports site should serve a balanced home page when no sports fan likes all teams equally.

It’s an approach that, of all companies, Yahoo! ‘gets’– and for them it’s been paying huge dividends for a long time.   And so it should for the rest of us.

What this means for media is that it’s not all about the content – instead, it’s all about the audience.  And that means the nature of media has changed.

It’s all about you. It’s all about me.

That’s the digital media future. And we need to start going there today – because audiences are asking (and even demanding) that we pay attention to them, that we really know them, as true individuals.

So, if you’re a publisher, here’s the challenge as you try to create meaningful content experiences today: Each member of your audience – no matter how vast it is – has to become the most important person in the world to you. Or, looking at it in a slightly different way, you have to become deeply involved and digitally intimate on a global scale each and every day.

What We Learned This Year About Creating Successful Media Properties Online

This week, we made some announcements about our achievements at Wetpaint, and it has prompted me to take a look back at 2011.  It’s easy to be proud of the 6.4 million unique visitor audience we have built at Wetpaint Entertainment monthly.  It is a significant accomplishment in just 15 months since we launched, and the Wetpaint team has worked passionately to get us here. But even a number like that is, well, just a number. The real value of what we did in 2011 lies in the all the learning we had about how to build, run and monetize a successful media property online.

And that learning makes me feel grateful – because as successful as we have been this year, it’s been against a context of upheaval in the industry.  Media is not easy.  Old formulas from print and broadcast are no longer working.  And even the just-minted generation of seemingly successful digital companies, from Demand Media to Zynga to Facebook itself, are having to constantly innovate to stay on top of the wave that they’re on as they hope to catch the next.

Clearly, the most important keys to financial success in media are building audience and monetizing that audience – and we’ve made significant progress on both here at Wetpaint.  Our greatest strength has been the data engine we’ve built to acquire, assimilate, and apply every possible insight about our audience.  We learned that smart and targeted analysis can improve everything we do; that lots of rapid experimentation is critical; and that social traffic is far more valuable than search.

We also learned more about the Kardashians and the people on the The Bachelor/Bachelorette than anyone in this world should.  Our editors did a bang-up job capturing the liveliness of the entertainment industry and they definitely deserve plenty of credit.

But while all our great content and social mojo would succeed in delighting audiences, it wouldn’t be enough to make a strong business without excellent monetization.  And so I’m equally excited to note that as we get ready for 2012, we’ve found that our formula of great content and social mojo is just as valuable to advertisers as it is to our audiences.  I’m pleased that we will be working with the team at Cambio Group via their joint venture between AOL, Jonas Group and MGX Lab.  Together, we will be  serving outstanding advertisers with some of the most innovative offerings around.

With this partnership in place, we are able to turn amazing traffic into amazing financial results. It will mean strength for our model and our company into 2012 and beyond.

But the implications are even broader for the industry, and that’s because we are setting a model that others can follow as well.  And that is what I’m most excited about:  What media needs most is a model that can be scaled and repeated – and our latest results make it clear we are on the right track to build it.

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.