Time for a wake-up call! In the media business advertising follows audience. Making that happen is the function of marketing and sales. The audience is attracted by content. The business formula isn’t very complicated. What’s changed is that online, not all content needs to be created by professionals, and distribution opportunities are vastly larger than with traditional media.
As its sponsor’s name suggests, this report was assembled from the perspective of self-identified “professional media,” some of whom are having trouble accepting that they’re no longer indispensible for setting the national—indeed, global—thought agenda. Some sections read like a portrait of a massive industry in eclipse. The study rather hopefully observes that “even with so many new sources, more people now consume what old media newsrooms produce.” True enough, but a rising tide floats all ships. Online, audience growth alone isn’t enough to ensure commensurate increases in revenue and profits.
Details in the study begin to pinpoint a big problem: high-cost professional content mills that too often are out of touch with audiences’ information needs and consumption habits:
- “The media and the public often disagreed about which stories were important in 2007”
- “Most Americans believe the news media are politically biased, that their stories are often inaccurate and that journalists do not care about the people they report on”
- “News people are uncertain how the core values of accuracy and verification will hold up”
Some media companies may also have lost sight of their fundamental business, delivering audiences to advertisers. “Advertisers no longer have to depend on paid media to distribute their messages,” the report hypothesizes, citing alternatives including starting their own web sites, posting to YouTube, or guerilla campaigns. But each of these options has a cost and as the study rightly notes, savvy marketers are more attuned than ever to ROI. The challenge for media businesses is to deploy resources to deliver superior ROIs, acting as specialized marketing channels for the advertising community. That’s always been true in media and the advent of the internet hasn’t changed it.
Most acutely, the new report raises the question of the future of branded media “in an age when so much information is so readily available that it is viewed as a commodity.” Bottom line, brands exist as a strategy for capturing higher margins. In the online media business, where the competition is only a click away, it’s only worth incurring the cost of creating branded content to the extent that it monetizes better than commodity content created by partners or the audience itself—for example, by attracting a demographic advertisers pay a premium for.
To fully close the loop, sales teams and advertisers need to buy into a site’s content strategy. The study observes that may not yet be the case. “The business side has begun to be identified as the problem area, the place where people are having the most difficulty changing,” it comments. And, “Madison Avenue, rather than pushing change, appears to be having trouble keeping up with it.” The report finds the “ability to get much more granular data and the pressure felt by chief marketing officers to justify their ad dollars have made ad spending accountability the No. 1 priority among marketers today.”
The study closes with a prediction: “2008 looks to be the year the mainstream press tries to lure citizens toward creating the content within their own outlets.” Once they attract the user-generated content, it will be interesting to see what they do with it—how it’s monetized and whether it’s fully integrated into the site or cordoned off in a UGC ghetto.
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