It is funny what catches the imagination. As someone who has been advising news organizations for nearly 20 years — presenting my arguments around the world and writing for people like you — I never cease to be amazed by the topics people respond to and those they ignore.
So it was interesting that my most recent rant about the value — or lack thereof — of social networks to news publishers drew a lot of comment (go to http://www.jimchisholm.net/Column1202.html).
Media product lifecycles are shortening, with newspapers being 400 years old, analog broadcast and telephony around 150 and digital media less than 20.
Despite the relative youth of digital media, many brands, such as Yahoo, AOL and Groupon, are already showing value fatigue.
And Facebook will be next.
From where I sit, news media are diluting their brand values by clutching to social media; it’s a life raft with a hole in it. Instead, what they need to do is restore confidence in their print products and by extension establish loyalty in their digital services.
Alas, this is simply not happening.
As a further reprise (and I apologize if am again recounting previous material, but I will get to the point), consider the following.
When you compare the intensity of news media consumption between analog (print) and digital media, the geometric effect of times visited and activity — what I call intensity — suggests that analog consumers absorb more than 15 times as much information as those visiting websites (see chart below).
This confirms another of my regular themes, namely a common misconception that Web usage is somehow destroying print readership. The reality is that the behavior of consumption between these two mediums is completely different. Examine your own behavior. I bet you spend time with your printed media, but flick through your digital options — probably several times a day.
In addition, and this is the subject of a separate study I am currently conducting, the nature of the online experience precludes visitors from fully navigating either the page they are visiting or the wider content of the site. This is newspapers’ biggest challenge, and is the conundrum that is driving down digital revenues and working against paywall models. (Editor’s note: Readers who would like to participate in Chisholm’s study can contact him at the email address at the end of this column.)
Finally, the attachment to partners, such as Facebook or the invidious Apple Newsstand, is horrifically damaging in two other key areas. First, it keeps publishers from really knowing their readers. Second, it destroys any opportunity a publisher might have to introduce the right advertiser to the right prospect.
Not rocket science
If you assume that publishers currently get a rate of one revenue unit for a page impression, and perhaps 10 for a click-through, my analysis of data from real-life projects with publishers and advertisers is that these figures can be accelerated to 100, provided publishers protect their customer knowledge and work with their advertisers in terms of ad serving.
The fact is, however, that a typical click-through rate is less than one in a thousand page impressions, and an active response is likely to be between 10 and 50 per million page impressions.
What frustrates me is that this is not rocket science. It simply requires publishers to appoint someone to track, analyze and report on their website analytics, and set goals to improve the geometric intensity of their website. We’re talking lower school math here.
In the meantime, social media are showing how real-time bidding can be used to generate a higher margin for a given inventory. But here, too, publishers have an even stronger value proposition as they offer deeper, wider and better-quality content that can be translated into more granular user insight.
And that is precisely what advertisers want.
Algorithms are now emerging to help publishers exploit the value in their content and thus avoid the plain-vanilla approach of Google or DoubleClick.
Yes, matching subscriber data with an advertiser’s customer data won’t be easy. But trust me, this work is going to be very profitable for publishers and advertisers. In fact, managing this data successfully will help us overcome the industry’s biggest conundrum.
If you are interested in participating in either of the research projects alluded to in this column, please email me. There is no cost, no hard sell. We will produce a report on our findings and recommendation for the industry worldwide.
Simply email me at firstname.lastname@example.org saying in the email subject:
Conundrum – participant or observer
Partnership – participant or observer
Jim Chisholm is a France-based independent media consultant. He can be reached at email@example.com.