Hitting the Reset Button on emedia
“Society doesn’t need newspapers. What we need is journalism.”
–Clay Shirky, Newspapers and Thinking the Unthinkable
While I’ve never worked for a newspaper beyond delivering them in high school, I have had both feet firmly planted in magazine publishing for 15+ years and have dipped my big toe into the world of books over the past six months, and I believe Shirky’s comment applies to the world of publishing overall.
The physical container isn’t important, nor are its bells and whistles; no one needs a book, magazine or newspaper — they need the information those containers are designed to hold, preferably information of the highest quality.
As tends to happen, a new container hit the market several years ago that holds infinitely more information than any one person could ever consume, of varying levels of quality — Wait, there’s more!! It even allows people to credibly add their own information to the mix!!! — and it shook the container-making institutions to their foundations as a result because they were forced to realize that their business wasn’t actually about making containers, it was about providing relevant and reliable, quality information.
That new container? You’re soaking in it.
“If what we have isn’t valuable and no one wants to pay for it, maybe we don’t have a business.”
–Jim Malkin, CEO, SourceMedia @ FOLIO: Growth Summit
I think Jim Malkin is a smart guy, but he’s showing up unfashionably late for this little party, though arguably a bit earlier than most other publishing executives.
I worked at SourceMedia for several years — first in marketing then, briefly, in advertising sales — and their business model was primarily built around advertising. Out of 50+ publications, the vast majority were controlled circulation — free to “qualified” subscribers in return for full contact and demographic information, providing a targeted audience for advertisers at a [theoretically] premium rate — supported solely by advertising revenue. Their approach to emedia was primarily built around online and email advertising with rigid templates for both designed accordingly, and the one major emedia initiative they had while I was there involved a paid content platform — a custom build that completely devoured internal resources and limited development in other areas, both logistically and financially — that assumed a heavy advertiser sponsorship subsidy on top of user subscription fees.
Today, that site is free for all users and has a modest, though nicely integrated, advertiser presence.
These aren’t trade secrets, and SourceMedia is by no means unique; as B2B publishers go, they’ve made some aggressive moves to restructure themselves in response to the dramatic fall-off in advertising over the past 12-18 months. That said, I’d conservatively guess that at least one-third of all ad-supported B2B print brands are going to be dead (or consolidated away) by the end of 2009, crumbling under the weight of their print-centric infrastructures and ill-conceived online investments.
The stripped-down survivors won’t last much longer if they don’t figure out how to properly value their content online as their pure play competitors — bloggers, self-publishers and indies — are more nimble, working with less overheard and lower investor expectations.
“Investor expectations” is probably the biggest boogeyman in emedia world as the success of most magazine publishers’ business plans are dependent on the “fast growth, high margin” online products they’re developing to offset the decline in print advertising and maintain the overall profit margins needed to pay off the massive debt their owners incurred in the go-go years of over-leveraged acquisitions. They’re praying they can solve the “analog dollars for digital pennies” dilemma, hoping against hope that the needed growth comes before someone realizes those high margins are largely imaginary as many emedia expenses are currently buried in the print side of the business which most are trying to, or already have, cut to the bone.
Consumer and enthusiast magazines face similar fates, and newspapers are already at death’s door; meanwhile book publishers’ problems have less to do with ill-conceived emedia ideas than seemingly having had no ideas at all.
The last questioner delivered the parting shot. If, as an author, I can design it myself, write it myself, publish it myself, why would I bother going to a publisher at all? What purpose do you serve?
–Peter Miller, Proprietor, Freebird Books & Goods, How to say f*ck you in 140 characters
I’ve noted previously how the major book publishers’ suicidal death spiral has thrown open the doors to savvy independent publishers and ambitious self-published authors, and the recent SXSW dustup Miller recounts above is but a piece of the puzzle. Ridiculous advances for “authors” of questionable worth; a completely broken distribution system they helped break; a dartboard business model that depends upon flooding the market with derivative work in hopes of stumbling upon a couple of big hits that keep the leaky ship afloat for another year — it’s insane!
Most publishers’ online presences are shameful bits of marketing detritus that would have been dated in the late 90s. They’re all about the products, offering no interaction or sense of community, cheating fans, potential readers and authors alike, not to mention themselves. Few even offer an ecommerce option, instead linking to Amazon, or worse, directing readers to their local bookseller where they will most likely have to put in a special order.
Publishers of all kinds are in a quandary about what to do with emedia, and instead of flailing around from one ill-conceived product to another, they should take a step back, reassess the landscape and hit the reset button, on both their investments and their expectations. A recent boss of mine known for her turnaround skills had a philosophy about allocating resources that I’ve come to embrace: if it’s not performing, don’t be afraid to take it behind the shed and put it out of its misery and dedicate those resources to something new or to make something already profitable even more so.
For most publishers, it’s way past time to take their emedia plan behind the shed for a little talk.
Consumers are the most valuable piece of the entire media ecosystem. Ironically, their interests are rarely brought up in discussions about the future. But their influence will only grow because technology is introducing more choice and voice. David Meer, chief research officer at WPP’s Enfactico, told me recently: “We need to stay grounded in high-level theories of what customers want, how we can meet their needs profitably, and how we can communicate to motivate them. And we must do this in a world where consumers control the conversation.”
–Max Kalehoff, AttentionMax, The Endgame Of Media Buying And Selling
At the aforementioned SXSW panel, there was single slide showing on the screen: “The internet is the largest group of people who care about reading and writing ever assembled in history. Now what?”
Whether it’s books, magazines or newspapers, the focus needs to be on the reader not the container, because the reader is now fully in control. The ability to self-filter content has always been there to a lesser degree, though with a clear role for self-appointed gatekeepers, but the Internet has accelerated the disintermediation process at hyper-speed. The value of content is more measurable than it’s ever been — and the steadily decreasing costs to produce it are well-known — and that valuation now happens both immediately and over a period of time, so there’s no one single solution to the problem publishers currently face in remaining relevant and profitable.
Ultimately, publishers’ primary focus should be to curate great content that people are willing to pay for, and to organize and nuture a community around that content and the authors who create it. That community will exist in multiple places and spaces, physical and virtual, and it will flow into whatever container suits it best.
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