How Much is a Magazine’s Content Worth? Part III

newsstand by loop_oh
newsstand by loop_oh

The rise of the social web has given birth to a phenomenon similar to the indie film revolution of the 90s, when everybody thought they had an interesting story to tell, and believed a credit card limit of a few thousand dollars was all it took to become the next Robert Rodriguez. He even wrote a book about it!

Most bloggers fall into similar territory, minus the upfront financial investment, and as noted in the New York Times on Friday, the failure rate is roughly the same — astronomical:

Blogs Falling in an Empty Forest

According to a 2008 survey by Technorati, which runs a search engine for blogs, only 7.4 million out of the 133 million blogs the company tracks had been updated in the past 120 days. That translates to 95 percent of blogs being essentially abandoned, left to lie fallow on the Web, where they become public remnants of a dream — or at least an ambition — unfulfilled… Richard Jalichandra, chief executive of Technorati, said that at any given time there are 7 million to 10 million active blogs on the Internet, but “it’s probably between 50,000 and 100,000 blogs that are generating most of the page views.” He added, “There’s a joke within the blogging community that most blogs have an audience of one.”

It’s worth noting that a percentage of those abandoned and lightly used blogs belong to traditional publishers who didn’t understand what a blog was but launched them anyway, partly because everyone else was doing it. Interestingly, many of these publishers have also bought into the notion that bloggers are legitimate competitors to their established brands and devalued their own content in response by giving it all away for free online and, as noted in Part One and Part Two of this accidental manifesto, are effectively doing so in print, too, all in the service of delivering as many eyeballs as possible for their advertisers with no Plan B in place for when the advertising dried up.

YOU GOTTA HAVE SOUL

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 last week’s Conversational Marketing Summit in New York City — a new media strategy session dedicated to helping brands “join the conversation” the social web has pretty successfully excluded most of them from so far — Federated Media Founder and CEO John Battelle’s opening remarks spoke just as directly to traditional publishers, too: “Ad networks have scale and data, but they lack soul. Customers don’t join ad networks.”

His reference to “soul” struck an especially warm chord with me as it’s something many “old media” brands already possess but haven’t always successfully leveraged online. That slow response left a huge opening for personal brands to evolve exponentially, gain precious mindshare and become competitive with the established brands that once nurtured them as featured columnists and editors-at-large; it also allowed savvy brand marketers to connect directly with consumers instead of having to go through traditional intermediaries.

And yet, amidst all of the dire predictions about the death of print, the one thing I’ve yet to see is a single industry study — or even an off-the-cuff anecdote from a moderately respected pundit not employed by a digital ad agency — that says consumers are demanding more advertising.

What consumers have demanded more of is control over the overwhelming amount of content that is now available to them online, and there are a wide variety of applications that facilitate the consumption, sharing, and yes, production, of content of all kinds and levels of quality — along with a number of ad-blocking apps thrown in for good measure.

CONTENT IS STILL KING

“Gatekeeper” is a four-letter word on the publishing industry’s conference circuit these days, a straw boogeyman invoked to elicit visions of old white men in leather chairs dictating what the masses should and shouldn’t be reading. Who needs traditional publishers anymore when the almighty (and ever-changing) algorithm and the “wisdom of the crowds” threaten to extract the soul from all content, leaving us with LOLCATS, Jon and Kate, and Blogola?

There will always be gatekeepers of one form or another, whether traditional publishers or the crowd-sourced variety. In both cases, the crowds are usually led by a few vocal minorities, and both have a history of chasing trends while ignoring new voices and ideas, so what’s old is basically new again.

The true value of content is more measurable than it’s ever been, so publishers’ primary focus should be on curating 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, and vary wildly in size; in some cases, they won’t be the least bit interested in having advertising invade their space, overtly or covertly.

Contrary to popular belief, though, print advertising definitely is not dead. It will need to evolve, and as I’ve noted previously, publishers, agencies and marketers are going to have to hit the reset button on their digital initiatives and refocus on the most important part of the equation: the consumer.

Marketers (and their agencies) and the publishers that need their support have to start treating each other as partners and not adversaries, working together to develop initiatives that engage their respective communities, not just pitch products at them after fighting over discounts off the illusionary rate card.

TECHNOLOGY FORCES REINVENTION

At the CM Summit, GCA Savvian Advisors’ Terence Kawaja offered some interesting insights, including a scathing parody called “The Day the Media Died” and the provocative statement: “What if low CPMs are the real ‘value’ of ad inventory? Technology forces reinvention.”

In an ideal world, traditional publishers would take the opportunity to reinvent their business model and approach 2010 as follows:

  • Place a clear value on all content and offer it in a variety of mediums, as dicated by the community’s needs, not the publisher’s budget line items;
  • Abolish the rate card and don’t accept spreadsheet-based RFPs;
  • Most importantly, ensure their content, and the products they’re advertising, are all worth paying for.

There’s only so many ad dollars to go around these days and the media contraction that’s already underway will continue to weed out the weakest brands and seasick investors. If a pure-play brand is a legitimate competitor to your established print brand — whether for readers, advertisers or both — you don’t have a viable business model anymore. Period.

For some magazines, this will mean investing more in their content, ensuring that it’s not just high-quality, but also unlike anything that’s available elsewhere. Premium content allows Harvard Business Review and Cook’s Illustrated, among others, to charge premium subscription rates in print alongside a freemium online model. Hearst Magazines was recently noted for the apparent success of its contrarian strategy, increasing the physical size of their magazines, raising newsstand prices and severely limiting the amount of print content that makes it online, arguably offering their readers a higher quality product and their advertisers a more desirable platform.

For those magazines whose content is more commodified, it will mean striking a better balance between a more compelling context worth paying something for — controlled circulation will become the domain of custom publishing over the next few years — and developing new channels for both themselves and their advertisers to engage their community with relevant content and product information.

For those with commodified content and no significant advertising base — or worse, one that “got” the Internet first — the outlook, to be frank, is rather bleak. Micro-niche plays like this can usually survive on their own better with less overhead than within a corporate structure where resources are more plentiful but prioritized according to revenue, and are probably better suited as pure-plays anyway.

What do you think?

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Guy LeCharles Gonzalez

As in guillotine. Old/new media pragmatist. Sometimes loud, one-time poet, still opinionated. Reading, writing, running, gaming, soccer, beer.

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