Monetizing Digital Content

Better Strategies for Monetizing Digital Offerings: Thinking Out of the Box while Looking across Industry Silos

Better Strategies for Monetizing Digital Offerings: Thinking Out of the Box while Looking across Industry Silos

Introduction: Dr. Howard Morgan, Co-Founder and Partner, First Round Capital

Monetizing digital offerings is a continuing challenge. Advertising can generally generate only some of the revenue required, so customer payments appear to remain essential for most businesses. Freemium was a good starting point, and now soft pay walls are being tested. Shifting music and film from purchase to subscription is emerging as a sea change.

Paul Smurl, Vice President, NYTimes.com

Shawn Price, President, Zuora.com

Betsy Morgan, President, TheBlaze.com

Richard Reisman, President, Teleshuttle Corporation

What else is new? What can be applied across verticals? Do we need to rethink the value proposition and customer relationship? How successful are strategies to apply social influence and “pay what you want”?

This panel discussion looks broadly at how content businesses such as publishing, music, and video are transforming themselves to achieve economic viability:

Among the issues discussed:
– What strategies are they adopting?
– What can these verticals learn from one-another?
– Do new transaction platform services create new opportunities?
– How far out of the box can solutions go?

Panel Moderator:
– Dr. Howard Morgan, Co-Founder and Partner, First Round Capital

Panel Speakers:
– Betsy Morgan, President, TheBlaze.com
– Shawn Price, President, Zuora.com
– Richard Reisman, President, Teleshuttle Corporation
– Paul Smurl, Vice President, NYTimes.com

The lifespan of online content is nasty, brutish and short

The lifespan of online content is nasty, brutish and short. What to do?

The above video interview is from Internet Week in NYC.                               
Sponsored by
brands, webtv, webisodic series, content marketing, consumers, eyeballs, display advertising, ana, association of national advertisers, iab, 4as

An ugly truth about online media is the incredibly fast decay rates of content objects. Even the most compelling content once published experiences a quick drop off in engagement relative to its perceived value.

Like Thomas Hobbes’ analysis of man in a state of nature, the life of online content is nasty, brutish and short.

Even with our most successful viral hits, an initial spike of aggregated activity around the work is followed by a dramatic plummeting of interest. Sure, search allows for some Long Tail discoverability but the fragmentation and capriciousness of our audiences dooms content of all types to obsolescence.

To stem the tide we build social ecosystems and construct SEO savvy strategies around that which we do in order to sustain the original audience lift just a little bit longer.

What I find interesting though in the above interview Peter Cervieri conducted with Federated Media’s Peter Spande is Spande’s observation of the engagement platforms audiences use for different categories. With business and technology news it’s Twitter. With men’s lifestyle it’s Facebook. And with Women’s lifestyle it’s on site comments. (The discussion starts at approximately 9:08.)

The goal, of course, is fewfold: to sustain the life of the original content object and build loyalty around the brand.

The lone piece of content can’t create that loyalty but by extending engagement with it, and engaging those that are engaged with it, we increase the likelihood that our next greatest hit will be viewed, shared and otherwise promoted… albeit briefly. Rinse and repeat.

So while an individual work suffers the nasty, brutish and short life an unforgiving online environment has in store for it, eventually doomed objects work in tandem to give life to brand loyalty.

Digital optimism: It’s really not as brutish as it may sound.

The Role of Research in Advertising

Research is about generating insights that lead us to better decisions.

Research is about generating insights that lead us to better decisions. Bob Liodice, President, Association of National Advertisers (ANA) talks about the relationship between the research and creative teams when it comes to developing new products or rolling out marketing campaigns.

Embracing Failure in Advertising

ANA President Bob Liodice on the fear of failure and what it means to the brand / agency relationship?

We sat down with Bob Liodice at the Association of National Advertisers (ANA) Creativity conference and covered a few topics. One topic was the concept of embracing failure. Breakthrough products or marketing campaigns require a little bravery and an acceptance that sometimes you may fail.

How do brands and their agencies foster a collaborative environment where the willingness to fail is encouraged and rewarded? Are failure and risk encouraged in your company? Do you fail fast and learn from it? Or are there road blocks that discourage the occasional swing for the fences?

Future Journalism Project Does NYC

Reporting from New York on disruption and opportunity in American journalism — a short video update on who we’ve been talking to and what you can expect to see.

Over the past few months we’ve been exploring current disruptions and opportunities in American journalism by interviewing great minds about their thoughts on — and efforts in — a remarkably fluid and changing landscape. The video above introduces some of whom we’ve been talking to.

Following the FJP

Project Background

Our goal is to launch a Web site in early 2011 that houses these interviews so that those interested in the future of American news media have a deep resource through which they can explore changing newsrooms, business models, education and the stakes all this has on democracy itself.

Interested in Collaborating? We are Too.

A good place to start is joining us at our Tumblr blog at FutureJournalismProject.org. A few of us are posting there now. A few more would be great. If you’re passionate about the changing journalism landscape and want to join in, send us an email and tell us a bit about yourself.

We’re also looking for hacks and hackers of all stripes:

Sponsorship Opportunities

Interested in being a Future Journalism Project Sponsor? We are too!

Contact us and we’ll let you know how we plan to integrate Sponsors across the Web Site, the Podcast Series and feature length documentary planned for 2011.

You can learn more about the scope of the project here (PDF).

News and Updates

You can follow our progress on Tumblr or on Twitter (@futureJproject), or send us an email at hello@futurejournalismproject.org.

Video Still: Heading for the Scrap Heap by John O’Connell via Flickr. Used with permission.

Is the Browser Dead?

As apps become increasingly lucrative will media companies jump the browser ship.

I write this in a browser, and read what I’m about to quote in a browser but that doesn’t make Michael Hirschorn’s rumination any less true.

We often note that the Web is moving toward an increasingly closed system.

I don’t like it but our media overlords continue pushing to make it so.

Back to Hirschorn:

All of this suggests that the era of browser dominance is coming to a close. Twitter, like other recent-vintage social networks, is barely bothering with its Web site; its smart-phone app is more fully featured. The independent TweetDeck, which collates feeds across multiple social networks, is not browser-based. As app-based usage climbs at the expense of the browser and as more content creators put their text, audio, and video behind pay walls, it will be interesting to see what happens to the Twitterverse and blogosphere, which piggyback on, and draw creative juice from, their ability to link to free Web content. If they don’t end up licensing original content, networks such as Twitter and Facebook will become purely communication vehicles. At first glance, Web sites like The Daily Beast and The Huffington Post will have a hard time once they lose their ability to hypertext their digests; on second glance, they will have an opportunity to sop up some of the traffic that once went to their now-paid rivals. Google, meanwhile, is hoping to find ways to link through pay walls and across platforms, but this model will clearly not be the delightfully free-form open plain of the early Web. Years from now, we may look back at these past 15 years as a discrete (and thrillingly indiscreet) chapter in the history of digital media, not the beginning of a new and enlightened dispensation. The Web will be here forever; that is not in question. But as Don Henley sang in “The Last Resort,” the Eagles’ brilliant, haunting song about the resortification of the West, “You call someplace paradise, kiss it goodbye.”

Head over to The Atlantic to read his complete thoughts.

Content-As-A-Service: The Next Realistic Business Model

The rules of making money in the digital age have changed.

Consolidation is a natural phenomenon in maturing markets, especially those markets where disruptive channel changes are occurring. The world of content is no different as evidenced by the growth of mega-media conglomerates and the proposed sales of magazines – think Newsweek in recent headlines.

However, even for the consolidators the rules of making money in the digital age have changed. Paywalls are sprouting left, right and center, but there is considerable debate of how to profit from digital content while still retaining and strengthening relationships with end-users. Having watched the implosion of the music business from a ringside seat, I would recommend some key concepts that matter for all content genres.

Access Charges Are Dead: Charging simply for access is a losing proposition, especially in the hard news category. The reality is that intellectual property and access are almost too cheap to monetize. This is driving a shift to selling content as a service. As an interesting example, a company I recently talked with is contemplating launching a political blog with content from well-known and respected political pundits. Rather than charge a subscription fee for access to the content (which might limit the network effect), their plan is to charge a recurring fee to post comments on the blog entries. This will both provide a greater immersive experience and help with screening out people who don’t “contribute” to the debate. Simultaneously, this social goods monetization enables commenters to create affinity with “high-status” folks and raise their own profile and visibility.

Aggregation and Disintermediation Are Both Relevant: But in ways far different than before. If you are a content aggregator, by simply making your content easier for your audience to use and consume, you greatly increase the relative value of your service. Don’t simply be a pipe (see #1.) It was completely unsurprising to me that Netflix would pay $1 million for improvements to their recommendation engine because they understand their value is in providing services that lets customers figure out what to watch next. How much value would cable companies bring if customers had direct payment access to the underlying shows? And if customers had access to that show across different devices?

Price Discriminate: Understand what people are willing to pay for and use that information to price appropriately. There’s a reason why airlines use dynamic and very variable pricing. While digital content doesn’t suffer from the same scarcity (i.e., there are finite # of seats), content consumers will pay for different experiences and services associated with that content. Your job is to test and determine what those thresholds are and how those customers psychographically identify themselves.

Don’t be Shy to Ask for Money: As a corollary to #1, don’t assume content has to be free and that your business model has to be advertising-driven. Quite the contrary, assuming you’ve built a compelling experience for consumers you should assume that people will pay. In fact, setting a price point of zero devalues the content service you are providing. There’s a reason that many online games continued to show strong worldwide growth despite the economic recession – the immersive experience, the social elements, in addition to the game mechanics – all provide a reason for customers shelling out $15/mo for a subscription or spending a few dollars each month buying and using virtual currencies and goods.

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The shift to content delivered as a service takes a slightly different mindset. Many in the content business have assumed that Google Search is their competitor. I posit that it may really be Google Reader and Instapaper that are the real competitive threats. When major media companies begin to look inward at their strengths and assets, it would seem to me that they should be able to provide content services that cause “aha!” moments that pull me away from aggregating RSS feeds. When major content companies focus on creating services that target articles and blog posts to individual customers as well or better then their ad serving partners do, then they are on the right path to services worth paying for.

Hating Youth Culture… Again

Is an entire generation to blame for all our ills?!?

It appears as though every year has its scapegoat. 2008 it was Sarah Palin; 2009 it was the financial system; and 2010 it is still the financial system, but this time accompanied by an entire generation.

Generation Y, or Millennials, are all over the news these days. Just last week a New York Times article discussed this generation of youngsters that according to writer Judith Warner is anything but lost in the modern world. Characterizing Gen Yers as an arrogant bunch of interns that demand mid-range salaries, the article chants along to what appears to be a general hatred of youth culture.

Business psychologist Charles Woodruffe, blames supposed negative characteristics, such as being outspoken, ambitious and self-confident, on the upbringing by their Boomer parents: He argues that these parents are not only too concerned about their children, but also spent too much time telling them they were special.

Most articles on Generation Y however, don’t acknowledge factors that obviously do make today’s youth culture special. Never before, has a generation [in the westernized world] been so multi-cultural, educated and involved. But instead of appreciating the connectivity growing up with the internet has brought, it is being downplayed to Millennials wanting to be on facebook at work.

Reading about this issue feels like reading about an army of parasites, that nurtures from feeling exceptional and better than its ancestors. Events that startled society and influenced youth culture are nearly not being mentioned: There is no talk of Columbine, 9/11, or how Gen Y’s cynicism might have emerged from the political sullenness of their parents.

The pressure to succeed in today’s world, along with a job market that demands a perfect resume clashes with the nickname Generation Stupid. So how are we (yes, I am a Gen Yer myself) supposed to react to this now? Isn’t it all just a huge contradiction?

But hang in there, folks, it’s already June and while we wait to get off the hook, we can apply for some more internships..

Present Like a Pro: Presentation Skills Workshop

The human brain forgets over 80% of what it heard after a day. What will your prospects remember from your sales meeting?

The human brain forgets over 80% of what it heard after a day. So began the Present Like a Pro workshop for media, publishing and advertising professionals at the IAB.

Given that many of us make presentations to prospects on a weekly basis, that statistic merits consideration as we develop our decks, often jam packed with information, and hone our story-telling skills.

Simply put, what 20% of your presentation will your prospects remember the next day? Was your presentation memorable? Did the audience retain the right information?

The workshop covered everything from how to open, to how to engage the audience, how to sell your stuff, and how to close.

Fortunately, I got to watch the workshop a second time, so I retained more than 20% of what the instructor, Anne Miller, had to say.

In no particular order, some tidbits from the 3+ hour workshop, which can be purchased as a video download from the IAB Online Professional Development Portal.

Your cover slide should state the objective, rather than the ever boring “ Capabilities Presentation to .” For my company, the title slide would read something like “Increasing ROI with ScribeLabs” or “Growing your business with ScribeLabs”.

Ask questions as you’re going through the presentation. It not only keeps the audience engaged, it confirms for the presenter whether people agree / disagree, understand, or are even paying attention, so that the presenter can change course mid-presentation for whatever reason.

Pro athletes don’t run upfield or upcourt with their heads down. Neither should a presenter ramble through a presentation without constantly keeping an eye on the other players in the room and soliciting verbal and body language feedback.

Weave in good metaphors, anecdotes or stories. While you have to deliver all your key points and messages, people will only remember 10% – 20% of what you said the next day. What does stay in people’s minds is the great story you told, or the great analogy. An analogy or a story also helps people connect the dots. The dots in this case are the bullet points you are delivering and what they mean for the customers business.

Visuals reinforce points. The visuals can either be literal graphics on a PowerPoint, or a picture you paint in people’s minds of something that they can recall from past experiences.

Make it about them, not you. Don’t start by saying “In my presentation, I’m going to tell you why we’re awesome…”. Instead, start by making it inclusive, “In our conversation this morning, we’re going to talk about some issues and challenges you face in your business, and some opportunities to drive your business forward.” Make it about them, not about you.

if you are an information delivering kind of person when you give presentations, and inundate people with bullet point after bullet point of important information, you have to keep in mind that people’s brains are programmed to want things to add up to something. So after spewing off 20 points, sum it all up for your audience (the “why should you care what I’m talking about” part of the presentation).

And say, literally, “In summary, YOU’re facing a lot of challenges…” or “In summary, YOU want to reach a new market…”

And then have a summary page. The title of that page should again be about them, not your services. “Grow YOUR business with US.” And then repeat the benefits they will get or the features you want them to remember.

Good summary phrases…

“the key takeaway is…”
“the bottom line is…”

“Again”, or “what this means is…”, are good trigger words.

Then hit them with the next step. “So if this makes sense, the next step is…” The next step has to be something the other person is going to do by a deadline, such as, “Review the proposal, call me with any questions, and I’ll follow up with you on Tuesday.” You should know what your desired next step is before getting to the meeting. The purpose of the meeting is to push the sales process along to get to that next point.

If you think you’re losing your audience, if they look bored or indifferent, you have to shake up the room, like a basketball coach calling a time out to settle the team down (I’m watching the Celtics blow a first half lead to the Lakers right now). “My sense is that what I am talking about is not what you’re interested in.” Take responsibility for losing their interest. There are 3 possible responses if you call a meeting “time out”:

1. You’re right, we’re not interested.
– Well, what are you interested in? I’m here for you.
2. No, we are interested (we just don’t look super excited…ever)
– OK, then let’s keep on going.
3. You’re right, half our staff was just laid off, so everyone’s mind is elsewhere.
– Well, do you want to continue, or would you rather reschedule when things settle down?

You shouldn’t be afraid to stop the conversation and ask for a reality check. After all, your goal is not to bore them and talk about something that isn’t of interest. Saying this out loud helps reset the tone of the room and the conversation.

The title of each slide should be the point you want them to remember from the slide, rather than something generic such as “Audience” or “Capabilities”.

PowerPoint Tip

When you’re presenting if you hit the “B” key on your keyboard PowerPoint will go to a blank screen. Hit any button to return to the current PowerPoint slide. This is a good way to continue an engaging discussion without losing people’s visual attention to the slide. Keep them focused on you and the conversation.

Overall, it is a great workshop that, while appropriate for anyone who makes presentations, is targeted at media, publishing and advertising professionals.

You can purchase the video from the workshop at the IAB Professional Development Web site. Well worth the $95.

Landline, Meet Dinosaur

As surveyors of our civic, cultural and political life continue to rely on landline-only polls, the portrait they leave of the public is increasingly skewed. A full 25% of the American population in now mobile-only.

The landline is going the way of the dinosaur

During the last half of 2009 approximately one quarter of US households used mobile phones instead of landlines, according to a study by the National Center for Health Statistics.

The trend towards household mobile has been going on for years. Take, for example, a survey size of me: I haven’t had a home landline in ten years or so.

Need a larger sample size? Here’s what the NHIS has to say:

The percentage of adults living in wireless-only households has also been increasing steadily [see Figure below]. During the last 6 months of 2009, more than two of every nine adults lived in wireless-only households. One year before that (i.e., during the last 6 months of 2008), 2 of every 11 adults lived in wireless-only households. And 2 years before that (i.e., during the last 6 months of 2006), only 2 of every 17 adults lived in wireless-only households.

The percentage of children living in wireless-only households is also growing. In fact, for this population, the 4.6-percentage-point increase from the first 6 months of 2009 is the largest 6-month increase observed since 2003, when NHIS began collecting data on children living in wireless-only households.

And for the visually inclined, the NHIS provides the following handy timeline:

Other eye-catching statistics from the research shows that 49% of adults aged 25-29 live in a mobile-only home, while 30% of all US Hispanics are cellphone only.

While the landline to mobile trend will continuously affect how we communicate, receive and share information, more interesting — and more profound — is an analysis by the Pew Research Center.

It seems that pollsters and other surveyors of national life generally rely on the traditional telephone to conduct their research. It’s simply much less expensive to do so. As Pew points out, with large numbers of US household now off the landline grid, “non-coverage bias” creeps into polls of all sorts.

From Pew:

For some estimates, even a small amount of bias may have important substantive consequences for the political or social implications of the research. Since the decline of landline coverage has not been uniform across demographic groups, non-coverage bias among certain subgroups may be even larger than for the full sample. As a result, some key subgroups in surveys based only on landlines may be severely underrepresented.

Since we’re in an election year, let’s look at two political polls and how they effect news coverage.

  • In polls of landline users only, Republicans lead generic horse races. Once cellular-only adults are included, these races become dead heats.
  • When sampling both cellular and landline users, more people approve of President Obama’s performance than disapprove. Limit the poll to landline users and equal numbers approve and disapprove.

Polls drive political coverage and in general most polls referenced by major media exclude the mobile-only population. Pew shows that such exclusion has a significant effect on overall results which in turn shapes the news narratives we see bandied about as accepted wisdom.

With the mobile-only trend growing, it appears that “reality-based” coverage of our civic and political life will grow more skewed with large segments of the population unaccounted for.

How to prevent that? It’s a matter of dollars and cents. Money that pollsters are well advised to spend.