Archive for July, 2010

A perfect storm

Wednesday, July 21st, 2010

If you don’t think changes are coming to your online business content model, think again.

In the $30mm acquisition category is Sysomos, now owned by MarketWire.  Traditional corporate communication has officially embraced Social Media.  Now companies who don’t understand how to leverage social media will benefit from the acquisition.

In the… ahem… greater than $30mm acquisition category is Google’s purchase of MetaWeb, which will add semantic search capabilities to Google’s capabilities.  What’s Semantic Search?   Think about it… you are usually looking for an answer to a question (as in:  I want to find all Ska bands currently on tour)  How in the heck do you query that?  Semantic Search, ergo… MetaWeb.

Yesterday, Amazon announced its electronic book sales have exceeded hardback books.  Imagine.  And besides Kindle, what are people reading their e-books on?  Yes.. your trusty iPad.   No wonder – 6 out of 10 adults are now using the internet wirelessly.

I laughed when I read that Kara Swisher dubbed the iPad as Christmas 2010’s “Tickle Me Elmo”; and no wonder… with FlipBoard’s ability to package your favorite blogs and traditional media together as your own personal media conglomerate.  I wonder which blogs and content providers have natural affinity?  How will advertisers be able to leverage these new content ensembles?   I love the smell of new revenue models.

Speaking of content ensembles, how about content merchandising?  I love the way Amazon suggests other things I might like to buy.  I can do that with books now, but I can’t ::wait:: to see what other content and blogs I may want to read.  The technology exists.  How can we monetize it?  Let me count the ways:  advertising, e-commerce,  subscription revenue, sales of aggregate marketing data and reader behavior tracking, ‘opt-in’ research, and affinity partnerships.

Near to my own heart… no data mining system or polling tool would be complete without a sentiment analysis component. 

New business models will revolve around how we find the information we need.  Monetizing the process as opposed to the product is going to be the biggest learning curve for media companies.   Thankfully, we have people like Seth Grimes who watch the entire text analytics market.  He puts people and companies together that are MFEO.  (Sorry- Sleepless in Seattle reference… Made For Each Other).

Content providers will need to optimize their product for the new technology.  Advertisers will still need to get consumers to take action, but the metrics they will need to track will expand exponentially.  Tracking tools will emerge, a la Google Analytics, but, once again, data is just data without people who understand what matters and why.

In the Web 3.0 world, the Consumer will be (and is always) King.   Content providers need to remember to follow the money.  Wherever consumers are spending their time and money is where they need to be.

Laurel Earhart, for the Smart Content Conference.

Three Lessons Learned from Early Online Content Providers

Wednesday, July 21st, 2010

 The biggest obstacle to online content providers in the pre-internet days was neither which business model to choose (Subscription?  Ad or Sponsor based?) nor which platform to publish in (AOL, Compuserve, or Prodigy?)

The greatest obstacle was that people didn’t know what to do online.

We forget that people killed a lot of trees.   Printouts of online content (and photocopies for colleagues) were de rigueur.  There were no bookmarks or forwarding of links.

Lesson learned:  People will initially treat new products the way they used the old ones.

We forget that people ran up enormous connectivity bills, sometimes exceeding their rent payments.  The greatest amount of time people spent online was not reading online content, it was interacting with others and playing games.

Lesson learned:   Follow the money.  If people are spending ten times the hours (and money) to do something other than interact with your product, you’d better find out what it is.

We forget that then people didn’t know what to click.  Buttons had to say “click here”.  Woe to those whose computers did not yet have a mouse.

Lesson learned:  Make the most lucrative real estate be irresistible and obvious.

To quote my  boss, Myer Berlow, from one of our 1999 staff meetings:

“ True interactive media is rare, and it’s never well-done.”

Successful content providers overcame the technology and business model hurdles by taking a chance and moving forward by trial and error until they got it right.  Forging ahead to Web 3.0 (or even 2.0 for that matter)  means taking a chance and imitating something that seems to be working even if you don’t 100% ‘get it’.   After all, being somewhat successful even though you don’t know why is a lot better for your business than hanging back until you’ve got it all figured out.

The internet waits for no one.

Laurel Earhart, for the Smart Content conference

Online Content Success Factors

Saturday, July 17th, 2010

As a salesperson, you know you’ve really got something when word of mouth exceeds your direct marketing efforts.

Judging by the overwhelming response we’ve had to the Smart Content conference, it appears we have touched a nerve.

When Seth asked me to assist him in development and marketing of his conference, I jumped at the opportunity because I realized market education isn’t something any single company can do alone.  Our backgrounds are in the same industry, but my focus is in sales and marketing.   The more I thought about it, the more I realized how substantially business models have changed in response to technical developments.   If only businesses could have some idea of the changes about to occur in the content sector, the better they could be prepared to effectively monetize these upcoming developments.

For some perspective of the business model changes to content, let’s review the major milestones before we take a look at what’s coming.

Twenty years ago, online content met the modem and subscription based content models struggled with how to make use of online media.  The greatest fear was whether online subscriptions would cannibalize traditional subscriptions.  Note that I say online subscriptions:  people occasionally chose to pay to go online to read their favorite publications.

The next milestone pitted publisher vs. publisher as some brave content providers opted to offer their services via dial-up services like AOL and CompuServe and be paid for actual usage for being part of a larger content offering.  It was the “walled garden” approach, and the fear was that online usage would erode the print model which was supported by traditional advertising.  Online advertising hadn’t yet taken root.

I was one of the first on-line ad sales representatives.  By 1999, the ad agencies had yet to believe in the online media model.  I remember being laughed at by venerable agencies on Madison Avenue when I had to lead their account managers down the hall to the mail room.  I actually had to use the fax machine line to dial out and demonstrate my service because, believe it or not, there was no internet access anywhere in the building!

There were two major tipping points that validated the online advertising model, creating the incredible “about face” in online advertising.  The first was when business and sales people began to have conversations about things like demographics and impressions instead of pixels and baud rates.  Understanding the vocabulary of your prospect and changing the pitch and retrofitting the metrics of your business model is essential to selling and evangelizing a new technology to a traditional audience.  When I could liken my online property to the demographics and impressions of a popular television show or print magazine, sales began to flow.  The other, equally important tipping point was to articulate what the new model could do for them.  When I explained that the oft-quoted adage by John Wanamaker was no longer true:  “Half of the money I spend on advertising is wasted.  The trouble is, I don’t know which half.”  We could now measure clickthrough and see which advertisement was working.  No other medium had that capability.

The online content providers who were most successful at this point were those who had the following:

  1. A compelling demographic and story about the difference between the online users and the print consumer.
  2. An understanding of the best online “real estate” (i.e. locations for most impressions and clickthroughs)
  3. Something beyond the print model, i.e. message boards or forums to encourage online participation.  (We called it “stickiness”)
  4. A willingness to test and rotate an advertiser’s creative, to optimize clickthroughs.

If you have a “war story” to share about this era, I’d love to hear it.  We’ll be addressing the evolution of the content business models in future segments, including:

  • How “Search” based advertising scuttled the “Prime Real Estate” model
  • How “Social Media” has taken us back to relationship marketing – and whose content is it, anyway?
  • What technologies are coming in Web 3.0 and what they remind us of in other business models.

We won’t have time at the conference to address the history of technology and monetization in detail, which is why this blog exists, to give some context for the future.  Let us know what you think about the historical references we all need to have before we move into Web 3.0 technologies.

Laurel Earhart, for the Smart Content conference