Tuesday, 10 February 2009

Salvation for Newspapers' Online Biz Model Has Arrived (Almost...)

Here's an insight related to AdAge 3 Min. Video on Jan. 12, 2009: Will Online Publishing Be Forced Back to Pay Model?

There's something revolutionary/evolutionary that emerges out of this video clip. Here's their summary:

"We will witness a movement back toward the for-pay online publishing model in 2009, says Ad Age Editor Jonah Bloom. In this commentary looking at the media year ahead, Bloom notes that there are more publishers than online advertisers to support them. And he strongly suggests that newspaper and magazine websites have no choice but to accelerate their diversification beyond advertising revenue if they hope to survive. "

The editor’s point is, if, due to the slump in ad revenue, news suppliers can induce customers to pay for news online (they are setting up for it — hence the requirement to ‘register for free’ to read articles at most news publishers' sites now, once you’re used to something, especially if it’s free, if they suddenly slam the door shut and tell you you have to pay a few cents for an article, you’re much more likely to do it), then this puts the suppliers back in charge (note that right now I believe that most of them are simply demanding too much money for their reprints — once they’re all doing it, the price should come down — I’ll pay a few cents for an article, but won’t pay $49/mo. for access to only one publishers’ archives). The publishers/editors no longer have to bow and scrape for revenue, they become profitable once again. They can also charge less for ads, hence will attract more advertisers [although if I have to pay for articles, I’ll complain if they push too many ads at me, but if they TRACK my behaviour -- and increase the possibility of doing so if one subscription buys me into all of, say, Time-Warner’s sites -- then the ads I’ll see will be more addressable (relevant to me) and I might even enjoy the ad feeds].

This is also coming about due to the ‘maturing’/saturation of blogging and Twitter. I really don’t want to read 100 ‘tweets’ a day, or 1,000 blog entries a week, nor do I want to get stuck in a cycle of reading only one tight, narrow-minded group of bloggers who are all inter-linked. I want to read the Economist, CNN, Newsweek, AdAge, Time, the Star and the Globe to get a cross-section of different reporters’ views and I want those experts to filter the bloggers and feed me Seth Godin’s blog only when it is pertinent and relevant (and worthwhile). In other words, the prediction of many pundits back in 2003 that eventually people would tire of ‘free’ news and opinions and will return to be willing to pay to have someone clever, experienced and trustworthy sort things out (edit) for me. One key to success for these publishers (I just invented this!) would be for a service like Pay Pal to offer a ‘universal subscription’ service — I pay $129/mo and get access to every news publishers’ archives — they sort out payment distribution. (Now THAT’S a big idea!)

What does all this mean for the agencies? I don’t know, exactly, but it is the kind of thing you need to be able to chat knowledgeably about with marketers to convince them to buy your services!

The principal point here is a return to ‘normalcy’, an end to the ‘wild west’, the latest ‘ice age’. Once news suppliers (formerly called ‘publishers’) are back on solid footing, with a universal advertising ‘rate card’ model, they’ll be able to pay for more ROI metrics on their sites, this will give advertisers the confidence to switch their budgets from traditional ATL to online, and we’ll have a more stable marketing environment — more marketers will demand ‘one stop shops’ instead of the plethora/multitude of agencies they’re forced to work with today. Agencies better be there at the crest of this wave... No, they better be ‘hanging ten’, riding the face of this wave, below the crest if they want to be out in front!

One last point, apropos of the new ubiquity of in-store video, no successful new supplier’s site will ever be solely text — all of them, like CNN and Ad Age today, will have embedded video, a blend of both video, text and audio files (I’d like to download a series of articles/podcast transcripts and listen to them through my Bluetooth enabled GPS device in my car — another new idea!). (One of the things I don’t like about Ad Age is that they do not post full transcripts of their ‘3 Minute Ad Age’ video highlight feature, while CNN always does.) Toronto's Globe & Mail and Star are yet to ‘get’ this crucial shift. EVERYTHING that any marketer does from now on, in promotions or advertorial formats, HAS to be in both the old media formats (POS, flyers, ads) AND video. Without exception. That’s a BIG change versus just a year ago!

Just a thought.

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