The recent digital revolution in the media industry may not have cost lives, but it has certainly cost lifestyles for the many who relied on traditional advertising revenue to maintain a viable proposition.
Latest forecasts suggest that £400 million in print advertising will be lost from the UK newspaper market by the end of 2014. Fragmentation and the rise of view on-demand services such as iPlayer have caused similar mayhem in broadcast.
Most revolutions bring a period of confusion and near-anarchy before a clear way ahead is defined and this one has been no exception. So far the only consensus is that the future is digital. But with online advertising currently only making up 25% of revenue lost through the decline in print advertising, profitability remains at a distance.
Most publications – from trade magazines and local newspapers to the nationals – now have an online version. But ‘going digital’ in this way alone is not going to win the battle. Instead it will take a complete rebuilding for digital. Readers are now engaging with content on multiple devices. But to monetise this interest through advertising, subscriptions or other newer methods yet to be discovered, businesses need to be nimble and adaptable to new events, ideas and forms of content to help shape the digital shift.
For example, the New York Times has recently introduced some imaginative new subscription offerings, including a mobile app described as ‘fast food’ compared with the ‘full meal’ of the actual newspaper, is yet another signpost towards a more lucrative and stable future. But not surprisingly given the nature of the industry, the problem isn’t a lack of creativity. It’s lack of the right enabling tools and the need for a change of mindset from becoming product to customer connected and focused.
For traditional publishers, legacy IT systems are all based around a print workflow and can’t be adapted easily. Younger companies may have more suitable systems, but often these are proprietary and, therefore, lack flexibility and scalability.
When ad bookings extend across traditional print, websites, iPads and mobile, Excel spreadsheets are inadequate and provide little insight into performance or customer needs. Nothing can be priced as one quote, there’s no joined-up data, few inventive cross-platform campaigns and little business intelligence to help sell further space or shape new products or packages.
This is important because at least with print, firm circulation figures are relatively simple to determine. Online impressions are almost impossible to predict without a crystal ball, or at least without any data to analyse – weather or events can cause widely fluctuating traffic. How can publishers explain performance or compare financial forecasts with what has actually happened?
Most other sectors, such as the finance industry, have been far more eager than the media industry to move towards establishing an all-round view of their customers to analyse this to predict future behaviour. But by doing this, advertising sales teams could cut across all media silos and provide their clients with a single sale booking of cross-media ads to help nurture innovation and drive revenue. This would also help create leaner sales, production and trafficking processes.
In fact, establishing a hub needn’t be such a major implementation as it first sounds. Many publishing houses are already using Salesforce and this can provide the platform needed to blend the data into a single entity.
This single customer view of both advertisers and subscribers – could be the one idea that helps to crystallise the current media mayhem into a clearer proposition. At least it could help convert the ‘print pound’ into enough ‘digital pence’ to secure the industry’s future.
