3 pil­lars of mon­e­ti­za­tion

The Insider - - CONTENT -

When it comes to de­vel­op­ing a prof­itable mon­e­ti­za­tion strat­egy, there are three pil­lars that must form its foun­da­tion: Au­di­ence, Di­ver­si­fi­ca­tion and Busi­ness Mod­els.

A mon­e­ti­za­tion strat­egy is only as strong as its weak­est pil­lar, so it’s im­por­tant to build ef­fec­tive and sus­tain­able tac­tics within each one to max­i­mize suc­cess and achieve one’s goals.

Au­di­ence

I have lost count of the num­ber of pub­lish­ers who’ve said to me over the past few years that they are “dig­i­tal first”. And while I ap­plaud their com­mit­ment to this bits and bytes world in which we live, I’m afraid they have missed the prover­bial boat by not putting read­ers at the helm of their close-to-sink­ing ships.

Too few pub­lish­ers re­al­ize that the glory days of mono­logue jour­nal­ism are over and that to­day’s read­ers are call­ing the shots. Peo­ple own the web, not brands, and those peo­ple have the power to dic­tate what they want and don’t want. In terms of me­dia…

What they want

- Fric­tion­less ac­cess to qual­ity con­tent (ed­i­to­rial and ad­ver­tis­ing) at the right price

- An en­gag­ing, ed­u­ca­tional and en­ter­tain­ing ex­pe­ri­ence

What they don’t want

- Bar­ri­ers to ac­cess (e.g. re­gional re­stric­tions, pay­walls)

- Poor on­line ex­pe­ri­ences (e.g. in­tru­sive and low-qual­ity ad­ver­tis­ing, se­cu­rity loop­holes, slow page load­ing and in­va­sive data track­ing)

But in­stead of en­gag­ing with read­ers, many pub­lish­ers are cut­ting them out of the con­tent con­ver­sa­tion. Blam­ing trolls and claim­ing brand-pro­tec­tion as rea­sons for muz­zling their read­ers, they jus­tify the killing of com­ments and opin­ions on their dig­i­tal prop­er­ties – push­ing read­ers away to so­cial me­dia to have their di­a­logues, and tak­ing their ad­ver­tis­ing money with them.

When I see this hap­pen­ing, I’m re­minded of a quote by Amer­i­can colum­nist and critic, Molly Ivins, in 2006. Her com­ments were tar­geted at the news­pa­per in­dus­try, but the same can be said for mag­a­zines, “I don’t mind be­ing in a dy­ing in­dus­try, but it re­ally pisses me off to be in one that’s com­mit­ting sui­cide.”

Know your au­di­ence to grow your au­di­ence

Driven mostly by mil­len­ni­als who were fore­casted to con­trol US$2.45 tril­lion of pur­chas­ing power glob­ally last year, the world is mov­ing from a knowl­edge-based econ­omy to a pas­sion-based one.

A 2015 study con­ducted by The Cam­bridge Group (TCG) showed that when brands are able to tap into a cus­tomer’s pas­sion, prof­its will fol­low. And that con­sumers who have a size­able emo­tional en­gage­ment and pas­sion for a prod­uct or ser­vice are the most will­ing to pay for those prod­ucts and ser­vices that meet their needs.

I don’t mind be­ing in a dy­ing in­dus­try, but it re­ally pisses me off to be in one that’s com­mit­ting sui­cide.”

Amer­i­can colum­nist and critic, Molly Ivins

To bet­ter serve these con­sumers, some pub­lish­ers are start­ing to seg­ment their con­tent based on peo­ple’s pas­sions, pro­duc­ing bun­dles that could be pack­aged separately and in­clude not only writ­ten con­tent, but au­dio, video and even syn­di­cated con­tent from other sources such as broad­cast me­dia. Even Face­book is ex­per­i­ment­ing in seg­ment­ing its news­feed in its mis­sion to be­come the world’s best per­son­al­ized news­pa­per.

But how does a pub­lisher dis­cover its read­ers’ pas­sions? One an­swer – Smart Data.

Go­ing be­yond data min­ing and sta­tis­ti­cal anal­y­sis, Smart Data ex­ploits be­hav­ioral an­a­lyt­ics to pre­dict how peo­ple will dis­cover, con­sume and en­gage with con­tent based on am­biances, what’s hap­pen­ing around them and what they’re do­ing at any point in time.

Those pre­dic­tions will lead to more and more gran­u­lar lev­els of tar­get­ing, al­low­ing pub­lish­ing sys­tems to choose the op­ti­mal con­tent (in­clud­ing ads) to de­liver to the per­son, when, where and how they want to re­ceive it.

The tech­nol­ogy is con­tin­u­ing to de­velop, but it’s al­ready be­ing de­ployed by peo­ple-fo­cused brands, such as Net­flix where

60% of the view­ings are the re­sult of Smart Data-driven rec­om­men­da­tion al­go­rithms that go way be­yond user star rat­ings.

In a re­cent in­ter­view with Ken Doc­tor of New­so­nomics, he ad­vo­cated that pub­lish­ers should in­vest in Smart Data in a big way in 2016, “I’ve been urg­ing pub­lish­ers to think about busi­ness in­tel­li­gence, also called an­a­lyt­ics, or data science. It is be­com­ing the cen­ter of every me­dia busi­ness. You have to have knowl­edge of your cus­tomers and what they’re read­ing and want to read, and similarly of your ad­ver­tis­ers and what they want and how well you’re per­form­ing. With­out that core of busi­ness in­tel­li­gence, you’re fly­ing blind at this point, and by 2020 you won’t have any busi­ness left.”

But be­fore you can learn about your au­di­ence, you need to find them and then get them to dis­cover you – some­thing that’s get­ting harder to do every dig­i­tal day. In the US alone there are more than 18,000 mag­a­zine ti­tles; that’s 225 bil­lion pages of ed­i­to­rial con­tent com­pet­ing for read­ers’ eye­balls.

And even when a pub­lisher does gain the at­ten­tion of a reader, re­tain­ing it is also get­ting much tougher. Fif­teen years ago hu­mans had an at­ten­tion span of 12 sec­onds. To­day we’re sit­ting at 8.25 sec­onds – al­most a sec­ond less than that of a gold­fish! It’s no won­der that in the UK the av­er­age num­ber of min­utes per day a reader will spend in 2017 with a mag­a­zine will have de­clined 58% from 2010 to just two min­utes.

To at­tract and re­tain the in­ter­est of read­ers, pub­lish­ers need to en­gage with them be­tween page-flips through…

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