Circulation Building in the Digital Age

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Selling Digital Content

The Wall Street Journal sells both audience and content and has been one of the most successful publishers to navigate both the traditional and new-media environments. "One of our biggest challenges is to build and modify the appropriate business model that differentiates us from news aggregators and other sources of commodity information," Brennen says.

Seper agrees, noting that even publishers in today's "free media" environment can generate circulation-based revenue if there is some competitive advantage to their offering. For instance, he says, "If you're in financial services and you can provide the latest information on the banking industry for bankers and others in that industry three hours ahead of anybody else, and you can do that on a consistent basis, maybe that's something they would pay big money for."
Brennen postulates that the economy, ironically, may have contributed to an increased willingness among consumers to pay for content. "When things get really complex, I think people seek out information that they can trust," she says. "We saw it around the last election, we saw it with the wars going on, we see it with the economy. When times are better[,] people, perhaps, are not quite as concerned about the quality of the news that they're getting."
In addition, she notes, the shift toward an uptick in those willing to pay for information has also coincided with a proliferation of new digital devices that consumers can use to access information.

Growing Digital Circulation

While some content aggregators receive revenue from websites that, in turn, provide content to a paying audience, others, such as Factiva, Inc., sell subscription-based content. Scott Schulman is the president of Dow Jones Corporate Markets and oversees Factiva. "We know that an increasing portion of our key sources are now behind some sort of paywall," says Schulman. To justify the payment, he says, they are producing high-quality content that readers care about. Digital, he says, "opens up possibilities because it takes away the physical distribution aspect." In addition, a global marketplace helps connect publishers to audiences that might have previously been far more difficult to reach.

A key challenge, says Brennen, is convincing the media-consuming public that digital content can be-and, in fact, is-as valuable as print. She adds, "Depending on your own digital preferences it could be more valuable." Publishers, she notes, need to think not only about the cost of distribution but also about the cost of the content. Sure, online publishers save in terms of postage and printing costs, but publishers that provide high-value content still have costs associated with developing or purchasing that content.

In addition, notes Schulman, aggregators such as Factiva provide value by sorting through the massive amount of information available online to deliver what is most relevant to specific audiences based on their needs and interests. Time is money and consumers increasingly, he says, "Don't have the time to spend hours or days doing random searches."

But finding an audience for their content is in some ways easier and in some ways more complex online. It's easier because the reach of publishers' messages is astronomically larger than in the traditional environment, but it's more complex in that online media consumers tend to be hypersensitive to spam, more so than traditional sensitivities to the "junk mail" that might show up in mailboxes of yore.

Digital circulation growth must be organic, says Seper. "You can't be a spammer." He points to three models of circulation building. On either end of the spectrum are those who scrape email addresses and pour them into their circulation lists (the spammers) and those who only take opt-in registrations. But, says Seper, there is a growing middle ground that he refers to as "nuanced opt-in." These are publishers who may gather business cards at events or meet people online in their demographic niche and add them to their lists.

"Obviously the place you want to grow the most is organic," says Seper. You do that, he notes, not only by passively waiting for people to go to your site to sign up but also through direct outreach that might occur through such simple (and traditional) methods as having a fishbowl at a conference to gather business cards to having every member of your staff ask everyone they meet if they'd like to be signed up for the digital publication.

At Anvil Media, Inc. a variety of search engine marketing (SEM) tactics are used to build circulation, says Nick Footer, business development executive. "We have found a great set of keywords that drive volume of traffic at the $.05 CPC [cost per click]." His advice: "Many online publications will optimize their site, but not go as far as providing their writers with SEO [search engine optimization] directions for the articles they write. Both of these tactics drive large volumes of traffic to the site, which they turn into subscribers at an above industry conversion rate. This was not an overnight project, but with the proper investment of time and, yes, money, we have delivered some great results."

Data analysis, agrees Lerner, is key. "The Amazons and Googles of the world are going out and buying companies that do analysis just to acquire the talent-they don't even care about the product, they're repurposing the people."

Analytics is likely to be a key driver of future innovation in online content, as is the proliferation of reading devices and technology in general. It's a rapidly growing and even more rapidly changing publishing environment.

The Future of Audience Development

Seper expects technology to have an impact on how he delivers content to consumers in the future. "I think the idea of the customized eletter is going to be much more common," he says, pointing to technology that already exists that would allow publishers to target customized content to individuals based on their responses to specific questions.

Lerner sees a lot more permission-based marketing on the horizon, along with an increase in the use of analytics to really dig deep into the data and use that data to append information in large-scale data warehouse environments. ZoomInfo is one example of this. The barrier to entry here, he says, is becoming less of an issue, making it possible for more publishers to gather-and strategically use-more information about their subscribers.

While much is uncertain, one fact remains clear: digital publishing is not for the faint of heart. It is a rapidly changing environment where even the most stalwart brands are subject to disruptive innovation and often fickle consumers control the bankrolls-whether publishers are gaining dollars through audience or expertise. One way or another it's the ultimate subscribers or consumers of content that matter the most.


Anvil Media, Inc.

Demand Media

Dow Jones & Co.


The Huffington Post

MedCity News

The Revolutionary Innovator

The Wall Street Journal


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