Surviving in an Unpredictable Media Landscape

Jan 08, 2018

Article ImageThe future of digital media is in flux, to say the least.

In one day alone, we saw the shut down of DNAinfo and Gothamist, Conde Nast’s reduction of publishing frequency for most titles and the shuttering of Teen Vogue’s print edition. Shortly thereafter, Ziff Davis bought Mashable for just $50 million — one-fifth of its prior valuation of $250 million – and in the wake of the sale, Mashable cut about 30% of its workforce. The final icing on the cake for the digital media industry this year was when we learned that BuzzFeed and Vice Media missed their 2017 revenue projections by about 20% each which amounts to a combined shortfall of hundreds of millions of dollars.

With an unpredictable landscape and an increase in competition from the endless supply of new media companies, both digital and traditional publishers are facing unforeseen challenges when looking for new ways to engage and retain their audiences. For example, the much-discussed “pivot to video” is in full swing, but there are a host of new difficulties that come with the online video business. While video is typically considered more engaging and can be monetized at a higher rate, those in the online video business are tasked with sorting out a messy business model. Video content is much more expensive to produce, more difficult to distribute and more of a commitment from consumers – it’s harder to get video plays than page views.

To run an efficient and effective business, publishers are tasked with lowering costs, increasing distribution and optimizing ad revenue. However, if publishers scale too quickly, they run the risk of paying for the production and marketing of content without first having built an engaged and lasting audience. With so many potential unknowns to factor in, it’s no wonder that many companies in the media industry are having identity crises.

On a brighter note, there are a number of companies that have been hugely successful in adapting to the new media landscape, simultaneously maintaining loyal fans and captivating new audiences. To stay relevant, it will be crucial for publishers to examine what’s been working for these companies and apply new tactics to their own business as needed. A few standout brands include Axios, Teen Vogue online and Washington Post. Axios is a great example of a relatively new publication that’s meeting a consumer need: news delivered online in brief, bulleted, and a clearly structured format, without the clutter of banner ads and pop-ups. It’s no surprise that Axios recently raised $20 million to fund the further expansion of its newsroom.

Another publication worth paying attention to is Teen Vogue’s digital platform. While Conde Nast announced the end of its print component, Teen Vogue online is now a “go-to digital resource for Gen Z” with a 66% YOY increase in its web audience and a 116% YOY increase in its mobile audience, according to AdWeek. Finally, the impact Jeff Bezos has had on Washington Post is incredible. He placed his bets on digital, completely transforming the publication’s operations to deliver reader-centric content and create a profitable business. Washington Post receives about one billion page views a month, sees 100 million monthly unique visitors and averages 36 million video views across platforms including Facebook, MSN Video, AOL Video, YouTube and Apple News.

There are a few key tactics that successful publishers are executing that other companies should consider to stay relevant: leveraging social video, gearing content to target audiences, and investing in digital to grow reach.

Leverage Social Video

Tapping into the wealth of social content online is critical, as these videos showcase what’s happening in real time – videos that get millions of views are an indication of what’s important to the online community. In order to successfully leverage social video to create revenue, publishers need to ensure content is brand-safe. As with YouTube this past year, we saw the backlash that comes when videos that aren’t brand-safe slip through the cracks. Ensuring content is brand-safe attracts future advertisers, which allows publishers to make more money from video platforms like Rumble.

Target Your Audience

While this may sound obvious, it’s also crucial for media publications to tailor content to their target audiences. We all know there has been an explosion of data in recent years. For media companies to thrive in this new landscape, they must harness this wealth of information to share relevant content for their readers and viewers. To inform future content strategy, companies should be measuring how their content is landing with audiences, and then applying predictive analytics to determine what to develop next. For companies one step ahead of the technological trends, machine learning has made this task even more seamless.

Invest in Digital, Grow Your Reach

Finally, to reach the ever-elusive Gen Z audience and grow overall reach, media outlets need to invest in digital, particularly across newer social channels. We’ve seen digital-first companies do this particularly well over the past few years. For example, CNN’s Snapchat channel now has a global monthly audience of 12 million, enabling the outlet to successfully connect with a younger audience. PopSugar leveraged Snapchat to build an e-commerce app (Emoticode) that taps into screenshotting on Snapchat – this is a much-anticipated way to monetize on Snapchat and a great illustration of how to creatively invest in digital.

When looking ahead to the next few years, web publishers -- and media companies generally -- will continue to evolve their digital businesses and look for new ways to increase scale and reduce costs. Inevitably, some will fail and others will thrive. The ones that thrive will do so by finding more cost-effective and targeted ways of distributing their content to the audiences that want it. For ad-supported media businesses, content will be monetized in ways that generate a considerably better marketing experience for the consumer as well as a higher ROI for the marketer. Those business efficiencies–distribution at greater scale and monetization that is fully optimized--will be achieved by technology. This technology will likely not sit within the media companies themselves, which would add to their cost base and make them unprofitable, but rather it will be technology provided by vendors who can offer it at scale and at considerable savings to the media business. In 2018 and beyond, the smart players in the digital content space will look outside their companies for solutions that bring down their costs. This shift will allow their inward focus to be exclusively on what they’re best at: developing great content for their target audiences.

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