The Next Big Thing
The cloud, the airwaves, the cable wires and even printed pages will be full of Facebook obsession for the next few weeks as the media obsesses over the market certifying the new billionaires and centi-millionaires as Facebook goes public. We’ll be subject to endless recounting of how Facebook has become a utility for 800 million of the earth’s population, and how Facebook is utilizing the many forms of information it gathers to draw advertising dollars.
Being the cynic I am, it would be a good time for me to go on a long trip out of touch -- but then nowhere is out of touch these days.
So I offer you some thoughts, not on Facebook, but on what you might see in the future if you could see or hear through the media noise.
What Won’t Change
Despite all the attention to social media, digital publishers of all types will still make their money on their own pages. Even today, despite the constant promotion by media companies asking their audience to “like me” or “follow my tweets,” these strategies produce revenue primarily through the contribution they make to driving users to their sites, and driving page views. Yes, you can sell promised tweets or Facebook postings to your advertisers, but publishers cannot guarantee how many people are seeing these bits of digital promotion. Only on their own pages can media companies promise a measure of attention from their audience. And it is this scarce and valuable attention that advertisers pay for. Social media is only a marketing avenue: like having your newspaper or magazine on the newsstand where people can see it when they walk by. However, newspaper and magazine companies well know they can’t “monetize” the not-a-reader show that peers at them from a newsstand. A tweet followed by a readers is the rough equivalent of a potential reader walking by a newsstand and seeing a magazine cover or newspaper front page. Yes, it builds the brand. But revenue only results from an engaged reader.
What Will Change
The continual increase in ease of digital payments, driven by the aggressive building and marketing of mobile payment solutions, will have many unforeseen ramifications. When we combine this trend with the nascent success the New York Times is seeing selling access to its premium content to the small core of its most interested readers, we’ll see more and more media companies pioneering new ways to derive revenue from their audience. This will affect not just the selling of mobile content, but traditional “browser-delivered” content as well.
Of course advertisers will continue to seek the next new thing in the never-ending race to add buzz to their brands. So expect to be asked hundreds of more times for a “unique” and “innovative” concept to help win business. But advertisers are realizing more clearly that the online advertising that they buy that sounds very low priced, is in fact very low value. New research is corroborating that many “impressions” advertisers have been paying for are not seen – because, while the ad might have “loaded,” it was delivered out-of-view on a page below the fold, or worse. The good news is that while pressure will remain on pricing, folks are realizing that the valuable attention of important target audiences is quite limited, and premium content publishers like ESPN and the New York Times can’t so easily be “bought around.”