For years, publishers have raced to win over new online audiences, wherever those audiences might be — on Facebook, Google and myriad other platforms that readers use every day. The thought process behind this mad chase was simple: To stay relevant, publishers reckoned, they had to reach as wide of an audience as possible, across as many platforms as possible — surely profitability would follow.
This thought process turned out to be partly correct; entire media empires have risen on the backs of digital platforms. But profitability? It turns out that the immense ad revenues associated with larger audiences were not a foregone conclusion. The platforms hosting those audiences, namely Google and Facebook, now guzzle up ad revenue like water at the finish line, taking $.70 of every new dollar spent my marketers, while leaving publishers with ad-supported business models high and dry.
But there is a way forward for those publishers that now find themselves floundering. To get ahead, they need to differentiate themselves ruthlessly.
What’s The Problem?
Ruthless differentiation starts with letting go of the broad missions that guided publishing brands in the past. “Informing and entertaining” is no longer a feasible way to connect with audiences (and, as we’ve seen, it can lead to a publisher’s undoing). To establish a simplified and specific mission, publishers must do what successful brands and businesses have always done: identify problems that people face and try to solve them.
The New York Times got a healthy bump in revenue in 2017 by identifying a very old problem — access to reliable news coverage — and solving it a new way. In the wake of the 2016 presidential election, the 166-year-old publisher doubled down on messaging about one of the things it has always done well: in-depth reporting. Then they sold that message to readers, ruthlessly and with gusto, in the form of digital subscriptions.
While not every publisher can be the Gray Lady, solid reporting is far from the only thing that publishers have going for them. Any highly focused publisher with a distinctive brand must find the thing that they do so well that consumers are willing to pay for it. And if a publisher can’t find “the thing” that consumers will pay for, then they must find “the thing” that marketers will pay for — in-market buyers. Creating relevant content for shoppers is valuable not only for the shopper, but for marketers looking to convert shoppers into buyers.
This must lead to one radical change in thinking: All efforts should focus on commerce. Platform dominance means that, realistically, most publishers will have to live off a third of their revenue coming from advertising — not the 60 to 70 percent they’ve grown accustomed to.
In order to develop a commerce mindset, publishers must expand the definition of commerce beyond the narrow legacy definition of “e-commerce stores” or “affiliate links” and re-define commerce within the context of the value they’re offering to marketing partners and the people using their sites.
Focus on Value
A publisher’s ad products and services must evolve to tangibly drive product sales for marketers. That’s one form of commerce. And for a publisher’s readers? A commerce mindset with respect to consumers involves anything and everything that makes money. Subscriptions aren’t the only option.
Many publishers, including The Atlantic, The New York Times, and The Washington Post, now host live events and conferences that tie into their brand missions and help diversify their revenue streams. Other publishers have found success licensing their content (or just selling it) to other sites. And there’s also money to be made in brand-licensing — Meredith’s branded products generated $23 billion in retail sales in 2016, according to Business Insider. Ultimately, the way that a publisher chooses to define commerce will depend on their objectives and on the problems that they are looking to solve for consumers.
Brand differentiation and thinking of new ways to generate money outside of ad sales is Business 101. But for publishers who’ve been brought low by the unfulfilled promises of platforms, the path forward starts with getting back to basics.