We’re in the midst of what Nieman Lab is calling “a profound advertising crisis.” The advertising and media industries have been hit hard by coronavirus, due in part to the cancellation of live sports and the impact of lockdowns on retail brands.
It’s hard to think about investing when things are so scary. However, there are investments you can make that have a good chance of paying off as we emerge from this downturn.
Right now, people are willing to read and view online, and digital content is king. Many premier publications have been providing free access to some or all coronavirus coverage, meaning more views. Travel + Leisure found a savvy (and digital) way to boost its audience numbers. For example, its article about famous museums offering virtual tours generated more than 4 million views. And when it comes to streaming, we predict that those companies with more extensive inventory of content will have a better chance of gaining market share.
At 3Pillar Global, where we develop digital products for clients in the media and entertainment industries (among others), we have seen firsthand how the transition to digital media and advertising has accelerated rapidly. Americans streamed 85% more video in March 2020 than in March 2019. Newsletter open rates are up, especially in arts, entertainment and fashion. We’ve been told by major publishers that they are seeing significant increases in subscriptions.
Media companies looking to survive the revenue losses of Covid-19 have a unique opportunity to leverage increased traffic to their digital content into lucrative relationships post pandemic. Here are four suggestions for media companies navigating a course forward in the current climate:
1. Demonstrate brand trustworthiness.
Brands like Bloomberg, The Wall Street Journal, and the Atlantic – which have dropped their paywalls for some coverage – have actually seen spikes in subscriptions. The key is to make sure that content is accurate, concise and thoughtful, in order to preserve brand quality and make a lasting positive impression.
However, surging traffic can cause problems with performance and page load time. Consider easing the deployment of new code to prevent embarrassing outages. For example, Zoom delayed all new features to focus on performance and security amid their privacy controversy.
2. Understand and serve the unique needs of your new subscribers.
Media companies have a unique opportunity to drive subscriptions from those who have shied away from paying before. But in order to maximize opportunity, make sure you’re collecting the right data. Understand who these new customers are and what they’re looking for.
With these insights, companies can create subscription models that offer a customizable experience. These might include micropayments for customers who can’t afford a subscription, or short-term subscriptions lasting a few months at a time. Topic-specific subscriptions may attract some new subscribers looking for particular information, and there may be opportunities to partner with other companies, à la ClassPass’s studio partnerships, to attract subscribers looking for variety. Creating value to solve for different needs can keep new customers from unsubscribing.
3. Expand targeted advertising efforts.
Collect insights from your audience data and target your digital advertising efforts. Be creative in your advertising and your digital products. The New media platform Quibi used social media advertising to target millennial customers, and the platform had 1.7 million downloads in its first week.
4. Develop virtual events with customer needs top of mind.
Demand for virtual events is skyrocketing. Financial Times reported that “investors are betting that once people try the digital alternative, many will not want to go back to airless conference centers…” The direct losses from tech events alone have surpassed $1 billion. Even after lockdown eases up, companies will have lower budgets for events and travel, making virtual events more necessary.
Virtual events have the potential to earn more revenue than in-person events, if done well. They have no physical space limitations, allowing more people to participate; top speakers may be more likely to participate virtually than in person; and you can offer in-conference purchases and products only available to participants. Companies like Bevy, Grip, and Bizly have already been thinking creatively about how to equip people and organizations to reach greater numbers, online.
The key to virtual events is understanding customer needs. Some people, for example, don’t go to events for the content or speakers. Rather, they go to network, or for the status of being part of marquee events. A virtual event might not serve these audiences. So, if you still opt for virtual, you will have to get creative in status-boosting offerings.
Conversely, there are customers who wouldn’t have made the cut for an in-person event that you can now serve. For example, TED was highly exclusive. So, the creation of TEDx made it possible to spread more ideas by increasing reach without damaging the brand. Access management platform Okta held a multi-day virtual tech conference that generated thousands more sales leads than its Las Vegas conference; 15,000 people watched the keynote, versus the 6,000 who would have been in attendance in person.
Advertising revenue may be down, but companies do have many opportunities to build strong digital revenue channels. An investment in digital products now is a long-term, not a short-term investment. But its impact will far outlast the current crisis.
About the author
Jessica Hall is the vice president of product strategy and design at 3Pillar Global.