Login
close
Login is restricted to DCN Publisher Members. If you are a DCN Member and don't have an account, register here.
Search

Digital Content Next logo

Menu

Category results for "Featured Post"

header image: tiles of various heights in blue, green, and purple iridescent gradient
Featured Post | Revenue

Can freemium ever be free? Paywall strategies from news, B2B, and B2C

Is there such a thing as a free lunch? For online audiences looking for news, metered and freemium paywalls offer a little taste of the feast that exists beyond the paywall. And if we’re honest, savvy online audiences know that there are ways and means to get at the content behind those paywalls for free, too.

But for the publications that are looking to monetize digital audiences through a paywall, how much to give away for free is an inevitable discussion. Beyond the public service implications – such as The Atlantic and The Financial Times making much of their pandemic information free-to-access – the point at which the paywall kicks in is a constant consideration for digital media companies. Consider all the attention The Economist received for reducing the number of articles readers got for free – from five to three – back in 2019. At the time its MD of global circulation Marina Haydn said the focus was on providing “value over volume.” 

It’s a constantly evolving conversation. Better, more accurate modelling tools allow for flexibility of paywalls based on user habits and demographics, so even within the same publication there are different amounts of “free.” Similarly, there are many sites where the “cost’ of access isn’t monetary, but instead the time and data cost of handing over user information at the registration wall.

There are as many options as users, and often multiple in use across the same publication. But which content is always free at certain publications, and is there best practice for what should always be free in different publishing verticals? How do hard news, B2B and B2C shake out?

Always free

According to the Reuters Institute “more than two-thirds of leading newspapers (69%) across the EU and U.S. are operating some kind of online paywall.”

There is an excellent argument to be made that most news content online should be free to consume at the point of publication. In the article ‘The Truth Is Paywalled But The Lies Are Free’ Nathan J Robinson states that while news paywalls are justified, we need to reappraise that in light of the new economies of disinformation online. 

Given the number of recent revelations about the role of advertising-based outlets in disseminating disinformation, it’s more important than ever that we examine how news sites can act as a bulwark against that trend.

Despite these concerns, of the largest quality news publishers online only the Guardian has a direct audience revenue model and also remains free. But there are other digital publishers that are primarily user-funded that make free news at point-of-consumption a core pillar of their offerings.

Eurogamer, the UK-based consumer news and analysis site, recently launched its own subscription or ‘supporters’ service. Notably when announcing the move its editor-in-chief Oli Welsh was clear that the content that was free-to-access would remain so; its new content would be “additive”:

“One thing we decided very early on was that we didn’t want to lock all of our work behind a paywall. We wanted to keep it freely accessible to everyone. So, inspired by the example of The Guardian (as well as of some of our competitors), we’ve created this supporter program where subscription is entirely optional, but comes with a bunch of (hopefully attractive) benefits, ad-free viewing first and foremost among them.”

That additive model is very similar to that of The Independent, which also creates subscriber-only content while allowing the majority of its content to be free-to-access. It brands the content behind the paywall as ‘Independent Premium’ – which matches Eurogamer and many other titles using the partial paywall model. 

Similarly, back in 2016 the Telegraph abandoned its metered paywall in favour of its current model, which has certain types of content that are always free. It then has a premium option on top and certain perks of registration that encourage users to sign up.

Nor does the free content necessarily need to exist in the same medium as the paid-for content. Quartz, for instance, still offers its newsletters for free while gating some content on its site behind the paywall. It currently has around 27,000 subscribers. 

For news publishers of any stripe, then, the option is there to have a certain amount of content that is always free. That could be, as with the Guardian, from a purely ethical perspective or, as with Eurogamer, because other revenue sources afforded by free access are still a big part of the overall mix.

Never free

This is the easy one. Many of the most well-known subscription success stories have a hard paywall at their heart. In fact, in many cases, any free content that isn’t purely promotional is anathema to their publishing strategies. 

That’s especially true for B2B and business information publishers, which mostly never lost sight of the value of their own expertise. Despite that, even among news publishers the hard and fast paywall remains notably rare. Of the biggest subscription success stories, only the Financial Times, The Wall Street Journal and a handful of others really embody the hard paywall ethos.

It is, as has been pointed out, a fantastic option if you have a rich seam of proprietary information or data, or occupy such a rarefied niche that few if any competitors exist alongside you. 

Free enough

Consumer-facing magazine brand Condé Nast has ultimately said that it wants all its brands to be paywalled. That’s a huge bet upon the ability of titles – mostly based around lifestyle and hobbies – to convert people to paying readers, and on the back of a metered model. But it’s not a contention without some supporting evidence.

On the back of WIRED going behind a paywall in 2019, its editor Nicholas Thompson said that: “I think it can work for every Condé Nast brand. I don’t think it can work for every brand. Think about Forbes, which has this very lucrative contributor network. No one’s going to subscribe to the contributor network, in part because there isn’t really an identity or a style or a voice – why would you subscribe to that?”

But the ability of free, premium content to act as an antennae for potential future subscribers shouldn’t be overlooked. For both the freemium and metered models – which are neck-and-neck alongside one another in terms of popularity in the EU – that free-to-access content puts readers at the beginning of the funnel to a full-blown subscription.

That’s especially true for consumer magazines, which rarely occupy the sort of rarefied niche that would enable a hard paywall. Over the course of the pandemic research from Jellyfish found that UK tech and gaming titles saw a rapid growth in digital subscriptions (268% YOY) – of which most have a metered paywall model.

It would be foolish to say that the never-free model works best for B2B exclusively, or that a metered model is the definitive best for consumer magazines. There are exceptions to each rule, and often the individual brands themselves play around with which content is free at any time.

Featured Post | Innovation

How we enhanced our site’s UX and boosted Core Web Vitals scores at The Washington Post

Ever opened an article and started reading, only to lose your spot because you were bumped down the page? This annoying occurrence is the result of layout shift, one of many performance issues that can crop up without consistent care and attention.

Improving the experience of our users is always a top priority at The Washington Post. With Google’s focus on user-centric performance metrics via new page experience signals called Core Web Vitals (CWV), we can better monitor and iterate on those experiences.

CWV signals are currently being rolled out globally. They consist of three new performance metrics: Largest Contentful Paint (LCP), Cumulative Layout Shift (CLS) and First Input Delay (FID). We set a target to reach the highest threshold across all three metrics by August 2021, as Google’s rollout of the new signals is set to be completed by the end of the month.

For publications like The Post, which need to balance rich advertising, rich content and page speed, CWV poses an interesting challenge: How do we ensure a performant experience on all pages across our domain in the short term? And, looking ahead, how can we bake good performance and attention to UX into our long-term processes and culture?

In August 2020, aggregate CWV scores show room for improvement
(Note: This data is for our entire domain on mobile devices only.)

Last summer, the engineering team at The Washington Post began exploring just that. Since then, we’ve seen significant lifts across all three scores.

In August 2021, aggregate CWV scores show significant lifts after performance investments.

To accomplish this positive shift, we put our users at the forefront of our engineering and design practices. Here are some key takeaways.

Understand the baseline

We began by determining a baseline for our CWV scores across our site using several different monitors to understand the complete picture. Luckily, there are a lot of awesome tools to help.

Step 1: Identify Patterns with GSC

The Google Search Console dashboard for CWV provided a good first pulse. This allows us to drill down into our less-performant urls and begin to identify patterns in templates or features.

Step 2: Get more granular segments with real-user data

Next, we collaborated with our Analytics team to set up dashboards that would show us an approximate distribution of scores for real users. This gives us more granular insight to triage issues on lower connection speeds, varying devices, etc.

Step 3: Automate and monitor release impact

We highly value continuous deployments and set up synthetic monitoring using Calibre App against our common page templates, with automated alerts going to Slack when we fell below our threshold. This allows us to gauge impact of each release so we can #alwaysbeshipping.

Make it a priority and assemble the team

Communication and a shared commitment to deliver high-quality user experiences are the cornerstones of our success. From engineering to design to advertising and our newsroom, web vitals became a common language and a common goal through a series of communication and alignment methods:

  • Recurring (and actionable) checkpoints across departments and teams to check in on progress, flag concerns and share tips
  • Slack channel for sharing web vitals wins, resources and questions
  • Company-wide presentations on web vitals in town halls

Getting company buy-in for performance work is possible by illustrating to stakeholders how CWV will benefit customers, increase the bottom line and speed up engineering productivity to ship more features, faster! It’s a win-win-win.

Fix the things!

We took several strategic steps to improve CWV scores at The Post.

Optimize Rendering of Main Images for LCP

We reworked the way we rendered the main image in our standard article layout, and as a result, it was the biggest improvement we saw in LCP.

How it worked:

  • Preloaded the img element’s srcset
  • Used an LQIP (low-quality image placeholder) in the form of a blurred svg as the background-image of the image element until the high-res request loaded
  • Assigned the attribute decoding=”async” to the img element

These changes resulted in an improvement to our LCP score that was immediately noticeable.

Reserved Space for Components to Minimize CLS

Anywhere we used lazy loading, we used a placeholder element with a min-height — and potentially min-width — to reserve the space so the element would not jump in and push content elsewhere on the page. We invested in skeleton states to improve the user experience for our readers. This is one of those techniques that became a pattern for us in our quest to improve our CLS scores.

One example of this execution is with our advertisement placeholder. Previously, ads would jump into the slot and push content down the page, which could be frustrating for users, particularly on mobile devices or on smaller displays.

Improving our CLS score required close collaboration with the advertising team. To evaluate impact, we developed and ran extensive A/B tests that served different creative with predictable sizes into the slot for a split segment of users. By analyzing the CWV and broader impact, we were able to make data-driven business decisions. In most cases — and to our surprise — serving predictable creative sizes increased revenue and we were able to commit several units to a set size and eliminate CLS. By opting to serve larger ad sizes (300×600 units only instead of a combination of multiple sizes, which caused a layout jump), we saw higher CPMs. We also eliminated several ad format types that were jumpy. These were traditionally poor performers with our users. We replaced those formats with units that loaded fully in view, resulting in higher ad viewability metrics and, ultimately, higher engagement and improved ad performance.

As the page loads, min-height is reserved with a skeleton state for inline ads:

Because of this, the ad can be fully loaded in without impacting CLS:

Code-splitting for Faster FID

While we have made continuous improvements to our FID, we found opportunities to further enhance the score by utilizing code-splitting. We were able to ensure that, on any given page, unnecessary code was excluded from our JavaScript or CSS bundles, making our files lighter and our pages faster.

FID is described as a phenomenon that “happens because the browser’s main thread is busy doing something else, so it can’t (yet) respond to the user. One common reason this might happen is the browser is busy parsing and executing a large JavaScript file loaded by your app.”

By leveraging Next.js dynamic imports, we can conditionally load the JavaScript for components that are needed by each page. We took a similar approach to code-splitting CSS with updates to our webpack build:

Maintain, maintain, maintain

As with many things, improving CWV scores is not something you do once and then move on. We’re working at The Post to integrate CWV into our ongoing product, design and development processes, in addition to regular review of changes in our scores. It’s an ongoing effort.

We were able to introduce CWV as a new set of standards in cross-team collaboration — and dedicate resources to maintaining these standards. This will serve as a point of reference for other cross-team initiatives in the future. Now, we’re looking at structuring other projects the same way, for example, on web accessibility.

This article originally appeared on The Washington Post Engineering blog and is republished with permission.

Want to share CWV tips, interested in working with us, or just feel like saying hi? 👋

Contact us at [email protected] and [email protected].

This project wouldn’t be made possible without the hard work of this outstanding team: Holden Foreman, Robyn Bortz, Anna Scalamogna, Taylor Scott, Christopher Kankel, Erika Johnson, Hannah Mahon, Amanda Bozzi, Arturo Silva, Dan Weaver, Joey Weed, Sarah House, Amanda Hicks, Ted Cook, Thomas Chan, Tommy Lisiak, Eric Lin, Hope Tambala, Ryan Luu, Leo Dominguez, Nathan Walker, Gregory Auld, Ryan Coughlin, Matt Callahan, Dave Merrell, Jeff Turner, Julie Bacon and Kat Styons.

Featured Post | Revenue

What the Hot Pod acquisition signals for Vox Media

There is no doubt the media industry can be pretty cutthroat. Publishers are always looking for new ways to generate revenue and compete with big tech, which dominates the digital advertising market.

Increasingly, media companies are diversifying revenue through subscriptions. So, when news broke that Vox Media acquired the Hot Pod newsletter, many focused on the fact that this would be The Verge’s first paid-for product. But there’s more to it. This is a story of friendship, partnership, trust, and serendipity – all of which form a strong foundation for growth.  

According to The Verge’s editor-in-chief, Nilay Patel, the idea to acquire Hot Pod came about because it’s founder Nicholas Quah decided it was time to move on. Quah took on a full-time position as a podcast critic on Vulture, a Vox Media title, and was ready to shut down the baby he’d birthed back in 2014. But Patel had other ideas.

“Rather than just shut down Hot Pod, I suggested Nick sell it to Vox,” explains Patel. “It was an ideal opportunity. We like Nick. We like Hot Pod. And Nick knows us, he knows our work, and he trusts us with the product that he built. It seemed like the natural home for Hot Pod. I’m not sure a paid product on Verge would have happened otherwise. The pieces just fell together.”

Learning curve

This new acquisition, which increases Vox Media’s growing arsenal of brands, wasn’t purely philanthropic – after all, they have a business to run. Patel says The Verge team had been thinking about moving into paid product for some time. It was all about finding the right product, at the right time.

“Nick’s legacy Is strong. So, we have the right product and the right audience” says Patel. “This will help us learn how to deal with a paid product, without the challenge of having to build the product as well and verify two things at once.

“We have a lot to learn, but we are looking at this as a test. When we have more experience in this area, we can create new paid products down the line.”

Another key piece in the puzzle was Ashley Carman, senior Verge reporter, who will take over as lead writer of Hot Pod. Carman is a respected name in the industry, thanks to her essential reportage of podcasting and audio.

“Ashley turns up in Hot Pod all the time, as she is one of the best podcast reporters,” says Patel. “Plus, she has worked with Nick in the past, so there is a lot of inbuilt trust and the audience know her. This means the transition should be seamless, which is another potential risk that is lowered. We wouldn’t have done this deal without her.”

Value proposition

Trust is a word that comes up time and time again when talking to Patel. It’s clear that this is one of the reasons The Verge has amassed a loyal audience of over 50 million. That and the fact it delivers award-winning content – for free. Content across all of Vox Media – including The Verge, Recode, Polygon and more – has been free to access since its launch a decade ago. (Though about a year and a half ago, they began soliciting reader contributions to help support their journalism.) The company merged with New York, which does have subscription-based brands, in 2019.

The combined media organization boasts a roster of fan favorites, reaching audiences obsessed with tech, gaming, music, food, lifestyle and – of course – the city that never sleeps. It has also been building up its roster of newsletters and a formidable slate of podcasts. The Hot Pod acquisition adds another brand with deep insider knowledge that fans trust, which the company believes they will pay for.

“We have a very large, free audience at The Verge. And we are proud of that” says Patel. “They will continue to be well served with free content. But in addition, we will offer Hot Pod, which is a great product.

Vox plans to keep the subscription price for the newsletter at $7 per month. However, it is offering paid current subscribers a three-month subscription to New York magazine, which Quah also works for. So, what does Patel think The Verge audience will make of this new paid-for product?

“We realize you can’t just charge for more stuff. You have to charge for content that is useful and valuable. We think Ashley can deliver a lot of value that is worth paying for.”

Growth plan

Patel says they have a load of new ideas for Hot Pod, such as reviews of software and services that the podcast industry runs on, more features, and a broader focus on technology – rather than just podcasting. But first they plan on managing the transition in a way that ensures the audience feels “cared for.”

“Over time we will make changes, with a focus on improving user experience,” he explains. “Hot Pod is already a must read. We want to make it a definitive must read.”

“Verge has a huge team, with 70-plus people in the newsroom behind us. So, we can bring new, exciting things to Hot Pod. But before we start instituting change, we are going to prove we deserve the audience and their money.”

Open ecosystem

After all, bigger isn’t always better. Sometimes taking an independent, trusted product and giving it big backing turns out to be the beginning of the end. Hot Pod’s new host, Carmen can attest to that. One of her recent investigations offered some insights into ways this can take shape. She took a look at how podcasting’s big bad boy Joe Rogan was faring after signing a $100 million exclusive deal with Spotify. Carmen cleverly tracked indicators on social platforms and found that Rogan’s influence has actually decreased since joining the podcasting giant.

Until now podcasting has largely been the domain of independents and creatives using open platforms to distribute and market their work. But the big tech companies know there’s money there and they have arrived in force.

“At The Verge we don’t actually think that dynamic is good, which is sympatico with the Hot Pod audience and what Nick’s ethos was,” says Patel. “There is a vibrant, open eco system of creators that makes the internet and our culture what it is.”

Once again, it’s all about building trust with your audience – and not just attracting big names or making changes for a fast buck. “So much of what is good about podcasting is the democratic access to distribution. And, as distribution channels become more tightly controlled, we will see aggressive ways of pushing back.”

“For us, the story is the push and pull between what people like and what the platform companies want to do, and how they do it. And Ashley is very focussed on that story.”

Meanwhile, the company will take its first crack at a subscription product amidst a newsletter (and podcasting) boom. And with its latest acquisition, Vox Media continues to experiment and innovate – while focusing on supporting creators, quality journalism, audience engagement – and trust all-around.

Diversity, Equity & Inclusion | Featured Post | Perspectives

Inspired by the BBC’s 50:50 Project, London Fashion Week goes all-in on inclusion

After two years, London Fashion Week is back with crowds, front rows, and shows. And the welcome strut of models on the catwalk brings with it the potential for great strides forward in making the industry more representative of society.

The British fashion industry has taken up a diversity initiative born in the BBC’s London newsroom but made it their own. Indeed, they’ve innovated in ways that could be trendsetting for newsrooms, content teams, and the fashion publications devoted to their work.

Model monitoring

The British Fashion Council (BFC) is the driving force behind the tailoring of the BBC’s 50:50 The Equality Project to the needs of its industry.

The partnership with the BBC’s 50:50 Project began that to the BBC’s Director of Creative Diversity June Sarpong joined the BFC’s Council. In September 2020, she became part of a newly formed BFC diversity and inclusion steering committee, which initiated the discussions of how 50:50 could be used to collect representation for the fashion industry.

Twenty design businesses signed up to use the 50:50’s data collection model at this September’s London Fashion Week. They were asked to collect diversity data from their teams represented at the event, which the BFC will collate. The results will be fed back to designers to support their future decision-making.

Katie Rawle, the BFC’s Senior Business Development Manager and co-lead for the Council’s 50:50 initiative, said, “Our initial thoughts about taking on 50:50 was how it could be empowering for designers. We’re empowering them to add further consideration to their decisions based on the data sets we give back to them.”

Sarpong believes that the success 50:50 has had within the BBC (and elsewhere) will positively impact London Fashion Week. According to Sarpong, “50:50 encourages all businesses to make more conscious choices around their teams from full time employees to the freelancers employed at shows, from models, to stylists, hair and make-up artists, communications and production teams.”

The BFC’s program adheres to the 50:50’s core principles: Collect data to effect change, measure what you control, never compromise on quality. These are the same cornerstones used by more than 100 partner organizations across the globe.

As Rawle said, collecting data to effect change for the fashion industry is all about informing designers’ future decision-making. September’s London Fashion Week will set the benchmark for them and the industry at the tri-annual event and they will then seek to improve their previous performance where necessary. The BFC has pledged to publish the industry’s data after 18-months. Critically, this aligns with the 50:50 ethos: Change not only happens – but is seen to happen.  

Beyond a superficial makeover

The fashion industry has advanced the “traditional” 50-50 model in that the design businesses also collect data on their behind-the-scenes staff. This includes everyone from the design teams themselves to hair and make-up, models, production, and communications.

Yvie Hutton, the BFC’s Director of Membership and co-50:50 lead, said the decision to use 50:50 for off-camera contributors was inspired by an improvement in the editorial sphere over the last five years. She believes a similar evolution is happening behind the scenes in the world of fashion – but would like to confirm it in numbers. And if it turns out more change needs to happen, transparency can only help.

“50:50 is such a great way to look at all the different sort of stakeholders that make up the industry and come together for a major event,” she explained. “It will give us a better understanding of whether people’s perceptions match the reality.”

Saul Nash AW21

Tailored collation

So how does the BFC’s adapted version of 50:50 work? Most of the 50:50 media partners monitor their content through perception and collecting that data on aggregating spreadsheets. This allows daily output that is simple, fast and can fit into a content-makers’ workflow. However, London Fashion Week is collecting its data through QR-codes.

Hutton explained that any contributor could simply scan the QR code on their phone and fill in a self-declaration survey there and then. She says that this method of data collection fits better with the industry’s current practices and for capturing off-catwalk representation. As with the media’s approach, it also allows data to be collated quickly and fed back to designers to support short-term and future decision-making.

Newsrooms looking to garner more actual data – as opposed to audience perception data – may want to consider the QR collection method. Sending it to a contributor before transmission or publication will allow them to use the data in real-time, which could be quite powerful.

A deeper look

In addition to extending the data collection on the who, the BFC have also widened the scope of what characteristics they are monitoring. They’re examining not just what the audience can see but those behind the scenes.

Rawle explained that, as with 50:50, they are monitoring gender, disability and ethnicity However, they have also included socioeconomic diversity (SED). Fashion, like the media and other creative industries in the UK, has been identified as lacking employees from working-class backgrounds.

“There’s this idea about creative industries that they’re a meritocracy and that you just work hard and you can make it and that isn’t the case,” she said. “I think we have to acknowledge that and that was one of the things that came out of the 50:50 pilot [at June’s London Fashion Week]. People were keen for us to capture it socioeconomic diversity, as well as the other characteristics.”

source: Social mobility in the Creative Economy

A recent report on social mobility in the creative economy highlighted how what Rawle describes here mirrored in the media. According to the research by PEC, 28% of those in film, TV, video and photography are from working-class backgrounds, while 41% come from what they describe as “privileged backgrounds.”

Fashion forward

At the very least the partnership forged between the media and the fashion industry through 50:50 is a powerful one. We share a common goal to create products that better reflect our world. And, as we see through each of our partnerships, there is much to be done, and much to learn.

In the case of the BFC’s approach to 50:50, they added in the element of class and economic diversity. To date, 50:50 has not been used to understand class as it is impossible to accurately perceive. It is interesting to consider the possibility of the BFC’s simple QR survey offering a means to capture this or other diversity dynamics.

We will be watching the BFC’s progress with interest, especially the BBC’s 50:50 external partners lead Miranda Holt. She has been working closely with the BFC and hopes their work will have an impact on representation within the media in the long-term from a different angle.

“At 50:50 we talk about how the media alone can’t change the representation our audiences see, hear and read,” she said. “Our pool of experts, spokespeople and contributors come from across a multitude of industries and sectors. If those people are not reflecting society, then it impacts our ability as content-makers to represent all. So, when industries – such as fashion – take steps to ensure their sector is representative it will have an impact for us. It will mean the media’s coverage of fashion can also better reflect our world.”

The emphasis, believes, Holt is on long-term. And Hutton agreed, pointing out that the British fashion industry’s 50:50 journey is just beginning, and that it will take time to create the change to which they aspire. There is no shortage of ambition. In two years’ time, she hopes the work being done now – not only with 50:50 but with other commitments on diversity and representation – will result in an industry that is not elite, but genuinely open to all.

“We’re playing a long game here and we all appreciate that this is an ongoing conversation,” Hutton said. “It’s not going to be an overnight success. It feels like it’s the very beginning of something that could be significant and it’s exciting to be part of it – to be at the forefront.”

Opening art credit: palmer//harding AW2120 (British Fashion Council)
Advertising | Featured Post | Revenue

As podcasting soars, advertising follows

Although the pandemic has revolutionized many of our media consumption habits over the past 18 months, one thing has become increasingly clear: podcasts are not going anywhere. Even as new work-from-home regimes supplanted daily commutes at the height of the pandemic, audio programming continued to find its way into the ears of its consumers.

According to The Infinite Dial, an annual report released by Edison Research and Triton Digital earlier this year, over eighty million Americans ages 12 and up (roughly 28% of the U.S. population) are weekly podcast listeners. That’s a 17% increase in listenership, which is sizable compared to the 9% increase recorded from 2019 to 2020. 

Source: Edison Research/Triton Digital

“Let me be the first to admit — the increase from 24% to 28% year-over-year did surprise me,” said Tom Webster, SVP of Edison Research and co-author of the report. “In a year in which absolutely nothing was normal, podcasting grew even more than it had the year before.” 

Once society enters a truly post-pandemic era, Edison Research’s Webster is confident that listenership will remain loyal, particularly with the resurgence of the daily commute. “Habits are habits. And when people go back to the office, we’re going to see a lot of these habits stick.” 

A formidable playing field for ad spending 

Advertisers are banking on this habit retention and focused audience attention. The podcast advertising market continues to rise steadily, quarter after quarter. By next year, the global podcasting industry is anticipated to reach $1.6 billion.

Source: Magellan AI

While leading podcast providers like Spotify have reported less users than they projected for the second quarter of 2021, their advertising sales are up 110% from last year. Congruently, their ad revenue has jumped from 10% to 12% in the past 12 months. 

“It’s clear to me that the days of our ad business accounting for less than 10% of our total revenue are behind us. I expect ads to grow to be a substantial part of our revenue mix,” Spotify CEO Dan Ek told investors in a conference call last month. 

According to research conducted by Magellan AI, podcast spending in the second quarter of 2021 rose by a sizable 22% from the first quarter of this year, a 40% increase year-after-year. It’s worth noting that, according to Magellan AI, sports podcasts added the most new advertisers in Q2 than any other genre. 

Source: Magellan AI

Impactful advertising

Which brands packed the biggest ad-spend punch? For longtime podcast listeners, direct-to-consumer brands like HelloFresh, Casper Mattresses, or BetterHelp may come to mind. Although, in recent months, larger corporations have risen to the top of the list of biggest ad spenders. 

What makes the podcasts so valuable to advertisers, especially the behemoth brands that seemed to have gone “all in” on podcast advertising in recent months? (In particular, what’s in it for those like Amazon or Geico, which seemingly have no lack of demand for their products/services?) 

“When you look at that [podcasting] audience, that audience is typically more affluent, more educated, has a higher disposable income. So, it’s very attractive to advertisers,” according to Damian Radcliffe, digital media analyst and professor of Journalism at the University of Oregon. “The other big factor here is that podcast advertising tends to be pretty limited & there’s a value in that exclusivity for podcasters which is quite appealing.”

Source: MagellanAI

A season of exclusive brand extensions

As the podcast industry continues to rise in listenership and sponsorship, we can also expect a growing wave of corporate partnerships and exclusive podcasting networks. This month, HBO Max and WWE both announced they would be launching exclusive podcast programming for their subscribers. 

HBO Max will be producing a number of ad-free podcasts as in-app exclusives to subscribers, beginning with “Batman: The Audio Adventures,” a scripted series featuring the voices of A-list actors Jeffrey Wright and Rosario Dawson. HBO already has over 25 network-specific podcasts that expound upon its programming including “The Chernobyl Podcast” and “Allen vs. Farrow.” However, “Batman: The Audio Adventures” will be the first audio program exclusively available to HBO Max subscribers beginning this fall.

WWE has teamed up with The Ringer, a subsidiary of Spotify, to create an exclusive audio network specific to wrestling-related content, in what will be a multi-year audio content partnership

“I think this is a model we’re going to start to see also in the podcasting space,” explained Radcliffe. “Instead of this content being available and distributed via an RSS feed to any number of podcast platforms it’s going to be locked in, behind a paywall. The only way [listeners] are going to be able to access it is by taking a subscription to that platform.” Radcliffe also points to an interesting development that’s emerged over the last couple of months, the ability to subscribe to specific shows with a paid relationship.

As media Goliaths and corporations continue to expand their purview to the podcasting sphere, brands across every industry are finding ways to appeal to even the most obscure of consumer niches. Considering that some podcasts have as much listenership as prime-time television viewership, there is no lack of ‘big fish’ in the podcasting pond. All advertisers need to do is find ways to reel them in. 

Best practices for embracing the ‘podvertising’ future

Focus on presenter reads

The Super Listeners 2020 study from Edison Research found that 48% of respondents reported paying greater attention to podcast ads than any other form of media advertising. A big reason for this is due to presenter reads. 

“If you look at things like presenter reads as a format…It is seen as a very effective way to reach an audience because it feels more integrated into the show, a more seamless part of the content,” explained Radcliffe. “It doesn’t feel as intrusive as ads coming in the same way as pop-ups, banner ads online, or TV advertising.” Radcliffe added that when it comes to presenter-read advertisement, tone matters. If advertisement copy is read casually and informally, it has a tendency to be less obtrusive to listeners. 

Select podcasts that make sense for your brand 

According to Radcliffe, “As [podcast advertising] continues to grow and as we see more specialized content being offered, that creates more opportunities for targeted advertising.” Although, Radcliffe was quick to emphasize an overlap in listeners and brands’ target consumers. “There has to be a cultural fit there. A fit in terms of style and content.”

Benchmark ROI with listener discount codes

If you’ve ever listened to a podcast, you may have heard advertisements that provide discount codes to listeners of the show. Not only do these discounts incentivize potential consumers, they are “quite a quick way to get a benchmark of ‘Is this advertising working? Am I actually converting listeners into consumers of my product?’ which matters a lot to advertisers,” said Radcliffe, adding, “They know exactly where that consumer has then come from.”

For larger brands, small conversion rates can still be valuable

 “Because the reach of a lot of these shows is large, brands don’t need a large percentage of conversion,” Radcliffe articulated. “Their equivalent ‘open’ rate could be small but because brands have got scale in terms of that audience reach. That could still be very valuable for them.” 

Featured Post | Perspectives | Policy

Seeing through Facebook’s transparency report

“Transparency is an important part of everything we do at Facebook.” Well, at least that’s according the first line of the company’s just-released Widely Viewed Content Report. The report is intended to provide insight into what content flowed across Facebook in the second quarter of 2021. In particular, it examines what content was viewed most in consumers’ News Feeds.

Facebook claims that most of the content on its platform comes from its users’ friends and family. The report states that news (or content that appears to be news) only represents a small fraction of what users see and share. It appears the company wants us to believe its platform is filled with family pictures and GIFs of kittens. Move along, industry watchers. According to Facebook there’s nothing to see here!

Cleaning house

The New York Times uncovered that this wasn’t the company’s first such report. According to the Times, Facebook prepared a Widely Viewed Content Report for Q1 but not release it. Apparently, the picture it painted wasn’t pretty.

According to the Times, “the most-viewed link was a news article with a headline suggesting that the coronavirus vaccine was at fault for the death of a Florida doctor.” Although the article came from a major publisher, it was the headline – and the way it was shared in a particular context by anti-vaxxers – that put it on top. Meanwhile, the 19th most popular page during Q1 was from the Epoch Times, an outlet widely known for pushing conspiracy theories.

Weird. These aren’t exactly posts about grandma’s mouth-watering apple pie or dare devil kittens hanging from ledges.

Remember, Facebook only reluctantly published the Q2 report after it spent a year discrediting external research from its own CrowdTangle data, which measures engagement (liking and sharing). When Facebook dismissed these reports, academics and researchers responded by pointing out that they were simply using the data Facebook had, itself, put out into the market. Meanwhile, CrowdTangle’s personnel were dispersed to other parts of Facebook, and the tools were pared back by Facebook, in what looked like an effort to regain control of the data and narrative.

It kind of feels like Facebook is hustling us in a giant game of Three-card Monte.

Revisionist history on repeat

Maybe there are those still inclined to give the company the benefit of the doubt. As Facebook spokesman Andy Stone soft-played their actions when he tweeted “we might have been guilty of cleaning up our house a bit before inviting company.” Unfortunately, the dumpsters full of incendiary trash impacted untold numbers of “guests” way before Facebook purportedly tidied things up and invited the “company” of critical analysis.

Facebook has a long track record of covering up and thwarting transparency at critical moments including the countless times where they enabled companies to collect data about consumers and then repurpose that data for number of reasons. Notably, these included selling Facebook’s data to third parties like Cambridge Analytica, which turned out to be one of the largest data breaches in history.

Deception is part of the business model

Recently, Facebook blocked researchers ability to gather information about what political ads are being shown across their services. It was especially galling that Facebook justified its decision as a protection of “user privacy.”

Given the company’s track record, it shouldn’t be surprising that Facebook once again opted to block full transparency. And yes, once again, the real reason is because it could hurt the business model. Even the FTC weighed in and warned Facebook not to use privacy “as a pretext to advance other aims.”

Truth told

For the Facebook model, it doesn’t matter whether the content is truthful. In fact, if there is a bias at all, it must be in favor of the least trustworthy, most salacious content (e.g. vaccine misinformation, Epoch Times) because that content tends to catch fire more quickly. And profits are way up. The business model is clearly working.

On top of that, at key junctures in Facebook’s history, executives have unequivocally chosen to hide the truth to maintain these profits. Vague commitments to transparency come only when they find themselves once again caught with a hand in the proverbial cookie jar. And now, even those promises to “do better” come with a giant caveat: We’ll only tell you something if it makes the company look good.

At this point, there are legitimate questions about whether Facebook is a good-faith actor that can ever play a constructive role. Facebook’s business model is at odds with transparency and their executives seem committed to running the business like a Three-card Monte hustle. With deep political divisions in our country hindering our ability to tackle a shared crisis (or even have a thoughtful discussion), we need leaders to step forward and demonstrate an unequivocal commitment to transparency and trust.

Diversity, Equity & Inclusion | Featured Post | Innovation | Perspectives

From the top down, and inside out: tackling media’s diversity problem

The business case for diversity has been made time and again. In fact, according to McKinsey, the relationship between ethnic, gender, and cultural diversity and financial outperformance has only grown in the years since the company first outlined its importance. And when it comes to newsrooms, the philosophical, moral, and business rational for improving diversity are also evident.

It is certainly heartening to see the impressive — even historic — rise of female and diverse newsroom leadership in the past year or two. For the first time ever, Black executives lead every major broadcast news network in the U.S. Women and people of color have also assumed leadership roles at dozens of major media brands. However, as HuffPost Editor-in-Chief Danielle Belton, who is Black, suggested to CNN, truly diverse representation in media won’t be achieved simply by hiring women and people of color to fill top roles.

In order to better serve the diverse population it reaches, the media industry must reflect that population from the boardroom to product development and from the newsroom to the sales team. It must also reflect these audiences in its sourcing and reporting. Hiring is one of the most visible ways media organizations are changing right now. However, there are also a number of taking tactical approaches that are meaningfully moving the needle.

50/50 and beyond

In 2017, the BBC launched the 50:50 Project, challenging its teams to achieve 50% female representation in BBC content. Today, the company says that 70% of its content features 50% women contributors. And this initiative is not limited to the BBC. The project partners with more than 100 organizations in 26 countries. The network includes public and private media, academia, conference businesses, law, public relations, and corporations. The 50:50 Project recently announced it will also strive for better inclusion of ethnic minorities and disabled people and those. The aim to achieve a 50:20:12 balance.

The BBC approach is fairly straightforward. Participants monitor the numbers of contributors in their content to set benchmarks for their chosen diversity measures. They then track their progress against those benchmarks as content is produced. Teams continually share and discuss the data which informs editorial decisions.

The BBC has found that the longer teams monitor and share data regularly, the more likely they are to create cultural change. 50:50 has enabled teams to identify topic areas where women or other diversities are under-represented, such as science or sports. It has also encouraged content makers to think differently about the stories they choose to tell. Reporters continually seek new voices and different perspectives to enrich their output.

Working on workflow

NPR recently announced a new initiative to track the demographics of its sources in real time. The tool, called “Dex”, is integrated with the company’s content management system. Dex allows NPR reporters to easily monitor the diversity of sources’ race and ethnicity, gender identity, geographic location, and age range. Over time it will also become a robust database to identify more diverse sources as well.

Deputy director of news operations Rolando Arrieta told Poynter that incorporating the tool into the company’s CMS makes diversity an integral part of the newsgathering and reporting process. Dex also allows for continuous monitoring, unlike the annual diversity reports many organizations produce. And, as Arrieta points out, simply counting sources is not enough. Creating a continuously updated resource for diverse sourcing and integrating diversity into content creators’ processes facilitates continuous awareness and improvement.

More work

Tactics and tools beyond hiring and sourcing are increasingly emerging. They are intended to assist in diversity objectives, but sometimes create a business opportunity in themselves.

Nielson introduced a tool earlier this year designed to better allow content creators, distributors, and advertisers to quantify their progress in diversifying representation on the small screen. Gracenote Inclusion Analytics measures how the screen time of various identity groups (such as people from a specific gender identity, sexual orientation, race, or ethnicity) stack up against certain benchmarks.

Bloomberg’s Gender-Equality Index (GEI) tracks the performance of public companies committed to disclosing their efforts to support gender equality through policy development, representation, and transparency. The organization’s New Voices initiative works to increase the representation of women and minority executives as sources in both online and on-air content. Recently, the company expanded its objectives to be more inclusive of a range of gender identities as well. 

Certainly, it is heartening to witness the recent spate of DEI executive appointments. It is encouraging to see the newsroom leadership begin to lose its pallor. However, it is also significant to see media companies not only recognize the value of diverse leadership, but also the critical role of incorporating diversity into the culture and workflow of their organizations. If diversity is the goal, there is no one simple answer. But with a combination of leadership, trust, transparency, and tools the media business can begin to build solutions.

Featured Post | Innovation

Inspiring through Instagram: Exploring NatGeo’s socially responsible strategy

National Geographic is an Instagram powerhouse. The publisher has just topped 175 million followers, which makes it the 12th most followed account on the platform and the only media brand to crack the top 50. Their photographs and stories reach tens of millions of people around the world each day.  

With such a vast following comes great responsibility. The world as we know it is changing. But explanations about how, why, and what to do can be divisive. National Geographic’s mission is to use science, education and storytelling to illuminate and protect the wonder of our world. But how is it being translated into its social media strategy? 

National Geographic’s Director of Instagram Josh Raab knows that many younger people aren’t subscribers to the publication. For many of them, their primary interaction with the brand will be through social media, rather than longform journalism.

Instagram’s audience skews much younger than many other social platforms, with two-thirds of users aged 34 or under. So ,for a publisher like National Geographic, there is a huge opportunity to reach younger people with key messages about climate, conservation, and our changing world. But it requires tactful handling.

Finding the nuance in conservation conversations

Raab’s aim with NatGeo’s Instagram accounts is to educate, rather than overwhelm followers with problems. “Anything that we do is impact driven,” he emphasised. “We know the change that we want to see is going to have to come from future generations. So our hope is that [Instagram] is the way that we can cover a lot of what we see in the world, and further[people’s] knowledge and understanding of it. 

But it’s a delicate balance. As social media grows increasingly divisive, Raab is keen that NatGeo remains a place to go for information, rather than explicit activism.

“What we don’t see enough is the nuance in some of these conversations,” he said. “I think that the biggest way that we can help is to really educate people on the complexities of some of those problems or some of those subject areas that we’re covering, and let them make up their mind for themselves.

“At the end of the day, you won’t see us yelling and screaming in ways you’ll see in other places. Social media for us is more about telling people about the world and highlighting some of the changes that we’re seeing over time.”

He sees Instagram as a way of learning by stealth, even if that means competing for audience’s attention spans. “We try to trick people into learning,” he said. “How do we get people who might be on a platform for instant gratification to walk away with an unexpected understanding of something they didn’t necessarily go looking for?”

A unique curation process

In order to encourage a range of voices and perspectives, NatGeo has come up with a unique model for curating their feed. Posts are actually submitted directly by the photographers themselves. This includes the captions. Although they are reviewed by the publisher, each one is in the photographer’s voice, which avoids the text sounding too corporate. 

“It’s a great way to connect the audiences directly with the photographers, who are really the storytellers, the explorers, the people behind the stories,” Raab explained.

This approach also helps NatGeo avoid the trap of posting content just for the sake of high engagement. Raab noted that the team have a good sense of how a post will perform before it’s put live, but that doesn’t influence whether or not it’s posted. “For us, it’s about whether or not the story feels relevant,” he emphasized. “We’re pretty focused on having a broad coverage… rather than only the ones that would perform. If that were the case, you would see a lot of polar bears and cute animal content!”

Raab believes there is a distinct advantage to having an account the size of NatGeos when it comes to posting about issues like climate and conservation. “You can guarantee that you’re reaching people across the globe, of every interest and political standing,” he explained. “So we do the storytelling we think is important, and that the world needs to see.”

“We’re lucky enough – or simultaneously unlucky enough – that regardless of what that is, we will have people who love it and those who like it less!”

Comprehensive storytelling through Stories, Reels, and AR

When it comes to getting the most out of Instagram, Raab has noted that although the algorithm changes, it consistently favors new functionalities like IGTV, Lives, or more recently, Reels. “We try to play into those, because we know that’s where we can reach the most people,” he explained.

This approach led the publisher to be an early experimenter with Instagram’s Spark AR tool. Although producing AR experiences aren’t yet on the regular schedule, the team have released over a dozen filters over the past year. These range from an AR tour of Mars to a Yosemite National Park filter, complete with a bear selfie experience.

“We saw an opportunity to do more comprehensive storytelling within a platform that is intended to be used more for social purposes,” said Raab. “We’ve tried to find a way to integrate both storytelling and social experience into singular creations. And, for the most part, I think we’ve been successful.”

The more informal nature of Stories complements what NatGeo is aiming to do with inspiring the next generation. The off-the-cuff feel, where scientists and photographers are telling their stories from the field, help show NatGeo’s followers that although they are incredibly talented, they are people. “I want them to watch it and think, “That could be me one day,”” said Raab. “That’s just integral to what we do.”

Inspiration through education

Climate change and conservation are polarizing political issues, especially in the social space. But NatGeo’s commitment to bringing in the voices of leading scientists, educators, storytellers, conservationists, and more into its photos, captions and stories makes it a place that people can come to learn, rather than be preached at.

“Getting the message out to younger audiences is important. But we also want to inspire them to do some of what they’re seeing,” Raab emphasized. “We want to educate them about the world, rather than yelling at them about the exact changes they need to make, or making them feel like change is hopeless.”

“Ultimately, it will be up to these younger generations that we’re able to reach there to make the change that the world will need.”

As the most-followed publisher on Instagram by a country mile, NatGeo is doing something right. Education by stealth – and the occasional cute polar bear picture – seems to be a winning formula for inspiring the next generation to care about our world. 

Featured Post | Innovation | Perspectives

Why media executives can’t afford to ignore blockchain innovation

Allow me to pose a few questions: Why doesn’t the U.S. have a modern high-speed rail system or solve the issue of droughts? Why doesn’t the U.S. have a national electronic grid to leverage solar and wind power? At least part of the answer is a reluctance to accept and adapt to new technologies.

Blockchain can and will play a significant role in each of these applications and services. However, blockchain is plagued by the negative stain of cryptocurrencies and a lack of understanding of the technology and its capabilities. That does not mean that we can afford to ignore it.

So, my question for you is, “Are you preparing your company to take advantage and leverage blockchain technology to grow your business and remain competitive?”

Without a doubt, blockchain is poised to impact the media business. That future will demonstrate the full force of Tim Berner Lee’s paper about the semantic web and blockchain will play a critical role. The blockchain train is about to leave the station, and you’d better make sure you have a ticket and get on board.

Blockchain technology will create new business opportunities in all sectors. Media companies have been slow to adapt to some critical technology evolutions in the past, which cost them dearly. We can’t afford to let blockchain to be another missed opportunity.

Are you blockchain-ready?

As an executive, understanding new technologies is essential. That’s because it could mean the difference between growing your business or going out of business.

So, how ready are you and your company for blockchain? Take this simple quiz to find out:

  1. My company and I have a complete understanding of blockchain technology.
  2. Blockchain will become an intricate part of business processes and applications.
  3. We have or are currently working on an application of blockchain technology.
  4. We have a working blockchain application that we are commercializing.
  5. My company sees blockchain as the strategic next technology for the next 10 years.

For every question that you answered, yes, give yourself 20 points. I have applied a score across each section of Roger’s Diffusion Curve in my rather unscientific study.

If you scored under 60 points, I would like you to consider the “what ifs” of not first understanding blockchain technology and how it could play a significant role in your business.

Missed opportunities

History has taught us that even brilliant minds can miss out on significant shifts. To put this in perspective, here are three examples of how a leading company ignored emerging technological and business model changes and eventually lost their business as a result.

Telerate vs. Bloomberg

Before Bloomberg, there was Telerate. Founded in 1969,  the Telerate system was the dominant terminal for Fixed Income Securities in the world. Dow Jones & Company, Inc. initially purchased a 32% stake in 1985. Eventually, Dow Jones purchased the remaining shares, bringing their total investment to $2 billion.

Founded in 1981, Bloomberg’s terminals first started to appear in Merrill Lynch offices in 1985.

By 1998 Bloomberg had displaced Telerate. Dow Jones had to sell Telerate to Bridge Information Systems for $510 million, a loss of $1.4 billion!

What happened? How did Telerate lose their luster, their dominance, and market share to Bloomberg? Data analytics, back-office systems, and customer service were the differentiators.

Blockbuster vs. Netflix

Founded in 1985, Blockbuster, became the dominant player in the consumer movie rental business, only to be upended by Netflix just over a decade later. Netflix created a new business model by mailing discs versus Blockbuster brick-and-mortar stores. The Netflix business model provided selection, convenience, low price, and satisfaction.

But Netflix did not stop there. Instead of just shipping DVDs, Netflix created a streaming service that competed with linear television and every premium film channel. Netflix beat HBO in a business that HBO created. Now media brands are trying to claw their way back with branded streaming offerings, but this isn’t going to be easy to do.

Sears vs. Amazon

Last but not least is Sears, which published the Christmas wish book catalog, and iconic brands like Craftsman and Kenmore, only to be squashed by the e-commerce king, Amazon. While Amazon was building a seamless ecommerce platform, Sears remained anchored to brick and mortar. Consumers loved the convenience of shopping from home. So, Sears — along with any number of retail businesses that failed to evolve — fell by the wayside. 

Time and again, newcomers leverage new technology and business models to overtake the industry leaders. Blockchain is no different. If you aren’t already figuring out how it will transform your business, you are ripe for disruption by someone who is.

These days, blockchain is being used for Asset Management, Insurance Claims processing, Cross Border Payments, Smart Property, and the Internet of Things. This article from Sam Daley highlights 30 Blockchain applications across many industries. The developments he outlines are just the beginning.

Blockchain and the future of media

Clearly, media companies have fully embraced digital. However, they are overlooking the possibilities blockchain has to offer to improve many aspects of their businesses. Blockchain technology can be integrated into multiple areas but here are a few examples that should appeal directly to media executives:

Content delivery

Launched in 2019, Eluvio Content Fabric uses blockchain technology to enable content producers to manage and distribute premium video to consumers and business partners without content delivery networks. It provides low latency, high quality (4K) content distribution, content monetization, and just-in-time streaming. It’s already being used by MGM Studios and FOX Networks, so it’s time to consider new ways to deliver streaming content.

Smart contracts

Blockchain-based smart contracts are contracts can be partially or fully executed or enforced without human interaction. Smart contracts are digital and embedded with an if-this-then-that (IFTTT) code, which gives them self-execution. In real life, an intermediary ensures that all parties follow through on terms.

Mediachain uses smart contracts to get musicians the money they deserve. By entering into a decentralized, transparent contract, artists can agree to higher royalties and get paid fully and on time. Streaming giant Spotify acquired Mediachain in April 2017. Given the increasing complexity of multiplatform content distribution, media executives will want to take a closer look at this business opportunity.

Digital advertising

MadHive is a blockchain-based advertising and data solution for digital marketers. The platform tracks, stores, and generates reports on customer activity, saving all the data to a private blockchain. MadHive’s targeted audience reports and real-time data monitoring give advertisers’ insights into their customers without compromising data privacy.

Clearly, digital advertising remains one of the largest revenue streams for many media businesses. However, increased consumer concern (and regulations) around privacy point to a need for new strategies. Blockchain provides detailed and precise information and data points that media executives would be wise to explore.

Content creation

Steem is a social media platform backed by blockchain. Its “Proof-of-Brain” community uses tokens as incentives, encouraging people to create original content. The amount of tokens distributed is based on the number of upvotes each article receives. Steem has paid over $40 million in tokens to creators. Blockchain is providing new business models and content creation models like this and media executives cannot afford to ignore the possibilities.

Blockchain for better business

My recent book, “Transforming Scholarly Research with Blockchain Technologies and A.I.”, provides a slew of examples of how Blockchain is transforming a wide range of industries. Don’t be lulled into under-rating its potential to impact the media business because of the shadow of cryptocurrencies. Blockchain will open new networks, improve efficiencies that will reduce cost, increase accessibility, transparency, and effectiveness.

Media companies that adopt this technology will position their company and team members for extraordinary success.

About the author

Darrell, an experienced digital publishing executive, has been at the forefront of significant information industry initiatives, i.e., Factiva, ScienceDirect, Scopus, BiomedExperts.com, ReviewerFinder, Underline, and Ripeta. Gunter Media Group, Inc. has advised many CEOs from startups to the most prominent publishers.

He is the author of the edited volume, “Transforming Scholarly Research with Blockchain Technologies and A.I.” His other publications can be accessed via his ORCID profile.

He is a graduate of Seton Hall University’s W. Paul Stillman School of Business (B.S. Business Administration- Marketing) and Lake Forest Graduate School of Management (MBA).

Advertising | Featured Post | Perspectives | Supporter Spotlight | Video

4 Media industry twists and turns you don’t want to miss

The business of digital media is not dull. It can be a bit like the not-so-well-wish “may you live in interesting times,” though. Keeping up with it all is a big job for digital media executives tasked with keeping their organizations healthy and at the forefront of this industry. A clear-eyed look into what’s next is important in order to keep up with the pace of innovation in this industry. To help, I’ve outlined four trends I’m watching closely during the second half of 2021:

1. Pandemic-era rebound in advertising market

Big takeaway. Knocking on wood, but all digital revenue indicators are trending positive in 2021 through midyear for premium publishers. DCN distributed both its proprietary annual benchmark and first quarter revenue reports in the past month. The reports are only available to participating members. However, I can share the top-line good news: Year-over-year growth was strong. And that’s even prior to the favorable comparisons to the depressed market from the onset of Covid in the Spring of 2020. CPMs have also strengthened in the open market where advertisers are finally putting in more diligence to know where their money and brands are delivering.  

Watch this. The largest challenge to the premium publisher business is keeping pace with the massive consumption in the back-half of 2020 due to a record convergence of captive audiences and riveting news cycles. Putting aside what is good for our business for a moment, it’s nice to see outdoor activities once again competing for attention! And for the booming digital audio market, that has some upside as well.

Surprise twist. The Delta variant looks like it may drive many Americans back to some of our early 2020 habits. Clearly, Covid continues to concern all of us personally and professionally. How it impacts economic and media consumption trends is to be determined as we approach the Fall.

2. Privacy and data protection

Big takeaway. 2021 will be the year that killed “tracking” – regardless of how successfully Google protects the soft underbelly of its surveillance business model. Apple will continue to distance itself from Google in an effort to position itself as the consumer champion by carrying the privacy torch. They pressed forward with iOS 14.5 in Q2 with installations now approaching 75% of the market. Why does this matter? It’s the first major operating platform to require consumers to grant companies permission to track them outside of the apps they’re choosing to interact with.

Watch this. This move better aligns iOS with the tracking prevention values long held by the Safari browser and those increasingly held by consumers. Given the market power of Apple, it has triggered a war with Facebook, the second largest tracker on the internet. In fact, Apple’s impact on Facebook’s future revenues was mentioned repeatedly on Facebook’s Q2 earnings call yesterday with future headwinds dominating the press headlines (despite their efforts to talk about the future “metaverse.”) As global regulators have frequently noted, a majority of Facebook’s data (and with that, their revenue) has long been derived from tracking users.

Surprise twist. The Attorney General of California also announced last week that their office had accelerated sending out warning letters to companies that weren’t properly honoring consumers’ opt-out of tracking requests via the Global Privacy Control. This should send fear through Google and Facebook as California law has defined tracking consumers as a “sale of data.” That definition will be mighty uncomfortable for two empires built on exactly that. And the California AG’s moves will accelerate pressure to create a federal law where Facebook and Google already have multiple regulatory issues to deal with. All of this has forced industry to accelerate its “reality check.”

3. Growing consumer revenues

Big takeaway. After a robust 2020, consumer direct revenues — including subscriptions — continue to grow, albeit at a slower pace. Overall, non-advertising revenues grew in the first quarter of this year. And they are trending up to 30% so far this year.  

Watch this. Although “subscription fatigue” continues to be a topic of discussion, DCN’s prior research and industry trends have shown nothing short of an insatiable appetite for quality programming. Yes, even when it bears the price of subscription. It doesn’t hurt that making a purchase is now as easy as a thumbprint on mobile.

Surprise twist. Gen Z (yes, the kids who grew up with iOS) don’t seem to mind advertising. DCN will be releasing research in September that shows that Gen Z’ers (16-24) actually have something in common with Gen Y (25-40). Both groups are very open to advertising in their programming. Whether they pay or opt for a free service, the existence of advertising doesn’t seem to be a major factor for younger media consumers.  

4. Strong streaming market

Big takeaway. No market has had more of a dichotomy between advertising and subscription-supported models than the red-hot video market. In fact, DCN broke out the “advanced video” segment for the first time in our most recent quarterly revenue report. And it nearly tripled in our first year-over-year comparison. 

Watch this.  Apropos to this heading, America can’t seem to get enough to watch from these trusted brands (and DCN members): Disney Plus, HBO Max, Peacock, Discovery Plus, Paramount Plus, and the many other services that have gone direct to the consumer and are reaping the rewards.

Surprise twist. The 10-ton giant of streaming video, Netflix, missed earnings in Q2. It lost hundreds of thousands of U.S. subscribers in Q2, with metrics that looked more like a traditional cable TV company. Maybe it’s a momentary lapse from last year’s stay-at-home streamers. But it could be a sign of migration to the newest competitors. Either way, I’ll be watching.

Trend watching and trendsetting

As someone whose job it is to promote the value of quality and trusted media brands and to call out those who seek to disintermediate them, monitoring trends can be one of the most fluid and head spinning parts of the job. The team at DCN will continue to champion the trusted providers of content that informs, entertains, and delights because that is what consumers expect and what we believe will ensure a healthy future for our industry.

Rounding up these current trends, I see a lot to be excited about – particularly with the next generation – as we continue to learn the lessons, both good and bad, from the pandemic. It’s never a dull business and I can’t wait to see what’s next.

Featured Post | Revenue

MVP: Why sports coverage could be the next great subscription driver

Sports coverage and analysis is the lifeblood of specialist sites like Defector and The Athletic. However, as the competition for subscription revenue heats up, many media outlets are re-examining the value of sports as a means to connect with audiences. And a rash of hiring and acquisitions shows that is trickling down to regional titles too.

Last week The Athletic raised its subscription price. The increase – the first since the sports news and analysis title launched – followed two failed attempts to tie the brand up with larger publications. The first endeavor saw The Athletic pitch a partnership with Axios, which ultimately came to nothing. The second saw it enter talks with the New York Times, which is currently in the midst of its own drive to add millions more subscribers.

On paper the latter seemed like a great potential partnership. The Athletic boasted over one million subscribers as of September last year, and 1.2m as of May this year. That would amount to an instant addition of over one tenth of the users needed to take the NYT past its target of 10m subscribers by 2025.

It also would have cemented the NYT as one of the definitive sources of sports news online: in addition to its own coverage, it would gain that of The Athletic’s ~400 editorial staff across text and audio. In the face of hungry acquisition of sports content from the likes of Sinclair, it would have put the NYT ahead of the pack to scoop up sports-focused subscribers.

By the numbers

So, what went wrong? The answer lies in the often-omitted information from the story of The Athletic’s early success. Despite (or in part due to) its initial splurge on the best-known sports journalists in countries across the globe, the site is still not profitable.  

Even with reported revenues of around $80m in subscriptions, it is not covering the cost of its formidable staff. In an interview with Variety its founder Alex Mather stated: “We have got 450 reporters, writers, editors, producers on three continents producing as much volume as any national newspaper in the world per week”. He then noted that the company was still priced the same for consumers as when it launched with just three full-time employees.

It’s tempting to suggest that The Athletic raising its prices is an acknowledgement that its play for scale to appeal to larger publications has stalled. It is likely that some of those subscribers, brought in through discounted or free subscriptions, will choose to opt out of paying, so it is concentrating on consolidating revenue from its most valuable and engaged users.

Sporting chances

However, it is too soon to say that The Athletic as an experiment has failed. Rather, it could be the catalyst that sparks important changes elsewhere. Even in the announcement that accompanied the price hike, there was a note of optimism. As we come out of the pandemic and live sports return in earnest there is an opportunity for sports news and analysis platforms, both at legacy organizations and at the digital upstarts like The Athletic.

Jasper Wang is VP of revenue and operations at sports blog Defector. While it pales in comparison to The Athletic in scale, its smaller newsroom allows it to be profitable at a comparable membership cost to The Athletic. It is effectively right-sized by design. He told me:

“If we take the business model first, we are subscription-supported, because we knew there was a rabid group of readers. Is that millions? No. But is it tens of thousands, maybe even hundreds of thousands? Yes. And so the quickest way to get some cash flow was to ask people to pay subscriptions directly. We had 10,000, paid subscriptions within 24 hours of announcing the project. We’re at about 39,000 total paid subscribers right now.”

The rights stuff

So even if The Athletic’s play for scale will lead to it shedding subscribers and some staff again, there is a demonstrable hunger for that content. That’s led to a spending spree in both broadcast rights and editorial output.

In the U.S., for example, Sinclair is still high on its acquisitions horse, attempting to control the distribution and streaming rights to regional sport. Its latest $250m effort to acquire NBCUniversal’s seven regional sports networks (RSNs) bulks up its Bally Sport network. Sport, even at the regional level, attracts huge audiences.

In fact, at ESPN there is growing recognition that, even with smaller audiences, live sports offer a bevy of opportunities to connect advertisers with audiences. “Primetime is when most people are watching, and that’s what sports is. Sports is prime,” says Rita Ferro, president of Disney advertising sales. Perhaps that’s why ESPN Plus is also raising its prices, with the annual cost jumping from $60 to $70.

And it’s on that primacy that some news outlets are betting their fortunes.

Investment opportunity

Newspapers, which cannot afford or have no interest in becoming carriers for sports broadcasts, are approaching the opportunity from another angle. In the U.K,, for example, Reach plc is investing heavily in creating new roles to tap into engagement from fans through punditry and analysis. Much like The Athletic, it is splurging on bringing new journalists into the fold to boost its coverage.

Jon Birchall, Reach’s audience and content director for sport, said, “We want to bring more views, a wider range of expertise and more round the clock coverage on both our national and regional brands.

“Our ambition is to not only continue to serve our readers, viewers and listeners but also attract new fans and communities.

Connecting with communities

The phrase “new fans and communities” is telling. While national leagues still attract the lion’s share of coverage and therefore subscription revenue, The Athletic has demonstrated that audiences are just as invested in their local teams. Reach’s play, then, is to take back some ownership of the local sports coverage it lost while stripping out costs.

Its timing is significant, too. Reach is currently in the middle of a drive to explode its digital revenue. Lloyd Embley, its editor-in-chief, said: “Over the past 18 months, we’ve significantly ramped up the number of new sites we’ve launched as part of our Live network, many in areas where we don’t have established print titles.

“Thanks to our transformation of editorial operations last year and underpinned by our customer value strategy which ensures we build deeper relationships with our readers, we have created a sustainable model for digital-only local journalism.”

In the U.K., sports subscriptions are also key to the fortunes of titles like The Telegraph. While the cost is less than that of an overall subscription, it is a recognition that sports coverage has its own appeal. In discussing its subscription plans, the Telegraph ranks its sports coverage alongside its politics as among the biggest drivers of subscription take-up; a member of the Telegraph team flagged its upcoming suite of Olympics coverage to me as being one of its primary focuses for the year.

Mind the gender gap

Perhaps most importantly of all there is still a gap in women’s sport, both in terms of coverage and punditry. Research has found that on average women’s sport receives about 4% of the media coverage of men’s. This clearly suggests there is still significant headroom for growth in revenue from subscribers looking to learn more about women’s sports teams and stars.

That’s backed up by research from Deloitte, which demonstrates broadcasters are slowly cottoning on the rising demand for women’s sport. In 2019, CBS Sports Network signed a deal to televise 40 regular-season Women’s National Basketball Association (WNBA) basketball games. Similar deals have taken place across the U.S. and U.K. for other sports.

Crucially, there is an opportunity for news orgs here too. Women’s sport advocacy group The Fan Project found that audiences are hungry for greater access to athletes and stars. At both national and regional level, investment in teams that can promote those stars will pay dividends for news titles. It’s a far cry from the days when tennis was considered the only women’s sport worthy of coverage in the U.K.

With the rise of online gambling and its integration with news titles, local sports coverage might well be the next great driver of revenue for regional titles on both sides of the Atlantic. Huge great experiments like The Athletic might not work on their own terms. However, they are already spurring a tranche of investment in what could be a key source of subscription sign-ups elsewhere.

Featured Post | Industry-Research

Game on: How younger consumers’ behavior shapes media usage

When it comes to media consumption, consumers have never had it so good. From streaming services to social media, movies to music and video games, to a variety of linear TV channels, options abound. With so much choice, comes inevitable competition for the providers, as they try to court the consumer. So how can media and entertainment brands form meaningful relationships with audiences? According to the latest Digital Media Trends survey it’s all about understanding generational trends – in particular Generation Z, who could cause the next wave of disruption.

The 2021 survey, which was conducted by Deloitte’s Technology, Media & Telecommunication practice, found that Gen Z demonstrate strikingly different preferences. Other research—and experts—back this up. Let’s take a closer look.

Video games

Boomers love streaming video while Gen Z is obsessed with gaming. The group, aged 14-24, place video games as their number one entertainment activity (26%). That’s followed by listening to music (14%), browsing the internet (12%), and using social media (11%). Only 10% of Gen Z said that watching TV or movies at home was their favorite form of entertainment.

“For the first time since we started this survey, Gen Z did not pick watching movies or TV shows as their favorite media. It was gaming,” says Kevin Westcott, Deloitte’s Vice Chairman and U.S. Technology, Media and Telecom Leader. “Obviously there was quite a bit of growth during the pandemic. Gaming is a social activity and a way to stay connected. However, video games were already significantly growing before Covid-19. It will be interesting to see if these preferences persist now that lockdown rules are relaxing in the U.S.”

With the dominance of video entertainment being challenged, media companies need to take a more diversified approach. Publishers should experiment with different storytelling techniques on social platforms, and gamification is a great place to start.

“If a media brand isn’t in the games business, they need to look at how they can make things more engaging,” says Westcott. “Gen Z are looking for more participation and this is where transmedia could help. By utilizing a range of platforms, the audience can interact with content and influence it, rather than just watching it.”

Source: Digital Media Trends, 15th edition

Social media

Beyond connecting with the world, social media is a common gateway for consuming a wide range of media content. Although all generations use social media, consumption varies depending on age. According to the Digital Media Trends survey, Gen Z and Millennials both rank listening to music as their main activity on social media. However, Gen X prefer to consume news. The second most popular activity on social media for Gen Z was gaming. For Millennials it’s watching TV shows and movies.

News

Interestingly, despite these social media usage trends for news, 50% of Gen Z still rank social media as their preferred way to get news, while only 12% select news from network or cable TV. Boomers are the opposite, with 58% getting their news from network or cable TV, and just 8% using social media.

According to a report by Flamingo, commissioned by the Reuters Institute for the Study of Journalism at Oxford University, younger audiences differ from older groups in terms of what they want from the news. Young people are largely driven by progress and enjoyment, which translates into what they look for in news. As such, they want news to feel easy and accessible. That means creating formats that are native to mobile and social platforms, as well as including these ideas on their own websites.

The report, entitled How Young People Consume News, also suggests that the news media need to change the way they report the news. This includes tackling issues such as stereotypes, diversity and negativity. It should also influence how news brands present themselves and their content on third party platforms.

Commercial media

A report by the Institute of Practitioners in Advertising (IPA), called Making sense. The commercial media landscape, found similar disparities with the way different generations spend their time on commercial media. Ages 16 to 34 spend 53% on a smartphone or tablet and just 22% on a TV. Conversely, those aged 55 and above spend 53% of their commercial media time on TV and just 14% on a smart phone or tablet.

“The way to drive engagement in younger audiences on broadcast TV is to ensure content is available across multiple platforms,” explains Simon Frazier, Senior Research and Marketing Manager, IPA. “Younger audiences are always media multi-tasking, which is a challenge for media. But broadcasters that tie in with a variety of touch points and blur lines between entertainment and reality enjoy good engagement and a good commercial performance.”

Content

According to a report from VICE Media, in partnership with Ontario Creates, Gen Z is redefining how content is being discovered, consumed, and shared. Three quarters of respondents (75%) report that original content is important to them. Music, video streaming and video games are the top paid services, while cable or satellite TV subscriptions don’t even make it into the top five for Gen Z.

This younger demographic also wants more diversity. Half say that there is a gap in gender diversity, sexual identity, and ethnic representation.

Source: Gen Z: The culture of content consumption

Along with good content, they want ease of discovery. Gen Z were born on social platforms so they play an important part of their content discovery. YouTube is their number one content source, with Instagram a close second, followed by Facebook, and Snapchat. TikTok is also gaining popularity. Gen Z tends to like content on social platforms that is transparent, with few barriers between the creator and the audience.

“With new voices and new platforms entering the media landscape by the minute, the competition for young people’s attention has never been greater,” said Julie Arbit, Global SVP of Insights, VICE. “Combine that with a young generation that has never been hungrier for content or savvier about how to access it and you have a whole new approach to content consumption. Understanding this new mindset is essential for anyone who is trying to reach this young audience.”

Subscriptions

The VICE study also found a massive 90% of Gen Z are willing to pay for content if it offers better quality (61%), better experience (56%), and more convenience (50%). Only four in 10 said they wanted an ad-free environment. However, with consumers losing income due to the Covid-19 pandemic, Digital Media Trends noted an increase in churn rates, across all generations, in the past 12 months.

“During the pandemic, churn across streaming more than doubled,” says Westcott. “We call it ‘hit and run’. So, they join for the hit show and then leave to join another service.”

“Instead of focusing on adding new subscriptions, media providers need to shift their focus to long term subscriptions. And the way to do that is to broaden their range of content, and offer exclusive, original, high demand TV series, plus games and music.”

Advertising

Despite the growth of subscription-based services, IPA reports that 63% of 16 to 34-year olds spend their time using platforms that are commercially funded by advertising.

“This represents huge opportunities for reaching this audience through commercial media,” says Frazier.

In the same group, four out of the top five commercial media properties are socially driven. These findings were backed up by Digital Media Trends. They found that social media influencers and ads on social media are the two most persuasive channels influencing younger generations’ buying decisions. They also typically liked ads on social media more than ads in streaming video content and other channels. On social media platforms, 62% of Gen Z and 72% of Millennials would rather see ads personalized to their likes and activity than generic ones.

Growing convergence

Despite these differences, there is a growing convergence of behavior across several generations of consumers, as younger age groups influence older audiences.

Source: Making Sense: The Commercial Media Landscape

“Ten years ago, we did a study on Millennials,” says Westcott. “We thought, as they aged, they would become more like us. But that didn’t happen. Instead, they have influenced older generations, who are now behaving in similar ways. The only way they really differ is that 26% of Gen Z rate gaming as their favorite entertainment, verses just 10% of Gen Z and 3% of Boomers.”  

It is this preference for gaming that could challenge video as the leading form of media consumption across all generations. However, according to the IPA report, there was a significant drop in the correlation between how younger and older generations consumed commercial media during lockdown 2020.

It found just an 8% similarity between 16-34-year-olds and 55+ during lockdown 2020. This was down from 21% before the Covid pandemic and 58% in 2015.

“What is clear is that the lockdown has undoubtedly reinforced the dominance of key media for the different audiences and exacerbated the differences,” says Frazier.

So, while media companies may still be video-first, it seems that younger generations are moving away from this platform. The question is, are media brands and advertisers prepared to follow suit?

©2024 Digital Content Next. All Rights Reserved.