As online shopping habits evolve, ecommerce is becoming an increasingly attractive revenue opportunity for publishers. We can’t predict what will happen as the pandemic wanes, but prominent studies suggest that ecommerce will continue its upward trend in the coming years.
Given this rosy outlook, now is a great time to investigate the potential of ecommerce (or revisit your strategy). But ecommerce success isn’t guaranteed. It takes careful planning, smart choices, and the right technology partner.
If you’re looking for expert perspective on the key elements of a successful ecommerce strategy, take the time to read Ecommerce in Publishing: Trends and Strategies. Sponsored by Sovrn and published by What’s New In Publishing (WNIP), this new report offers deep insights into the ecommerce space to help publishers develop a winning ecommerce strategy (that goes beyond affiliate). It also provides insights on how to deliver an exceptional shopping experience and maximize revenue.
3 considerations for your ecommerce strategy
Whether you’re just starting out looking to enhance your strategy, there are certain key topics you’ll need to consider. Here are three of the big takeaways from our report:
1. Changing technologies
As ecommerce becomes increasingly enmeshed in the day-to-day digital experience, it’s easier than ever for consumers to make online purchases. And purchase capabilities now span a wide variety of channels – from traditional websites to social media outlets, mobile apps, and more. For publishers, this opens up new ecommerce opportunities that go far beyond traditional affiliate marketing, like curated online stores, subscription boxes, buy-now-pay-later (BNPL) models, and more.
Things move fast in the world of online publishing, so there’s always a new tactic or technology to explore. At the same time, tried-and-true revenue sources can fall out of favor without warning. We’re seeing this play out before our eyes in recent months, with Facebook’s first-ever decline in usage and the phenomenon of “subscription fatigue.” Publishers who tap into multiple selling channels will have more revenue opportunities — and better protection from market volatility — than those who stick with a single online platform or property.
Look for flexible, easy-to-use solutions that work with almost any type of commerce content and one that evolves along with the industry. We believe personalization that delivers a unique shopping experience tailored to readers is the right approach. Also, tools such as price comparison make it easy to cut through the noise and help your readers find the best deals on the products they want.
2. Culture and content fit
It’s important to recognize that ecommerce is not a one-size-fits-all venture. Some ecommerce tactics will work better than others for your brand, your content, and your unique audience. Gaining a deep understanding of your reader base is a fundamental step in developing an approach to ecommerce that will resonate with your audience and selecting the products and merchants they’ll love.
Make sure you analyze which products and merchants are most appealing to your readers. For example, your audience may have strong engagement with certain content, or they may prefer a certain brand that’s featured on your site.
With a better understanding of your overall affiliate program, you can continue to refine your affiliate strategy and drive more revenue. A dashboard can help you identify these trends, by displaying performance metrics and delivering insights on what’s working (and what’s not).
3. Merchant diversification
Ecommerce success requires forming mutually beneficial partnerships with merchants that appeal to your audience. Most publishers start out promoting a single merchant like Amazon or Walmart, because they offer affiliate programs that are easy to understand and implement. But these internal programs rarely offer the highest rates or the most desirable products — and when your earnings rely on a single merchant, any change in commission structure can devastate your revenue stream.
By diversifying your merchant mix, you can ensure that no single vendor has a disproportionate impact on your earnings — and you’ll be in a better position to adjust your strategy in response to market fluctuations. Of course, your target merchant list may change over time as your content and your audience continue to evolve. You may also discover that individual merchants revise their requirements for affiliate approval from time to time — so it can be challenging to maintain a steady mix of merchants on your site.
Maximize your ecommerce potential
Undoubtedly, we’ve seen an acceleration in the adoption of ecommerce that presents an enormous opportunity. Media companies, which offer content that fits seamlessly into the shoppers journey, are in a position to benefit from this trend. But to do so, our research finds that there are a number of critical factors in play (a few of which I’ve covered here). With the right strategy in play, publishers are poised to be a vibrant port of the growing ecommerce marketplace.
About the Author
Rebecca Cole is the Director of Content and Communications for Sovrn, a publishing technology platform that provides advertising tools, technologies, and services for content creators to build their businesses, remain independent, and thrive on the Open Web. Rebecca has more than two decades of experience driving increased attention through purpose-driven content. She has held communications positions in tech, energy, and consumer brands and was a journalist and editor. Rebecca has an undergraduate degree from The University of Iowa and a master’s degree in journalism from The University of Colorado Boulder.
If we’ve learned anything over the past few years, it’s that almost anything is possible. For better or worse, the future is highly unpredictable, which can make long-term planning difficult. One of the best ways to prepare for the future — whatever it may bring — is by keeping up with industry trends.
That said, one looks to be a sure bet: ecommerce. Undoubtedly, this is a revenue trend that will only grow in importance for publishers. According to GroupM, “By 2024 retail-focused ecommerce will amount to $7T in annual sales activity or 25% of all retail sales.” And the effects of the Covid-19 pandemic have only continued to accelerate the adoption of online shopping and the move away from traditional brick-and-mortar retail.
For publishers, creating an ecommerce strategy that is optimized for impact is more important than ever.
If you’re looking for expert perspective on the trends that are shaping ecommerce and their implications for publishers, take the time to read Ecommerce in Publishing: Trends and Strategies. Published by What’s New in Publishing, the report offers deep insights into the ecommerce space to help publishers deliver an exceptional shopping experience and maximize revenue.
3 trends to watch
Ecommerce is evolving rapidly, as new technologies emerge, and consumer expectations continue to rise. We’re already seeing the impact of these three trends, but they are likely to become increasingly more prominent.
1. Friction-free experiences
Publishers and retailers alike are focused on creating smooth, seamless ecommerce experiences. That means empowering consumers to complete a purchase quickly and easily, in as few steps as possible.
For example, an inefficient ecommerce experience might send readers from your content to a merchant page where they must search for the featured product, visit the product page, add the item to their shopping cart, and finally check out. Shoppable technology can streamline the process, allowing consumers to go directly to the desired product page — or even add merchandise to their cart from a link in your content.
Reducing friction is beneficial for both publishers and merchants, as it lessens consumer frustration and increases conversions. And consumers increasingly expect this type of functionality, so they can shop whenever, wherever, and however they prefer.
2. New payment methods
The practice of buy-now-pay-later (BNPL) is growing in popularity among major retailers, who are eager to provide consumers with easy payment options. This trend is beginning to catch on among publishers as well — especially with those who already leverage ecommerce as a core part of their business.
BNPL is essentially a type of short-term financing that allows consumers to make a purchase now and pay for it in the future — often in multiple, interest-free installments. As consumers get accustomed to this type of payment option in the retail world, it’s likely that publishers will need to follow suit to avoid missing out on valuable ecommerce revenue.
On the outskirts of the payment method trend, a few publishers are experimenting with purchases using cryptocurrency or even text-to-buy — although these are far from common.
3. Social commerce
A frictionless experience is integral to social commerce, which allows consumers to make purchases through apps and social channels. This segment of the ecommerce market is growing rapidly, from $89.4 billion in late 2020 to a projected $604.5 billion within seven years.
With numbers like these, it’s no surprise that publishers are exploring new ways to monetize user engagement on social media. Ecommerce opportunities are the next logical step for influencer-focused channels like Pinterest and Instagram, so users can immediately purchase the products they see.
Channels like Instagram, Pinterest, Facebook, and Snapchat are rapidly expanding their shopping tools and functionality, which can help publishers tap into this trend. After all, research shows that finding inspiration and products to buy is cited as one of the main reasons today’s consumers use social media.
The continued growth of ecommerce has become a potential revenue stream that is too big for many
publishers to ignore. By partnering with platforms, retailers and other service providers publishers can create rich ecommerce experiences, offering the type of online shopping experiences that consumers now demand. Those that don’t risk being left behind, leaving much of ecommerce’s potential unrealized.
About the author
Rebecca Cole is the Director of Content and Communications for Sovrn, a publishing technology platform that provides advertising tools, technologies, and services for content creators to build their businesses, remain independent and thrive on the Open Web. Rebecca has more than two decades of experience driving increased attention through purpose-driven content. She has held communications positions in tech, energy, and consumer brands and was a journalist and editor. Rebecca has an undergraduate degree from The University of Iowa and a master’s degree in journalism from The University of Colorado Boulder.
Video shopping is being hyped as the next big thing in video and shopping. But it is kind of hard to believe that livestream commerce, which has its roots in the home shopping experience we know from cable TV, will be truly transformational. Now reconsider it as a new paradigm that combines information, entertainment, and retail. And, even if you count live callers to shopping shows, livestream shopping provides a whole new level of customer connection and conversion. So maybe activity and investments are booming for good reason.
This year will be remembered as the biggest year yet for video commerce revenue. Research firm eMarketer reckons the global market for livestream shopping will rake in a massive $500 billion this year.
Break this down by region, and China accounts for the lion’s share of earnings ($480 billion). But more astounding than China’s percentage of global revenues is the speed at which livestream commerce completely has transformed the country’s retail industry. Global management consulting firm McKinsey reports it took less than five years for livestream commerce to develop into an innovative sales channel and one that regularly attracts more than one-third of Chinese Internet users.
Western companies ramp up to revenues
The U.S. market may be nascent in comparison, but the pay-off for early adopters is impressive. Data from management consulting firm Activate’s Technology Media Outlook 2022 pegs revenues at $11 billion this year, up from $6 billion in 2020.
Big names need little convincing. From online retailers Amazon and Alibaba to big tech and social giants Facebook, Pinterest and TikTok and Twitter, companies are “jumping into livestream shopping hard.”
The pandemic provided a big push. At one level, strict lockdown measures have accelerated the trend of shopping online and in-app. At the other end of the spectrum, isolating at home has increased the desire of consumers, who crave connection and diversion, to interact with a new breed of creators and influencers lining up to make shopping informative and fun.
Media companies engage audiences primed to purchase
Right now, the most popular combination to power livestream shopping is social networking platforms and retailers. However, media companies offer ideal partnerships. They alone can position offers where they matter most: the point of inspiration where customers are consuming content and open to suggestions.
“It’s really about creating an experience where content meets commerce,” Bryan Moore, co-founder and CEO of talkshoplive, a live streaming, social sales network, told me in an email interview.
He believes that the ideal intersection occurs by “connecting the retail and media landscapes.” His company has worked with Conde Nast and Hearst, retailers like Walmart, and creators from Oprah Winfrey to Dude Perfect on live commerce. Which maximizes distribution and, he says, “converts the most sales by cutting out all friction.”
This month BuzzFeed was the latest media company to announce a partnership with talkshoplive. The live stream with creators Carolina Reynoso and Vivian Nweze celebrates BFF-entine’s Day, highlighting product recommendations, gifts and much more. It follows a string of more than 50 livestreams on destinations, including Amazon Live, the retailer’s shoppable livestream offering.
Another fast-mover in livestream commerce is NBCUniversal. The media company launched its commerce capabilities on its One platform in 2020. Since then, the company reports it has created over 250 different pieces of shoppable content and counts over 200 active retailers on its platform.
From experimentation to execution
The number of media companies doubling down on livestream commerce continues to grow. But so does the competition.
New data from Sensor Tower, a company providing market intelligence and analytics for the mobile app economy, shows that one-third of the top 15 apps (measured in downloads) in the U.S. have “either already experimented with livestream shopping events or have announced plans to test livestream shopping in the near future.”
To up their game, media companies will need to be brave and broaden their approach beyond just driving affiliate conversions. The real power of livestream commerce is not about pushing products or driving sales.
The deeper goal should be to build affinity for an interactive shopping experience – not just drive a purchase. Done right, whether the consumer purchases or not, the experience continually and consistently delivers something far more valuable: memorable and meaningful engagement.
How to do live shopping right
On the face of it, livestream commerce is a perfect match with campaigns to sell beauty, fashion, decor and other items where brands and merchants pay the highest commissions. But this opportunity goes far beyond lifestyle. There are opportunities in many other verticals, including B2B software and services. Whether you opt to target consumers, or cater to business professionals, your first task is to enable the conversations and interactions that power commerce.
Cultivate creators to add authenticity
Encourage niche creators who can enhance the experience (and the reach of your retail partners) and open the aperture of how you view opportunities in the Long Tail. Reams of research show the engagement rates for nano-influencers are up to ten times those for mega influencers and major celebrities.
Expand capabilities to create customer value
Position your company to present shoppable products to your audience in a way that maximizes convenience and minimizes friction. Choose platforms and partners that will allow consumers to enjoy the programming and the purchase experience. If possible, don’t just align with a livestream partner. Build the talent and tech in-house to run your own livestream platform. It can be a significant investment, but it also positions you to go after brands and opportunities that value access to your audience and are willing to pay a premium for it.
Draw from data and consumer behavior
Livestream commerce requires deep commitment and insights. Be prepared to set up a team to manage these activities and “own” the customer. More importantly, equip them to build personas of potential customers and segments to understand the audience. This will also help you understand which interactive perks (games, giveaways, quizzes) are likely to keep these consumers engaged and entertained.
Experience, engagement, and (yes) earnings
Content is king. But it takes more than compelling and trustworthy reviews and recommendations to enhance the livestream shopping experience. While incremental – or even significant – revenue is a compelling reason to move into live shopping, it offers other meaningful rewards.
Today’s consumer enjoys an end-to-end experience that media companies are uniquely poised to offer. From the moment of interest, to inspiration and even investment, the media ecosystem can truly engage consumers in a way few others can. Live shopping experiences offer a new way to leverage content-based customer experiences to increase engagement and, yes, feed the bottom line.
The ecommerce boom was far and away the biggest trend to have come out of the pandemic – at least for digital media companies. Unsurprisingly, media organizations that had already invested in ecommerce infrastructure and affiliate revenue partnerships reaped big benefits. They made hay while the sun shone.
Good Housekeeping, for instance, saw an increase in ecommerce-powered sales of 567% in March 2020, compared to the same period in the previous year.
Some, like Dennis Publishing owner Exponent, even spun off parts of their businesses that were outperforming in terms of ecommerce. Its automotive-based properties were made into their own dedicated business – Autovia – in March of 2021. It was, as its chairman Peter Plumb noted, an opportunity “for those with the broadest and most engaged reach, the richest audience data and the most trusted brands and content.” They were poised to benefit from the rapid growth in ecommerce.
Meanwhile, Dennis’ future owner Future plc has absolutely dominated the ecommerce space. As countless analysts have pointed out, its long-held aim to own every part of the ecommerce journey from ideation to recommendation to purchase has proven to be a lucrative strategy.
But Future was not content to rest on its laurels. After announcing over $1bn in ecommerce and affiliate revenue in 2020, Future made a number of acquisitions to own even more verticals from top to bottom. As a result, it is set to push into the U.S. Overall, it sees a lot of headroom for its ecommerce ambitions.
And it is ecommerce-focused media companies that continue to grow ecommerce revenue even in the tail end of 2021. So, what do Future and the other huge media ecommerce successes have in common? The answer is down to that end-to-end ownership of a vertical. Though it remains to be seen how long that this strategy will suffice when platforms are also banking the benefits of ecommerce growth.
Putting the ease in ecommerce
One thing that needs to be pointed out is that it isn’t all that hard to simply launch an ecommerce strategy. Forbes has started selling branded items and called it its entrance into the ecommerce space, for instance. Meanwhile BuzzFeed has been loud and proud about its expansion into ecommerce partnerships as well. The company predicts that 18% of its total revenue will come from commerce over 2021. Even the companies whose print holdings are the main point of contact have doubled down on ecommerce technology, with fashion magazines like Grazia including scannable images in their pages.
And since the headroom for growth is so great it is also possible – or even likely – to report success in that area. That is itself cause for celebration. Diversification of revenue streams should be encouraged wherever possible. Even the recently announced tie-up of Vox Media and Group Nine was based in part on their shared investment in ecommerce, with the release stating that “both companies have proven success in bringing their brands to life through commercial licensing, affiliate partnerships, and collaborations with major retailers like West Elm, Target and Old Navy and producing premium capsule collections with, for example, Marc Jacob.”
But the corollary of that is that, in order to be one of those huge successes, you first need to be, well, huge. You need a big audience to sell to. You also need a stockpile of existing content to both demonstrate expertise and to repurpose as affiliate sales material. Hearst’s Kristine Brabson, executive director strategy and editorial insights, elaborated on this to Damian Radcliffe. Of its ecommerce growth, Brabson said “We didn’t suddenly create a bunch of new content…” Instead, the company ensured that the products being recommended on its best-performing pages were actually available for sale. It’s difficult if not impossible to do that from a standing start.
Top to bottom
Just as important as enormous scale and longevity, though, is ensuring that your ecommerce operation is layered throughout the entire operation. Meredith, for example, earned $27.7 million from its affiliate operations in Q2 this year, a 26% year- over-year increase from the same period the year before. And it did so without sacrificing any other revenue strands in service of providing the best possible ecommerce environment.
By contrast – though it has been a boon to the bottom line – the integration of Wirecutter into The New York Times’ wider business does not appear to have been quite as successful. Last month the staff of the affiliate publishing business (acquired by the newspaper in 2016) went on strike and actually urged readers not to make any purchases through the site itself. As NYMag explains: “Wirecutter was always treated as a second-class citizen, isolated in its own Slack, its own offices, and its own reporting structure under Perpich. It never joined the newsroom, and its work was openly sneered at by some long-time staffers. Many Times staffers don’t believe their work is journalism at all.”
A similar omission of an ecommerce-focused division occurred at Vice’s 2020 Newfronts. The company barely mentioned Refinery29, which pre-acquisition by Vice in 2019 had been lauded as a trailblazer for the burgeoning ecommerce space.
As with Forbes’ efforts, mentioned above, simply owning an ecommerce business does not mean that you can take the full advantage of the ecommerce boom. It has to be threaded through the entire business, treated as an integral offering, and allowed access to the entire breadth of the media company’s content. That’s what empowers Future’s success.
The reintegration of platforms
So where does that leave the media companies without the scale to own a vertical or the ability to build ecommerce through the entire business? One early clue comes from LadBible’s recent foray into the space in partnership with TikTok for a two-day “live shopping event”. Sam Oakley, director of social video at LadBible Group, said: “We are always looking for new ways to entertain and give our audience new things to discover and experience. We are proud to work together with TikTok and look forward to seeing our community enjoy a virtual shopping experience.”
While those of us with memories of over-reliance on platforms may balk, the reality is that ecommerce and affiliate revenue already rely in no small part on Amazon and other retailers. It is a growth industry not just for the newspapers and magazines, but for all players. You only have to look at the sheer amount of investment platforms as varied as Snap and Pinterest are putting into their ecommerce tech to spot their intentions are the same as media companies’. In many ways they are outpacing those publishers mentioned above: Pinterest now automatically updates products that are sold out with those that are available. But those publishers do have something platforms can’t replicate so easily – a history of curation and recommendation. Trust, basically. Provided we recognize the value of ecommerce and don’t shunt those teams to the side, we might not end up with the power imbalance between publishers and platforms that we did with advertising. Long may that growth con
Mobile is a massive opportunity only heightened during the pandemic as audiences turned to their smartphones for the comfort food of apps and entertainment. Significantly, though, throughout this period consumer tastes and appetites changed. Users had both the time and the desire to discover new apps and content, a dynamic that allowed many niche apps and content creators to gain mainstream appeal and profits. In some markets, it created a perfect storm of opportunity for hyperlocal news and entertainment that meets consumers where they are.
Continuing with our series of industry interviews [video below], I talk to Jani Pasha, Founder and CEO of Lokal, who is harnessing hyperlocal content in a play that has the potential to make it the NextDoor of India. With a model built on monetizing connections and transactions at the intersection of community, content, and commerce, Lokal is making the most of a booming opportunity.
The model is smart and replicable in other markets. However, Lokal also benefits from a seismic shift in the fabric of its addressable audience. For the first time, India now counts more Internet users in rural areas than cities. And rural users typically aren’t as interested in national and international news developments. Instead, they crave information about civic, political and social issues that impact their towns and villages.
But India isn’t the only country experiencing these shifts. The explosion in the number of Internet users, accelerated by the pandemic, reveals opportunities in regions such as Central and South America. While we might think that growth has slowed, in the last 12 months alone, the total number of Internet users globally has grown nearly 8% to reach 4.72 billion. That’s more than 60% of the world’s total population.
From silver surfers to app initiates, new users in these regions rely on mobile and apps as their personal lifeline for news and information (even education). They turn to them to make daily decisions about how they live and what they buy. Tapping that potential requires companies to micro-segment audiences and tailor content to the needs of towns and communities, not cities. It also helps to focus on fundamentals.
Understanding that new users are likely to be low on the learning curve, Pasha made a bet on voice that paid off. Bypassing bell-and-whistle tech features for a dead-simple interface like voice fast-tracked new users to frequent app use and interaction. Ease of use also increased trust in the app. And that trust allowed Lokal to acquire new users easily through the most effective advertising on the planet: word-of-mouth.
Voice also empowers every user to make a contribution. This enabled Lokal to grow its ecosystem at minimal cost. Users call in stories about developments in their local towns, creating the content that keeps other users engaged and loyal. They rely on the app to learn about offers and events nearby, sparking conversations that end in commerce conversions.
And this is where Lokal’s strategy to be a local content platform, not a content provider, makes business sense. By positioning itself as a super app — one that allows a user to access several services in one place — Lokal establishes itself as the trusted middleman in interactions and transactions. What’s more, Lokal drives in-app activities it can monetize. And let’s not forget that first-party data is gold.
In our interview, Pasha shares how Lokal is training creators to ensure its content is fresh, relevant and relatable for audiences who crave hyperlocal content on their terms. He also weighs in on the future technologies and opportunities local news apps and outlets everywhere should embrace to grow their revenue streams.
WATCH OR LISTEN TO THE FULL INTERVIEW
FULL TRANSCRIPT
Peggy Anne Salz, Founder and Lead Analyst of Mobile Groove interviews Jani Pasha, Founder and CEO of Lokal:
Peggy Anne Salz: The pandemic had a massive impact on local media. In the U.S. alone, more than 300 national newspapers closed their doors. Local newsrooms also shut down contributing to the growth in news deserts, that is, cities where people depend on one local news source, if any at all.
But one company is bucking the trend big time, Lokal, a hyperlocal news app in India is not just growing its user base, it’s also making money. It’s a new twist on monetization. And we get the inside track here on Digital Content Next. I’m your host, as always, Peggy Anne Salz, mobile analyst, content marketing consultant, and frequent contributor to DCN, which is a trade association serving the diverse needs of high-quality digital content companies globally. And in this series, we shine a light on the people pushing the envelope. That’s why I’m so excited to have Jani Pasha, Founder and CEO of Lokal. Welcome, first of all, to Digital Content Next, Jani.
Jani Pasha: Hi, Peggy. Nice to be here.
Salz: Absolutely. And coming to us from a very hot Bangalore today, I understand.
Pasha: Yeah, right. It’s very hot, actually.
Salz: So let’s start with Lokal. You have described it as a hyperlocal Tinder because it cuts out the middleman in finding a date or partner. But it’s also a news service. It’s much more than that. So tell me about Lokal and, above all, the user experience.
Pasha: Yeah, Peggy. So we are not just only the Tinder of that place. We do quite a lot. But I’ll tell you the backstory of how we started. So essentially, if you take India, it’s a very diverse country with 90% of its population living in tier-2, tier-3 cities, and towns of India. And these people, most of them, have not traveled further than their adjacent district, because it’s so diverse that with every 50 to 100-kilometre radius, your food habits change, cultures change, language change quite frequently.
So they are staying in those locations of their towns and cities generationally with their parents, grandparents, their homes, and businesses. So naturally, they’re so curious to know about what is happening around them. And there is one more factor that kicked in, in 2016, Jio, a mobile operator who has reduced the prices of internet drastically to make India the cheapest place for 1 GB data for you to use mobile internet.
So then we have this, all these 90% Indians who didn’t have access to internet previously suddenly had access to internet. But essentially, these users are new internet users who are not comfortable in English language. And so then what will they do with the internet, right? So Lokal is the platform which we started it as a platform to deliver hyperlocal content, which is extremely useful for them. And that is the gateway of how they’re adapting to the internet to use internet more usefully in their life. So today, if you take this 90% Indian audience who are new to internet, they are using internet prominently for entertainment, either to… You know, we used to have TikTok. We don’t have it anymore. It is banned by the government. So there are many TikTok parallels and YouTube and Facebook. And then they use WhatsApp for communication.
Apart from that, they can’t use internet meaningfully. And Lokal is actually being that platform giving them the content that they can use and that is of importance for them. Then naturally, making them use internet for multiple use cases. And as at a location, our density of usage increased. We evolved as a platform. So you rightly said we evolved as a Tinder, a place where people find other people to get married. It’s a place for businesses to advertise about their businesses to local community. It’s a place for businesses or people to actually sell their properties. And all this is happening in their native languages of Telugu, Tamil, and Kannada. We are expanding across the country. And we have seen because we have a lot of density in that location, users are adopting platform like crazy with more use cases coming up almost every day.
Salz: But, of course, internet penetration alone doesn’t spell the profits that you’re getting. Part of it is also the experience. You talked about ease of use. You talked about local languages. What are some of the innovations in the UX and UI design that contribute to your success? What does an app with local news need to look like and offer?
Pasha: Very interesting and relevant question, Peggy. So when you talk about these new users right, so all the smartphones have the keyboards in English language. So one challenge when we’re trying to build Lokal was how can you make the content creation easy on Lokal, especially that of text format.
Like, a lot of information about what are the vegetable prices in that location to what are the updates happening in that town, not everything can be captured on video. So they have to be typed. How can you make that easy? So, the first thing that we did, or we built was, making this creation easy, where the user will input the content by voice instead of typing. So they are using voice to actually create the content. And once we started doing that, we realized that creation with our voice is much more convenient than typing on a keyboard because you have to… It’s not natural, right?
Like humans, we speak to each other. So that’s a major shift, right? So if you go on a website today like on Amazon, you have multiple navigation. There are filters, there is sorting, there are multiple pages, multiple categories, but for an interaction, like the natural interaction for a shopkeeper in our location is to go and ask to a small retail shop owner that, “You know, what is the cost of this item? And how can I get it?” It’s natural voice-based input. In India, a lot of businesses are SMEs, sort of small and medium businesses unlike in U.S. where you have a Walmart. You go and then you select. It’s a voice-based communication. You ask, the shopkeeper goes and gets the information, and we’re replicating the same because the technology has caught up.
Salz:Interestingly enough, you were talking about how your audience is very focused on local content. I mean, hyperlocal is really hot in India right now. It’s fascinating that local newspapers, right, newspapers are growing at a double-digit rate. Now, you also have impressive growth results. Now, I’ve seen numbers growing 25% roughly month on month, that’s the last I’ve read, and that’s because of your monetization model. So one is the content, but it’s also a very smart approach to how you generate revenues. Tell me about that.
Pasha: We have built a playbook, via which we launch a location, and we get local content creators in that location to create content, which is very relevant to that community, very, very hyperlocal in nature. And then you get a density of users using the application. And once you have that critical mass of density at a location level, then it becomes a platform where everyone…like, everyone relevant started coming onto the platform, and then they start doing a lot of things, which are monetizable.
Even this is true for people in the West also. Newspapers used to be the place for everything, right, at a location level. You want to do real estate, you want to do jobs, classifieds. Everything used to happen on newspaper. Internet came in. All the small, small parts became large businesses, right? Craigslist, Airbnb, they’re all part of this local newspaper, right? Had these newspapers, you know, are technology-friendly or had they been…had they had that vision or foresight, they would have been the super applications that everything is happening on them.
It’s just that the news publishers migrated their digital publishing online, but they left the rest of the parts for others to pick. In India, we have that opportunity right now, where it’s a very new audience. Internet is being built for them in their native languages. And Lokal is trying to do that with our approach of delivering hyperlocal content. So we don’t consider ourselves as a local news platform. We consider ourselves as a local content platform. So that is the different approach that we are taking compared to newspapers, Peggy.
Salz:That is fascinating because you’re showing that there is a great deal of benefit to being a fast follower here. I mean, you have purposely… It sounds like you have thought this through, Jani. How to be a content platform, keep the social media, keep the connection for yourself and not give it over to the big tech giants or the big social media platforms. That’s the focus. That’s the essence of your strategy. How do you keep the momentum? Because, of course, you’re on a growth trajectory, all of India is on a growth trajectory. And high growth usually means high competition. And how are you keeping these large companies literally from eating your lunch?
Pasha: Our competitive advantage that comes in is based on how hyperlocal we are and how much our team understands the nuances of India, which is very difficult for a tech platform sitting in the U.S. or sitting in some other place to understand and build for it. And these are very new behaviors Peggy. So, as I told you, right, how does a business establish trust digitally? What happens on Amazon is that you go and list on Amazon their ratings, and those are the places how you do it. But how will it happen for a new internet use case, right?
For these very new people where the trust on internet is low, right? How will you do that? It’s a new challenge that we will solve probably for a small business to establish trust very quickly on our platform, and how they can do it. So it’s just that, the nuance, I would say. I would like to summarize that the nuance is very difficult for someone to understand. And hyperlocal in general, is a network effects business, right? You have large density using your platform for multiple use cases, someone coming and replacing it would be difficult.
Salz:It’s interesting that you started monetizing wishes. Tell me about that.
Pasha: It’s just crazy. We never expected all this to happen. We just thought we’re solving a problem of local content not available digitally. When we started creating content, people started coming. So that is the nuance. Like, in India, you have this behavior.
In the small town of India, especially in the southern part, this is very prominent, so that south Indian part, that if Peggy you were a friend of mine and I want to wish you a happy birthday, and I want to do this in a way that everyone in the community would know that I care for you, and we are actually close friends. And how will I do that? I used to either buy advertisement on newspaper with your photo, my photo coming and I’m wishing you happy birthday. Or I am sticking a big banner in the city or town center wishing you a happy birthday.
So the same behavior has been adopted on Lokal now, where the same people who used to do that are posting their wish, like I’m wishing Peggy happy birthday. So there is a standard template where your photo, my photo, will come and I’m broadcasting it to 10,000, 15,000 people in the town, the same purpose they wanted to accomplish previously, now, they’re accomplishing on Lokal. And they have that data to see also that how many people are actually looking at it. So this is being monetized on Lokal. And this is a very, very interesting, unique use case, Indian use case that we are monetizing. And we are seeing a lot more use cases coming like this, and we’re super excited for that.
Salz: You’re also speaking very much as the maker of a content platform. And, of course, a content platform needs creators, needs citizen journalists. It’s all local. So it’s probably very much just about empowering individuals at the local level to grow your business, how do you do that? How do you find them? Train them? How do you make it possible for them to contribute to your platform?
Pasha: The prominent content distribution platforms used to be newspapers like how it happened in the West also. And over the last three, four-, or five-decades time In India, large news publications, this content distribution platforms, have created a lot more content creators in these locations by training them, by informing them, by letting them know what is happening.
And most of these creators in this town used to work for this large distribution platforms like newspaper or television for free, most of them. Why? Because I told you, right, how important these small locations and communities are for these people.
So if I am a creator who can get the word out in a big distribution place like a largest newspaper, I get invites to events happening in the town. Anything big happening in the town, I get to know about it first. So I’m an influencer in that location. So then we have these influencers across India, hundreds of thousands of them. What we simply do is that we have this network of people. We have this digital crunch of hyperlocal content; we just connect them. And that is how we are getting this content.
Salz: You are more than a Nextdoor in India, you’re a content platform, news platform connecting, making business possible, helping merchants. And the reason I have you here today on Digital Content Next is because there are lessons here for publishers everywhere. What do they need to pay attention to if they want to succeed in hyperlocal news?
Pasha: My take is that technology is evolving very rapidly. Publishers should be open to work with new technology coming in. Like, Substack is a great platform where publishers are able to monetize their content. So there are a lot more innovation that is coming. So publishers should be thoughtful and be open to experimenting with these technology players because these new platforms are coming in. And with the creator economy coming in, I’m also very hopeful of how publishers becoming much more important than what they used to be before.
Salz:We started off by talking about the situation particularly in the U.S. where local news, local newsrooms, they are declining, there’s no question. What would be some advice to those that are there to say, “Here’s what you can do to up your game. Here’s what you can do to be sustainable and successful?”
Pasha: I think for small-level publishers, I think what is working for us is being hyperlocal and having a plan. And for us, it’s about figuring out that playbook of how you can get or make the things work at a location. So I think for publishers, especially individual publishers, I think hyperlocal play is going to work, with them also having…who are open to work with, new technology players, which essentially are tools and not platforms possibly.
So Substack is a tool for you to distribute your content. It’s a tool, right? And essentially, for payments, you can use a tool. So someone who is more open to work with these technology platforms and having hyperlocal focus would be able to build sustainable businesses. That is what our belief is. And I can’t compare clearly India to U.S., but in India, specifically, because of how the market is, the maturity of the user towards internet interest, it’s going to be very, very large play in India, especially the focus of hyperlocal.
Salz: So very, very much about being a platform, which is what you’re doing connecting people, connecting businesses, that’s what local content can do really well. The monetization model currently is about classifieds. What’s it going to be going forward as you try to be more and more a super app?
Pasha: So, yeah, Peggy, we are today connecting people, and monetizing on that for the sake of making money, for the sake of selling property, for the sake of improving…giving deals to people, small businesses advertising about their offerings. As the trust increases among these people, we would eventually go into a place where we will enable commerce as well. So that is what the plan is.
We will enable commerce. We will enable these local economies much more digitally. And we are a user-focused company, Peggy. So we have a creator who creates content, and we always think about how we can empower him or her, how can we make their lives easy. Similarly, we have businesses and how can we better help them to get more business. In that, the natural next step is to enable commerce on the platform to have additional revenue streams for them. So we will figure out how we will monetize. But we want to build that use case on our platform. It can be search, it can be something else, we’ll figure out. It’s too early right now. Probably in a year or two, I can tell you a lot more about it.
Salz: Great, Jani. And I think I’ll be back to hear it as well. Thanks so much for sharing your story at Lokal with me today.
Pasha: Thank you, Peggy. And nice talking to you too.
Salz:And thank you, of course, for tuning in and taking the time. More in this series about how media companies like Lokal are taking charge of change in their business. And in the meantime, be sure to check out digitalcontentnext.org for great content, including a companion post to this interview, and join the conversation on Twitter @DCNorg. Until next time for Digital Content Next, I’m Peggy Anne Salz.
As digital publishers diversify revenue strategies and develop ecommerce businesses, it is important to understand the consumer purchase process. For many publishers, ecommerce is more than just affiliate links, branded content, and online stores. Publishers are exploring investments in online shops, unique product offerings, wellness programs, virtual learning, and events. With new ecommerce businesses and multiple digital touchpoints consumers, expect an efficient and personalized shopping experience.
BlueVenn, a provider of tools and analytics for marketers, explores consumer purchase behaviors and engagement in a new report, Digital Divide. They partnered with OnePoll to survey 4,000 consumers and 500 marketers in U.S. and U.K.
Key findings include:
Over half (55%) of all respondents in the U.S. report that having a personalized shopping experience with a brand is important to them. Interestingly, only 27% report that brands provide a similar and cohesive shopping experience across all channels.
While marketers report that their businesses collect a lot of consumer data, only four in 10 report using the information. Clearly, it’s important to analyze the data and incorporate the findings to improve the consumer experience.
Fifty-seven percent of U.S. consumer report that they prefer to share their data directly with a brand they trust. This offers a unique opportunity for publishers to grow their ecommerce businesses since they already have a direct and trusted relationship with consumers.
Mobile ecommerce is the new norm in the U.S. Six in 10 U.S. respondents (61%) agree (32% “strongly agree” and 29% “somewhat agree”) that they’ve increased the amount of time they shop on mobile compared to last year.
The top two digital channels that U.S. consumers use to interact with brands include email (61%) and desktop/laptop web browser (51%). Interestingly, Facebook placed fifth (39%).
Close to two-thirds (63% “very important/somewhat important”) of U.S. respondents report that they think it is important for a brand to create a personalized shopping experience.In fact, 58% of U.S. consumers report that they are likely (23% “very likely” and 35% “somewhat likely”) to stop buying a product/service online due to the lack of a personalized experience.
Less than half (43%) of U.S. respondents report that brands understand their shopping need.
Browsing and browsers
When shopping for specific goods and services, U.S. consumers prefer overwhelmingly their desktop/laptop browser. Ranking and ratings:
Clothing, homeware, and exercise equipment – desktop/laptop browser (#1, 48%)
Holiday or leisure – desktop/laptop browser (#1, 54%)
TV, movies, or entertainment – desktop/laptop browser (#1, 38%)
Diversifying product offerings and revenue streams is helping publishers deepen their audience relationship. As publishers continue to build their direct-to-consumer ecommerce portfolios, it’s important to monitor the consumer’s digital shopping experience. Understanding the process of multiple touchpoints and shifts in online shopping behavior provides insight into consumer needs and expectations. There is a growing opportunity for publishers to play an important role in offering consumers a cohesive digital shopping experience.
Successful D2C brands have a strategy for each and every customer touchpoint. This new crop of startups have made this specific way of marketing and selling into a model all its own. They have a renewed focus on understanding what customers want, expect, and need every step of the way. This includes everything from research to purchase and returns along with everything before, after, and in-between.
This approach borrows much from what is perhaps the oldest “direct to consumer” industry in existence: publishing. Publishing has always been the purest form of providing what the consumer wants, whether news or entertainment, in text or audio or visual form. Publishers have to be direct with consumers. Their value proposition is clear: This is what we offer, and here it is for your consumption. And today’s most successful D2Cs mirror this process in their sourcing (and marketing).
Traditional publishers recognize the power of subscription models and advertising on editorial content, but many of the new class of publishers have gone above and beyond. To name just a few: Food52 transitioned successfully from recipe blog to culinary business, leveraging their recipe site, and engaged its community to create a thriving home kitchen, cooking and specialty food business. Buzzfeed’s Tasty pivoted (or pivoted their pivot) into Pet by Tasty. They harnessed the undeniable combination of the internet and animal content. And they use it to power a natural pet food business. And of course, in 2014, Emily Weiss metamorphosed digital beauty destination Into the Gloss into the multi-billion dollar juggernaut Glossier. This new class of publishers understands — and monetizes — the power of brand equity, loyalty, and community.
Lean into your D2c roots
Even the more “traditional” publishers are well positioned to do the same. They’ve already accomplished the hard parts, like building a community, establishing trust, providing consistent value, and earning brand equity and cachet. Now more than ever, publishers are sitting on an unmined vein of pure gold. And with today’s level of technology, the next step for publishers is much more achievable than, say, sourcing a sustainable make-up factory or producing industrial quantities of pet chow.
Publishers now have the tools and expertise readily available to marry editorial with branded content thoughtfully and intentionally. They can respectfully leverage the enthusiasm and engagement of their communities and the eminence of their brands to create novel revenue streams. We can say farewell to the numbers game, where more clicks and eyeballs meant everything. It is being (rightfully) subsumed as a jaded consumer population demands quality, relevance, and a bit of respect in how they are advertised to. Publishers have already done the hard part as the original D2Cs.
Here’s a few more lessons that they can re-borrow from today’s most successful D2C companies.
Let your content lead your commerce
D2Cs quickly developed a new mastery of advertising everywhere their consumers already were, in podcasts or specific niches of social media. Even then, these brands did their best to match the theme, tone, and even appearance of their surroundings. In no way can an ad or branded content take a reader/viewer out of the experience. Your brand has worked so hard to give the consumer a consistent “universe” of experience. Don’t let bad advertising take them out of it and ruin all the established good will.
Luggage D2C Away doesn’t sell suitcases. They give consumers the ability to live the jet setting lifestyle they’ve always wanted. Casper doesn’t sell mattresses. They imagine a world where everyone is well-rested and sleep is a pillar of personal fitness. Today, the bigger picture is the bigger seller, especially when everyone knows they can get an objectively similar product from a dozen places instantly. With everything so commoditized, consumers want to be a part of something bigger. Chances are that consumers already associate your brand with a lifestyle, feeling, or movement. Identify it and become a proactive champion.
Taking back the lead
Publishers are the “OGs” of D2C. Publishers boast the power of brand equity, loyalty, and community. So, they are uniquely positioned to capitalize on the opportunities that D2C brands have to work so hard to achieve. All publishers have to do is to continue to focus on their consumers and take back the lead in crafting, monetizing and commercializing the products their consumers want, expect, and need – a trusted brand with content.
A fundamental shift has occurred in the past year: Publishers experienced a fortuitous combination of increased audience size and engagement. Many publishers are considering how to balance subscription marketing with ad monetization in order to take advantage of new readers and higher engagement.
In a recent survey, 53% of publishers experienced an increase in engagement with their email newsletters during the Covid pandemic. Email is taking on a new role in nurturing these relationships and maximizing their value. Much like retailers, publishers can leverage email as a path to conversion.
Rethink the “customer” experience
Executives are rethinking many parts of their business in light of the pandemic’s silver lining of higher engagement. And with third party cookies under imminent threat, publishers have both a challenge and opportunity with how to collect insights about visitors to deliver value for advertisers and drive business operations effectively.
One way that publishers can take better advantage of their new engagement opportunity is to collect more data. They have an opportunity to more effectively test and integrate new revenue opportunities by approaching their digital business the way a retailer approaches ecommerce. Many publishers have discussed adding commerce opportunities to their models, such as The New York Times’ addition of Wirecutter to their portfolio. However, for many publishers, the concept needs some direction.
Often, the best work across publisher initiatives is done by connecting experiences between the website, search, and social media. Unfortunately, email remains a relatively static, separated channel. Retailers would be shocked to know that publisher email is frequently bifurcated between content-based newsletters and transaction-based messages about subscriptions with little coordination between them. Email is a hidden opportunity that will help with many 2021 publisher goals.
There are many strategic and tactical improvements that publishers can make to better orchestrate channels to achieve their goals. And these improvements have already proven successful in ecommerce. The multichannel retail experience includes data collection and segmentation, intricate channel orchestration, a dedication to measurement and analytics, and sophisticated testing and personalization with email and SMS. These channels must work together seamlessly to serve to engage, connect, and communicate.
Mapping the “customer” journey
A loyal reader has a particular series of actions that they will, pretty predictably, take. They might visit the site every morning. Or perhaps they open their mobile app every evening as they hang out on the couch. A search-driven reader might have another set of behaviors. They might averaging 30 seconds on the page, with a possible second article before abandoning the site.
These various user profiles are essentially different “customer segments.” Each of these offer their own set of value opportunities and paths to conversion. Many publishers have already created segmented strategies and content personalization. However, multichannel revenue-driven marketing, including email, usually takes a back seat. This reduces the ability to re-engage, offer deeper personalization, and drive conversion.
Retail tactics to learn from
Publishers have more in common with the ecommerce experience than they may realize. In fact, several established ecommerce best practices can be repurposed for publishers:
Browse abandon
Retailers will often trigger a personalized email when someone abandons a product search. Publishers can do the same, tracking everything from scroll depth to which search terms drove them to the site. By testing segmented triggers to bring different readers back to the story, or to similar or different stories, publishers come across as more relevant and more interesting.
Cart abandon
Similarly, retailers will trigger a personalized message via email or SMS to remind people of what’s in their cart. Publishers can do the same with event and subscription signups, or with articles saved for later reading.
Interest-based triggers
Every time a consumer reviews a product, or clicks on a link, that information is gathered to improve personalization and triggered messaging in the future. This information, be it driven by content behavior or more transactional behavior, should be collected by publishers to build richer user profiles and to inform segmentation and marketing actions. This data is also hugely valuable for editors seeking to better understand reader interests.
Live content
Retailers used live content during Black Friday/Cyber Monday to drive interest in sales, manage inventory. Streaming content showing employees explaining products, and influencers discussing health tips, drove engagement and sales. Publishers can imagine incorporating everything from breaking news and live entertainment to real time interviews and podcasts.
Channel optimization
Email is only one element of a multichannel communication strategy. It’s best to test within and across channels to understand how to get people to stay engaged based on their preferences and habits. For example, testing the success of driving engaged readers on mobile web to download the app, or transitioning engaged mobile app readers to in-app messages and push instead of email, can help publishers meet readers where they are without any friction. SMS can take things one step further for brands that don’t have standalone apps but cover breaking news, the same way many D2C retailers alert shoppers about sales.
Bonus points
These five common triggers in a retail strategy also serve another purpose: to test messages and collect more data. Adding triggers along the customer journey doesn’t just provide opportunities to re-engage, they make businesses smarter. Combining insights and measurement across different parts of the business can help speed up learning. Personalizing different elements of the customer journey can help speed up conversion.
Content is the product that many publishers focus on, but it’s the readers (aka customers) that will deliver insight and revenue. By turning focus toward the transactional touchpoints along the reader journey, publishers will find more chances to increase their insights and improve their performance. Retailers may have more measurable ROI. However, what retailers have spent years learning through testing can now serve as a reliable blueprint for publishers.
About the author
Allison Mezzafonte has worked in the media and publishing industry for 20 years and is currently a growth consultant, as well as a Media Advisor to Sailthru. A former publishing executive for Bauer Media, Dotdash, and Hearst Digital, Allison serves as a strategic partner to media clients.
Ecommerce has been a strategic priority for publishers for a number of years. Then, in just the space of a few months, Covid-19 accelerated the shift to digital shopping by five years. It’s no surprise that the competition in online shopping is heating up as a result.
Trust is a crucial component in ecommerce success. With many online shopping sites providing overwhelming choice and increasing issues with fake or incentivized reviews, consumers are turning to recommendation and comparison sites in order to help narrow down and evaluate purchase decisions.
Publishers have benefited greatly from this. Their established audiences and high levels of trust have allowed them to build their own authority in product recommendations and gift guides, with many generating significant revenue from affiliate schemes and referrals.
However, as competition in the space increases, some publishers are looking to certification and branded seals as a way of cementing that trusted relationship between them, their audience, and the products they recommend.
SELF launches seals after commerce surge
Conde Nast’s SELF magazine is the latest publisher to expand its commerce efforts by launching two new award seals. The title has seen ecommerce content traffic in October up 949.3% year-over-year, and the time spent with ecommerce content up 1,130.5% for new shopping.
In response to increased demand for its product recommendations, the health and beauty magazine has launched two seals. The SELF Certified seal is awarded after a thorough product analysis and review. And a product must score at least 7 out of 10 in order to be eligible for it.
The second seal, SELF Fave, is for wellness products that the editors themselves personally use and recommend. These are “the ones we keep coming back to, again and again, and enthusiastically rave about to anyone who will listen,” they explained.
SELF has been creating ecommerce content for several years now. Their decision to launch the seals was as an extension of a strategy that they describe as “thriving”. “SELF editors know the wellness market better than anyone, and our audience trusts our recommendations,” SELF magazine’s Editor in Chief Carolyn Kylstra said. “Now, they know that products and services that get a SELF seal are the best of the best.”
Building additional trust
Having audience trust is particularly important in the health and wellness space, where new products are often launched with big promises, scientific-sounding tems, and celebrity endorsements. While some do what they say, others can be really misleading. Others can be more harmful than helpful.
“People want to know that they’re buying the very best wellness products out there, and that the products are going to be genuinely helpful, rather than a lot of empty promises,” Kylstra explained. “The SELF Certified and SELF Face seals can give them more peace of mind in that regard.”
SELF’s editors play an important role in building trust alongside the new seals. As journalists, they are skilled in interviewing experts, seeking out relevant research and cutting through marketing speak in order to properly assess products. But there have also been improvements to the assessment process to support the editors.
A transparent process
In order to launch a certification scheme, publishers must first have a set of standards for products, either in reviews they publish themselves or in recommendations given by experts. At SELF, they revamped their review process to introduce added rigour.
“First, before considering a product for a SELF Certified seal, we turn to research and experts to set expectations and figure out exactly how to test the product, and what criteria we should be judging it against,” outlined Kylstra. “We publish that criteria publicly as a buying guide. So, there’s transparency with the process.”
This research and pre-testing phase means that the editor or writer carrying out the actual process will be on the lookout for specific things, rather than testing against generic catch-all standards. The SELF team have taken care in communicating these standards and what they mean to their readers, with the rating system available at the top of each review.
Product categories on SELF have their own buying guides published publicly as well. These feature expert-suggested criteria that not only helps the editorial team evaluate products, but also helps readers make their own decisions.
“Transparency is key to trust,” Kylstra emphasised. “We want to make it as clear as possible why a product gets the seal, how we tested it, and why it scored what it did. This transparency will help readers feel more confident that the product is truly as good as we say it is.”
Cementing expertise
Conde Nast is not the only publisher looking to boost their ecommerce credibility through certification and seals. Hearst UK unveiled a state-of-the-art product testing and accreditation facility in London over the summer in order to expand its famous Good Housekeeping Institute seal of approval across a wider range of titles.
“We know more than ever that what our readers are after is impartial, trusted information,” CFO Claire Blunt said at the launch. “All our readers are smart, savvy shoppers, and they want to know how best to spend their money. So our testing functionality is also about providing them with impartial, trusted insight.”
There is also an additional commercial benefit to publishers with certification. When a seal has been awarded to a product, brands can then pay to license the use of the logo in their own marketing campaigns.
As publishers compete to stand out in ecommerce, it is likely we’ll see more brands launch seals and certification as a way of gaining additional trust. But it is important to do this alongside a rigorous testing process, and to communicate clearly with readers about how products are evaluated in order to build trust in the long term.
Traditionally, many media companies earned the bulk of their revenue from display advertising. But as the pandemic continues, media companies face an increased need to explore more innovative models of monetizing their content. Here are several ways media businesses can generate new revenue streams:
1. Data
Data is the future of driving revenue. Consider what Conde Nast is doing with first-party data, with its Now|New|Next Segments. These explore what consumers are buying now, how the behaviors might change, and who will spend next. Increased audience engagement is driving the ability to discover new customer segments, opening the door for advertisers whose doors are closed during the pandemic.
Advertising spend decreased during the early months of Covid-19, but now media companies are starting to look at data offerings to entice advertisers. GDPR and additional privacy laws have dictate that this monetization strategy must emphasize a cookie-less future.
2. Monetizing Talent
Reputation and brand are important in the media industry. Quality journalism keeps people coming back — and talent is a big part of that. Media has begun to recognize the value of monetizing the individual. For example, Spotify gained exclusive rights to Joe Rogan and Michelle Obama podcasts, and The Athletic gathered a cult of the best sportswriters. Quake, a subscription-based podcast founded by media veterans, just launched in October 2020 with $2.5M in seed money. Its exclusive shows are headed by top talent in politics and media, like Laura Ingraham, Soledad O’Brien, Mike Huckabee, Andrew Gillum, Marc Lamont Hill, and Buck Sexton.
If media companies don’t start monetizing talent, the best journalists will begin creating their own micro-brands instead. This will further crowd the competitive space and the talent is likely to take their dedicated followers with them.
3. Ecommerce/Affiliate Marketing
Ecommerce in news media is poised for explosive growth. According to Digiday, 85% of CPG marketers are planning to buy more ads from retail media networks. Many media companies are forming partnerships with retail brands, as retailers are piggybacking on the reputation of established media brands, and vice versa. This could be especially lucrative during the holiday season.
Some ways to explore the Ecommerce opportunity include:
Creating newsletters with embedded content to promote either brand advertising or direct-response advertising.
Allowing partners to pay for news real estate by writing their own opinion pieces.
Opening an online shop, like BuzzFeed.
Offering affiliate links for products mentioned.
Opening a pop-up boutique and e-commerce shop for the holidays.
Promoting events with merchandise (for its livestream with Billie Eilish, Spotify is promoting with an exclusive t-shirt).
4. Paywalls
More media companies are putting digital subscription strategies ahead of other initiatives, and the numbers show that’s paying off. The New York Times has reported an increase in subscribers of 2 million year over year, and their digital subscription model is now finally more profitable than their print model.
And the latest report from the Digital Publishers Revenue Index, shows an overall increase in revenue from subscriptions over the past decade. 10 years ago, subscriptions made up only 7% of digital revenue, and now the data show that has increased to 22% of total revenue. Many publishers have begun to explore paywalls — from soft, hard, metered, and dynamic models. If you’ve not yet done so, now’s the time.
5. Communities and Membership Models
With the cancellation of in-person events and social gatherings, there has been a huge decrease in networking opportunities. Companies like Fortune are successfully solving two problems with one (big) concept. Problem 1: What’s a way to monetize virtual events to decrease revenue loss? Problem 2: What is a new way to bring in revenue and create a loyal customer base?
Traditionally, Fortune’s live events were designed for a finite number of people; there could only be 50 people at the Top 50 CEO’s retreat, for example. But Fortune realized an opportunity to grow its community to include previously untapped leaders and create a broader community by launching Fortune Connect in the fall of 2020. This online learning platform and community provides ongoing networking events and educational content to aspirational mid-tier leaders. Fortune is using a membership model to build, and grow, a sticky community.
6. Over The Top (OTT)
A growing list of brands are expanding into broadcast and streaming TV to grow their brand, engage their audience where they go, and bring in a new revenue stream. TIME & Univision won an Emmy. Vox has a top-ranked Netflix show. Axios is on HBO. Vice, New York Times and BuzzFeed have turned to streaming content. Beyond their well-known “Explained,” Vox has branched out further into unbranded production shows.
OTT is no longer an opportunity limited to legacy video or television brands. Media companies of all sorts are finding creative ways to monetize their video investments because it engages a new audience and establishes a new habit for the consumer to connect to the brand.
7. Education
Media companies are providing a growing number of learning/education courses for readers. For example, TIME has expanded its iconic TIME100 people with TIME Talks. The Wall Street Journal launched a mobile app to help provide resources on managing finances during the pandemic. Morning Brew has been putting together 101 courses on topics like Marketing, Finance, and Branding. And Axios is starting 101 video courses on topics like 5G, which are sponsored by companies related to the topic.
Publishers are seeing an opportunity to develop deep subject matter expertise and be the go-to source on certain topics in addition to news stories. It improves the value they can provide to subscribers and pulls in more targeted advertisers since they can reach a highly engaged niche audience on long-shelf life content that can continuously draw an audience.
8. Evergreen
Most hard-news outlets saw a drastic hit to their advertising revenue this year. Even an increase in subscription revenue failed to offset the advertising losses. But evergreen sites like Dotdash — which owns sites like SimplyRecipes and TreeHugger — have seen an 18% increase in revenue. While Dotdash does rely on an ad revenue model, they use ads about ⅔ less than a traditional news outlet and bet on fast page load and better UX for their growth.
What makes it particularly effective is their diversification of brands and content. Their travel brand ads, for example, have decreased while their health verticals have exploded. Having evergreen content allows them more flexibility in what content to create and how valuable each piece is to them since it doesn’t have a shelf life.
As news media becomes increasingly competitive, companies must find innovative new methods of generating revenue that also help attract and retain new customers. By exploring a wide range of approaches, with a focus on your core competencies and customer needs, news publishers are able to stay competitive and build healthier diversification of revenue sources.
For quality publishers with strong consumer relationships, a content-to-commerce strategy offers a valuable revenue diversification approach. The International News Media Association’s (INMA) new report, Content-to-Commerce Brings Revenue in Post-Advertising World, outlines key considerations, strategies and their implementations to help publishers build this line of revenue.
While ecommerce may sound straightforward, successful implementation is not easy. First, a publisher’s brand must have a purpose, a reason to exist for the consumer. It needs to be authentic, possess an emotional quality, and present a personality. If a publisher meets this high bar, then it can begin the work of developing a commerce strategy because its content connection to a purchasable product will be valuable to consumers.
The major models
The INMA report identifies three basic content-to-commerce models:
Affiliate models, which send customers to an outside product link, earning the publishers a percentage of the purchase revenue.
Attribution marketing, which tracks touchpoints from consumer to purchase, assigning a value to the touchpoints in the journey. If the publisher, is an effect touchpoint, they receive a percentage of revenue.
Direct ecommerce, which offers company-owned products to consumers allowing for both higher revenue and higher conversions.
An integrated platform
Sweden’s Aftonbladet, a Schibsted-owned company and the largest news platform in the Nordic countries, partners with ecommerce platform Tipser. To sell products, Aftonbladet pairs its content with integrated ecommerce platform. They most often place embedded ecommerce in their features departments such as food and health. Aftonbladet made an important decision at the start not to integrate ecommerce in hard news content.
Aftonbladet recommends that publishers be completely transparent. For example, they need to communicate if they include embedded ecommerce elements in their content. An embedded ecommerce model should help build reader loyalty, not weaken it.
The content connection
Aftonbladet also creates content around ecommerce related products. If consumers search for a product of interest, it can lead to Aftonbladet’s library of content. It’s a great way to bring consumers to Aftonbladet content, connect them to products and increase overall traffic to the site.
The New York Times uses an ecommerce model with Wirecutter, which it acquired in 2016. Wirecutter is designed to help readers’ by offering them recommendations for retail purchases across multiple categories. The brand does a lot of the work for the consumer by providing product details, comparisons, and recommendations. Wirecutter Guides talk to category experts. They do the research, test the products, and find the best option in any category, then offer an unbiased recommendation.
Wirecutter maintains a reader-first mission, with a secondary focus on ecommerce. It also offers exclusive deals through their merchants and retailers. Wirecutter made an important editorial decision early on that product reviews cannot be influenced by a retail partnership. The core focus is to recommend the right product for the right consumer.
Question your approach
The INMA report identifies four key questions for publishers to address when identifying the right ecommerce model.
What do your readers need that you can provide that benefits them?
What’s the shortest journey to get it to them?
How can you make money from doing that?
How does your content lead the way?
As ever, a publisher’s primary goal must be to provide content that serves an audience. Then, they can build out an effective strategy to monetize their content and audience relationship throughout the customer’s ecommerce journey.
The holiday shopping season was once a time of packed stores and crowded gallerias. These days, people are much more likely to stay home and do their shopping from the comfort of their couches. In particular, IAS found that this year, nearly all holiday shopping will be online, specifically on ecommerce and retail sites. So, while audiences watch nostalgic holiday movies, they’ll also be on their phones researching gifts to purchase for their loved ones.
Unfortunately, consumers aren’t the only ones online — fraudsters also have their sights set on holiday traffic. Invalid traffic (IVT), which includes malicious fraud as well as general non-human activity, has the potential to steal valuable impressions. Since it looks like Cyber Monday will become Cyber Season, publishers should optimize their inventory to both support marketers and thwart fraudsters.
Unwrapping holiday ad fraud
Shopping online offers a convenience that brick and mortar stores lack: information. In their search for the perfect gift, IAS found that consumers turn to search engines, review sites, and online advertisements. Consumers look to advertisements for guidance, and are most interested in ads they see on well-known and respected sites. IAS research shows that retail sites are especially prone to fraud, witnessing spikes around popular shopping dates like Cyber Monday.
At the same time, holiday season campaigns tend to be short and sweet, only meant to appear in consumers’ feeds for a few months. Longer campaigns give advertisers more time to review and optimize campaign performance. However, during this time, advertisers rely on premium inventory to achieve the ambitious KPIs associated with holiday campaigns. This puts additional pressure on digital publishers to optimize their inventory to minimize risk and maximize performance.
Putting fraudsters on the naughty list
A recent survey of U.S. consumers found that 51% of respondents plan to start their holiday shopping earlier this year. To mitigate fraudulent activity, publishers should also prepare early by optimizing their inventory. Bots can be given instructions to visit premium sites, pick up desirable cookies, and then visit fraudulent sites to monetize. In order to protect the value of their inventory, here are some key reminders for publishers looking to prepare for the holiday season.
Make a list and check it twice
✓ Figure out where site traffic originates
The first step in identifying fraud is recognizing where traffic originates. For example, traffic that is sourced from a supplier has a higher possibility of attracting fraudulent bot traffic. Suitable ad environments are powerful, and transparency helps to build a strong relationship between publisher and advertiser.
✓ Confirm how visitors are attracted
If traffic is sourced, there is a higher possibility of fraudulent bot activity. If most traffic comes from data centers, rather than residential or corporate networks, publishers should confirm that there are no software tools being run in those data centers that hit their website. Running tools that drive traffic may result in invalid traffic per industry group standards.
✓ Not all invalid traffic is malicious
Some cybersecurity, testing, and analytics solutions employ methods that can trigger fraud detection models from ad verification vendors. For example, some bots are designed to crawl the internet and gather information or generate simulations. Publishers should work with their ad verification vendors to further analyze their inventory and consider adding known data center IPs to an exclusion list.
Happy holidays
In order to protect the value of their inventory, the publisher needs to analyze traffic patterns and optimize their content appropriately.
In conclusion, the web is rife with invalid traffic. Some traffic — consumers, crawlers, etc — is such a helpful gift to marketers that it should with a bow. However, there’s a great deal of malicious invalid traffic, the lumps of coal in the industry’s stockings. Such activity on publisher pages can threaten the trusted relationship you’ve built with your advertising partners and cost you real dollars.
The holiday shopping season is right around the corner, and safe inventory is the best gift to give to your partners. If you’ve detected invalid traffic on your site, then it’s likely that your advertiser partners have too. No need to ring the alarm just yet though. Being proactive and well-informed can go a long way toward ensuring that you and your advertisers present a unified front against fraud.
