CRM over CPM – A key strategic imperative for media owners.

From the NAB to the Edinburgh Television Festival to the RAB to just about any media-related conference over the past year, there’s been talk about the end of the traditional commercial media model, unless media owners radically change their approach to attracting audience and generating revenue. Yet now more than ever, media companies need to return to their core principles and that means striving to deliver prospects to advertisers. (For some, this in itself is a fairly radical move.)

Unusual peaks and troughs in ad revenue have always happened (the current recession-related drop only accentuated by the decline in dot-com related revenue). The key underlying trend at the moment, and the reason why many broadcasters/publishers are feeling threatened, is that advertisers are now demanding higher quality prospects.

And by “higher quality” I don’t mean wealthier, upmarket prospects. I mean prospects that are going to be more likely to transact with the advertised brand. Simply put, the only way media companies can improve the quality of prospects they deliver is by:
- knowing more about them
- reaching them at moments that are more conducive to transaction

The first of these is driven by adhering to the principles of CRM. [As discussed briefly below, but outlined in more detail in Friedlein’s excellent "CRM meets eCRM: An Executive Briefing" which can be found in the "Publications" section of e-consultancy.com.]

It’s another reason why the old CPM needs to be taken out back and put down. Is there anything more banal and short sighted than selling your prospects (your only truly valuable asset!) as an index? Why spend all the money on marketing, content, and distribution if, at the final stage of the process (i.e. the sale of the prospect) you reduce it to a simple sale of demographic quantities?

It is naïve to expect brand managers and media buyers to drop the notion of the CPM overnight, but media companies should surely be combating its influence. And the best way to initiate this combat is by building data about your prospects. Digital channels are ideal for this, and herein lies the key rationale for “traditional” media owners spending a cent on “non-traditional” channels. Forget about content portals, subscription models and dreams of a mass-market Internet “audience”. Media companies should focus their digital assets on the improvement of their prospects and consequent contributions to established revenue streams.

Would be interested to hear any comments on the above - or feel free to contact me directly: