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There has been a lot of talk about publishing business models related to paid content. We understand this space pretty well, given that Econsultancy has been operating a ‘freemium’ model successfully for over 10 years now.
But rather than talk about our business model, I wanted to give five tips from my own experience on what I believe is important, and what works, in order to be successful at selling content online.
1. Content *is* Marketing
My somewhat simplified view of how the ‘freemium’ model works is that you need freely accessible content, including applications, in order that Google can crawl that content, and that people will willingly link to it, so you have high search rankings which in turn drive traffic that you must then monetise.
Currently SEO is by far the most effective way to drive the highest volume of new customers to your site at the lowest cost. And though we have a 300+ page guide on how to do SEO, in the end it comes down to good content that the right people link to.
So don’t think of your free content as a cost. Think of it as a marketing investment. Measure its success through the links, traffic, and value it generates. Cut back your ‘traditional’ marketing budget and invest it in content and online PR.
[Note: if your content is an application, or piece of ‘technology’ - e.g. an iPhone app - then you could arguably make that a capex cost which can be amortised and sit below your EBIT line in the P&L. Behold, content and marketing aren’t even costs!]
2. Metrics: Outcomes not Inputs
We must assume that it will not be long before all online advertisers will have a complete and detailed view of users’ interactions with their advertising online. They won’t just know the “inputs” you have sold them, typically page views, but they will know the outcomes, such as clicks, leads, data, visits, sales, shifts in propensity or brand favourability, even referred total customer lifetime value. And they will know exactly how you compare in delivering value compared with your competition. They will know much more about the value you are really delivering than you, as the media owner, can.
This will put publishers and media owners at a negotiating disadvantage in the long term. But even in the short to midterm we need to get used to selling outcomes, not inputs. Frankly who cares how many page views you get? This is, in any case, meaningless as an engagement metric, a video metric, a metric in an age of Ajax. What matters, and what advertisers want, are outcomes, value. There will be nowhere to hide.
But the good news is that if you, the media owner, start measuring and delivering, and selling against, outcomes sooner rather than later you can command much higher premiums and have the negotiating advantage for a while yet. And, if you get used to optimising your site against end goals and outcomes, rather than inputs like mere ‘traffic’, you’ll evolve a much more effective site.
[Note: I’ve written at much greater length about this in my article New metrics and business models for digital publishing - selling outcomes not inputs]
3. Value your Techies
Really, the commercial side of publishing, the events, the editorial, the marketing... they’re not rocket science. There are plenty of good people you can hire to do this stuff, especially now.
However, outstanding web techies are the rocking horse shit of online publishing. And by good I mean not just technically brilliant but commercially astute, focused on user experience, and with a grasp of marketing. Think Jeff Bezos, Larry and Sergey...
Too many publishers undervalue their web techies. I don’t believe online publishing platforms are an 'off the shelf', 'plug and play' commodity. Despite advances in the platforms out there you’ll always need to customise them. I haven’t yet come across a platform that truly does content management, eCRM, e-commerce, email, analytics and subscription management really well. But feel free to comment below if you think you've got it cracked...
Great web techies will give you agility, a competitive advantage and an IP asset that is really important. Interestingly also, the best editorial people I’ve been able to recruit have been open to leaving their previous roles because of their frustrations with the tech infrastructure where they were. Great web content folk are massively attracted by great web techie folk.
So fire your overpriced Publishing, Editorial or Marketing Director and get a great CTO / Head of Web Development instead.
4. Identity Hijacking
What do people value most? Certainly in the world of B2B, people are pretty concerned with their reputation, whether their personal reputation or that of their company. And understandably so. Their personal or corporate credibility and reputation correlate directly with earning potential.
And how do you check up on a person or a company these days? Yes, you Google their name, or company name. And they Google their own names, of course. Prospective clients do it. HR folk do it. The procurement team does it. We all do it.
The genius of something liked LinkedIn, knowingly or not, is to ‘own’ an individual’s name, via search, online and therefore be the window to their personal reputation. And now they’re doing the same for companies.
Think how much more powerful it might be to wrap content around individuals and companies rather than the other way round. Try very hard to hijack identities online, because if you can, you’re sitting on something very, very valuable. Think directories, think tagging by names. Econsultancy has a Member Directory and Supplier Directory for precisely these reasons. And it draws people and companies in like a magnet...
5. Think like a Retailer
Many years ago, doing some consulting work for one of the commercial broadcasters, I remember asking who the broadcaster considered to be their customers. Their answer: their advertisers. I wonder if Google would answer the same? Given their user-centricity, I suspect not. Listen to the likes of Sir Terry Leahy, of Tesco, and you feel near mania levels of customer focus. Indeed their Clubcard, the resulting data of which yields super-granular levels of individual customer insight, has been trumpeted as one of the main drivers of Tesco’s continued market dominance.
I don’t believe most publishers really care about their readers, viewers, users as *individuals*, as real people. They are ‘traffic’, ‘demographics’, ‘users’... blobs of numbers to be traded. Most publishers are not truly customer-centric; at least not for the customers that matter most (clue: not the advertisers).
We must think and act like retailers. After all, we’re trying to sell and retailers are good at that. If we’re going to successfully sell content we should be speaking retail speak: RFM (recency, frequency, monetary), customer clusters and value segments, conversion rate optimisation, average order value, basket mix, churn, satisfaction, product range, merchandising, bundling, promotions, cost per acquisition by medium, cross and up selling...
Let’s face it, if we’re selling digital content, at least we don’t have to worry about logistics, stock control, inventory, warehousing, delivery, fulfilment, nor, really, returns or fraud. Frankly we have it easy. We have a lot to learn from (r)etailers about the science and art of selling online.