Media Ascending

March 24, 2011 § Leave a comment

We were discussing Content Ascending in this space a few weeks ago. How about Media Ascending? This was essentially the point of David Carr’s column in the New York Times describing the evolving mission of Google from Technology Company to Media Company. “In essence,” he wrote, “Google, which cracked the code on the Web advertising model, has come to realize that if content becomes just a commodity, then advertising will follow suit.”

Indeed, the stakes are very high for advertisers in this regard, where the separation between soap-the-brand and soap-the-commodity is wafer thin. Content and creativity are the only things keeping the affects of advertising from being overwhelmed by price and promotion. Commoditize content and the burden upon creative to make the case for brands will exceed advertising’s ability to create compelling messages. It is just too hard to produce great creative - which is why so much advertising depends on the ability to intrude on consumers with the volume up.

…But, as to Media Ascending:

The pattern was pointed out in an iMedia column long ago: every new media revolution starts with technical innovation, followed by rapid adoption, a dominant technology culture and then, finally, a media proposition grounded in content. Most recently, of course, it was television and radio. Once their respective boxes had been packed and shipped and switched on in the parlors of America, manufacturers saw the need for content to keep their enterprises growing. They built networks, as David Carr describes:

“RCA commercialized a spectacular invention called radio, but by the mid-1920s the company realized its new wonder needed great content, so it bought and merged several radio stations to form a media company called NBC. Later, RCA did the same trick with another catchy invention: television.”

Today, RCA’s legacy is NBC. And nobody – nobody – sits at home marveling at the fact that the picture on their tube is bouncing off a satellite over the equator. There is, instead, only, ever, one question on their minds: what’s on?

It is a media question.

Richard J. Tofel Foresees Better Media Days Ahead Without Search Engine Optimization

March 10, 2011 § Leave a comment

Peering through the lens of search engine optimization (SEO), over at the Nieman Journalism Lab, Richard J. Tofel looks into the future of the World Wide Web and reaches this conclusion, or so it seems: the media business model will reset around the value that binds a reader to content. Call that value loyalty and intent.

Tofel is tipped-off by two events. First is the widely discussed action that Google has taken to shore-up the quality of its search results against the tide of search engine manipulators, optimizers, content mills, etc., that has been building for years. Second, is the sale of The Huffington Post, a reputed master of SEO, to AOL for $315 million. In these things, Tofel sees the signs of backlash and correction. He writes:

“…SEO itself is an inefficiency, a transaction cost rather than a value-creator — it is a technique designed entirely to compensate for the failure of the search engine to correctly analyze site content, searcher desire, or both. Over time, economics teaches us, inefficiencies tend to be wrung out, and transaction costs reduced.”

And then, later, referring to the Huff Post/AOL deal:

“But if it is true that most entrepreneurs sell out near the top, and it is, then perhaps we have just been sent a signal by one of its masters that the dark arts of SEO have peaked and that the century’s second decade will see them fade, perhaps into near nothingness by the third decade. In other words, it seems increasingly likely that, when the history of this era is written, SEO will turn out to have been a transitional phenomenon.”

Transitional from what to what? If I may, the short answer is from big to small. But that’s not a complete answer. Richard Tofel would probably say transitional from an advertiser-centered media business to a reader-centered media business, with the difference being that readers will substantially subsidize the cost (if not the profits) of the media through their wallets, or their loyalty.

Tofel writes:

“…a focus on readers rather than advertisers as the heart of business model will, inevitably, create a more segmented dynamic, as the strongest appeals to readers tend to be in niches, and as, to venture an impolite reminder, some readers are a great deal more valuable than others. This is not only because some readers have more money to spend on content (as they do, admittedly, on the goods and services offered by advertisers), although that is true. But it is also, and ultimately more importantly true, that some readers are willing to spend more time, to develop greater loyalty to particular content, to value it more highly.”

As a media consumer I can say unreservedly that this is what the internet has meant to me from the beginning: the value of particular content. I can also say unreservedly that search engines have never been especially good at connecting me with that value. The process has always been awkward and imperfect and time consuming. It has always been inefficient, just as Tofel observes.

The search engine business model, however, and its exploitation by publishers, with both good and bad intentions, mimics our experience – what we have known – with traditional media. Long ago media started playing an audience game, which mostly continues today. Richard Tofel is describing the results of SEO, but he could be just as easily describing the results of media business behavior the past 30 years when he observes:

“SEO has been, more than anything, about growing pageviews and unique visitors — any pageviews, and any unique visitors, the more the merrier. It is a force, therefore, for lowest-common-denominator publishing. And after a decade of SEO, a lot of lowest common denominator is what we have.”

How about after three decades? The Real Housewives of New Jersey, anyone?

I suspect Tofel is rooting for a backlash against lowest common denominators. I’m with him. Advertisers, if they could be persuaded to stop chasing sticks around the yard, would do well to root for a backlash, too. A more “segmented dynamic” media world exists to give them what they need for their “segmented dynamic” brand world. It is not more audience. It is loyalty and intent.

Wailing and Gnashing of Teeth at the 4As Meeting in Austin, Texas. It’s All Good.

March 9, 2011 § Leave a comment

I am very sorry to be missing the wailing and gnashing of teeth that is reportedly going on at the 4As meeting in Austin, Texas right now. According to Ad Age, senior agency panelists lashed out – seemingly at each other, but probably just in frustration – at, well, just about everything:  complexity, communications, clients, compensation, change and even creative. Lots of “Cs”on the list, but maybe all because of one “B”, which would be “Big.”

Howard Draft, Executive Chairman of very big agency, Draft/fcb, was quoted by Ad Age saying:

“You can’t be great with 10,500 people on a regular basis…Size does matter on controlling the product you put out, if I’m looking to make money.”

Part of that may have to do with the fact that with 10,500 people an ad agency will struggle to bond with and nurture its talent. This was the point of a separate discussion, a presentation by Andrew Benett, Global CEO of another very big agency, Havas’ Arnold Worldwide. According to Ad Age, his “bleak” report on employee retention revealed that 30% of an ad agency’s employee population would turn over in 12 months, with nearly all agency employees (96%) indicating they felt confident about finding a another job thanks to an improving economy (and, we might surmise, because there are always so many job openings resulting from so much turnover).

If he were starting over today, Mr. Draft reportedly said, his ad agency would never have in excess of 50 people and it would charge clients $1 million a month. In which case, the incidence of great creative work issued by the agency on behalf of a client would presumably go up from the rather sad levels that Draft and fellow panelists, Claudia Batten, Peter McGuinness and Duff Stewart, estimated at less than 50%.

All of this echoes a story last fall, also in Ad Age, about the exodus of creative talent from ad agency land. Matthew Creamer wrote:

“Since the beginning of the year, a veritable Cannes jury worth of senior creative talent has shrugged off the leashes of big agency networks for their own start-ups or for creative pursuits outside the ad industry.

“Longtime agency watchers will say this kind of churn has always been part of agency life, but to dismiss the trend as part of some cycle is ignoring some key questions that agencies need to answer. After all, the pressure on these companies’ business model is intense. While the economic gloom might be lifting, for most it still lingers and, besides that, agencies are getting hit from all sides: Cost-cutting, conservative clients; procurement officers; more competition from small and midsize shops; newfangled concepts such as crowdsourcing agencies; and a business model still very reliant on the production of ads, not ideas.”

In reaction to Matthew Creamer’s piece, I told a short story in this space:

I can remember sitting around a pool in suburban Connecticut in the late 80s chatting with a fellow I’d known since I was a boy. I’d grown-up to work in advertising. He’d grown up to work in investment banking.

Dancer Fitzgerald Sample (DFS) had been sold recently to Saatchi & Saatchi, which came after a merger or two with other agencies, Backer and Spielvogel and Compton. Or something like that; I forget the order. I had worked at DFS, but moved on. My friend was explaining:

“You see,” he said, “The people at these companies – these ad agencies – that have built them through the 50s and 60s and 70s, they want to retire, and they own more stock in the companies than the companies can afford to pay them. They have to sell.” And the holding companies, of course, will have to keep buying.”

For me (I wrote at the time) that conversation by the pool all those years ago has satisfactorily explained everything about the ad agency business since, including now, because it made it inevitable that the cycle would re-boot and the green shoots of numerous new agencies would begin to appear when big got too big, as big always does.

So, cheer up Austin. Really, the wailing and gnashing are the birthing sounds of a new ad agency era – a smaller one.

Which is maybe why your conference is aptly titled “Transformation 2011.”

Ad Industry Self-Regulation: History Says, Better Than the Alternatives (or Your Money Back)

March 7, 2011 § Leave a comment

Rance Crain, President of Crain communications, and Editor-in-Chief of Advertising Age, offers a retrospective on advertising industry self-regulation going back to the good old, “Mad Men” days. We take it for granted today (or should be able to take it for granted) that product claims in advertising are credible and can survive scrutiny, but it was not always so. Reminisces Rance:

Colgate’s Rapid Shave, for example, demonstrated in TV commercials that its lather could shave through sandpaper: “To prove Rapid Shave’s super-moisturizing power, we put it right from the can onto this tough, dry sandpaper. It was apply … soak … and off in a stroke!”

Never mind that it took 80 minutes of soaking to penetrate the sandpaper or that the sandpaper wasn’t even sandpaper; it was really Plexiglas made to look like sandpaper.

Campbell’s Soup was called on the carpet for putting marbles in the soup bowl to better show off its ingredients in TV commercials. And Listerine was forced to run corrective advertising to admit that the mouthwash couldn’t cure colds or sore throats.

Advertising had to have its back to the wall, however, in order to make progress towards self-regulation. Rance Crain concludes by quoting Howard Bell, Chairman of the National Advertising  Review Board:

 “If there hadn’t of been a firestorm against the industry, ad people would have said we don’t need it, and some did anyway.”

The call for advertising self-regulation happened and it worked. The call is happening again, and it can work again.

Time (Magazine): Same as it Ever Was.

March 2, 2011 § Leave a comment

MediaBistro’s FishbowlNY points to an article in Fast Company by Steven Rosenbaum, the author of Curation Nation, who is seeing signs of the past in the curating, blogging, sharing media world of today. In this case, Rosenbaum makes note of the early days of Time Magazine, which began life as a news digest. He writes:

“Now, 90 years later–the magazines of Time Inc. are among the elite of publishing–the top of the content creation food chain. But that wasn’t how it all began. In fact, as Luce biographer Douglas Brinkly tells the story–there were sliced-up copies of The New York Times and piles of foreign magazines everywhere around the offices. Luce’s idea, and that of his business partner, Briton Hadden, was to condense all the news busy people needed to know into one weekly read. The magazine, Luce wrote, would ‘serve the illiterate upper classes, the busy business man, the tired debutant, to prepare them at least once a week for a table conversation.’ There was not a lot of brooding about other people’s intellectual property rights.”

The next paragraph of the story offers a more colorful description from Michael Kinsley taken from an article by him in the Atlantic:

 “Time was intended from the start to be what we now call ‘aggregation’ or (if we’re being hoity-toity) ‘curation.’ Although it later succumbed to bureaucratic bloat–an insane system of researchers feeding material to reporters that fed it to writers–at the beginning it was just a lot of smart-ass Yalies rewriting The New York Times. “

Happy? What’s old is new again. So much for all the angry, resentful talk from the content creators of today aimed at the content curators.

Except that as sure as history repeats itself, today’s curators all want to grow-up to be Time Magazine – or any similar vestige of the bureaucratically bloated media era. In fact, at the beginning new media had another word for it besides “bloated.” The word was, “portal.” It makes you feel bloated just to say it. Bureaucratic and portaled.

Same as it ever was. Count on it.

Advertising Industry Trade Groups Come Together to Make Brand Measurement a Priority Online

March 1, 2011 § Leave a comment

The IAB (Interactive Advertising Bureau), the ANA (Association of National Advertisers) and the 4As (American Association of Advertising Agencies) announced this week at the IAB’s Annual Meeting that they have joined forces to finally make sense of online brand measurement. It’s clear that the broader media and marketing community recognizes that if brand advertising can’t safely follow consumers online through successful planning, buying and measurement then the opportunity represented by new media, and the chance to connect with digital generations, now and in the future, will pass them by with whatever undeterminable affect on the future of the world’s major marketers.

Not that that was ever going to happen. Even in the darkest days of the early internet when the idea of one-to-one, risk free advertising was being spooned into the hookahs of the industry was the “end of branding” a plausible reality. Brands are people. People are brands. To posit the end of branding would be to posit the end of the consumer. Not likely. Not yet.

Ergo, the announcement by the chief marketing councils that brand measurement will be brought forth online, or else, is the signal that brands and branding are off the ropes, making it likely – and just write this down, you can check back on the claim later – that the internet will usher in a new era of marketing intuition and seat-of-the-pants decision-making. Measurement, after all, is the net under the performance, not the performance. If you follow my meaning.

Content Ascending

February 18, 2011 § Leave a comment

The few blog posts in this space over the past couple of weeks have been mostly concerned with the Huffington Post/Aol deal (here and here) and the debut of new subscription models for publishers courtesy of iPad and Google’s One Pass (here). There is a common thread to them and it is content.

At other times, posts have been made here spearing content mills, Aol’s included. Demand Media’s IPO in the last few weeks was, nevertheless, another story about content – whether quasi, or not.

Content, and its material importance to the online media business, seems to be ascending. That would be an important sign of progress after the years it has spent living under the roof of technology.

Along these lines Ad Age interviews Michael Wolf, who, with Anil Dash, started Activate, a digital consulting firm which sounds like it is helping media companies save their content from drowning in the torrent of new media technology. They quote Michael at the end, saying:

“Media companies do well when you have competition between platforms. We aren’t sure what platforms are going to work and what consumers will buy. We’ve gone from this free and open web where everything is available back to a point where things are closed. We are now back to a place that works very well for media, and that is scarcity. The idea that somehow a media company could be back in the position that they create scarcity and therefore create value it totally turns on its head the way things have been going until now. This is the moment of revaluing content.”

It is hard to say on the basis of a few paywall models that we’ve gone from open to closed. But it does appear this is the moment of revaluing content. In which case it should lead to alignment with other media platforms making it easier for advertisers to answer the question, “How do I use new media?”

The answer won’t surprise them. Use it the same way consumers use it: for content.

Twitter Shares a Few Secrets with Advertisers – and Explains Everything

February 17, 2011 § Leave a comment

Twitter has produced an instructional video for advertisers to help them chart its waters and, presumably, lead them to spend more money on the social network. The news and a link to the 40 minute video were shared by Peter Kafka in his MediaMemo at All Things Digital.

I won’t be watching the video. But Kafka reports that at the end Twitter producers warn advertisers they may be subject to negative feedback from users objecting to the commercialization. Don’t panic, they reportedly say: this segment of the population is “an extremely marginal percentage of the total.”

Undoubtedly true. But don’t be fooled, because it is probably comparable to the extremely marginal percentage of total Twitter users that they estimate will be engaged with the advertising, which is only one to three percent, according to Kafka’s story.

Thus, Twitter’s teaching video explains everything, successfully describing the state of advertising play online. It is isolated on the fringes – an extremely marginal group of advertising performance metrics making the case against an extremely marginal group of antagonists, by shooting over the heads of a vast, commercially unengaged population of users.

To embrace the comfort offered by Twitter is to accept the fact that the marginal groups just don’t make much of a difference.

Paywalls? There’s an App for that.

February 16, 2011 § Leave a comment

It seems like so long ago that Rupert Murdoch was out there stumping for paywalls and attracting the derision of the New Media proletariat. Then came iPad, which deflected the conversation away from the issue of content and towards the issue of apps. Now, today, the buzz is about Apple’s 30% cut on publisher subscription prices within its app and Google’s new One Pass paid content system.

Interesting.

Super Bowl Gets Social Media into the Big Game

February 4, 2011 § Leave a comment

A headline in today’s SmartBrief Social Media newsletter reads, “How Social Media Saved the Super Bowl,” which causes one to think, no wonder traditional media hates the internet.

The article itself, which appears in Forbes.com and is written by Optimedia US CEO, Antony Young, is not so cocky. The Forbes.com title reads, “Why Social Media Hasn’t Killed the Super Bowl For Advertisers”, which at least acknowledges in some form that Super Bowl ad spots on Fox have been sold-out since October at $3 million per 30 seconds thank you very much. So, tweet that.

Antony Young’s point is that marketers are finding ways to use social media to extend the value of their expensive Super Bowl campaigns. This year, for instance, they are releasing Super Bowl spots early into social media channels in order to build buzz for their campaigns, clearly a good idea. Antony certainly seems to think so. He also thinks the Super Bowl will remain a very good partner to other media – social media included – and a “super marketing and media event for advertisers.”

Someone at the new, digitally enhanced and enthused Forbes.com probably wrote the title for Young’s piece on the site, and when it left there it must have been one of SmartBrief’s social media revisionists that, in a stretch, interpreted social media as Super Bowl rescuer. A better, more accurate description of the piece might have been “Super Bowl Gets Social Media into the Big Game.”

In which case, just a little “Thanks, Mean Joe,” would do.

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