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 § 1 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.”

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 § 1 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.

Promotion Fatigue

January 31, 2011 § Leave a comment

There is an interesting bit in Ad Age about the diminishing impact of price promotion on sales among packaged goods companies the past year. It says:

“SymphonyIRI Group reports that even though the percentage of packaged goods sold on price promotion increased markedly for the second consecutive year, the average volume lift per promotion fell.”

There could be a couple of reasons for the decline, which the Ad Age story mentions. One is the recession. Another is the “drumbeat” of offers online, which will soon include Google Offers. Overall, in response to a super abundance of deals there is simply “a level of promotion fatigue,” according to Susan Viamari, the author of the SymphonyIRI report.

It is a reminder that price promotion is short-term. Long-term, Ad Age quotes Utpal Dholakia of Rice University saying, “it has very little effect.”

TechCrunch Columnist Paul Carr Writes About the Affect of Too Much “Fertilizer” Online

January 25, 2011 § Leave a comment

“The fact is, it’s almost impossible to find a single ‘content’ company on the web that maintains a horseshit:quality ratio better than 10:1,” notes TechCrunch columnist, Paul Carr, in a post (“NSFW: On the Internet Nobody Knows You’re a Journalist”) that Paid Content was alert enough to notice and link to in its Around the Web section.

Elaborating, Carr writes:

“Just look at the homepages of Yahoo! and MSN, boasting the respective top stories: “Why Clooney Won’t Marry” and “Five Things You Shouldn’t Do When You Propose”. For all its lofty ideals, even The Huffington Post has succumbed to the temptation of bolstering costly and time consuming think-pieces with an avalanche of linkbait crap and blatant cut-and-paste jobs from other blogs.”

And, further:

“Tina Brown’s Huffpo-rival, The Daily Beast, is at it too. Sure, today’s top stories include a piece on a possible Egyptian revolution, but what’s that right underneath? A slideshow of “Ashton Kutcher’s 10 Best Shirtless Moments”. Hell, even Salon – whose journalism I praised the other week – isn’t immune to the page-view boosting lure of the slideshow: today their front page boasts a pictorial guide to “Hotels with a dark past” (including the Bates Motel, which doesn’t even exist) while on Friday they bravely addressed the issue of the child sexualisation with a gallery of “shocking” but  “sexy” child images.

Paul Carr’s column could be a companion piece to the article by Nicholas Spangler in the Columbia Journalism Review about the 40 hours he spent as a Demand Media writer. As I described in this space back in November, Spangler is a journalist that worked for years for The Miami Herald, and wrote with open resignation, about the end of his journalistic world and the rise of the new one typified by Demand. It is a world of “commercial content,” driven by algorithms “without”, Spangler wrote (perhaps quoting Clay Shirky), “regard to civic value or subjective judgments about quality or any of the other sentimental trappings of the Murrow century.”

Paul Carr is more inclined to describe the absence of civic value and sentimental trappings in online content today as, simply, “horseshit.” But he is a realist: horseshit is what the people want and horseshit is what the people get.

He storms:

“AOL’s (and HuffPo’s and Yahoo’s) front pages are packed with celebrity-obsessed crap because that’s what people are searching for, and that’s what they click on. It’s a problem at TechCrunch too: in the past seven days, almost three times as many people clicked on our headline about famous people using Twitter as cared about Mike’s interview with Google’s three most senior executives.”

Last week I took note of the precipitous drop in American Idol’s TV ratings so far this season and, despite the fact it remained the highest rated show in its time slot, allowed myself to wonder if our long, (inter)national nightmare with reality TV was coming to an end. No more Real Housewives of Anywhere; The end of real horseshit.

Fat chance, because when media aspires to sustain bigger and bigger audiences in order to attract more and more advertising it winds-up looking half-naked, with a grease-painted stomach hanging over its belt, fist pumping in the air and yelling “More beeeer!” Big media slimes you.

This is true online and offline. But it is also true, online and off, that where media is not trying to be all things to all people it doesn’t need washing off. Case in point, the New Yorker, which Paul Carr turns to and hugs like an old friend in his TechCrunch piece:

“The joy I felt today flicking through the New Yorker – stumbling across Tad Friend’s wonderful piece about Lenny Bruce tribute actor, Steve Cuiffo and a short story by Woody Allen (Woody Allen!) before reaching the Armstrong profile – was easily the highlight of my day.”

(How ironic if new media sends us back into the waiting arms of old media, now leaner and more fit and more in touch with its true self.)

Every brand steward in the marketing business should give careful regard to Paul’s happy encounter with the New Yorker if they give any regard (or disregard) to the rub-off affect of media on their brand images. I know when I’ve been naughty or nice consuming media. I know when I’ve been slimed. And the truth is that the unquenchable desire for viewers, listeners, readers and users will slime you, every time.

Which was why it was such a good thing that the Internet came along to free audiences from the growing indignity and abuse of modern mass media, providing them with a nearly endless resource of content that seemed so incorruptible. It lacked production value, maybe was not always beautiful, but it was genuine, timely, real, likeable, in an across-the-fence-to-your neighbor kind of way. Now, even the inherent niche quality of the internet is being subjected to manipulation thanks to so-called content mills – not because they possess a vision for an agrarian new media economy with gardens in every yard, but because they, along with much of mainstream media, remain industrialists – old media wannabes – factory farmers spreading fertilizer from the sky.

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