Mar 172016
 
walking the shop floor is important to business management

Last week Australia’s Fairfax Media announced the company will cut another 120 editorial jobs at the Sydney Morning Herald and the Melbourne Age. What strategies beyond cuts can save old media companies as traditional advertising revenues dry up?

For decades, the print and broadcast media was incredibly profitable as they provided an advertising platform for businesses and individuals. While television revenues have held up, the rest of the media industry has seen their income collapse.

In the early days of the web the hope was display advertising would provide revenues for online publishers, however it turns out  readers are blind to the ads and, should the messages become too intrusive or resource heavy, people will install ad-blockers.

One revenue channel for publishers is ‘content marketing’ or ‘branded content’ where advertisers sponsor specific stories. At the Sydney Ad:Tech conference earlier this week Asia-Pacific Regional Advertising Director for the New York Times, Julia Whiting, described what the iconic masthead finds works in this medium.

Whiting says there are five key factors in making branded content work for advertisers.

  • Give something of value. Be entertaining, informative, educative or provide some utility.
  • Tell an authentic story. Make the link between the brand and story as subtle as possible.
  • Produce high quality content. Consider how a newsroom cover the story and what would hook the reader.
  • Choose the right environment. Advertisers have to align with publishers that have the right brand values and audience.
  • Targeted campaigns. Use data to define and find target audiences then use that information to deliver relevant content.

The question with the branded content is how explicit the advertiser’s message or sponsorship can be before readers start losing trust.

Becoming creepy

Another aspect is creepiness. One of the campaigns Whiting showcased was The Creekmores, the story of a young family who travelled the world as the mother was dying of breast cancer that was sponsored by Holiday Inn.

On a personal level, this writer is uncomfortable with such a personal story being associated with a multinational brand and wonders if the family would have been happy for their tale to be part of a branded content campaign for a hotel chain.

For branded content to really work, that ‘alignment’ between the publisher, audience and advertiser is essential and in turn ultimately relies upon the credibility of the outlet.

In the case of the New York Times, that credibility rests upon good writing and strong editorial values, although the paper hasn’t been immune from scandal itself.

Good, well edited writing may turn out to be the greatest asset for today’s media outlets as smaller publications such as The Economist, Punch and The Spectator see readership and revenues increase.

The Guardian, ironically an outlet that itself is cutting 250 staff, reports these publications are succeeding due to well written articles. “If you produce journalism that is not just better but significantly better than what’s free on the web, people will pay for it,” says Spectator editor Fraser Nelson.

Which brings us back to Australia’s Fairfax where a succession of clueless managements have eroded editorial standards. Three years ago former editor Eric Beecher wrote a scathing account of his time at the company where an incompetent and unqualified board flailed in the face of market changes it could barely comprehend.

One of the villains of that tale, board chairman Roger Corbett, was a successful Chief Executive of the Woolworths supermarket chain. That he was so obsessed with a failed business model and protecting margins by slashing costs indicates much about the nature of Australia’s insular corporate world.

A consequence of Fairfax’s cost cutting obsession has been foreign outlets have stepped into the market with The Guardian, Daily Mail, Buzz Feed and a range of other sites setting up in the country – something that further squeezes the incumbent’s market position.

In opening her Ad:Tech presentation, the NY Times’ Julia Whiting noted Australia was the outlet’s fifth largest global market, something undoubtedly driven by the decline in the SMH’s and Age’s output.

The travails of Fairfax and the successes of smaller outlets show what might be an encouraging trend in the media – that a quality product actually attracts an audience and advertisers.

If that’s true, the managements that mindlessly cut costs that hurt the quality of their core product may be accelerating the demise of their businesses.

Mar 152016
 
what is the future of journalism

For years I resisted attending the Tech Leaders conference, formerly Kickstart, as I felt a bit of an imposter being invited to attend as a journalist.  As a consequence I missed the peak days of the event.

In the ‘good old days’ dozens of journalists, most in the employ of profitable media companies, would fly to a Queensland resort to wine, dine and debauch themselves as PR agencies who were picking up the tab would try to introduce their clients and pitch to the group of hungover scribes.

Funding these events was relatively straightforward, public relations agencies and their clients were happy to pay substantial sums for access to journalists. In the golden days of technology journalism, large IT supplements were full of lucrative advertising for jobs and products.

That river of advertising gold has long dried up and in the technology industry that shift has been exacerbated by the collapse in IT industry margins which has further hurt advertising budgets.

As the industry has faded so too have the numbers of media professionals, many journalists have either moved into PR roles themselves or are now desperate freelancers.

The industry shift to freelancers has been problematic for the organisers as the remaining staff journalists are chronically time poor so can’t lightly take a day away from the desk and the independent reporters don’t offer direct access into trade journals and general news outlets.

Events like Tech Leaders are giving the PR industry a glimpse of the journalist free media landscape of the near future where the traditional pitching to outlets in the hope of being published is effectively obsolete. Looking at the numbers at Tech Leaders, it’s clear that world is not far off.

The question everyone in the industry has to ask is ‘how do people perceive I add value?’ For many, including myself, the answer is ‘we don’t’.

In an age where there is an almost unlimited supply of information and commentary, journalists and PR people have to find a new way to convince the market they add value.

Mar 072016
 
newspapers are dying as the media business models move online

What happens to journalists when no one wants to print their words anymore?

The Bill Moyers website has striking accounts of sexism, ageism and exploitation of younger journalists as the industry deals with its Twentieth Century business model collapsing.

Much of the dislocation Dale Maharidge describes could have been written about factory workers twenty years ago and will be probably written about a whole range of white collar occupations over the next two decades. The disruption being felt by journalists is not unique to the media industry.

While the media industry struggles to find the 21st Century’s David Sarnoff, the human cost is real. The price workers pay when an industry is disrupted shouldn’t be understated.

 

Mar 042016
 
what is the future of journalism

One of the new models for journalism is being sponsored by corporate interests.

This works well until the news turns against the corporate sponsor, as Australia’s ANZ now discovers.

For companies there are many good reasons for to have their own media centres, but to pretend they are twentieth century style Washington Post, Watergate journalism is probably hoping for too much.

Mar 032016
 
as-seen-on-TV-advertising-spend-digital-online-media

Understanding how a new technology will change industries is a challenge that has faced every generation in modern times.

Two of the industries most challenged by the rise of the internet have been the publishing and advertising sectors which have seen their established and wildly profitable ways of doing business demolished.

One of the mistakes almost every industry and business facing technological disruption makes is trying to apply their old models to the new methods which almost always produces poor results, the transition from live theatre to movies and then to television through is a good example of this.

So it’s not surprising that the advertising industry is now admitting that display ads on web pages have never worked and from that follows the maxim that print dollars equate to digital dimes.

For the online publishing industry, we’re still waiting for our modern day David Sarnoff to figure out how to make money online.

Feb 122016
 
iraqi_journalist

What does a startup do when it’s faced with a PR crisis? Recently Australia witnessed a spectacular example of what not to do when Sociabl, a startup that promised to connect users with celebrities, flamed out spectacularly.

Sociabl promised to connect punters over video with celebrities for a fee ranging from $500 up to $100,000 for individuals like Richard Branson with half the money going to a charity of the celebrities choice.

The app and its two young founders had plenty of coverage and all looked good until one of them, Brandon Reynolds, appeared on prime time evening show A Current Affair to spruik the service.

Unfortunately for Brandon he was interviewed by one of the celebrities listed by his app and the host, singer and presenter David Campbell, had never heard of the service.

A true PR disaster

Needless to say the interview didn’t go well with poor Brandon meekly declaring at one point “we’re not a major fraud!” You can watch the train wreck on the show’s website.

To compound the problem Brandon then wrote a defiant Medium post – later removed – accusing the program of slandering him and posting a pile of correspondence with the various celebrities’ agents.

Earlier this week I was invited to join a panel consisting of a journalist, a startup founder and a lawyer who also runs a startup along with myself we looked at how a startup can avoid a Sociabl like disaster. The lessons from it were clear.

Stop digging

Rule one in crisis management is when you find yourself in a hole, the first thing to do is stop making it deeper.

Brandon clearly missed that memo and his defiant post that accused the journalists and the network of defaming him only antagonised them. What’s worse, the attempt to throw the celebrities’ agents under the bus was only going to take him and his business partners into a new world of pain.

So when things are looking bad, stopping and taking a deep breath is the first thing to do. The absolute wrong action is lashing out publicly at media, advisors or business partners.

It’s probably not a crisis

There is no doubt Sociabl’s debacle was a crisis, but it’s an outlier and a situation that few startups or any businesses will find themselves. In most cases what appears to be a crisis is just a minor hiccup that looks like a big problem because you’re too close to it.

Most startup founders and small business owners are working hard, under stress and deeply emotionally engaged in their business. It’s understandable to over-react to what is often a minor, or even imagined, crisis.

By stopping digging, or panicking, and taking that deep breath you have the opportunity to get things into perspective. It’s also the opportunity to take advice.

Talk to your friends

One of the first things any new business should set up is an advisory board or panel. Helping with a crisis is exactly what those advisors are for. Talk to them and get their wisdom, usually they’ll bring some perspective and more experienced friends will know how to manage a crisis (if it exists).

An important aspect of asking for advice is actually taking what’s offered. One way of burning bridges with friends and trusted advisors is to ignore their advice after asking for it.

If you have investors then talk to them, particularly if they have seats on your board. They’ll want to know about the crisis anyway and if they’re experienced may well be the best people to help.

Get professional help

For early stage startups this tip isn’t much use as good PR and crisis communications professionals quite rightly charge a lot of money for their services.

If you do have raised substantial money however, then a good PR agency should be one of the first professional services engaged with the funds. Sociabl claimed to have raised $210,000 which probably wasn’t enough to get a good one.

Had Sociable engaged a competent and professional PR firm, it’s likely they would have avoided the disaster on A Current Affair.

Rally the fans

If you have loyal customers, user or supporters then a crisis is the time to get them onside by engaging honestly on the web, through email and on social media. Be honest, be open and be quick to reply.

If you have made a genuine mistake then it’s likely your fans will support you as long as you come clean. All bets are off however if you’re ripping those loyal supporter off.

Have a plan

Early in your business do a risk analysis to identify where things could go wrong and have a plan to deal with known risks. Hopefully you’ll never use it but it’s handy to have when something foreseeable happens.

Don’t be a fraud (of any size)

“We’re not a major fraud” will go down as one of the greatest lines of the current startup mania and one that Brandon Reynolds will struggle to live down for many decades.

At this stage I should point out I don’t believe Reynolds and Sociabl were a fraud of any size – he and his team simply didn’t understand how the world of celebrity engagement and the media work.

The key lesson is don’t be dishonest. Only make claims you can justify and promises you can deliver. Hell hath no fury like customers, investors or journalists who believe they have been misled.

For those raising money through crowd sourcing this is an important point as overstated claims and missed delivery dates will not only cause a crisis but see loyal supporters desert you.

More importantly, a crisis brought on by dishonesty may get the attention of the authorities if you’ve breached consumer law with your customers or securities regulations with your investors. Don’t be evil is a good philosophy for a young business.

In summary, the best advice for a startup in avoiding a crisis is not to put get in the position where you might find yourself in one however sometimes things are outside your control, when they do take a deep breath and talk to your friends.

Jan 052016
 
How are magazines and newspapers surviving in a digital world?

We may have reached Peak Content suggests Kevin Anderson in The Media Briefing as media companies, social media services and sharing platforms flood the world with information, rendering a lot of what’s being produced by media companies effectively worthless.

For publishers trying to make money from advertising this has been the reality for the last decade as the market has been spread thinner as thousands of new channels have developed and the established players have doubled down on their efforts to churn out content.

To illustrate the content explosion Anderson cites Columbia Journalism Review’s 2010 feature The Hamster Wheel where Dean Starkman described the effect of media outlets’ focus on churning out content with a description of the Wall Street Journal’s output.

“According to a CJR tally using the Factiva database owned by the paper’s parent, News Corp., the Journal’s staff a decade or so ago produced stories at a rate of about 22,000 a year, all while doing epic, and shareholder-value-creating, work, like bringing the tobacco industry to heel. This year, theJournal staff produced almost as many stories—21,000—in the first six months.”

While that was bad enough new players were pumping even more content onto the interwebs as Anderson points out, in 2013 the Huffington Post put out 1,600 pieces a day from its 550 staffers and an uncounted army of unpaid bloggers.

The vast bulk of what is being put out is trash, in Huffington Post’s case well web optimised garbage, that adds no value to readers and is only attracting fractions of a penny per article. The model, as both Anderson and Starkman point out, is broken and no-0ne is paying much attention any more.

Fixing the broken attention model is what online travel site Skift are exploring as they rationalise their operations to focus on delivering more relevant content to their audience.

Skift’s co-founder Rafat Ali described how the company refocused on its core purpose of informing travel industry professionals about their sector and stopped regurgitating syndicated stories and those of less value.

We gave up chasing scale. We took out *all* goals on traffic on the site, for everyone. We could do this because we didn’t have tons of outside money pumping through our veins, and this was a useless pressure we created for ourselves in an effort to show the illusion of growth to investors. And since we weren’t chasing investors, we didn’t need to chase what they would consider scale. It was a vanity metric.

We cut back on spending any money on getting users through Outbrain/Facebook/Twitter. We cut back on the number of stories we were doing on a daily basis, on chasing the tail on disposable news stories. We also cut back on syndicating our stories — in which we put in a lot of effort at the start, publishing on NBC News, CNN, Quartz, Fox News, Business Insider, Mashable and many others, to zero effect on our revenues — and also cut back on publishing useless filler syndicated stories we got from a third party syndication service.

Chasing those ‘vanity metrics’ was killing Skift, just as it is for most of the publishing industry in the views of Starkman and Anderson.

While we’re still some way off finding the model that works for online publishing, Skift’s stripping back to the basics seems to be an important step in finding what’s profitable.

The biggest problem though facing the publishing industry is convincing consumers, or advertisers, of the value they are adding in a world of almost unlimited information. This is a challenge that many industries are going to face.