After reading Matthew da Silva’s post yesteday on last month’s Media 2010 conference, I spent the evening thinking about the challenges facing old media. As I pondered, I was struck by a radical (yet logical) series of thoughts, leading to the following question. Could small business owners soon become the new media barons? Let me explain.
If there is one thing that the media industry has taught us over the past century it’s that it pays to ‘own’ the audience.
Many of our modern newspapers once held nothing other than advertisements. Of course, clever proprietors began to realise that an interesting story or two might entice more readers… to look at the ads.
As a consequence, modern journalism was born:
A device to get more people to look at the ads.
This is a slightly cynical observation and, of course, the model has never been that simple. Some media products do exist on a pure subscription, user-pays model. There are also vanity publishers, who are happy to publish media at a loss, to pursue a social cause or personal agenda.
But these are usually the exceptions to the rule and most definitely not the case with contemporary newspapers, which are largely built on classified advertising sales (one of the first types of advertising to make the exodus to online).
This begs the following extended question:
If journalism exists to support advertisers, what happens when these advertisers find more cost effective alternatives to reach their markets? What is the purpose of a journalist then?
The conventional wisdom (usually the least accurate type of wisdom) is that the purpose of the journalist is to inform and educate and ask hard questions that need to be asked.
Sadly, no. Without undermining the important role of journalists, what I have described above is a ‘job description’. (And it’s a bloody important job, at that.)
However, the commercial purpose of journalism has not changed.
It’s still to sell ads (i.e. attract the attention of consumers), even if this answer might leave your average journalist turning slightly pale before reaching for the job section of the newspaper – or, more likely, switching on their laptop to start browsing the job sites online.
To me, the future of journalism can be found within the answer of another question:
Who profits most from owning the news?
In the media and marketing landscape we are now familiar with (and have grown accustomed to over decades), the media industry obviously has the most to gain from owning the news and, therefore, the eyeballs of consumers.
This is because, for the last hundred years, extraordinarily large amounts of profit could be made from selling advertising space due to the limited number of ways that were available for advertisers to reach their audiences.
The model was simple:
Acquire the attention of consumers. Then rent it.
In the 21st century, however, a seemingly limitless number of ways have evolved to reach a prospective customer or communicate a specific message to a pre-defined audience.
The money to be made by media companies from owning the news and renting the attention of consumers has just about dried up. It’s no longer the cash cow it once was.
So, if media companies no longer have so much to gain from owning the news, who does?
Advertisers as Renters
The answer reverts back to the concept of advertisers as ‘renters’.
In the past, a marketer could prepare an advertising campaign and be quite confident of reaching possibly millions of largely undistracted eyeballs.
The shot-gun marketing approach was an efficient marketing mechanism for many years because the value generated would exceed the cost of the exercise (we can only assume).
Nowadays, the same sort of blanket approach is, firstly, not going to reach as many undistracted eyeballs but, secondly, the target market may in fact resent the advertiser for employing a style of advertising often now referred to as ‘interruption’ marketing (thanks to the wit and wisdom of Seth Godin and others).
Further, the ‘renter’ mindset can often undermine the quality of marketing, in terms of the message and approach.
If you rent a car, you often don’t worry too much about its re-sale value. If you rent an apartment, the same type of thinking usually also applies.
If you ‘rent’ access to another organisation’s audience, you might not think too deeply about the repercussions of the exercise on the audience’s perception of you or the media outlet – you might not mind playing the same advertisement ad nauseam during every end change of a televised tennis match, even if your commercial drives most viewers to tears.
You’re probably just happy to get your message across (again and again).
But what happens when you buy that car or that house? Suddenly, you’re likely to apply a great deal more thought to your actions, to the future value of your ‘asset’.
We all know it’s better to own. So, why rent?
Advertisers as Owners
The cost of establishing a media outlet is diminishing.
In fact, all you need these days to launch an online news site is a server and an open source blog platform, likely to set you back a couple thousand dollars. (Plus, an opinion, of course.)
But what if you are a medium or large organisation, accustomed to spending $500,000 (or more) a year on advertising?
For example, what if you were responsible for running a hypothetical company created to sell solar panels and you already have a budget like this to spend?
You could consider these two options:
- Place advertising in targeted magazines, on television, billboards and radio.
- Employ and place one journalist in Canberra, one in Copenhagen, one at your HQ and become Australia’s most engaged and heavily resourced media outlet for news on the environment and clean technology.
No other Australian media outlet invests this much talent to cover either of these topics over the course of a year.
If you play your cards right, who is not to say that your news outlet will not dominate its target market – be cited, quoted, aggregated – and attract far more goodwill and customers to your website (or business the outlet was created to support in the first place) than an obvious spend on TV, radio, print media?
Of course, I know what you’re thinking.
This raises questions about journalistic independence and bias.
Bias in Demand Media
Can a privately owned company really be expected to present news without interference from management? Will the news organisation report information likely to have a negative effect on the parent company’s products or services?
Firstly, you’d be a mug to think that this sort of interference doesn’t already happen now – that company policies and the views of management don’t already influence reporting (even in the context of public broadcasters such as the ABC).
Secondly, I’d like to make the bold claim that news outlets hosted on the internet are held to an even higher level of accountability than traditional media outlets, simply due to the low tolerance for poorly reported or overly biased opinion on the web combined with the mechanisms available to quickly unearth a lie or hidden motive and then share the discovery. It’s often said:
Online… nothing is wrong for long.
A private company seeking to present itself as a ‘new media’ news outlet has a vested interest in providing news that aspires to the standards set by ‘old media’ or risk losing the goodwill and the audience that it created the news outlet to attract in the first place.
An abuse of trust on the internet has far greater reach and longevity than on any other medium – now, in the future and at any other time in the history of news and marketing.
And, of course, channels that ‘own’ an audience (rather than ‘rent’) are far more likely to treat that audience with respect, when it comes to marketing to that audience and keeping the boundaries between editorial and advertising clear.
So, who will own the media?
Media will always be run by the organisations with the greatest amount to gain. Traditional media organisations are losing their reason for being, as advertisers find other ways to engage with their target audiences.
The likely next evolution in media ownership will occur when marketers realise that audience attention is not just for renting – when a shift in thinking takes place that compels marketers to aspire to ‘own’ access to their target audiences.
The commercial purpose of journalists will still be the same (to get people to look at ads). Their job description will, thankfully, also not change (to ask the hard questions that need to be asked). The same high standards will be pursued, poor journalism will be challenged and abuses of trust will be punished.
But a greater level of respect will emerge, for the reader and for the marketer. Because renters might be content to treat their ‘rentals’ with disrespect. Owners aren’t.