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| Home > Commentary > JackMyersThinkTank > Content is King, But the King Needs a New Wardrobe | |||||
Content is King, But the King Needs a New Wardrobe
Last Updated: July 20, 2010 at 09:41 AM GMT By Jack Myers The greatest value to advertisers of new media technologies is not the ability to aggregate and buy audiences at progressively more cost efficient prices. It's the ability to work with content producers who can identify their audiences, build databases and loyalty programs, enable direct communication to targeted audiences and motivate them to act in measureable ways. As evidenced by Google's introduction of its Do-It-Yourself App Creation software, targeted to teens and unsophisticated users, both technology and content will become increasingly commoditized into the foreseeable future. Audiences will be progressively more splintered and difficult to reach. The value of media sellers that can successfully reach and motivate audiences will, in this emerging marketplace, become even more valuable. Although most forecasters, including me, are reasonably bullish on the future of advertising, growth projections remain at or below inflation levels, meaning real growth will be flat to down for the ad business. Many of today's media content producers will find it progressively more difficult to maintain reach, and there simply will not be sufficient dollars in the marketplace to sustain the mid-single digit growth that they require without restructuring their current business models. Even those that can scale their audiences will experience ad costs that decline at an accelerating rate. Traditional content-centric media sellers will need to have in place alternative business models that generate revenues above and beyond what is available in the share-of-market and CPM game they play in now. For at least three decades, consultants, economists and analysts have been recommending that media companies expand their focus beyond marketers' advertising budgets and take a more holistic approach to the marketing ecosystem to attract non-advertising marketing budgets. Through these capabilities, content-centric media companies can begin attracting those non-advertising marketing dollars that are targeted to retail trade initiatives, consumer sales promotion, event marketing, social and conversational interaction, direct sales and other "below-the-line" activities. At some point during this decade, commoditization will catch up to even the most protected media assets and those that have developed alternative revenue models will be thankful they did. Read Jack's weekly commentary at www.jackmyersthinktank.com and http://www.huffingtonpost.com/jack-myers. Jack Myers' full commentary on this topic, including relevant economic data, is available to corporate subscribers of Jack Myers Media Business Report. To communicate with or to be contacted by the executives and/or companies mentioned in this column, link to JackMyers Connection Hotline.
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Reader Comments(2)
Smart post, Jack. Agree that great value will be generated in uniting "Above the Line" and "Below the Line" activities. The media and devices our consumers spend the majority of their time with mandates this because they already blur those lines. This begins with a necessary realignment of marketing resources, process and approach; marketing channels and activities will shift as a consequence, but shouldn't be where change starts. One of the areas we're looking keenly at for our clients is this aggregated value you bring up--many CPG marketers don't value the CRM data beyond it's utility as a distribution channel for email. It's further complicated by distributed content, apps and social networks so that "value exchange" today looks more like a paid content king/feed role like the Kraft/Meredith relationship that resulted in their new "Big Fork/Little Fork" iPad app launched yesterday. It's a content wrapper for their brands, but who owns the relationship beyond the download? Who owns the ratings and reviews? Who owns the remarketing benefit/space? Apple owns their review space and their terms says they own the iAd space in their apps. So we're looking closely at how marketers can own their relationships to generate greater loyalty, preference or behavior changes at point of transactions so we build this value into our creative briefs as well as terms and deal structure on all fronts. Thanks for the thoughtful post.
Cheers! Mark Silva, Real Branding Posted at 05:51 AM on Jul 20, 2010 by Mark Silva
Great insight Jack. Promotions and other forms of incentive and reward based marketing are going to gain increasing importance in the marketing mix.
Posted at 07:23 AM on Jul 20, 2010 by Alan Gerson
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