In today’s world, we have pressures on us to show the results of content marketing. If we only look at our owned media efforts as a replacement for advertising, and measure it under a content consumption model, we will ultimately fail at providing a positive return on investment.
A successful, long-term, Content Marketing approach is more expensive than advertising. It just is. The goal of content marketing must be to provide multiple lines of integrated value across the business. Thus, our true investment is not in content. It’s in the result of the content – a subscribed audience.
As mentioned earlier, Audiences as an output of media companies are not new. They have long been noted by scholars as being one of the two outputs from media companies. However, they have also been a much less analyzed source of value for businesses. Professor Philip M. Napoli, the author of Audience Economics: Media Institutions And The Audience Marketplace concluded: “Unfortunately, [audiences], the second major product of media firms has not been subjected to a comparable degree of analysis, although its production is inextricably intertwined with the production of the first.”
Today’s media company, works extraordinarily hard to create multiple lines of value through the production of content, and measurement of its consumption. But, today, because of the democratization of content distribution and production technology, the audience is the key asset. It doesn’t matter whether the company is selling access to content, the adjacent space to the content, or the merchandising made available by the content, or all of the above. The first output, the content, was only valuable to the extent that it was scarce, hard to produce and difficult to distribute to the masses.
Today content matters not nearly as much as the second output – the audience. As one television executive stated “I can’t think of another business that makes one product but sells a different product. We make programs and put them on the air. We are not selling the programs, we are selling the people that watch the programs.” In short: today, content only has value to the extent that it builds and keeps the audience.
So, what is different about that?
For the last 80 years, from the time that Robert Elder made his speech on that cold New York day about his Audimeter, the marketplace for the value of both content and the audiences that consume it has been determined by the third party measurement of content consumption.
As Nielsen, themselves have said:
“Our primary goal is to measure content and advertising no matter when it’s watched or on which devices.”
The challenge of course is that the value of measurement of content consumption also depends on those same two foundational elements: scarcity and difficulty in distribution. In today’s world – we as consumers have tools that filter through the noise for just exactly what we want, when we want it and where we want it. It is no longer tenable to make a mark on a piece of paper every time the dial is turned.
In turn, media companies are turning away from content measurement as a sole indicator of value. As Ad Age reported three years ago, the company is “once again in jeopardy, and this time its reigning dominance isn’t a sure thing. For the methodical research company, the accelerating pace of change in media may finally be getting out of hand.”
And, this year, marks a time when major television networks like NBCUniversal will offer advertisers something more than content consumption measurement. As was reported just this year: “the use of new and more fine-tuned audience data reflects the TV industry’s attempt to emulate the precise targeting abilities of digital.”
Now, of course the only way that NBCUniversal can even go beyond this is that they have access, through their parent company Comcast to the audience directly. It is their owned media audience.
Today, value is being created where media companies have a direct, and proprietary relationship with their audiences in order to sell them access to content, merchandise them to advertisers, or sell merchandise directly to them.
You can see this trend happening across the media landscape:
✼ HBO’s over-the-top service, HBO Now, is still only a small portion of their approximately 50 million subscribers in traditional cable. However, it has added 2 million subscribers in less than two years, and is accelerating. In 2017, HBO plans to add more than 600 hours of original programming.
✼ Netflix, which started as a DVD rental service, has now gone from approximately 27 million subscribers in 2012, to more than 60 million subscribers in five years. Consider that within the next few years more than 50% of Netflix’s content will be original productions.
Disney, whose content used to run on Netflix has recently decided to remove their content in lieu of starting their own streaming service.
✼ In a transformed news media environment, complete with “fake news” and mistrusted outlets – brands such as The New York Times, The Washington Post, The Atlantic and others are seeing exponential increase in subscription rates.
And subscription is the primary means of driving their business.
✼ Amazon, the world’s largest retailer, has launched Amazon Studios, and will spend more than $2.6 billion on original content for its Amazon Prime service in 2017.
In short: media companies are doing exactly what was promised with the democratization of technology and distribution. They are routing around third parties who control access to audiences and the third-party measurement platforms that create markets. They are setting NEW values by establishing direct relationships with audiences that are proprietary. They are doing what marketers have done for 100 years. They are making their own markets.
But one of the above examples stands out even more than the others: Amazon. This is a company that less than 20 years ago was simply an online book store. Amazon’s move into becoming a player as a media company is the signal that this isn’t just a phenomenon among media companies. Amazon no longer just sells the content – it makes the content.
Source:The Content Advisory