The Future of Digital Media: Insights from Infinitive Digital BrainFest
Digital media was a top-of-mind topic for a many panelists throughout at Infinitive Digital BrainFest. A few highlights (see at #digitalbrainfest for more details and insights from the conference):
- Sad but true joke about the demographics of the newspaper industry – courtesy of the Jim Brady, Editor-in-Chief of Digital First Media: “Newspapers that want to be close to their customers should build next to cemeteries.” Ouch.
- Bonus insight for traditional newspaper brands: losing 6% a year in print revenue, while lower than 10% industry average, is not really a strategy for long-term success.
- Slowly but surely, structural change is taking place in the media-buying word; agencies are beginning to plan their online video plans with their TV buying efforts.
- Businesses need to get perspective on social media. Yes, it can be a massively cost-effective tool for customer acquisition, but the risks relative to brand and public relations damage is real and must be monitored carefully.
- Interesting debate about B2B digital marketing content – specifically whether blogs are killing the white paper or whether white papers are simply being “blogified.” In his opening remarksInfinitive CEO Denis McFarlane took the former view, but several attendees tweeted that they believed white papers are still critical to sharing deep thought leadership and that blogs are critical for distribution of such content. And of course all content should be as engaging and scannable as the best blogs, with highly conversational tone and unique perspectives.
Infinitive Digital BrainFest: Insights & Takeaways from the Digital Ad Solutions Track
Thank you to our expert panelists and attendees of the first annual Infinitive Digital BrainFest last week in Chantilly, Virginia. True thought leadership and innovative insights were flowing in the intimate setting. And a good deal of fun was had by all.
Some of our favorite “a-ha” moments from the day:
- According to publishers, sales engineers who can speak the language of individual publishers, deeply understand their unique business objectives and cultures, and marry them to the right technology are the most valuable individuals on the teams of software firms. This is such a successful concept that publishers are mimicking the “seller + ad technologist” paradigm in media sales. It’s a clear sign that the Mad Men days of closing deals over two-martini lunches are long gone.
- Are we seeing convergence or divergence? Some claim that 2012 will be the year of media convergence, but in some ways the advertising landscape is becoming more divergent, as multiple channels and platforms continue to emerge. Agencies are demanding more integrated programs that include social, video, mobile, web and hyper-local elements. Publishers need to recognize this new reality and shore up their technology, people and processes to deliver content and offerings as smoothly as possible across all these dimensions.
- Whether we like it or not, Microsoft Excel is a critical tool in the digital publisher tech stack. Instead of trying to replace Excel (or hoping it will go away), technology and solution providers should make sure their tools integrate well with Excel (e.g., simple import and export capabilities). That being said, publishers must also recognize that Excel is not an enterprise database and there are real risks of overreliance on Excel (given its lack of security, irregular updating, storage on personal drives, etc.).
- Success in ad operations is a team sport; publishers and the software providers and the consultants they rely on must each do their part to deliver effective projects in a fast-moving and highly fragmented landscape.
- According to software providers, the most demanding customers can be the most valuable in helping improve and expand product offerings. That’s a potentially valuable insight as technology evolves rapidly.
- In choosing between custom configurations or off-the-shelf deployments, it’s critical to always “ask why.” Just because software features work one way doesn’t mean the status quo is the optimal fit for a way a publisher works. Conversely, examining processes closely may lead to opportunities for streamlining. Put another way, software should never be configured to support poorly designed processes.
- Most industry stakeholders believe fragmentation in the industry is here to stay, even though widespread consolidation of vendors is likely in the next few years. To handle the continuing chaos, talent is the number one critical success factor. Processes and technology will change, but organizations with a talented, passionate Ad Ops team, are more likely to meet and exceed their performance targets. Talent will be the most important element of navigating the evolving landscape and the difference maker between firms that thrive versus those that merely survive.
- In terms of measuring success of advertising operations and supporting technology, most publishers don’t have formal performance measurement programs in place. In fact, they apply a variety of quantitative and qualitative metrics – including increased revenue, adoption of new features, specific problems solved and the strength of relationships with their vendors and consultants. As technology matures and clear process best practices emerge, more objective criteria will emerge.
- Publishers have to lead! Agencies and advertisers will contribute their own requirements and business needs, but publishers have to step up in their own efforts to innovate and lead the way.
Thanks again to our excellent panelists for the digital ad solutions track:
- Melissa Bertram, VP of Advertising Operations, Kelley Blue Book
- Tim Messier, Director of Audience Management, AutoTrader.com
- Bryan Moffett, VP of Digital Strategy, National Public Media
- Benjamin Reid, Independent Digital Media Consultant
- Vikram Somaya, VP of Global Operations & Audience, Thomson Reuters
- Tim Wolfe, VP of Ad Operations, Gannett Digital
Another Old-Line Publisher Explores Digital Future
The CEO of National Geographic recently addressed the magazine’s need to “turn a new page” as it faces up to its digital future. There is no doubt that the company’s focus is on track –
expanding reach on multiple platforms, launching a website, forming joint ventures with television networks—where programming now comprises 56% of total revenue—and experimenting in the videogame market.
In a highly fragmented, multi-channel world, content providers and media brands must understand how they can find and connect with consumers across all of these. The leap from magazine to videogames is not such a big one these days.
Of course, NatGeo has a long way to go; digital comprises just 3% of revenue today, but the company plans for it to reach 50% ultimately. Testing and learning is part of how it will navigate to this growth
We started selling a digital “Triple Play” of the magazine, which means you get the print edition, the digital edition, and access to our archives. As we move ahead and begin to offer more things, we’ll figure out what we can put behind a paywall, and what we can’t. There’s a lot of experimentation that will come on the pricing front.
Netflix to Become Cable Channel?
Several reports indicate that Netflix might seek to position itself as a network as it seeks to drive subscriber growth. This report highlights how the cable-streaming strategy could help Netflix in a few strategic areas:
- Reducing the company’s annual customer churn rate of 50%
- Growing its number of streaming accounts in the U.S. from 22 million today to 60-90 million, which is the goal.
Considering that several cable providers have started or are planning their own streaming services, it will be interesting to see who may partner with Netflix.
Avoiding the Customer Bermuda Triangle
Author Jeanne Bliss offers a useful metaphor regarding the risks of a siloed approach to CRM. In her book, Chief Customer Officer: Getting Past Lip Service to Passionate Action, she writes of a phenomenon called the “Customer Bermuda Triangle:”
“When the metrics used to define success drive us more deeply into our own silos … customers are lost in the handoffs between departments. We lose sight of them when they fall in the cracks between the silos. Because we don’t purposefully observe or measure how the customer traverses the jumbles of our organization, they sink deeper and deeper out of our viewfinder. And for the customer, we slip further and further away from the place they want to be.”
When Selling Looks Like Spam
According to this report, companies are catching on that more isn’t always better when it comes to sales and marketing. Specifically, they are pulling back from mass e-mailing – which customers typically see as spam. As one executive put it:
“You get into this mind-set that the more emails you send, the more sales you generate … But that can really start to annoy people.”
To us, this looks like a classic case of putting technology capabilities ahead of CRM strategy; just because companies can send huge volumes of personalized emails doesn’t mean they should. While email marketing has proven effective in boosting online sales for retailers, clickthrough and open rates have dropped dramatically in the last few years. That looks like a by-product of sending too much volume.
The bottom line is that customer preferences must be a key indicator in deciding how much email marketing is too much.
Cord-Cutting vs. Cord-Swapping
According to Nielsen, the number of Internet-only TV homes is growing – up 22.8% from 3Q 2010 to 3Q 2011. The report said:
it is too soon to determine whether these households are so-called “cord-swappers”– swapping the cable/satellite TV cord for the broadband Internet cord – but they are growing faster than any other segment of the “cross-platform” television marketplace.
Another wrinkle in this great TV transition is the use of gaming consoles as devices for watching online content via TVs. According to this report, the practice has “tripled in popularity since 2009.” And it’s no surprise that the so-called “millennial” generation (approximately ages 14-28) is leading the way.
The challenge – and it’s a big one – for digital marketers and analytics teams is to ensure their tracking systems can follow viewers and users as they interact with content across different devices and platforms.
The SpongeBob Dilemma: Does Streaming Help or Hurt?
Nobody said industry transformation was going to be easy. And certainly the digital media space has had more than its fair share of creative destruction. Of course, creative destruction by definition presents big, game-changing opportunities alongside all the serious and disruptive threats.
Consider the case of Viacom. As a recent WSJ story points out:
Web streaming is boosting Viacom Inc.’s profits —but it may be undercutting it as well. Continue reading
The CRM Paradox
“Even though the United States is evolving into a service economy, customer satisfaction is at an all-time low.” Essentials for CRM, by Bryan Bergeron
Much of this paradox is driven by rising customer expectations. That means marketing, sales and service leaders must strike a delicate balance as they try to strike the right balance. For instance, can measures designed to boost efficiency and reduce costs (like IVR technology and offshoring call centers) also be used to personalize and enhance customer interactions?
Digital Marketers Want to Track Brand Ads’ ROI
A new study highlights digital marketers’ growing preference for brand advertising, as opposed to direct response. To be clear, both categories are set to grow rapidly in 2012, but brand will grow at a faster rate.
Roughly half of marketers plan to increase direct-response spending, compared to 64% who plan to increase online brand ad spending.
More social and mobile activity, plus increasing usage of online video, are the key drivers. Also interesting (though not surprising) is the finding that more marketers are moving their budgets from TV and print advertising to fund more of these digital initiatives.
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