For many of us working in the content industries, the last few years have been challenging, with layoffs in old companies, shrinking online ad rates in the new and tech investors who would rather back “platforms” than “media”.
But I think we may be back, baby. After only a few hours at the Monaco Media Forum this week, I was struck by the enthusiasm displayed around a clutch of companies — especially those like BuzzFeed, Vox Media, Buzz Media, Thrillist and Tumblr — that suggests, just as Bill Gates said 16 years ago, content is the next hot business model again.
Theirs is a quite different approach from legacy media and, for many, effective monetization is at yet unproven. But a confluence of prospects appears to light the way, for a content template, at least for a certain sub-set of new-wave players. The ennui setting in around networks like Facebook is giving way to excitement about creation platforms like Tumblr. For an industry that was supposedly on its knees, this seems refreshing.
Here’s what I’ve been learning about why:
1. Branded content may be the money-maker
Everyone is talking about “branded content”, “sponsored content” or “native advertising”. While advertiser-funded articles, video and so on are not necessarily new, many old-line publishers had, until recently, been cautious to blur lines too far.
What we are now seeing, however, is a wave of pure-play online publisher with far fewer hang-ups about unifying church and state — and an old guard that, spurred by ongoing decline and recently-relaxed European rules, is following suit.
Marketers themselves are also bullish. Excited about growing publisher willingness and desperate to get their messages across unobtrusively, advertisers are super-keen to pile money in to content creation of their own.
Good timing. “The banner is about to die and is already cratering,” BuzzFeed founder Jonah Peretti said during a panel discussion in Monaco, channelling the community’s shared concern about falling rates. “Now more brands are coming to us saying, ‘We want to be more like a publisher and you know how to do that.’”
For publishers that can both amplify advertisers and retain readers’ trust, this could emerge as a realistic new revenue model to help sustain the content creation sector going forward.
2. Social is content’s best friend
Nobody is operating in old vacuums anymore. Content publishers are fortunate now to benefit from a massive traffic hose, the social networks.
As some users tire of sharing their own baby photos and “likes” online, new-wave publishers think the object of their sharing is, increasingly, becoming “quality” content. As Thrillist’s Ben Lerer said: “The people who stand out are going to be the content creators who create the best content.”
Fahad Khan, CEO of social media conversation manager OnePublic, said during another session: “I don’t have friends who are experts in all fields. They can’t fulfill my interest verticals. I turn to editorial.”
Said Vox Media’s Joe Purzycki, publisher of SB Nation, The Verge and now Polygon: “From a content and marketing perspective, there’s nothing more valuable than social right now. Within three months of launching The Verge, our content was being shared more widely on Twitter and Facebook than our next three closest rivals.”
3. Matching supply with demand
More than just that, we are witnessing the emergence of a class of media company that relies on technology, not just its founding editorial mission, to determine what it publishes. By harnessing what search data says about what web users “want to read”, publishers can create articles to satisfy that need.
It is an efficient system to make a geek proud; journalism as platform, an audience for everything — no article goes to waste. Publishing begins to become a perfectly matched supply-and-demand game, and that minimizes losses.
Peretti: “You can reach millions of people that way, just from making something someone wants to share with someone. There’s an opportunity to build a big media company that’s technology-enabled and socially created for a world of sharing.”
Yet this is a very different kind of content creation from the journalists’ stories that readers don’t know they want but which reporters think must be read. A tail wagging a dog, perhaps. Serendipity, be damned.
Vox’s Purzycki said: “We’re not going to change what we’re writing based on social response all the time. But we use that data daily to drive ‘why was this popular’ and, from a brand standpoint, show them how widely it was shared”.
4. Devices are lighting up a new path
Two brief years in, tablets and mobile devices are giving optimism to content creators who see higher engagement, a straighter-line conversion from print and more attractive presentation
After 15 years in which the web was pretty much the only digital content channel in town, now we are delighting in a diverse number of screens and sizes and modalities, each designed for reading, watching and listening, not computing, and all of which beg, sumptuously, to be touched and consumed.
That’s only going to grow more commonplace. “Thirty-three percent of our traffic is coming from mobile,” Vox’s Joe Purzycki added. “We’re preparing for world where it’s 50 percent. These are perfect reading devices.”
5. Commerce and content can co-exist
Just as brands and publishers alike are beginning to think more expansively about advertiser-funded content, retailers are coming to regard content as one of the best possible drivers of ecommerce conversion.
Brands are being conceived, like fashion-and-beauty’s Asos and Birchbox, that marry articles and sales in the same place. Retailers are realising that, to move people to buy goods, storytelling is a great motivator, and honest, helpful guides are even better.
6. Paid content is really happening
iTunes’ 400 million credit cards on file, growing consumption of pay-for audio and video, and the continuing emergence of sexy new devices with payment mechanisms built in all point to a rosier outlook for business models that rely on charging consumers for content.
Even a start-up darling founder like Tumblr’s David Karp agrees, telling a Monaco Media Forum panel that the economics of content is the next hot investment area.”The ecosystem is at phase two right now – distribution,” Karp said. “The third phase has already started to show its face — the new economics. These people are building huge ecosystems — the next big step is going to be how they profit from it. We’re starting to see that in Kickstarter and in Etsy. I‘d be putting all my money in to that.”
7. Costs are falling
Content-making costs are falling rapidly. New technology platforms are allowing producers to make great stuff on the cheap and several publishers are leveraging pro-am production.
So much of professional content lately has been about cost cuts enacted by troubled big publishers. That hasn’t gone away. But now nimble web outfits are showing large players a plan for how content can be produced on the cheap, making possible content factories that can run at a fraction of their forebears.
This is often a rather different kind of low-grade output than that familiar to trusted professional print publishers — but quality doesn’t always have to fall with costs.
“We were producing broadcast-quality content from a small room in mid-town (Manhattan),” Vox’s Purzycki said.