Can you get us started please with a thumbnail of your path in the media industry? And tell us about your work at LEAP Media Solutions.
I spent five years right out of college with Gannett and McClatchy before joining the New York Times Company in 2005. It was there that we built the first centralized audience marketing division in the United States newspaper community, using marketing automation and analytics technology licensed from ASTECH InterMedia, which was owned by Tom Ratkovich.
In 2010, I was recruited to The Day (New London, CT) to assist Gary Farrugia with implementing its membership model, which also became a best practice model within the industry. We were then approached by several small and independently-owned companies who were very interested in what we were doing, but financially constrained to invest in the technology and resources to implement something for themselves. Tom shared a vision to start a new company that would operate under a shared resource management approach, meaning we would invest in the technology and resourcing talent, then leverage across a coalition of partner publishers with the focus on marketing execution. The Day has been our partner and advocate from the get-go, and the concept resonated in the industry. We are grateful to be working with over one-hundred local media companies today ranging from 5,000 to 500,000 subscribers.
You participated in the recent LMA Regional Innovation Mission to Boston in which you joined 15 fellow travelers to visit Brightcove, the Boston Globe, Cxense, Hubspot, ThriveHive, Entercom and WGBH. Tell us about the overall experience of participating in this small, fast paced study tour.
This was my second IM, and the first regional. Both have been at the very top of the list, as far as career-defining experiences. The Boston tour was particularly rewarding because the prevailing themes (“customer-first”, investments in audience knowledge, etc.) are topics for which everyone at LEAP has devoted their careers. But more than that, the opportunity to bond with people I admire, who represent companies I respect, is one of the greatest benefits of the IM experience.
LMA has identified the perfect formula of blending media companies with the industry disruptors, and the dialogue that results with these companies is so important – just look at the Facebook “détente” that Nancy and her team have worked to orchestrate over the past year. I really think it is important to find common ground with them, and LMA is leading the way in that respect.
What did you learn on this trip?
Media companies now recognize importance of positioning the consumer at the center of the business model, and they are beginning to make the investments to build a holistic view of the customers who comprise their audiences in order to monetize those relationships in a variety of ways. It is exciting that companies are now thinking beyond subscription models to create new consumer-oriented revenue streams.
In a post IM blog, you wrote that data is indeed the new currency of exchange. Can you give us some insight into your thinking on this?
First, our modeling consistently shows that about 80% of paid subscribers come from 20% of a publisher’s addressable market, and I just don’t see that changing in any meaningful way. We must find alternative ways to engage the other 80% who may never pay for content, but are nonetheless valuable and can be monetized indirectly. This could be video content consumption, ad-sponsored email newsletters, or responding to promotions and events that we can execute on behalf of advertising partners. The incredible amounts of data captured through these interactions means that publishers can deal in a new currency of exchange (data) since advertisers are also looking for new ways to connect with their own customers and potential customers.
Now the challenge is there are lots of technology companies that compile and store the data. We emphasize going a step beyond to enrich, score, model and build audience segments so that the data becomes actionable. If you are storing data, but not acting on it – what’s the point? Data should be regarded as a currency of exchange, with publishers uniquely positioned to connect local businesses with their customers and potential customers.
What are the key components of the data that media companies should be collecting?
We adhere to a hub-and-spoke model, depicted in the diagram at right, which identifies and then integrates the following: USPS standardized address, subscribers, transactions, site registration, newsletter registration, contesting, promotions, deals, events, eCommerce, demographics and lifestyle data, web analytics, and advertiser customer data.
Building audience databases is one thing. Knowing how to maximize the treasure trove is another. What are some of the top initiatives that every media company should be undertaking with its audience data?
We believe revenue diversity must be at the center of your audience strategy, which is to say there are multiple paths to monetize customer relationships beyond persuading them to pay for access to content.
For those media companies that have not done much with their data, how do you recommend they get started in forming a strategy?
Begin with the end in mind: what are you in business to do? Let’s assume it is some derivation of “we exist to connect buyers and sellers in the local marketplace.” Okay, fine. How do you do that? “We produce content, provide services and deliver experiences that audiences find valuable.” Then the next logical question is, “who is your audience?” We don’t portend to define strategy for our clients, but I suggest wrestling with that last question and see where it leads you.
When you know your audiences and what they find valuable, your strategy on products, services and experiences will follow, and revenue always follows audiences.
Many media companies are stymied by too many choices/too few resources – choosing which new initiatives to devote limited resources to while remaining focused on core business pursuits is an everyday problem. What advice can you give to overcome this dilemma?
A great question. What I see too often is media companies make decisions on technology and then try to fit their strategy around the capabilities, and it usually ends up being a poor outcome for all concerned.
I think companies need to spend more time upfront in defining their business strategy, identifying the requirements and only then do you have the basis on which to base investment decisions. If a company cannot support your business requirements, you don’t end up wasting time and money only to end up down the wrong path. This is a very pervasive issue in the industry.
Enviable assets – brand, audience, local – are part and parcel of most media companies. Please share your views on how these attributes should be leveraged to push the revenue diversification needle.
I would change one part of that statement, and it would be “audiences” rather than “audience.” An individual can belong to many audiences, even within a single brand relationship. If you think of it this way, there are numerous paths to monetization.
There is also a philosophy we have adopted at LEAP with respect to the inherent advantages afforded to newsmedia companies, and that rests in your ability connect buyers and sellers in the local markets that we serve. This has been true throughout the history of publishing. Our brand, our access to and knowledge of our audiences, and deeply-entrenched local presence – as we all know – are foundations on which a long-term, sustainable business model can be built. But again, an individual publisher may have hundreds (perhaps thousands) of audiences within their sphere and our ability to provide access to any of those audiences presents tremendous value to local businesses.
Of late, there’s been much maligning of news media from the national stage and inevitably there’s a trickledown effect locally. Thoughts on overcoming the stigma of fake news, etc?
I think we should take active measures to identify and shun the perpetrators of fake news, and reject those who obsess over it.
What resources do you use to keep up to date with digital marketing trends?
I read a lot of eMarketer, Digiday and of course the stuff that comes across my LinkedIn and Twitter feeds from any number of sources. The Local Media Association also provides great training and thought leadership, and we have representation on the Chief Digital club.
Finally, what do you think are the best opportunities for local media at the moment?
Revenue diversification is both an opportunity and an imperative. An imperative because the available revenue mix is now comprised of dozens small slices, rather than 4-5 large categories. But an opportunity because these emerging areas depend on delivering access to audiences – which is a major competitive advantage because audiences are something we have in spades.
Dispatches from Mega-Conference: New ideas for consumer revenue, branded content, alternative funding