Thriving as econtent prices fall

Last week I wrote about why I believe econtent prices will continue to drop in the future. The feedback I got in a couple of LinkedIn groups and via email was mixed. Some readers agreed and others seemed to think it was the craziest thing they ever heard.

Regardless of where you stand on this, there are a number of things you can do to prepare…just in case I’m right. Here are a few strategies to consider:

Sponsorship – Why force the consumer to pay the full price of your content? Think about a multi-pronged revenue strategy instead, where a sponsor pays part of the price. The end result is an ebook, newspaper or magazine that features a “Brought to you by ‘xyz’” banner somewhere on the cover and probably includes a sponsorship message and maybe even an offer for the sponsor’s products/services inside. You first need to think of which prospective sponsors might be interested in an affiliation with your content. Are they looking to get their name next to your brand? Do they want to include a message to your audience? Whatever the reason, identify a short list of sponsor prospects and start the discussion. Be sure to think long-term, not just one title or a single day’s/month’s edition. And be creative: Rather than just asking the sponsor for a fixed fee, can you get a cut of the revenue generated by the leads you’re providing them?

Premium+exclusive+direct – This is rapidly becoming one of my favorite concepts. Book publishers in particular are seeing their prices pushed downward by Amazon’s desire to give customers the best deal possible. There’s nothing wrong with that, till it starts to cheapen your brand. You can try to go direct at a higher price but what consumer wants to pay more when they can get the same product from Amazon for less? That’s why you have to think about creating premium versions of your products that are available exclusively on your site. What value can you add to your standard products and how can you deliver those only on your website, in a B2C manner. Yes, it means investing more in that premium content, but if it helps preserve your price point and enables a direct relationship with your customer it’s definitely a model worth building. 

Bundles and partnerships – What are some of the adjacent businesses and products that complement your offerings? How can you bring them together to create a bundle consumers can’t resist? And are some of those companies looking to extend their reach, particularly into your customer base? If so, they’ll have an incentive to discount their product in order to partner with you.

Despite the grim outlook of declining prices there are still new business models to be invented. The beauty of this is that these three options are not mutually exclusive; they can all co-exist with your existing channels and pricing models as well.

Why Amazon Firefly is important

At any given point in time it’s easy to assume that search engines have evolved as much as they’re ever going to. Sometimes it’s hard to avoid falling into the logic that was allegedly uttered long ago by Charles Duell: “Everything that can be invented has been invented.”

Putting the gimmicky eye candy called “Dynamic Perspective” aside for a moment, there’s another element to Amazon’s recently-announced Fire phone that everyone in the content industry needs to focus on: Firefly.

On the surface, Firefly also feels like a Fire phone gimmick. In reality, it’s a next generation search platform and likely to be the first significant Google challenger. I’m not suggesting Google will disappear or feel the pain anytime soon, but Firefly will force them to evolve.

Firefly lets you snap pictures of objects so you can buy them from Amazon. It’s the next step in showrooming, the process brick-and-mortar retailers loathe. Publishers need to look beyond Firefly’s ability to enable one-click purchase of a physical book sitting on a table. Rather, publishers need to consider how Firefly will eventually enable the discovery and consumption of all types of digital content as well.

Let’s say you’re at the ballpark watching the Pittsburgh Pirates play. You snap a picture of the beautiful city skyline, looking out from behind home plate in PNC Park. You’re curious to learn more about the park, the team or maybe even the city itself.

Instead of clicking the camera button, click the Firefly button on your Fire phone. Rather than just getting a photo you might not ever look at again, your screen is filled with search results. These aren’t just the website links you get from Google though. You’re looking at all sorts of free and paid content you can consume now or later.

All the usual suspects are included here. You’ll see links to books about the team, park and city. But you’ll also have an opportunity to buy the program, print or digital, from today’s game. And maybe there’s a link to purchase a digital edition of today’s local paper or just portions of it (e.g., the sports section, just those articles covering today’s game, etc.) The results could also include articles about the team/park/city, accessible via either a trial subscription or maybe they’ll ultimately be free thanks to the ever-expanding reach of Amazon Prime. 

Don’t forget that all these results won’t just appear in random order. Amazon will develop a search algorithm as sophisticated as Google’s, but with the benefit of all Amazon’s “customers who viewed x also viewed y” data and capabilities.

Most importantly, don’t forget the power of paid placement in these results. Amazon has generated plenty of revenue from publishers for placement and promotional campaigns. Firefly will open the door to an enormous number of new ways Amazon can charge publishers for premium placement in those Firefly search results.

I haven’t forgotten that you’re sitting at a baseball game and the last thing you want to do is flip through search results and spend time reading content on your phone. That leads me to another model I suspect we’ll see from the Firefly search platform: save for later.

Web searches today focus exclusively on the here and now. You search, find what you need and you move on. Firefly opens the door to a lengthier relationship between user and search results.  You can’t be bothered with all the Firefly details when you’re trying to watch the baseball game. That’s why you’ve configured Firefly to save those results for later retrieval. They could sit in a holding area in your Amazon account, similar to your Amazon Wish List, or maybe they’ll be delivered to you via email. The more likely scenario is that Amazon will do both, of course. Amazon knows the value of data and reminding customers of what they like, so expect to see plenty of notifications about these potential one-click purchase opportunities.

None of this functionality exists today, of course. And most of it won’t be available when the Fire phone ships in July. But rest assured that these and plenty of other innovations will eventually be available through the Firefly feature. Amazon’s #1 goal is to get consumers to buy things and Firefly is a huge step forward in making those transactions happen more frequently and conveniently.  

Location-based content in the future

I’m one of the hundreds of millions of people who use Google News in a variety of ways. Long ago I configured it for the keywords I like to track so that I can scan the latest headlines on my favorite topics. I also have it set up to show me the latest goings-on in my hometown.

I’ve got to say the local element of Google News isn’t exactly the service’s greatest feature. It’s littered with stories that aren’t exactly news, they’re not in line with my interests and, in some cases, they have only a very loose association with my town.

It’s amazing that in this day and age of geo-tracking, data capture and rich content there’s no killer app for location-based content.

I’m talking about a service that does the following:

  • Knows precisely where I am, whether that’s at a ballgame, in the supermarket or sitting in a coffee shop
  • Knows who I am, including my interests and habits, whether this is the first time I’ve been in this location or if I come here regularly
  • Provides me with information, stories, and yes, even deals on purchases I might want to make while I’m in that location 

I’ve seen bits and pieces of these requirements but I haven’t seen them all rolled into one service.

The first point is pretty simple. Every modern phone has geo built in, so it’s just a question of this service tapping into those capabilities. 

The second point may sound spooky, especially if you’re concerned about data privacy. Then again, anyone who thinks they can avoid being tracked and measured these days is pretty naïve. Opt out when you can but know that data is still being collected, even if it’s nothing more than your location from cell tower triangulation.

I figure that since all this data is being gathered, why not use it to my advantage as a consumer?

The second point also sounds a lot like how Zite, now part of Flipboard, tracks my reading habits to gauge my interests and uses that information to provide more relevant content tomorrow. That’s a terrific application of data gathering and one that always resulted in a more efficient reading experience.

The third bullet is where all the work still needs to happen. Tagging is critical here. When stories are written, what level of tagging is included so those same stories can be presented in a location-based service? I’ll bet there are few, if any, geo-based tags included with most articles today, so this is an important point to consider when creating content. 

Finally, the game-changer here isn’t a bunch of apps. You don’t want to force mobile users to download a new app every time they visit a new city or go to a museum. This has to be one single service that provides access to all the big stories and hidden tidbits of information no matter where you are. Sort of like Google News, only much, much better.

Why you need to experiment with content sponsorship

Every type of content is facing downward pricing pressure. Free online news has disrupted the newspaper industry. Free article-length content has impacted the magazine model. Free and cheap ebooks have completely upended the book publishing world.

It’s time for publishers to think more broadly and creatively about multiple streams of income. Many are too focused on protecting the streams they already have and worry about the cannibalization potential of new models. Those publishers are only contributing to their own demise.

No matter what type of content you’re producing, why wouldn’t you consider at least testing the sponsorship model? 

Here’s what I’m suggesting: Find a business partner who values your content, your brand and your audience. Sit down with them to determine what you both can offer each other and gauge their sponsorship interest. Then pick a product, determine the publicity campaign, nail down the offer and make it happen.

Here are three scenarios based on what type of publisher you are:

Newspapers: Give away an entire day’s e-edition; the whole thing, not just a section or two. Make sure the sponsor’s message is prominent so readers can appreciate the generous deal this sponsor has created for them, the reader. Feeling bold? Why not make it free for an entire week? Btw, plan ahead and sell special advertising pages, and don’t forget to count all those new digital ad impressions you’ll get from this broader, free access. 

Magazines: Similar to the newspaper model, but now you’re probably talking about one weekly or monthly edition. But why not make this a richer edition with more features than what you typically offer? After all, one of your goals should be to attract new customers with your unique, valuable content. Think about video content that’s currently behind your paywall, for example.

Books: Yours isn’t a subscription model with new editions every week/month so you need to focus even more on the length of time to extend the free offer. Don’t go through a retailer! Just give readers the ebook right on your website; that way you’ll know who those readers are and you’ll be able to build a direct relationship with them. 

Each model is slightly different but there’s a common thread throughout: dramatically expanded reach. Be sure to have a plan for all those names and email addresses you’re gathering. Don’t let them just sit in a spreadsheet that nobody ever acts on. In fact, force your team to come up with a detailed follow-up plan before you ever launch the campaign.

This is an opportunity to dramatically increase your product’s reach. It’s not about giving something extra to your current subscribers; this is all about finally building a relationship with all those other prospective customers. It’s also about building a solid relationship with your sponsorship partner. If they like the results, which means the sponsor gets more visibility for their brand and products, this could be step one of a much broader, ongoing sponsorship program for you business.

Here’s another reason to do it: Even if you don’t, your competitor(s) probably will.

What can we learn from Getty’s new free, embed model?

Getty Images made an interesting content-usage model announcement last week. After years of playing whack-a-mole with everyone who’s ever stolen one of their images, Getty decided to embrace the free model for a portion of their library. You’ll find additional details on this here and here.

As a wise man once said, you can significantly reduce piracy if you make your content available at a reasonable price and in a convenient format.

OK, free is a pretty radical price and of course piracy evaporates when content becomes free. But it’s important to note that Getty isn’t just giving up and letting pirates have their way. They’ve introduced a model that I think could become a viable template for other types of content.

Note that Getty isn’t saying everyone can now just copy and paste the images into their sites. Getty is instead providing a snippet of HTML code you’ll use to legally embed the images on your site. This approach offers a number of benefits for Getty including tracking and, more importantly, a new potential revenue stream.

By embedding the code in your site Getty will be able to gather data about where their images are being viewed and who is viewing them. This data could eventually be valuable to Getty as they’ll suddenly have access to plenty of metrics they knew nothing about before. Unless you’ve been hibernating the past few years you know that big data can be quite valuable and it’s easy to see how Getty’s data will become big rather quickly.

What’s even more intriguing to me is how Getty will be able to control how those images are rendered on your site. The images live on Getty’s servers, much like YouTube videos live on Google’s servers.

Do you remember when YouTube videos didn’t have pre-roll ads? These days it’s rare to watch any YouTube video without first having to sit through a short ad. 

Will embedded Getty images soon have ads in them? Maybe. It makes sense for Getty to at least experiment with ads. They’ll have plenty of opportunities to study all that data they’re gathering to determine the viability of ads with images.

What about other types of content? Magazine and newspaper articles come to mind. How often is that content illegally copied and pasted onto someone’s website? How often is the same content scraped off the publisher’s website and dropped into an app? The app might give credit to the publisher, and even offer a link to where the content originally appears on the publisher’s site, but how many times do readers get what they need from the ad-free scraped version and never click through to the publisher’s site? How many ad impressions are lost as a result?

What if publishers offered a model like Getty’s, so someone could grab a snippet of code to embed the article in their own site? That version would provide data and a possible advertising opportunity, just like Getty’s.

OK, I think I know what would happen… Most publishers would resist, saying they want the traffic coming to their own site and threatening legal action against anyone who copies and pastes illegally. The smart publisher, on the other hand, would instead embrace this for the data and new, alternative revenue opportunities it represents.

I can’t wait to see how Getty’s model evolves and whether it will expand into other types of content.