It’s been a horror couple of years for media businesses in the ANZ markets, and on the revenue side things don’t look like getting much better any time soon.
Despite some optimistic predictions by analysts pre-Christmas, early new year indicators from the retail sector are that there is little if any growth to count on in 2012. So display advertising is likely to remain soft.
The car industry is struggling, real estate prices are flatlining, and whilst employment rates are still holding up relatively well job ads are stagnant at best.
Europe is either officially in recession or about to be, depending on who you read, and the only glimmer of hope for developed economies seems to be that the US might just pull a very small rabbit out of the hat and post some limited growth this year.
All of which will leave China wondering who it is going to sell to and trying to figure out how to manage a precariously balanced domestic economy as it grows by a forecast 8.3% this year.
With such challenging external factors media companies are looking to get their operational businesses streamlined and positioned for the next economic upturn, or at least refocused into new markets.
And any way you look at it the name of that game is digital.
Locals will watch with interest as News Ltd puts a price on The Australian’s paywall and starts to charge consumers in February some time, and then extends that to its other news properties. Will they follow a similar model to Slovakian media company Piano Media and introduce a unified paywall for all their sites and channels? Or will they price individually by product and brand?
Meanwhile, Fairfax has taken initial steps with AFR.com by bundling print and online subscriptions, where once there was a distinct price regime for each point of access. This has stimulated useage of AFR.com and provided some good initial data which will no doubt feed into the next iteration of the AFR’s digital strategy.
Other publishers are starting to use detailed information about patterns of useage to feed into cross-selling and build new value for clients.
And this, I think, is the key point for media in 2012: data. Data in all its forms can add enormous value for publishers: data about reader habits and preferences, data about customer needs, and data as a basis for new forms of journalism.
In 2012 innovative, consumer focused product development that takes advantage of all available data inputs for marketing and sales – and data output for editorial – will deliver much needed trial, purchase and loyalty as publishers look to grow valuable digital audiences.
The past ten years have shown us a lot, and one of the lessons is that audiences expect creativity and technical excellence in production values, as well as good content. “Quality” content on its own will not convince consumers to pay online. Quality – whatever that is – needs to be packaged cleverly, it needs to be easily accessible on all devices, searchable, filterable, and able to be interacted with.
In digital publishing terms we’re about to step into the interim stage of maturity as an industry. We’ve left infancy behind, but we’re not yet fully formed. The need for experimentation hasn’t passed, but at the same time expectations are vastly higher than they were five or six years ago and cost management is more critical than ever.
Just as the first phase of digital product development in media publishing was characterised by a serendipitous relationship between traditional journalism and the disciplines of software development, so the next phase of digital publishing needs to take advantage of other non-traditional media skills and expertise.
Some publishers have begun creating new roles in their newsrooms and marketing teams, whether it be social media managers or visual data journalists. This is a good step, but the challenge is to do more than simply retrain the smartest young reporters in the newsroom. Those smart young reporters have a lot to offer, but they won’t provide the solution on their own. So bringing in new skillsets, such as computer scientists, and training them as computational journalists is an example of the kind of direction publishers need to go.
Publishers have been on a set path for some years now, following the advent of new information and communication technologies. But for too long most didn’t really want to acknowledge this new reality. During 2010 and 2011 there was a belated recognition at the highest levels that digital really is the future. 2012 will be the year to act on that.
It’s going to take more careful planning, and in some instances a new culture of innovation and in others a whole of business transformation; it will take a fair degree of courage and even some luck, but the alternative is not pleasant to contemplate.