Frequent thinker, occasional writer, constant smart-arse

Tag: opportunity (Page 2 of 2)

A casual chat with a media industry insider

Today I had the chance of picking the mind of Achilles from the International Herald Tribune, who last year was appointed Vice-President, circulation and development. Achilles is a family friend and I took the opportunity to talk to him about the world of media and the challenges being faced.

The IHT is one of the three daily financial newspapers of the world, along with the Wall Street Journal and the Financial Times. It is currently owned by the New York Times, and has a global circulation of 240,000 people. I had a great chat on a lot of different themes which could have me blog about for a week straight, but here are some of the facts I picked up from our discussion, which I will summarise below as future talking points:

  • On Murdoch’s acquisition of the Wall Street Journal: “very interested to see if he will remove the paid wall”.
  • The IHT experiemented with a paid wall for it’s opinion content, but they will be removing that later this year
  • He says the Bancroft family sold it because they are emotionally detached from the product. It was just an asset to them.
  • A lot of the content is simply reedited content from the NYT and internationalising it. For example, replacing sentences like “Kazakhstan in the size of New York state” doesn’t work well for an international reader who has no idea how big New York state is.
  • On the threat of citizen journalism with traditional media: “they are a competitive threat because we are competing for the same scarce resource: the attention of readers”
  • The problem with citizen journalism and bloggers is the validity of their information – behind a newspapers brand, is trust from readers of the large amounts of research and factchecking that occur. They have no credibility.
  • A blog may develop credibility with an audience greater than the New York Times. But this poses problems for advertising as advertisers might only advertise because of its niche audience. Blogs are spreading the advertising dollars, which is hurting everyone – it’s become decentralised and that has implications which are problematic.
  • The IHT’s circulation is spread thinly across the world. For example, it has 30,000 readers in France and six in Mauritius.
  • Their target market is largely the business traveller, which has its own unique benefits and problems. For example, a business traveler will read it for two days but when they get back home, they will revert to their normal daily newspaper. It’s not a very loyal reader.
  • Readership is a more important concept than circulation as it tells advertisers how big the actual audience of a publication is. For example, the average newspaper has 2.7 readers per copy. However due to the nature of the IHT’s readers, despite having high circulation, they have low readership.
  • IHT is in a unique position of relying on circulation revenue more than advertising. For example, a normal daily relies on circulation revenue as 20% of its total revenue; the IHT counts on it for 50%.
  • It’s hard to get advertising because a readership of university professors is less desirable than fund managers that might read the WSJ. Advertisers prefer to target key decision makers.
  • It doesn’t rely on classifieds as a revenue source – a key thing hurting the newspaper industry currently.
  • Although they place more reliance on circulation revenue, they still get some good advertising opportunities as a lot of readers are politicians and government decision makers.
  • They get a lot of advertising for fashion
  • Psychographic data is more important to advertisers than circulation and it shows what type of readership a publication has.

Half the problem has been solved with time spent

On Thursday, I attended the internal launch of the Australian Entertainment & Media Outlook for 2007-2011. It was an hour packed with interesting analysis, trends, and statistics across a dozen industry segments. You can leave a comment on my blog if you are interested in purchasing the report and I’ll see if I can arrange it for you.

One valuable thing briefly mentioned, was the irony of online advertising.
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Thoughts on attention, advertising, and a metric to measure both: keep it simple

Advertising on the Internet is exploding. Assuming you accept my premise that the Internet will be the backbone of the world’s attention economy – then, I am sure you can see the urgency of developing an effective metric for measuring audiences that consume content online. Advertisers are expecting more accountability online and there is increasing demand for an independent third-party to verify results. But you can’t have accountability and there is no value in audits, if one place measures in apples and the other in bananas.

The Attention Economy is seriously lacking an effective measurement system

Ajax broke the pageview model of impressions, the one billion-dollar practice of click-fraud is the dirty big secret of pay-for-performance advertising, and the other major metric of using unique visitors (through cookies) is proving inaccurate.

It sounds crazy, doesn’t it? The Internet has the best potential for targeted advertising, and advertisers are moving onto it in stampedes – and yet, we still can’t work out how to measure audiences effectively. Measurement is broken on the Net.

(Although I am focusing on advertising, this can be applied in other contexts. An advertising metric is simply putting a monetary value on what is really an attention metric.)

Yet when we look at the traditional media, are we being a little harsh on this new media? Is the problem with the web’s measurement systems just that it is more accountable for its errors? After all – radio, television, and print determine their audience through inference which are based on sampling methods and not actually directly measuring an audience. Sampling is about making educated guesses – but a guess is still a guess.

Maybe another way of looking at it is that the old way of doing advertising is no longer effective. Although we can say pageviews are broken due to AJAX, the truth is it was always an ineffective measurement system, as it was based on the traditional media’s premise of how many viewers/subscribers theoretically and potentially could see that ad. As an example of why this is not how it should be: when people visit my blog via Google Images, they hang around for 30 seconds. People that search for business issues on the web that I write about, like stuff you are reading right now – spend 5+ minutes. If both are equal in terms of page views, but the later actually reads the pages and the former only scans the content for an image – why are we treating them equally? My blog is half about travel, and half about the business of the internet, which is why I have two very different audiences. Just because I get high page views from my travel content, doesn’t mean I can justify higher CPM’s for people that want to advertise on internet issues. Not all pageviews are the same – especially when I know the people giving me high pageviews, arn’t really consuming my content

Another issue is that advertisers are so caught up on who can create the most entertaining 30 second ad, that the creativity to get people entertained has ovetaken the reason why advertising happens in the first place: to make sales. The way you do that, is by communicating your product to the people that would want to buy it. If I placed advertising on this blog, from people who want to do web-business related stuff, they should only pay for the peope that read my blog postings for 5+ minutes on the Attention economy, not for the Google images searchers who are looking for porn (my top keywords, and how people find my blog, makes me laugh out loud sometimes!).

When we create a metric that measures attention, lets be sure of one thing: the old way is broken, and the new ways will continue to be broken if we simply copy and paste the old ways. New ways like click-through ads that appear on search results, and account for 40% of internet advertising is not how advertising should be measured. The reason is because it is putting the burden of an effective advertising campaign, on a publisher. Why should a publisher not get paid, with the opportunity cost of not using another ad that would have paid, because of the ineffectiveness of the advertisers campaign strategy at targeting?

When measuring audience attention, lets not overcomplicate it. It should be purely measuring if someone saw it. As an advertiser, I should be able to determine which people from which demograph can see it my ad – and yes, I will pay the premium for that targeting. If it turns into a sale, or if they enjoyed the content – is where your complex web analytic packages come in. But for a simple global measurement system, lets keep it simple.

Concluding thought

If I stood at the toll booths of the Sydney Harbour bridge naked, some people will honk at me and others won’t. If I can guarantee that they can see me naked, that’s all as a publisher I need to do. It’s the advertisers problem if people honk at me or not. (Not enough honks means as a model I should still get my wage. They just need to hire a better looking model next time!)

I’m on the APML workgroup

As Chris announced, I’m now a member of the APML work-group. So the question, is why have I joined it? Because profiling is huge. People are only starting to get to grips with the loss of privacy on the web – I suppose an externality of an electronic world. I remember reading about some guy who posted on a marijuana bulletin board in 2000, and that it still comes up in Google searches. Prospective employers, prospective girlfriends, prospective anything – he now cannot control the information that he was once a pot head. It’s like someone watching you get changed, and you don’t have the option of pulling the curtain. Privacy, is about giving you the choice to use that curtain – whether you’re an exhibitionist or not!

Something a lot of people arn’t aware of, is the amount of data other companies are collecting – and you can’t control it. You reading this blog posting – I can find out what browser you have, what city you are viewing this from, who your Internet service providor is – heck I even know what version of windows you use. And I’m not even trying to profile you – think about Google or DoubleClick that know of every website you visit by placing a cookie on your computer.

Why do people want to collect information about you, known as your “attention data”? Because they can profile you – and when you can profile someone, you can personalise the experience for them…and target their advertising better.

The APML standard does a very simple thing: it allows you to control your “attention”. It’s still early days, and although there are some smart people discussing some deep issues on it, everyone on the work-group is still feeling their way of where this standard is going to go.

If you have thought about targeted advertising – and if you don’t you should – I would watch this standard. Or better still, start discussing it – this is a huge opportunity to set things right, before the Internet dominates our lives.

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