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Media company turns to software

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CFE Media is a traditional, integrated b-to-b media company that publishes Consulting-Specifying Engineer, Control Engineering and Plant Engineering. Last month, the company transformed itself into a software company as well, when it introduced ContentStream, a patent-pending product to help advertisers with content marketing. Depending on how the software-as-a-service offering is accepted by b-to-b marketers, media industry observers say this may be an intelligent initiative for CFE Media, and they advise other media companies to watch ContentStream's progress closely. “It's a smart move,” said John Wickersham, a partner at Atwood Advisors, “and I think it's the kind of thing survivors are going to have in the mix.” CFE Media embarked on the development of ContentStream about two years ago. When Group Publisher Jim Langhenry and the CFE Media team made sales calls, they asked customers about their budgets: Where are they spending more money? What areas are receiving less? Over the past several years, it became apparent that marketers were spending more money on their websites. Not only were they investing in technology platforms to build and operate the sites, they were spending more to develop content and keep customers and prospects coming back. Faced with this evidence and the lack of significant growth in print advertising, CFE Media—led by Langhenry and CEO Steve Rourke—saw an opportunity. “What are we really good at?” Rourke asked. “Content.” After discussing several approaches to helping their customers create content, CFE Media decided to pursue a software solution, which eventually became ContentStream. The company established a number of goals for the product, which would syndicate content for marketers:
  • It should provide easy access to such CFE Media archived content as articles, podcasts and videos produced for its three brands.
  • It should allow marketers to select the kinds of content they want, so that, for example, articles could be filtered based on subject, date published or other characteristics.
  • The content should be delivered automatically with little to no effort on a daily basis from the marketer.
  • The software should be as compatible as possible with a variety of content management systems.
  • With these parameters in place, CFE Media spent about 18 months developing ContentStream to deliver syndicated, targeted content via SOAP or FTP. CFE Media said it is in initial talks with about 20 marketers that are interested in the product. The size of the companies runs the gamut from small to large, with midsize companies and divisions at larger companies expressing the most interest, Rourke said. The cost per month for ContentStream service is similar to that of a print ad. The software is already being used by MyPurchasingCenter.com, a site that covers the purchasing sector. The site mainly uses content from CFE Media's Plant Engineering to populate its MRO/Indirect vertical. So far, MyPurchasingCenter.com has been pleased with the results. Dan Hirsh, managing partner of Media Solve Group, which operates MyPurchasingCenter.com, said the ContentStream stories have boosted the site's SEO performance. Although he did not comment specifically on the merits of ContentStream, Chuck Richard, VP-lead analyst at research firm Outsell Inc., applauded media companies' ventures into software and online platforms. He noted that a recent Outsell study, “The New Drivers of Valuation,” found that a $100 million information company generating 25% of its revenue from software-oriented “platforms” received a valuation of $62 million more than a similar company without such an offering. “Over the years, we have been part of information company conversations investigating whether to pursue new lines of business such as offering services and building platforms,” Richard wrote in the study. “In some of those instances, the reason given for not pursuing such opportunities has been, "But we're not in that business.' Agreed. More's the pity.”
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