Content matters more than ever, and people are watching more video and listening to more music than ever before. The internet is global and therefore opens up new markets. Digital reduces distribution costs and increases margins. Huge brands with major economic value and audiences have been created, from Google to Facebook. So what makes companies succeed, and what can we learn from them?
Key trends and resulting shiftsFrom centralized to scattered: On the internet one must both distribute messages and make them easy to find. Instead of focusing on corporate websites or content portals, make content easy to find and access via search engines, social networks or aggressive partnering. Quincy Smith of CBS has the right idea when he looks aggressively for ways to seed CBS content and allow it to be found all over the web. General Motors not only has a deep website with an efficient search function but also makes its content freely available at auto sites such as Edmunds.com.
From authority to authenticity: Consumers believe marketers less and less and each other more and more. Word-of-mouth has always been powerful, but it has rapidly expanded on the web. Each customer is a broadcasting station for a brand. People believe marketers on issues of fact, such as specifications, and they also turn to third-party experts such as bloggers. But when it comes to opinion -- whether the product is good -- they look to other consumers.
From conduit to content: With the internet, you are only a click away from the content you want. The traditional distribution chokeholds -- publishers, TV networks, cable companies and soon even telecoms -- will see their ability to serve as tollbooths or to gain market cap due to their distribution roles decline. Even the temporary new gatekeepers will become less powerful; Apple's iTunes is facing the threat of MySpace's music offering.
From spaces to audiences: Marketers never wanted to underwrite the entertainment industry, but the only way they could cost-effectively distribute their messages was by buying space (pages, TV spots, etc.) inside content consumers wanted. But with search and ad networks, we can buy interested audiences rather than space. Marketers can pay search engines to reach interested consumers who look for products and services in their categories without having to underwrite content. Across all search engines and categories, marketers bid 56¢ a click for audiences (a cost of $560 per thousand people) while paying CPMs of less than $20 to insert their messages in other people's content.
Blueprint for successIs your content 'fit' (free, intelligent, transmittable)? It's very difficult to charge for content online unless it is very special, and subscription models limit audiences, as content providers such as The New York Times have discovered. When content is freed, audience climbs, but that's not the end of the story. The content needs to be intelligent; the provider needs to know who is interacting with the content so it can sell audiences to marketers at a premium. The New York Times uses registration as well as behavioral targeting to sell segments vs. space. Finally, content is found via search and social media, so it is critical that content is optimized for search engines and is easily embedded and distributed via the blogosphere and social networks. If you have a new ad campaign, put your ad on YouTube and buy a search program so your brand shows up in search-engine results.
Does your content smell like a 'rose' (relevant, open, simple, elegant)? Is it relevant? Can people speak back to it or embed it in their websites? Are its design and navigation simple and elegant? The importance of this has been clear when it comes to products (think iPod vs. Zune), and content is subject to the same laws.
Do you have a plan to deliver 'sofa'? Marketers want scalable outcomes that are friction-free and accountable. Search-engine marketing fits that description in that it reaches millions, is outcome-driven and is based on the auction model, which makes it easy to buy. Plus, the big search engines return your call. We see many companies fail because their grand ideas have no hope of getting large audiences or require a lot of work and trouble to buy. Advertisers are voting in a big way for SOFA by preferring to buy inventory from ad networks rather than publishers themselves because the publishers often do not offer large audiences.
Rashid Tobaccowala is CEO of Denuo and chief innovation officer of Publicis Groupe Media. Previously he was president of SMG Next, a futures practice in the media industry. He has more than 25 years of marketing and strategy experience.