Martin Sorrell: Newspaper/Magazine Contraction Must Continue

So what? you might ask. Well that's a pretty big 'so what'.

What Sorrell is saying, as a CEO with a HUGE vested interest in 'legacy media' like print, is that the whole debate our industry is engaged in, about how the print segment will evolve, how its business model will shift, the future of journalism, etc, is all very esoteric and relevant to those who may survive the cataclysm, but that the blade has already begun its downward arc (without meaning to be too dramatic about it).

The simple law of supply and demand has already made the dozens of newspapers in any given city redundant. There are already far, far too many suppliers of quality content (and a lot of poor quality blog and local news sources) now proliferating -- and more come online daily. Gourmet magazine was just an early casualty.

Think for a moment about the inevitable result of a simple calculation of supply and demand, of both readers and advertisers, and what it means for print-related firms in the coming 12-24 months. Then think about what it suggests about how the marketing industry is going to change, both tactically and strategically.

There's going to be a much deeper evolution following the current "Social Media"/"Marketing 2.0" wave as we abandon 'push' and embrace 'pull'.

Some thoughts: http://preview.tinyurl.com/change-marketing

To build on Kevin's comment - and the clarity of Mr. Sorrell's position - I would add that the pull market is creating new service layer bundling in which publishers, networks and content portals are being forced into transition as consolidated yet unacquainted entities, who retain different or conflicting agendas and most often operate against the tide of inventory and demand. In between these layers, advertisers and consumers are redefining their relationships (or they are creating new ones), and the role of agencies is fast becoming one in which these new relationships are facilitated and nurtured. In other words, agencies have become content producers and editorial experts, not just buyers of media, creators of ad campaigns, or the orchestrators of PR stunts.

Further, the good news - at least for those agencies and media companies who can adapt - is that the glut of mediocre mid-tail content on offer is calling for these relationships to formalize in the trial of new revenue models, and digital channels can afford us the opportunity to do this without too much exposure, or, allow us to fail in ways where we can recover quickly and course-correct our strategies. Known as 'gap markets', the pockets of interaction that blossom along newly formed environments within the social web are generating micro media that can be disseminated, shared... and ultimately, monetized.

Funny enough, my mother spoke about these dynamics 25 years ago when she was an executive in the entertainment media business. Granted, new media had not yet show its face in the way it does now, but even back then, traditional publishers and studios were looking for ways digitize and repurpose their assets, as well as create new revenue streams.

Exciting world we live in today...

Gunther Sonnenfeld
@goonth

And the interesting news yesterday regarding the SF Chronicle moving to a gloss paper daily print at a higher subscription price speaks directly to content migration. Cannot wait to see how that works out.

It's true that agencies are getting more into the content creation sphere, and building media interfaces directly with their clients' audiences.

But to say this is primarily due to contraction in print channels is missing the point. The main driver is that brands need to behave in a different, less self-entitled, way.

Brands need to deliver content because they need to be more genuinely useful to their audiences. Engaging today's attention-poor consumer takes more than simply shouting messages about yourself. As a brand, it's increasingly important to demonstrate your value by giving folks something genuinely useful; free apps, games, entertainment or information. Starbucks, Dell, P&G, Walmart, McAfee are just a few of the folks jumping into the area.

I have a feeling that work which has to 'earn' its own audience (rather than take it for granted) will tax many shops beyond their current skills.

So keep your seatbelts fastened - that Captain says the turbulence will continue for some time yet. More thoughts here: http://tinyurl.com/yjq2b5k