Posted on April 9th, 2008 by Atif
The NY Times was in the news yesterday – this time, a docile development related to its web site leadership. The Times was nominated for several Webby awards. In fact, the company has the largest presence of any organization with nine nominations, including the following categories: Best Visual Design, News, Newspaper, Best Copy and Best Practices.
Good news is a welcome relief at The Times. The “nation’s paper” is no stranger to front-page storylines. It is the center of several dramatic circumstances that involve controversy over future business direction. In a quick recap, there’s been shareholder discord over share price performance, governance structure (dual-class stock) and future strategy in response to the quickly vanishing newspaper business model. These issues are inter-related because different groups (broadly management vs. shareholders) hold different views on how the address the current industry climate and whether the corporate structure needs to be amended to respond decisively and effectively. Recently, hedge funds were successful in securing two seats on the company’s Board through a settlement with management.
With traditional offline revenue declining at a steady pace (January print revenues were down 9.8%), the foreseeable future does not look promising for overall financial performance. But is there light? In other words, as the core declines, how quickly is the revenue loss replaced by the digital business? Clearly this is a question of rates of change. Currently, the company does about $750mm a quarter in total revenue and about 90% is print. If the digital base, which is about $85mm per quarter, continues to grow at 15% annually while the core continues to decline at 10% annually, online will overtake offline 9 years from now. Can you say web 4.0? Even at 20% online revenue growth, we’re talking about 7.5 years for equivalency. Certainly a long way off and sufficient cause for shareholder anxiety. Read more »
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Posted on February 4th, 2008 by Atif
Ad Meter is a great cultural artifact which has been around for 20 years. It uses a live panel to record second by second sentiment about Super Bowl commercials. It works like this: 234 panelists use a device to continuously rate how they feel about ads in real time. An ad is given its highest average score at any point (second) in the length of the commercial by these panelists. I wonder why they take this approach (an ad with high highs and low lows can still win). Local avails are excluded from the eligibility for obvious reasons. Whatever you might feel about the method, it’s a uniquely fun and accessible diversion that is a loose gauge of the mainstream meme.
As you might guess, the highest rated ads are those which are most entertaining, tell a compelling story and engage the viewer. Like a show within a show. The top five from 2008:
Super Bowl commercials are the zenith of branding advertising venues and stand at the opposite end of the spectrum from search engine marketing. Of course both ends have a role and purpose in a marketing portfolio. Different spend allocations make sense depending upon the nature of a product category. In the SEM and direct response world, popularity and ratings are easy to measure - they’re measured in ad performance. That is ultimately revealed by cost of acquisition (COA).
But as brand advertising acquires some of the characteristics of direct marketing approaches such as SEM (and vice-versa), I’m left to wonder, is this the best we can do? I wonder why no one has disrupted the idea of Ad Meter (within a broader context). Read more »
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Posted on September 15th, 2007 by Atif
Labs, research and incubation practices within large companies are growing in importance and influence. For this reason, I’m starting to pull together information on how innovation is being pursued by large technology and media companies, while raising some questions about these approaches in the process.
There’s no doubt the sourcing, development and scaling of innovation will become a way of life for the company of the future. Consider the following statistics which speak to the significance of the matter for large companies:
- A recent study revealed that 72% of corporate executives believe their primary source of competition in 5 years will not be the company which is currently the main competitor, according to Bain & Company and the Economist.
- The well-known author Chris Zook, also of Bain, published data predicting that 10 years from now only 1 out of 3 companies will resemble what it looks like today (one of three will be acquired/bankrupt and the other third will redefine the core business).
- By 2000, the average tenure of a firm in the S&P 500 had declined to 10 years from its historical level of 66 years.
Yes, the half-life of market leaders is headed in a clear direction and that’s downward.
Since the nineties, a lot of growth has been predicated on acquisition strategies, but even that is beginning to fade as the fail-safe vehicle for entering new markets. Zook studied the success rates of different strategies when the rules of the core business are in flux (business turbulence). Large/transformative mergers yielded a 5-10% success rate in contrast to a 30%-40% for initiatives where companies re-positioned around new platforms. These are defined as hidden, internal assets which are developed into market-facing platforms. That’s a humbling or encouraging comparison depending upon how you look at it.
We’re living in a time where traditional disruption has become more manageable through known and repeatable business processes. Today’s anxiety is being driven instead by the Black Swans, who lurk without prior knowledge, waiting to upset industrial economics before you know it.
So what the models for innovation and the trade-offs between them? I’m starting to look at some current examples and attempt to glean the best practices. Read more »
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Filed under: Google, Innovation, Traditional Media | 1 Comment »
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Posted on August 22nd, 2007 by Atif
So, is Facebook a media firm or a technology company? In case you don’t know, the conversation was spurred by Mark Zuckerberg’s comments at the iMeme event (held in SF during late June), which I attended. Mark takes the perspective that the company is in the technology business. This existential-like question is difficult to wrestle down, not only for Facebook but for the industry more broadly.
Facebook’s position on the matter is very timely, and somewhat predictable, since platform is the strategic mantra of the company now. In case you’ve been living on Mars for a while, Facebook is an engine gaining steam despite its existing scale by opening-up. It’s demonstrated the horsepower to haul the core social networking market but is gaining the strength to pull along all kinds of adjacent services. Under the hood, it’s a jumbo-jet. But the plane has many, many empty seats where applications can sit. These applications are, of course, best sourced from the market and third-parties. Facebook’s core has therefore become open to others to wrap around the social networking phenomenon. Powerful stuff. Keep in mind, not all platforms are alike….plenty of companies have developer programs but they’re offering more of a bus-ride, rickshaw experience or mini-jet seat, compared to Facebook’s Dreamliner. Playing enabler, the company has deduced, supports the notion that it fits “lower in the technology stack” than where media businesses reside. Read more »
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Filed under: User Experiences, Web Apps, Web 2.0, Innovation, Traditional Media | 2 Comments »
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Posted on August 11th, 2007 by Atif
Much of the dialogue about web content over the last few years has focused on the long-tail. That’s been for good reason – the idea was one of those mega-trends with rippling consequences. It came onto the scene in a big way because it nicely encapsulated many diverse developments in the media world. But along the way, we may have lost sight of it’s equally important cousin – mainstream content.
It’s true that mainstream is not what it used to be. But it’s still around – alive and kicking. In fact, you could say mainstream is bigger than ever. If you don’t think so, just consider the popularity of the Super Bowl, which has always been ubber but continues to grow in reach and cultural significance. Last season (2007), it was watched by over 141mm viewers versus 91mm in 1993. The 10 most-watched programs in TV history are all Super Bowls, according to the NFL. This in no way diminishes the advent of the long-tail, though it raises important questions about how these two cousins will get along and work with each other. Things may be in flux, but there’s no doubt they’re two pieces of the same puzzle.
Mainstream is anything that has universal appeal to consumers despite their differences. Differences in taste, preferences and affiliations. In a globalized world, mainstream content will grow not shrink in terms of audience. There will always be a common denominator that links people. In a frictionless medium like the web, where instantaneous diffusion is built into the system, anything that can capture global consciousness will have a field day.
It would be interesting to know how many things in the public consciousness have wide recall factor and whether this figure is growing. In other words, the number of items that enter into pop culture and how quickly. Safe to say that more things go mainstream and they get there faster? Of course, there’s no precise bar for mainstream. Something doesn’t have to be mainstream at the international level to qualify.
If mainstream is still big, then what’s changing about it? Read more »
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Posted on June 8th, 2007 by Atif
As reported in The Week, an online magazine called Pasadena Now has “hired two reporters to cover local government who have never set foot in Pasadena, and may never.” The reporters, who work from Mumbai and Bangalore, cover the beat by participating in webcasts of City Council meetings (open to all) and sorting through publically available archives on the web. In an era of email and Skype, it’s not hard to imagine sprinkling a story with quotes here and there from local politicians and stakeholders. The publisher describes these resources as “efficient” which “means he can pay his new hires $10,000 a year to generate 15 local news stories a week.”
Here’s an example of labor arbitrage impacting the frontline of journalism albeit on a small scale. The natural question is whether this is a one-off or a broader trend. What exactly is the latent arbitrage opportunity amongst other media jobs, especially those in the upper-echelons of journalism? The Week seems to be fairly resigned about the matter: “if you think you’re job is safe, ask yourself if somebody in India, Pakistan or Indonesia could do it for less.” Read more »
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Posted on May 13th, 2007 by Atif
Have you noticed that print media is
coming to resemble web pages?
Consider the re-design of the Financial Times (first edition of new design on April 23rd). The front page demonstrates four common facets of web content. At the top, there are tabs that highlight key content that sits inside. Not everything can make it to the front page of course. These look like a cross between tabs on a web page (which typically represent different channels or recurring sections) and the slideshow concept. By slideshow, I mean bubbling-up programming from inside the site in a visual manner with some text summary. Slideshows are often implemented in the form of scrolling content vignettes. It’s the experience you find on AOL or Yahoo’s main page, NBA.com or even Rhapsody. If the FT front page were digital, you could just imagine the scroll from one tab to another drawing your attention to 3-4 items beyond the front page that the editors think is great copy. Read more »
Filed under: User Experiences, Web Apps, Innovation, Traditional Media | No Comments »
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