To exploit the web's full potential, publishers and media groups need to build bridges between isolated silos with both internal and external data. This will enable them to build strategies based on relevant and factual information. Ada Sekirin, VP Benelux, Germany and Eastern Europe at Business & Decision, takes the pulse of the media sector.
The arrival of mobile Internet is having a clear effect on the media consumer. Media consumption is becoming increasingly volatile. The consumer compares, tests, subscribes, unsubscribes... The consumer is 'shopping' for media content, but it would not be entirely correct to think of the price tag (or free-of-chargeness) as being the consumer's only selection criterion. The consumer is always in search of products and services that stand out from the crowd because of their added value, whether it is the relevance of an article to a target audience, the service's user-friendliness (such as an easy online payment method) or its availability through different channels (paper, mobile), and so on. Products and services offering such added value may always find a model that the consumer is willing to pay for.
Grab the opportunity
New technologies offer new opportunities, also in the media sector. Personalised content is one such example. An application such as Flipboard allows a media group to offer innovative services to its readership. Content aggregators have been around for some time, but never made the big break. Without a doubt because they were limited to offering free content without strong added value and because they lacked ease of use. The behaviour and use of technology is rapidly evolving, also in the field of payment methods. Just a couple of weeks ago, the Belgian publishers launched a shared payment platform, allowing readers to buy articles with just one click of the mouse.
The big media groups have two major assets at their disposal. By offering the possibility to change the threat of the digital wave into an opportunity, this allows them to stand their ground in the rapidly-changing media landscape.
First of all, there is the traditional media's popularity. Despite the arrival of new media and new channels, the traditional mass media maintain their role as creators of social interaction.
Secondly, there is the traditional media's knowledge of their customers. Media groups collect and store massive amounts of data about their audiences, markets, advertisers and website visitors. The main challenge is to turn this data into profit, as it leads the way towards new offerings and growth. Media groups need to face this challenge on several levels, using the right type of analytics tools.
Specify a new approach
Most of the media groups tend to increase the complexity of their commercial offering, which is not necessarily a bad thing. They offer packaged solutions, combining for example TV ads with Internet bannering. Using this approach, the advertiser runs the risk of not making the most of one or the other channel. It is becoming increasingly important to compare the audiences, target groups and profitability of each channel, having a clear overview that then allows to adjust the media group's commercial path. New BI technologies help media groups to get this work done both objectively and transparently. The new technologies allow end-clients to anticipate both positive and negative effects of a new commercial approach, thus avoiding mechanisms that could become problems in themselves. Just one example: multi-support applications for personalised media consumption. In this new context, content suppliers need high-performance analytics tools to define the right advertising rate levels, as well as these new sales channels' profitability.
A media group can tap into several external data sources that are available in the market. But, then again, this data too is stored and managed in siloed environments. Data consolidation is often executed only partially, or left to the user's initiative. Despite all this, several media groups have put in place enterprise IT solutions, thus allowing them to consolidate different information sources based on generally accepted integration rules. That way, the organisation has a direct view on « a single version of the truth ». And what's more, a centralised environment simplifies sharing expertise and supporting knowledge transfer whenever a key employee leaves the enterprise. The objective is to put in place an evolving information management solution that naturally gains maturity over time through its users' input.
Implementing a central Business Intelligence tool also allows the benchmarking of external data (coming from market analysts) and internal data, such as sales data from different departments. Subscriptions for digital content have the advantage that it is possible to capture data about the audience in real time. But digital media also generate massive amounts of data. To transform this data into usable information, a structured approach is indispensable.
Building advertiser loyalty
The changes in the media landscape go hand in hand with new models for defining advertising rates. In the world of television, for example, advertisement rates used to be based on the length of the ad and the moment it was aired. This method is being replaced more and more these days by rates based on the GRP (Gross Rating Point), thus guaranteeing the advertiser to reach a certain percentage of a certain target group. By investing in high-performance Business Intelligence tools, a media group can find a solution to stretch the guaranteed GRP to a large number of advertisers, and not only to the biggest ones, thus allowing it to optimise its sales. The use of IT offers an important advantage: better control over sales while, at the same time, allowing the media group to build advertiser loyalty - at a predictable cost. In this case, the media group must be able to rely on its back-office to efficiently analyse large amounts of information, again allowing it to offer and sell advertising space at the right price.
The media group's single biggest asset is the quality of its information. The quality level depends on the journalists' professionalism on one hand, and on the capability to efficiently process data on the other. Today, the tools that are needed to maximise the value of data exist. Implementing these tools requires a sizeable up-front investment, but is essential to support innovation in a market that is becoming more and more complex.
Ada Sekirin, VP Benelux, Germany & Eastern Europe, Business & Decision