How Media Companies Are Using Technology
by Ben Ganje, Lineup Systems
Ask anyone working in the media industry and they will tell you, the times have changed. In fact, the modern media landscape has been altered so dramatically and been written about so profusely that nearly anyone you ask will have an opinion on the downfall of traditional news organizations. Yet, what’s not talked about enough are the success stories. The new approaches and initiatives that are turning the tide for media companies who have not only understood the new media world, but have put progressive strategies in place and invested in technology to exploit new revenue opportunities. Let’s look at three key trends and the tools that are making the difference between failing and thriving.
TREND ONE: Industry Consolidation
The age of digitization has delivered the print newspaper industry some tough blows. Since the 2009 market crash, circulation has dropped and many companies have struggled to retain market share in the onslaught of growing online news sources. Large, iconic media conglomerates such as the Sun-Times Media Group, the Journal Register Company and Tribune Company have been the victim of this, declaring bankruptcy and reducing headcount.
Acknowledging that “money follows eyeballs,” and in an attempt to grow both bigger print and digital audiences, media companies have turned to mergers and acquisitions for growth and scalability. This consolidation has led to the desired portfolio capabilities and larger audiences, but it has also introduced a new level of complexity to the business. Companies that have combined several, if not hundreds, of media brands into one operation have been left with the headache of how to effectively integrate portfolios and channels effectively to maximize their investment. The companies that have succeeded have understood that it is not just a merger of people, but a new way of thinking and operating across the entire business. They have also understood the importance of simplifying their technology solution to enable this change.
One such company is Gannett, which after a long series of wisely chosen acquisitions, is today considered the largest U.S. newspaper publisher (as measured by total daily circulation). The company owns 128 local media organizations across the country, as well as USA Today, and has relied heavily on technology to tackle the challenge of how best to integrate new titles into its portfolio and optimize disparate ordering systems, complex workflows and redundant processes their acquisition strategy has created.
The implementation of Lineup Systems’ Adpoint Advertising Sales Platform enabled Gannett to rollout a plan to retire 52 legacy systems and associated maintenance costs. Adpoint also established a single customer view across its multiple operations and media channels for the first time in the company’s history, which provides a vital foundation for more aligned customer relationship management strategies and sales approaches. And, the flexible, web-based platform infrastructure of the Adpoint solution ensures faster integration and reduced IT costs for any future business acquisitions.
TREND TWO: A Changing Competitive Landscape
Pure-play digital companies continue to grow at a staggering pace, and this poses another great challenge for traditional news organizations. Today, Google and Facebook each generate more ad revenue than all the magazines in the United States combined. This small number of players capturing a large portion of available ad spend has rapidly diminished market share for traditional news outlets. However, while we all agree that Google and Facebook aren’t going anywhere soon, there are opportunities for traditional media companies to begin recapturing some of the revenue lost to pure-play digital competitors.
Many of Lineup’s customers are seeing an increasing number of advertisers returning after trying local advertising programs with companies like Groupon and Yelp and finding those sources failed to help them connect with consumers in profitable ways. At its peak, Groupon had operations in nearly 50 countries. Today, it has cut its operations back to 15 markets, shedding 11 in the last quarter alone. This is because single channel audience solutions are increasingly being replaced with multi-media ad ‘packages’ offering greater engagement, performance and relevancy for marketers.
This bundle approach is not new, but media companies are becoming increasingly smarter in how they create packages to achieve diversified revenue growth. By leveraging technology innovations media companies now have a single, holistic view of their audience offerings combined with the ability to create and manage complex, multi-channel ad campaigns.
TREND THREE: We Need to Get Closer to Customers Than Ever Before
Today’s advertisers have more choices than they can count. In the past, traditional media companies saw a large percentage of their revenue come from agencies responsible for arranging advertising on behalf of their clients. Today, that revenue stream is dwindling as media organizations begin to dive deeper into offering agency-like services, such as the development of branded content and creative services. This shift means media sales organizations need to rely on their direct sales channel more than ever before.
However, at a time when media organizations have a great need for top talent, there’s a shortage of it available in the market. Declining advertising revenue forced many stars out of the business. Developing new talent takes time most of us don’t have, but that time can be cut in half with technology solutions that delivers the insight a salesperson needs to understand which customers are most likely to buy which product, where the best revenue opportunities are, and guides them through the process of building the multichannel packages that today’s advertisers seek. Technology and CRM advances have automated the previously laborious multi-channel order management process and provided actionable business intelligence for enhanced sales strategies.
Today’s sales people also need to be ‘hunters’, actively in the field building relationships with existing customers and developing new ones. The old model where sales reps spent most of their time in the office coordinating orders and campaign pitches isn’t sustainable or cost-effective. True cloud-based technology has answered this call, providing sales with mobile tools that offer access to customer information, real-time inventory availability, and the ability to conduct business from anywhere. The best media organizations are exploiting this capability to enhance sales performance.
In a tremendous time of transformation, growing advertising revenue isn’t easy, but as many progressive media companies are already proving, it’s certainly not impossible. The difference between surviving and thriving boils down to creating efficiencies that enable your organization to manage consolidation, keep ahead of the competition and provide sales with the tools they need to exploit opportunities. Technology, as you can see, is a true enabler.