I was asked to give my opinion by a co-worker of the declining world of print and their struggle to adapt to the net specifically some of the issues that Conde Nast has been having. What followed was a little bit of a rant and a lot of personal opinion about my personal feelings and views on traditional media dealing with the online world. I figured I would share it. I have to say that this is more of a rant than a well detailed and documented argument but I figure that I wrote way too much here to only share it with one person.
1) Print advertising rates and demographics are bullshit when compared to the Internet. Print has been slow to adapt to this.
This is something that people are beginning to come to grips with. Magazines and newspapers will give out circulation numbers and then have studies done that will tell you on average how many people read what. But in reality it is nothing compared to the cold hard data that the Internet provides. For a lot lower price I can place an ad that is geo-targeted, content targeted and will reach the people I want. Plus I have hard numbers on how many people are actually seeing the ad versus the inflated and bullshit numbers that print is giving.
The thing is they are not changing their game up even when they do embrace online media. In Buffalo the local newspaper wanted us to advertise on their website and the cost was inline with what they were charging for print ads. But the traffic for the webpage was horrible and the CPM would be like $25-30 we estimated. (Of course they don’t explain what the CPM is because most of the people they were dealing with had no idea. Plus when you have a traditional ad sales rep trying to sell online media it is comical.) Meanwhile on niche sites in our industry we could get 8x more page views in a month to a targeted audience for less money. As businesses become more advanced and wake up, these companies are going to have harder times overcharging for ads that underperform.
2) With that being said the Internet is still a mess and print hasn’t capitalized.
Let’s say you want to place an ad on a leading website. They might be selling their own, have a broker, using an ad system like Google (or others of that ilk), or numerous other options. So where do you advertise to get a certain spot, where do you get the numbers you need to make a choice? You have to jump through hoops to do it especially if you aren’t a web savvy company. Now say you have a list of 15 sites or more to do this with and you are dealing with tons of vendors, have to do tons of research, and it becomes more effort than you want to expend. This is one of the issues impacting Internet ads, plus you have services going under, people removing their ads. There is no real standard. The ease factor still lies with traditional media outlets. Placing a television ad on twenty cable channels is infinitely easier than placing an ad on 20 websites if you aren’t buying them all through the same vendor.
Companies like Federated Media and others are trying to establish themselves as partners with major sites but there are so many out there that it is impossible to keep track. So then you have traditional publishers getting into the mix (and late) with their own ad sales departments but they don’t have the traffic built up to justify the ad spends that they want to charge. For them it makes the web not profitable and for the advertisers they look elsewhere because these traditional names don’t have the traffic that well established sites have, kind of a circular problem.
(Note: This is also one of the major problems with monetizing video is that you have a ton of different people producing it and very few points of representation.)
3) Slow to establish a foothold in their niche
People magazine is a great example. That site has traffic that Perezhilton.com has and TMZ (which launched later) as well as a ton of other sites that aren’t that far behind. There were people already in the niche and people.com will never gain a dominant market share. Meanwhile the reason why espn.com did so well was that they made themselves THE source and bought other properties that they saw as emerging. People started to embrace a fantasy football writer on the web they signed him, they found the most popular sports blogger (before blogs took off) they signed him, and they have continued to evolve. Also they have repurposed their content created on radio and TV into podcasts and videos for the site, always staying a step ahead. CNN also did the same thing and they should be credited with a great use of video and other evolving technology.
Condé Nast meanwhile now has a bunch of niche magazine and hasn’t made an effort to stake a claim with any real effort on the Internet except for a few original sites. When they realize that their current strategy is failing one they are going to have to overinvest to get that traction. And it will probably way too little and way too late.
4) Staffing issues
Newspapers more than magazines are getting rid of experienced writers for young people out of college. They can pay them less and they are just replaceable parts. (As written about in Mark Dueze’s Media Work.) Now these young writers are able to maybe write at home on blogs and freelance making the same as they would in a crappy newspaper job. So you have a ton of quality content being created that is in competition with traditional outlets.
Newspapers and Magazine have one thing that these people don’t, access. But that is quickly changing. People can now establish themselves as an authority for the same pay and have something tangible to sell or to build their name off of. Talent is shifting.
Conde Nast is basically operating off of ego right now. Over the next ten years there is going to be a shift towards mobile digital readers like the Amazon Kindle and exclusive web content for subscribers. (Sure the Kindle can’t give you those amazing pictures you see in a fashion magazine but how about having the ability to see 10 high resolution pictures of that same shot online?)
Look at the shift that has happened in the music industry. Ten years from now buying physical music at a store is going to be almost non-existent. The high rate of digital music adoption, the crashing profitability for big box retail, and the better technology continue to reshape this business. There is no reason to believe the same isn’t going to happen to print.
What are your feelings about the future of traditional print media companies and the interent?