In a speech at the D2 Digital Dialogue conference yesterday, a top Macy's marketing executive, in a true "I'm mad as hell and I'm not going to take it anymore" moment, made the following statement: "Consumers are worried about our use of data, but they're pissed if I don't deliver relevance. … How am I supposed to deliver relevance and magically deliver what they want if I don't look at the data?"
This question speaks directly to the larger issues facing the publishing industry today: how to make money in a world where today’s consumer wants everything … and nothing. Consumers want their content free of charge, free of advertising and free of tracking. And what do content providers get in return for all this freedom? Well, freedom from revenue.
All this stems from the dot com mania when it became both fashionable and conventional wisdom that success online depended on free content. In the process of doing this, we’ve trained an entire generation to expect everything for free, to the extent they become indignant if any modest attempt at monetization offends their delicate sensibilities.
The content industry to a large part created this mess by enabling this unsustainable state of affairs. Ironically, those information companies that stuck to their paid subscription models are the ones in the best shape right now. And therein lies the answer to this problem: let’s move past increasingly intrusive, contorted and ultimately futile efforts to monetize our visitors, and start turning our visitors into subscribers. No, it won’t be easy or painless, but is there a real alternative?
We can look to the newspaper industry for inspiration. The entire industry, to paraphrase Churchill, is finally doing the right thing after having explored every other option. Yes, newspapers are charging for their content. That’s all the more remarkable because newspapers are burdened with a severe commoditization issue. And just this week, People magazine announced a news subscription bundle priced at $100 per year. Yes, People magazine. If that doesn’t embolden you, what will?
So if you are still mired in the dismal world of free content where consumers want to get everything for nothing and advertisers want to pay next to nothing to reach them, there is an option. And if you honestly don’t think you can make the shift, you need to take a hard look at your content. As Sharon Rowlands, former CEO of Penton once said to me, “If our content is as valuable as we say it is, why do we all spend so much money begging people to take it?” Answer that question and your business direction becomes clear.