RSS Feeds Monetization: How To Profit From RSS Feeds

XML-based datafeeds are becoming popular tools for delivering content to online audiences from Web sites. But such RSS feeds are far from popular with publishers intent on boosting page view statistics and fearing leakage through content that's delivered to users who will never come in to their sites.

Photo credit: Nikolai Sorokin

The real issue is not feeds but the need for publishers to accept that an important portion of their revenues will rely on understanding how to make money from content delivered to their audience's personal devices and Web sites.

Some leaders are already making good money on feeds: what will it take for others to follow suit?

Traditional news datafeeds were not always the most popular products to be selling in my days as a Reuters marketing manager. Feeds were seen by some as a threat to the Reuters Terminal product, a PC-based software package loaded with graphics and analytics features that cost a bundle to put on the typical securities trader's desk.

Oftentimes those Reuters Terminal PCs got their securities market data and news from a Reuters datafeed anyway, but if the client chose to take the feed into another content display system or just pump it into a database, their revenues per user would be less.

Today market data feeds are a way of life the securities industry. Companies like Reuters are doing just fine, though, thanks to major adjustments in their marketing strategies that focus on optimizing feed products for the venues that matter most to their clients.

Ultra-fast feeds support their increasingly automated trading functions and sophisticated analysis software used by their most talented staff. With major financial institutions trimming their trading staffs aggressively in favor of more efficient strategies supported by feeds the days of the all-singing, all-dancing financial display product as a revenue leader are numbered, if not already past.

As a new generation of feeds begin to flourish on the Web some of the same worries that have furrowed brows at financial content companies are wrinkling the foreheads of major media company executives. Clicking on the familiar orange icon found in many Web browsers can produce an XML-formatted feed of updates from a Web site into your PC or mobile device - or your own Web site.

The popularity of this fairly standard feature is growing quickly amongst both online trend-setters and enterprises trying to absorb online content into their own operations.

So the recent news of Yahoo's trimming support for RSS feeds does not come as a complete surprise.

Feeds have spread fear before.

Yahoo is pushing hard to become the online destination of choice for media content, grabbing a boatload of licensed and acquired content to pump up its page views and its advertising revenues. But wile there's a fair amount of user-generated content in Yahoo's recipe this is still a classic aggregation play: my site will have more good stuff than your site, so it will be worth more to advertisers and subscribers. Feeds will only cloud the real issue in Yahoo's view as it tries to build its page view statistics into powerful sales tools for advertisers and subscribers.

In spite of Yahoo's apparent skepticism online feeds are on the rise. A recent report on major magazine and newspaper publishers shows 78 percent of surveyed newspapers using RSS-formatted XML feeds and 48 percent of magazines using RSS feeds.

But none of the respondents were placing advertising in those feeds: RSS feeds are seen mostly as a lure to bring users back to their Web site. The Wall Street Journal is now monetizing its feeds with ads, though, pointing the way for others to reconsider feeds as a tool for revenues.

With the rise of online RSS feeds, publishers need to consider how best to position themselves aggressively with a medium that promises to upend profit equations as much as financial feeds reset the stage in financial market data.

Here are a few thoughts as to how to approach using online feeds profitably:

• The limits of Web sites as content services are showing

  

  With the strong emphasis on page views some media companies are missing out on the value of the Web as a broadcast medium that people can filter according to their own needs. Web sites are important tools for providing convenient content packaging but The New Aggregation argues that insisting on Web site visits draws content away from the uses that audiences demand in their own business and personal lifestyles. Think of feeds as a broadcast to home and mobile theatres and your Web site as your downtown theatre: today it takes both experiences to build up a property into a profitable media star.





• Time for a new generation of metrics

  

  As Steve Rubel points out in a recent article page views don't always capture how people interact with increasingly sophisticated content that combines text, graphics and software-enabled functionality into something that's far more than just a page.

  As RSS feeds enable a new generation of content services to add value on desktops and mobile devices, publishers need to get more comfortable with devising performance metrics that follow content into the audience's own platforms - and that travel with content as users share it with one another. Services like FeedBurner already provide measurable performance for feed content: it's up to publishers to take advantage of advanced content performance measurements tools to appeal to a new generation of advertisers.





• Not all feeds need to be created equal

  
  The proliferation of bone-simple content syndication via XML feeds belies the full potential of feeds as a transport for delivering valuable content. As content becomes more a blend of information and services wrapped in XML "widget" putting together these packages is going to increasingly allow for RSS feeds to be consumed by audiences on the platform of their choice.

  Some feeds may be free or ad-supported broadcasts but there's a lot of potential for premium feeds that go beyond mere text, links and graphics to sophisticated payloads that engage audiences at a higher level. Just because you're using standards such as XML to shuttle content around in feeds doesn't mean that your content can't break out into unique value-add configurations once it's delivered.

Feeds are neither a panacea nor a threat for online publishing: they are only a transport mechanism that allows publishers to service clients in multiple venues of their own choosing. The proliferation of feeds calls upon publishers to take a far more sophisticated view of how content payloads sent out via RSS feeds can be shaped into products that can return revenues.

Companies like Reuters struggled for years to shape feeds into a "terminal"-centric view of markets before accepting that old performance metrics weren't as important as happy customers who were helping them to make money.

That's a thought worth feeding on for a while in the world of online content.

Originally published by John Blossom as "Feed on This: Publishers Face the Dilemma of Content in Motion" on December 6, 2006.

Find out more about John Blossom and the management consulting services of Shore Communications Inc. covering enterprise, media and personal publishing at Shore.com.

Photo credits
Fence stop: Lev Mel
Report Chart: Pei Ling Hoo
Red peg: msv