Curated by: Luigi Canali De Rossi

Wednesday, December 27, 2006

Online Marketing: Traditional Media Gives Way To Conversation-Based Web Marketing Channels

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Corporate Web sites may not push out awesome viewership statistics compared to many media sites, but the data coming out of recent research is pointing to direct communications with online audiences providing multiples more impact on their bottom lines than media-based advertising.

Photo credit: Andres Rodriguez

Online media companies are likely to have a great year in 2007 but the looming question is how much longer marketers are going to care about Web site advertising in an era when direct conversations between sellers and buyers are pushing traditional media to the sidelines.

The media isn't dead yet, but if it can't shoehorn its way into these conversations more effectively it better start thinking about it's retirement plan.


The environment for online media is looking pretty robust, these days: forecasts for 2007 online ad revenues are looking great and new forms of electronic media production are flourishing everywhere. Brand advertisers are also beginning to embrace the Web more enthusiastically, shifting more of their spend into online channels than ever before. Yet for all of the buzz and bubble over online advertising the greater fact is that media companies are beginning to face the greatest challenge of all: disintermediation.

Disintermediation is a word that has challenged publishers before, but it was a less important threat in the early days of the Web. Corporations were content at first to put out "brochureware" Web sites with little meaningful content and user's interactions were limited to viewing pages and filling out forms for the most part.

But as corporations have learned to create and to sponsor their own engaging content and Web 2.0 technologies have encouraged users to write about and engage corporate content, things have changed quite a bit.

Advertising Age brings this together (registration/subscription) in an article that highlights some interesting statistics surfacing in recent online ratings data. Consumer goods giant Procter & Gamble Co., for example, does not have blockbuster Web sites by media ratings standards - P&G sites captured about 3.3 percent of ComScore's U.S. October audience ratings - but by comparison this percentage is more than double it's percentage share of overall U.S. ad spending and nine times its percentage of online ad spend share.

The AdAge article also points to McKinsey & Co. research that showed visitors to one corporate site generating $40 in corporate profit per visitor on average, compared with $5 for audiences reached by traditional media. Not only is going through intermediaries an expensive route through which to acquire customers, but one which doesn't pay off as well in the end.

While content generated by media companies continues to engage audeinces it's not clear that advertisers seeking return on their investment are going to follow suit endlessly with major brand-building campaigns. If markets are conversations, as The Cluetrain Manifesto once intimated, then media companies are having a much harder time figuring out why anyone should be chatting with them.

User-generated content is held out oftentimes as a way to help media companies to find a place in the chit-chat between sellers and buyers, but owning a user-generated media property is not synonymous with being able to engage in a conversation. Brand advertising is about seduction: conversations are about relationships. In the meantime the focus on user-generated content leaves fewer dollars to spend on traditional media products - further weakening their potential to appeal to audiences.

Are we witnessing the death of media? Well, yes, in an abstract sense.

There will always be advertising and there will always be companies willing to extend their conversations with their markets through media-based advertising. But if marketing is better served through more direct and focused communications with audiences and through multi-channel advertising wholesalers like Google, then traditional media companies have nowhere to go but down.

The conversations that drive media spends are shifting radically and rapidly and will continue to do so over the next several years. Here are a few ideas as to how media companies can keep abreast of these changes:

  • Polish your conversation skills.


    In spite of the influx of user-generated media services being adapted by media companies most are pretty "hands-off" when it comes to integrating user content with editorial sources. While traditional editorial content is still valuable it's lack of integration with conversations found in user content is going to compromise its ability to attract premium ad dollars in the long run.

    If marketing is moving from a command-and-control economic model to a networked model then media needs to adjust its fundamental purpose from being a medium for advertising to being a gatherer of market participants exchanging views. It sounds simple enough, but making a conversational marketing model work in the long run is going to take a lot more skill than slapping banner ads on MySpace pages.

  • Move beyond your roots.


    Advertising at the very dawn of commercial radio was thought of - literally - as a phone booth in a studio which people would rent for a limited time to broadcast a message. Today that phone booth is online and interactive - much to the pleasure of advertisers, but also to the detriment of publishers who still struggle with their role.

    Media companies can continue to focus on renting out studio phone booths, but it's a better bet to focus on providing content that marketers can contextualize as they please in their own "phone booths" and in contexts defined by their audiences - and to provide expertise and technology that will allow marketers to extend those conversations into deeper levels of engagement.

  • Rethink aggregation.


    For the vast majority of publishers aggregation is about gaining an edge by bringing together your own content or licensed content into one "walled garden" or another for advertisers or subscribers. But search technologies and services such as social bookmarking, feeds and web mining have make the ideal garden something that is much closer to the needs of individuals and institutions than the ambitions of publishers and aggregators.

    Marketing value is now maximized when content flows to the contexts that users desire most as efficiently as possible - rather than trying to corral them into contexts not conducive to marketing conversations.

With a near-infinite inventory of content and a finite inventory of advertisers, media companies are in a race with corporate marketers to come up with the most compelling content and context that can get a marketing message across to audiences.

In the long run this is a race that most media companies can only lose. It's time for media companies to shift permanently to being enablers of effective conversations from all sources.

Today's "media star" is no longer the one with the least common denominator gazing at them but the one who can get audiences and marketers looking at one another most effectively.

Originally published by John Blossom as "The Death of Media: Are Direct Online Marketing Channels Superseding Publishers?" on December 14, 2006.

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

Photo credits
Blue duster: Alvin Teo
Step out of line: Michael Brown
Render of molecule: Sunagatov Dmitry

John Blossom -
Reference: Shore [ Read more ]
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posted by on Wednesday, December 27 2006, updated on Tuesday, May 5 2015

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