Clients coming to me–and they’re coming to me as never before–seeking clarity on what this will all look like “on the other side” are usually, for starters, really asking “How worried should I be?”
Sometimes of late, to reduce the general anxiety level, I quip that “we’re not the newspaper industry.” I fear that this is occasionally taken as gallows humor, although I intend it as anything but. What I intend it as is quite simple: Perspective.
But what if we were the newspaper industry, or more broadly, the print periodical industry? What then?
Actually, Booz Allen’s Strategy & Business has just written about this very thing, in Reinventing Print Media. Granted, much of it doesn’t remotely apply to us (or even, being parochial, to Adam Smith, Esq., which never has been and never will be a print publication), but some useful learning nevertheless emerges.
Two trends have intersected to deeply corrode revenue for mainstream print media, the second of which is the familiar rise of digital media. Essentially the only traditional publications that have been able to charge more than $0 for their online content are The Economist, The Financial Times, and The Wall Street Journal–all, of course, addressing a professional business audience with one-of-a-kind brand names. Consumer oriented publications that can charge are as rare as hen’s teeth. They mention Consumer Reports and Zagat’s,but I can’t think of a single additional example, and even the mighty New York Times has had to reverse field on this score. Whether the taking of a different set of decisions at the outset of the mass-market digital age would have made any difference is, at this point, academic in the most devastating sense.
The first trend, which many non-industry insiders are unaware of, is the accelerating migration of marketing spending towards so-called “below the line” activities. “Above the line” spending represents classic paid media advertising; below-the-line is everything else, and everything else is now the bulk of spending, and growing. (Like what? Like in-store promotions, manufacturers’ own web sites, loyalty programs, “viral” and word-of-mouth efforts, YouTube videos, corporate Facebook pages, etc.)
So what do the august gurus prescribe for our friends in the dead tree world?
First, the full menu, and then, what we might adapt to our purposes:
The first strategy is to develop deeper relationships with readers around targeted interest areas. This builds on a strength that has always been at the heart of publishing: Strong print brands enjoy a trusted relationship with their audience; readers are loyal to print publications because they provide high-quality content about specific interest areas. […]
The second strategy is to tap into revenue streams beyond advertising and circulation. […]
The third strategy is to reinvent the content delivery model (with a particular focus on lowering costs) and to emphasize a “profitable core” of unique and brand-defining material […]
The fourth success strategy for the media company of the future is to innovate with new products and pricing models.
Permit me to suggest that all of ##1–3, if conceived broadly enough, can be useful to us, and only #4 lands at our doorstep with a resounding thud (largely, but not solely, because of the terminally vacuous jargon in which it’s expressed).
One at a time:
#1, “develop deeper relationships with [clients] around targeted interest areas.” That sounds like something a lot of us already know to do quite well, thank you very much. Consider:
- focused client seminars on new developments in areas critical to their industry;
- free “health checks” where you and a fellow partner or two might spend half a day discussing ways you’ve seen similarly situated companies get in trouble, and what could have been done to head things off;
- brief “secondments” of some of your junior team members to the client’s offices for cross-pollination and insight into what drives day-to-day decision-making in their lines of business;
- and more, I’m sure, which you are creative enough to dream up.
Examples from ConsumerLand may help spur your thinking:
Procter & Gamble has built its own digital media assets in the home and beauty category, Nike targets runners and other athletes, and Diageo helps young adults find bars and nightlife. […]
Hearst — another leading magazine player serving a broad set of women’s interests with titles such as Cosmopolitan, Good Housekeeping, Marie Claire, and Redbook — produces Real Age, a Web site that provides health information and offers a test that evaluates more than 125 factors to determine a person’s “real age.” To date, Hearst has grown its database of women by more than 8 million registered users who have taken the Real Age test.
How about #2, exploring new “revenue streams” beyond the traditional sources? Again, I think we know how to do this. Instead of just defending your clients when they’re in a dispute or advising them how to navigate a corporate transaction, how about offering training in compliance so as to help ward off some disputes to begin with? (Ideally, start with disputes, such as employment litigation, which are fairly low on the food chain and only once you’ve demonstrated a track record there might you consider moving up the ladder.)
Or, what is perhaps a more timely suggestion, given the inevitability of clients’ sending massive e-discovery projects to vendors specializing in handling intensive document review projects in ways more cost-effective than throwing recent Ivy League law school grads at them, how about offering some creative suggestions about how you could help manage, supervise, and strategically guide those enormous “boots on the ground” efforts? (You won’t be hiring and paying the infantry anyway.)
#3 may be my own personal favorite.
Isn’t this another way of expressing the mantra every firm purporting to have a strategic rationale would have offered you until very recently? To do the “high value,” “price insensitive” work? This simply states it a bit more subtly and stresses the perspective of the client rather than that the firm: “to emphasize a ‘profitable core’ of unique and [firm]-defining material.”
From our friends, with my interpolations as to what it could mean for us:
“Print media companies need to employ a range of efforts, but first and foremost, they must focus resources on their “profitable core” [of clients] and build from that base. The profitable core is the set of print and digital content [your firm’s intellectual property, expertise, and know-how] that most drives audience [client] engagement around well-defined interest [practice] areas. It is only on those distinctive content assets that a media company can build a “right to win,” competing for attention against marketers [non-law-firm competitors such as Thomson West or LexisNexis], user-generated content [in-house resources, including lawyers], and other media companies [law firms you compete against]. Identifying the profitable core requires thinking freshly about the zones or editions of a newspaper or magazine and eliminating sections that do not drive significant readership or advertising revenue [a/k/a rethinking your geographic footprint and practice area mix].”
The most important message of all, of course, is to abstract from the specific tactical or battlefield suggestions outlined in the Booz Allen piece or humbly suggested by yours truly, and to adopt the mindset of competing in a world where settled conventions about such things as associate career paths and the billable hour model are suddenly being called into question.
A fellow named Aaron Shapiro, a partner in digital advertising agency Huge (which has clients including Ikea, JetBlue, NBC Universal, Thomson Reuters, Time Warner, and Walt Disney), puts it best: He says this environment will require you to think as both startup and incumbent simultaneously. “It will take aggressively fresh thinking,” as he expresses it.
So no, we are not the newspaper industry. But if you believe Booz Allen, even the newspaper industry ought to see reason for hope–conditioned on some “aggressively fresh thinking.”
Not at all gallows humor. Perspective.
