Shape matters more than size

Due to fundamental long-term changes in consumer (media consumption & purchase) behavior, media companies are no longer content providers...they are in the conversation business.

Media companies - staffed and structured to be content providers in a classical Media Value Chain - need to come to terms with what they are becoming. In order to succeed:

1. Doing nothing is not an option
Media companies need to find a new Smart (a new mash-up of capabilities and business model innovation across their network) & Sustainable Sweet Spot within the unfolding Marketing Eco System.

2. Resizing is not enough, shape matters more than size
The cost reduction initiatives to keep traditional media companies commercially viable will remain important (shareholders focus on stripping out cost to maintain earnings per share), but will not suffice. Slimmed-down media companies will have to evolve further than they have done to date and need to change shape (long-term focus) as well as size (short-term focus). Key will be the ability to reshape traditional business models and organisational structures to best exploit the opportunities that ongoing technological development and digital transformation offers. A strategic approach, taking account of structure, governance and culture, identifies a more sustainable model for operating in the unfolding Marketing Eco System.

Deeply embedded ways of working need to be changed. Data analytics and real-time consumer insight have not traditionally been core competencies of media companies, while data analytics will become fundamental to any content-based organisation.

Conclusion: Traditional media companies need a very different kind of skill set to generate the new revenue streams that are going to be very important going forward. The most succesfull status-quo-challenger, the most agile skill-set-winner of tomorrow, takes it all.

Do you want to know more about Sanoma's beliefs on the future playing field of media companies? Watch this!

David de Boer, Manager Marketing Intelligence Sales, Sanoma

(source: Deloitte/Spencer Stuart, Ed Shedd & Grant Duncan, "Why agility must follow austerity in the new digital age", june 2010)

Customer orientation is a choice one makes over the course of a lifetime (part 1)

Customer orientation: of the 462 goals that Amazon has set for itself in 2010, 360 of them will directly effect the customer experience, while the word revenue is only used in 8 occasions.

Amazon founder and CEO Jeff Bezos spoke in may 2010 at Princeton University about the difference between choices and gifts. Cleverness is a gift, kindness is a choice. Gifts are easy -- they're given after all. Choices can be hard.

One's character, he suggested, is reflected not in the gifts one is endowed with at birth but rather by the choices one makes over the course of a lifetime. "It's harder to be kind than clever"

• How will you use your gifts? What choices will you make?
• Will inertia be your guide, or will you follow your passions?
• Will you follow dogma, or will you be original?
• Will you choose a life of ease, or a life of service and adventure?
• Will you wilt under criticism, or will you follow your convictions?
• Will you bluff it out when you're wrong, or will you apologize?
• Will you guard your heart against rejection, or will you act when you fall in love?
• Will you play it safe, or will you be a little bit swashbuckling?
• When it's tough, will you give up, or will you be relentless?
• Will you be a cynic, or will you be a builder?
• Will you be clever at the expense of others, or will you be kind?
  

When you are 80 years old, and in a quiet moment of reflection narrating for only yourself the most personal version of your life story, the telling that will be most compact and meaningful will be the series of choices you have made. In the end, we are our choices. Build yourself a great story. Good luck!

The value of online video versus TV to improve your marketing ROI

Gian Fulgoni posted an article on Comscore with an important lesson for online advertising:

"in a branding world, advertising creative is critical. As Internet advertising seeks to increase its currently meager 6% share of marketers’ spending for branding advertising and to move beyond a reliance on direct response marketing, using the right creative will become critical. This will be compounded by the move to the use of more expensive ad formats such as rich media and video. The cost of being wrong becomes substantial. It will be vital for the Internet to take a page out of television’s playbook and focus more of its research dollars on getting the online ad message right."

It is an interesting article (but - in my opinion - not the complete story), triggering some related questions:

Trend: The end of advertising as we know it

• -> What about the impact of the growing importance of branded content on the value of online video versus TV to improve the marketing ROI ?

Trend: Changing consumer purchase behaviour

• -> What about the impact of the changing consumer purchase behavior on the value of online video versus TV to improve the marketing ROI ?

Trend: 'moment of purchase'-shift from bricks to clicks

• -> What about the impact of growing popularity of multi touch tablets - in combination with the impuls-buying-strength-of-online-video - on the value of online video versus TV to improve the marketing ROI ?

In the unfolding marketing eco system, what will become the value of online video versus TV to improve your marketing ROI? What will be the complete story? Time will tell.

David de Boer, Manager Marketing Intelligence Sales, Sanoma

9 iPad learnings gathered on Sanoma's journey

The year 2010 is the year of Touch & Tablets.... and the year of the unfolding Marketing Eco System. Although the ultimate media-format has not been invented yet, Sanoma gathered some learnings on the 'multitouch'-journey.

But first two beliefs:
1. There are no magazine-apps, but mediabrand-apps;
2. In the end there won't be 1 perfect universal Autoweek-app, but many perfect Autoweek-apps.

In this unfolding Marketing Eco System all content goes digital AND goes mobile. New media-formats will emerge. Everything gets tagged and walled gardens open up. Lot's of (formerly) bundled content breaks free of old trapped business models and will be further atomized online.

Atomized mobile digital content drive micro-payments, which move from niche to mainstream payment models.

Don't build pay walls for your readers around the bundle, but activate people to give permission for a micro-payment for each atom that engages them to see, or read, or play, or listen a bit more of it. Monetize the instant gratification need.

Conclusion: Find out how to activate people to give as many micropayment-permissions as possible from the moment they jump into the real-time river of emerging media-formats; formats 'stuffed' with branded content & affiliate marketing deals.



David de Boer, Manager Marketing Intelligence Sales, Sanoma

The powers in the unfolding Marketing Eco System; building the internet Operation System

The internet is becoming an operating system that manages access by mobile devices to cloud subsystems ranging from computation, storage, and communications to location, identity, social graph, search, and payment. There are five main competing contenders: Amazon, Apple, Facebook, Google and Microsoft. Those 'big five' all have credible platforms with strong developer eco systems.

In the unfolding marketing eco system, the key question is

Will a single company put together a single, vertically-integrated platform? Or will we see services from multiple providers horizontally integrated via open standards?

In the short term, we'll see heightened competition, shifting alliances, and a wave of innovation, as companies fight for advantage in delivering next generation applications, and then use those applications to drive adoption of their respective platforms.

How long will it take before the big five (Apple, Google, Microsoft, Amazon and Facebook) will realize that it is in their interest to work together.....and make a start to adopt the horizontal, open strategy? And, last but not least, what will be the unique 'added value role' of the 'other' media companies, on top of the building blocks of the big five?'




David de Boer, Head of Marketing Intelligence Sales, Sanoma


(Source: Tim O'Reilly, State of the internet Operating System, part 1 and part 2)

Building brands while improving marketing ROI

Today's mass marketing model needs to evolve or marketeers will erode their ability to build brands, which is critical to avoid commodization. Today's media measurement systems needs to evolve to facilitate the marketer building brands while improving the marketing ROI.

Improving the marketing ROI starts with understanding how to improve the personal relevance at receptive key touch points with the consumer; at the moments that most influence their decisions.
(Source: Future of Advertising Project, Y. Wind)
Which moments most influence purchase decisions?
Digital technology is fundamentally transforming (1) consumer purchase behaviour and (2) media consumption habits. Gaining superior insights on media consumption behaviour - from a better understanding of the relationship between changing shopping and media usage - is necessary to improve the marketing ROI.

New technologies are changing consumer purchase behavior
Consumers are increasingly adopting new behaviours when it comes to researching and buying products. Traditionally, marketers' view of the purchase process has been based on a "funnel" with five successive stages:

1. awareness
2. familiarity
3. consideration
4. purchase
5. loyalty
   

This model is becoming increasingly outdated, as consumers much more activily reach out to the recommendations of their (online) peers to understand their options. "The real new medium is the voice of the consumer"(Peter ter Kulve, CEO Unilever Benelux).

New technologies are changing media consumption habits
Truly understanding the increasingly complex media consumption behavior of consumers allows marketers to more accurately anticipate on the impact and synergistic effects of media; to reach (or better, touch) their target consumers more effectively and efficiently at receptive moments, via relevant content that serves consumers' interests.



Media & Marketing measurement systems must leave their single media silo approaches and accomodate multi-media measurement. Unduplicated reach across different media will become a necessity, engagement and relevance will need to be researched too....to make the next step in improving the marketing ROI.



David de Boer, Manager Marketing Intelligence Sales, Sanoma

Managing Media Companies • time to shift from Advertising Sales to a true B2B Marketing approach

Only a few TV channels apply sophisticated yield management techniques for the sales of scarce time-slots, similar to the techniques used by airlines when selling airline seats. Most advertising sales forces are managed traditionally, that is they are often organized by B2B customer size and region and selling only one type of media. The sales approach is mostly push, that is sell the available products, with little room left for the advertiser to shape the proposition.

Revision of advertising sales
The digital transition will foster traditional media companies to fundamentally revise their approach to advertising sales and implement sophisticated B2B marketing strategies. An aggressive sales force on its own will not suffice. The advertising sales process should be transformed into B2B marketing with a focus on targetability and measurability. For this, media companies will have to develop a much deeper understanding of their B2B customers' needs. With these deeper B2B customer insights, a value-added proposition has to be developed, based not only on strategically designed (crossmedia) advertising products, but also on a service offering along the whole advertising value chain.

(Source: Future of Advertising Project, Y. Wind)
Media companies have the unique chance to interact with advertisers in the concept phase, based on their understanding of target groups and storytelling abilities; in the media selection phase, based on their knowledge of media-usage patterns; and finally in the measurement phase, by providing consumer-usage data.

Tying this all together into a coherent approach will make the media company a strategic partner for advertisers/brand marketeers.....rather than suppliers of ad inventory.

Integrating sales forces
In many media companies the sales forces for offline and online are still separated. With the growth of online media and the increased need for integrated offerings, this approach will have to be revised.

Traditional media companies will have to manage the transition from price-based to value-based competition in advertising sales. This will entail a fundamental shift in mindset and innovative approaches in creating value for customers. Managing the complexity of more differentiated offerings, ensuring an effective use of resources and securing a constructive cooperation with the media agencies will be the main challenge in implementing this strategy.

David de Boer, Manager Marketing Intelligence Sales, Sanoma

(Source 1: Managing Media Companies, A. Aris and J. Bughin)

(Source 2: The basics of B2B sales succes, McKinsey)