The digital revolution has brought two major changes for consumers in the media industry. Firstly, customers have the choice to buy digital or non-digital content. And secondly, they can do this via a physical shop or online.
As a publisher, you therefore need to understand two key things:
- What format are customers going to buy products in?
- What channels will they use for the purchase of products?
The answer to the first question is quite predictable, as I will show in the next paragraph. It will however be far more difficult to understand and predict how customers will purchase products. The way people get access to content has changed spectacularly and thanks to further product innovation coupled with the creativity of sales and marketing teams, the choice for consumers in how they get their content will only increase.
In my previous blog - Five Tips to Help Publishers Sell More - I explained how important it is to be able consistently report reliable and meaningful information about the usage of the content to your stakeholders. In this blog I will talk about the challenges around measuring success in the ever changing media industry, and how you can prepare yourself to report on things tomorrow of which you do not even know they exist today.
The easy-to-predict shift to digital content
This graph shows different trends in digital content relating to Books and CD's.
Based on these figures it seems safe to predict that very soon digital music sales will overtake the sale of physical CDs.
The sale of books however, shows a different picture. Readers still appreciate the physical properties of 'print', but most do not care about the way music reaches their ears. Electronic book readers are not a commodity just yet and the peak in e-Readers' sales is still to come.
One thing the graph makes very clear is that the only growth is via digital. The trend for physical products is certainly not looking good and there is little chance it will pick up. Consequentially, organisations will focus on innovating electronic products and channels. Physical products will be produced as long as there is demand but don't expect innovation, big investments, or high profitability margins.
Challenges and innovation in sales channels
One of the challenges publishers face is attributing revenue and usage data to individual products. Digital content is sold in different contexts via multiple parties/channels. In the case of bulk deals to third party content providers, it will depend on the willingness (and ability) of the third party if you can get actual usage stats from individual titles. But even in your own operational system, you might not be able to contribute the revenues of a bulk deal to an individual title because the total amount of the deal might simply not be split out to its individual components.
There are many examples where it is very difficult to pair up revenues or usage stats with individual products and not all of them are necessarily related to digital content only. Below are two fairly new examples to illustrate some of the challenges publishers are facing when trying to report accurately about the performance of individual products.
Example one: Google pays a French governance body for using news snippets in search results
Google has agreed to pay £52M to a French media fund. This gives Google the right to use news fragments in their search results, without having to pay for each individual snippet used.
This is not just interesting from a financial point of view. Stakeholders will be keen to find out how often their article(s) showed up in Google and how often people clicked through to read their content. I imagine Google will be willing to share this information...for a price.
The challenge for publishers will be to effectively leverage the information provided by Google, and successfully integrate this source of information when reporting back to their stakeholders.
Example two: Not-for-profit organisations push for making content available free of charge
e-Readers will become cheaper and before long they will be as common in developing countries and conflict zones as mobile phones are today. With this comes the incredible opportunity to give people access to information at a scale they have never experienced before. Once the e-Reader is cheap and data communication affordable, there is nothing stopping children in conflict zones from downloading the best training material on how to speak English for example, or other online training material. Well, that is, as long as the price of the content is not prohibitive.
Organisations in the not-for-profit industry are already working on ways to make high quality content available free of charge. One of the models used for this is already used in the academic world: The results of government funded research are frequently published in an 'open access' model, where the author pays publishers to put the article up on internet, accessible for everyone, without charge. This model can be copied to make education material available in developing countries.
Via this model, stakeholders will want information from the publishers other than 'revenues' to measure success. It is likely that these measures will come from external sources rather than from the publishers operational systems. So again it will be essential to be able to capture data from external sources and integrate this into your own reporting system to produce coherent, useful information for your stakeholders.
Prepare yourself for the future
Prediction is very difficult, especially about the future and especially in a world where the pace of change and innovation is rising. We don't know which sales channels will be invented, what information stakeholders will want, or which sources should be used to measure 'success'.
Modern tools have no problem in integrating data from a wide variety of sources, be it social media through web services, different databases or connections to various standard business applications.
By having the right tools in place you will be able to load data from different sources into your Data Warehouse and quickly respond to your stakeholders changing requirements.