George Washington’s second inaugural address was just 135 words long. JFK’s inspiring “ask not what the country can do for you” speech required just 1,366 words. William Howard Taft bunged on for 5,434 words in 1909, while back in 1841, William Henry Harrison set the high-water mark for bloviation, with 8,460 words. Lincoln, a great writer as well as a great president, distilled all the passion and resolve of the Gettysburg Address into 272 ringing words. Those words live on, unlike those of President Harrison, whose oration trapped him – and his poor audience – on a bitterly cold day for 1 hour and 45 minutes, after which he came down with pneumonia and died. His presidency lasted just 31 days. If you ask me, there’s a lesson there for all who wield a pen.
Present company excluded of course.
It’s conventional wisdom that brevity is the key to digital media success in the Age of the Skim. Look, I love Axios and follow closely what they’re doing with Axios Local, but they are the pimps of the doctrine of brevity. They give you a 150-word summary report and end it with “Go deeper. One minute read.” Go…deeper? In a minute? The thinking is crudely pragmatic, it goes something like this: “If a user is not going to stick around for long, we had better give her the world in a minute so that we can capture and monetize a fraction of her time and ensure she’s not afraid to come back and check in again.” This thinking has morphed into conventional wisdom, something which I firmly believe should be avoided as a matter of principle.
The age of the skim is troubling for reasons beyond the challenge of building a successful digital news business. It cannot be good for comprehension and civic learning, surely? Could this be the reason why we have all become so stupid?
“I took a speed reading course and read Tolstoy’s War and Peace in 20 minutes. It’s about Russia.”
Woody Allen
The danger is that opinions on things that matter are formed too hastily and prone to easy influence. I could go on about this, and maybe one day I will, but not here. Do not be misled by the subject matter into construing this blog as a kind of journalism research paper. It’s more of a novella. With smartassery.
I digress. The fact is, the skim is a big business problem in media today. After all, a key indicator of engagement (and loyalty) is whether a reader scrolled or swiped during the visit or bounced away after reading only the first window of a page. I fess up. These days even I often bounce away. Overwhelmed by the incoming data stream of news reports, emails, texts, social feeds, I too have become a skimmer. Like you. It’s the reason why you will not finish reading this post, even though I’ve been sitting here all bloody day in my sweats and slippers pounding it out.
And we are not alone.
According to Deloitte, the average American picks up their phone 47 times a day. https://www.cnet.com/tech/mobile/americans-are-checking-their-phones-now-more-than-ever-report-says/ I’ve seen other estimates that put this figure as high as 58 times. About 70% of these mobile sessions are fast, compulsive “check-ins,” typically involving messaging or social postings.
According to Chartbeat, a “content intelligence platform” for news publishers, 35% of desktop users leave a page before scrolling down at all. 45% of readers who load an article will leave within the first 15 seconds. https://whatsnewinpublishing.com/how-many-readers-actually-scroll-once-they-load-an-article/
Unsurprisingly, the scroll frequency and depth is even more shallow on smartphones and tablets. That’s a worry. According to Broadband Search, 56% of the web’s traffic so far in 2021 has come from mobile devices rather than desktops, up from just 6% in 2011. https://www.broadbandsearch.net/blog/mobile-desktop-internet-usage-statistics
Twitter is the poster boy of the skim era. It combines the brief (280 characters is really brief!) as well as the performative – another characteristic of media today – and although it’s too noisy and show-offy for me to want to build much of a presence over there, I do admire the way it makes available a stream of thoughts from millions of people all over the world, in real-time, the diet different for every user. Twitter is something transformative, it would simply not have been possible without the internet. And it’s built for the skim.
But brevity is not the only answer. It’s simply the most obvious. The fact is that it all depends. It depends on the kind of news, the market, the product positioning, the purpose – and the economics. Most of all, it depends on the nature of the audience.
Two of my favorite email newsletter pubs are Not Boring by Packy McCormick and Stratechery by Ben Thompson. I make a point of reading each of them each week. Not only are they insightful, they each share a similar no-bullshit tone and display an occasional flash of self-deprecating wit, something too rare in our desperate, fallen world, overrun as it is by thousands of grandstanding idiots unleashed by social media. Here’s the thing. Each piece is never less than 3,000 words long. Usually they come in at 5,000 or more. Yet, more than 80,000 people “subscribe” to McCormick’s free newsletter. (It’s free, so “subscribe” is in quotation marks) Thompson keeps his newsletter numbers close to his chest, but I just dug around a little and I figure he has about 30,000 subs paying him $120 a year. Not a bad return, particularly when you remember that it’s email, so his operating costs are low and his marginal costs even lower, even though he publishes it from Taiwan (where he lives) and has readers in 85 countries…
So, yeah. So much for brevity. It all depends on the kind of “news” we’re talking about. These two content capitalists are making a handy living as long-form journalists…
But, they’re in the vertical market publishing business. Sorry for the business school language there, but that’s the business they’re in. They’re each chasing a well-educated, niche audience with tailored content. That kind of audience is self-qualified for a certain kind of advertiser AND deeply engaged, which is the key if you’re looking to turn them into subscribers. Everyone operating a media property dreams of such an audience. But when you look across the media industry, you see that not all eyeballs are equal.
The eyeball market is hierarchical. These days, Big Tech floats atop the food chain because of its gigantic scale and the fact that it is the jumping off point for well, just about everything. Then come big-volume, commercial, vertical whales, sufficiently differentiated in value from Google and Facebook and Amazon to thrive as independent brands. AutoTrader comes to mind.
In fact, the founding CEO I hired out of Times-Mirror for that venture, Chip Perry, bucked the herd and spent millions on big-event television awareness campaigns to establish the brand as a destination in its own right. He wanted, as he said, “first-party data.” Everyone said he was nuts to forego advertising on Google. Everyone was wrong. Zillow is another classified advertising whale. Indeed and Linkedin, too.
A few big tuna swim just below them. At this level you see national legacy general news brands like nytimes.com and wapo.com, as well as one or two digital-natives of scale, like Buzzfeed. Finally, if you’ll let me extend the metaphor I now find myself trapped in, (I really do need to change edibles) crawling on the seabed far below are thousands of microcommunities — messaging channels, recommendation sites, influencer followings, that kind of thing.
The deeper you dive here, the narrower the content focus, the more engaged the audience, the more differentiated the product. Down deep, nobody’s skimming. You would think then that the audience would be more valuable down there and that, being easier to sell, it would drive stronger and more consistent revenues. Right? Not so fast. In fact, it’s hard to make a living at that level of submersion. The eyeballs are more valuable, but if you dive too deep, whether you’re trying to turn them into subscribers or sell them to advertisers, there’s simply not enough of them to earn you a decent living unless, like Packy and Ben, it’s just you and your family that you have to support. No, you have to head back up towards the surface if you want to build a significant business. Not all the way up, mind you.
The strategic play is to get vertical, but not too narrow, and to roll-up a number of vertical products so that, in the aggregate, across a number of titles, the audience becomes big enough to matter. If you combine that selective reach with refined interest-targeting processes, you can drive significantly better advertising campaign results. Interest targeting performs better for lower funnel campaigns where a promotion can drive an actual sale. You’re reaching fewer people but if they buy or spend more, then the reduced brand awareness benefits are offset by stronger direct response.
What does this suggest? It suggests that magazines, or magazine-like digital products, are the perfect play in media today if – and it’s a big if – they can make the transition to digital.
This is precisely the rationale behind media company IAC/InterActiveCorp’s $2.7 billion deal this fall to acquire Meredith Corporation’s National Media Group. Under the deal, Meredith Corporation’s digital and magazine businesses — which include People and Better Homes & Gardens and Southern Living — will be folded into IAC’s digital publishing unit, Dotdash, and will be called “Dotdash Meredith.”
Dotdash got its start in the early 1990s as the website About.com and became part of IAC in 2012 when Barry Diller, IAC chairman, bought it for $300 million from The New York Times Company. Yes, this is the same guy who told a packed conference room in 2000 that he could see no way for a media company to make money “on the internet.” Then he turned to me and said “if you can, we’d all like to hear it.” That was another fun time. Diller having finally seen the light, in 2019, IAC bought a venerable magazine, Brides, from Condé Nast, the publisher of Vogue, Vanity Fair and The New Yorker. It soon scrapped the 85-year-old print version to concentrate on the Brides’ digital presence. That acquisition kicked off a buying spree that included purchases of Liquor.com, Treehugger and Simply Recipes, Serious Eats and Investopedia. See? IAC is building a collection of narrow content products in vertical markets and selling those audiences both separately, and packaged together.
After the acquisition is completed, the combined company will draw a total of about 175 million online readers every month, making it one of the largest digital publishers in the U.S. It may in fact be the largest, come to think of it.
IAC’s Dotdash to buy magazine publisher Meredith in $2.7 bln deal | Reuters
Though smaller, Future Publishing in the U.K. is pursuing the same strategy. Since 2018 the company has also been on an acquisitions spree, dropping tens of millions of pounds at a time on specialist magazines covering markets as diverse as music, football, and practical caravanning. By the end of 2020, Future owned more than 220 titles and through the middle of 2021, according to the company, average unique monthly visitors were around 20 million, triple what they were three years ago.
This is why we here like Vox Media’s strategic position, too. We’ve examined the Vox Media strategy before: https://blastofwinter.com/2018/02/05/digital-media-shakeout
Their recent acquisition of Group 9 Media and its additional set of vertical media brands has increased the likelihood of a public offering in 2022.
A million years ago at the dawn of web 1.0 I tried to get newspapers to understand this idea. I wandered around in the print wilderness making speeches about what I called “The Great Unbundling.” Go deep into the niches in your markets I would say, that’s where the value lies, it lies in aggregating a set of vertical markets and specific audiences. What is a newspaper, I would ask, but an agglutination of vertical content? They looked up at me from deep in the Mariana Trench and I could see what they were thinking. “Jesus, what a douche.” That’s what they were thinking.
Like I said earlier, not all eyeballs are equal. The marketing and financial value of a news audience is a function of many factors, including demography, income and lifestyle. But the most valuable eyeball of all is the eyeball that finds the content – and any advertisement within it – relevant. RELEVANCE drives lifetime value in media today. And general news is a shitty business without it, a low engagement, high churn business with low growth prospects, a weak subscription offer and advertising potential restricted by limited reach while promising the opposite.
Signaling relevance is an important part of the promotional messaging, too. The Internet is a purposeful medium, a point characterized most vividly by the fact that search is at the heart of all digital activity. In media, one way to think about this is to think of value as how useful a particular product is. This is hardly an original thought. How many articles have you seen on digital news pubs that begin with the phrase “How to…” or “Why is…?” They’re trying to tell you they have a solution to your problem, whatever it may be. This may not be an original insight, but utility is, nonetheless, the cornerstone of relevance. So, with regards to news, publishers might ask themselves to what extent their product saves their audience time or money. How helpful is it? They might also ask how it increases understanding of an issue? Or, is it useful in a completely different sense – does a news story make the reader feel a certain emotion; joy, sadness, empathy, for example? Or is that different sense of utility too obtuse to be, well, useful?
Tali Sharot, an expert on Cognitive Neuroscience at University College, London has thought a lot about the role utility might play in digital media product development and marketing: https://thefix.media/2021/08/12/media-businesses-face-an-engagement-erosion-crisis/
There’s a big lesson here for general news publishers thinking about how, precisely, their product is building audience lifetime value. LTV is the net present value of the profit stream of a customer. It is a tool that has its origins in the halcyon days of direct marketing and particularly the catalog business. Typically, it is used to compare the costs of acquiring and keeping a customer with the discounted positive cash flows that will come from that customer over time. A good publisher is constantly examining the drivers of high engagement (as measured by ‘hang time,’ or time spent with the product), return visit frequency and retention, for these are the primary indicators of a healthy LTV number. But if the biggest driver of LTV in the media sector today is RELEVANCE and you continue to operate like a 1950s mass media outfit – the same general news product for everybody – then relevance is hit and miss and LTV metrics will make that obvious. The good news is that there are proven techniques available to increase relevance, notably through audience insight gained from market data analysis, but most general news publishers still prefer to rely on the instinctive judgment of their newsrooms instead. Their desire to deliver a “worthy” news product outweighs considerations of what makes a profitable digital news business work.
It puts me in mind of the great English soccer manager Brian Clough, who was a leading light in the game when I lived in London and worked for BBC Television. Clough was the English equivalent of that great baseball philosopher, Yogi Berra. He once quipped that he had a fine team on paper, but unfortunately the game was played on grass. A lot of general news publishers have outfits that look good on paper, too. They talk a good game about their future prospects, like Jonah Peretti, the Buzzfeed CEO, is doing a lot of as a result of his company’s recent less-than-stellar IPO.
He’s not fooling Wall Street. Peretti and so many others operate their companies like they were in the newspaper business, with a product offering that is too broad and designed with no-one in particular in mind.
So, they struggle to make a buck, bouncing from one strategy to another and one revenue miss to another, never getting market traction.
They’re lost in the age of the skim.
And now, the Update:
The usual summary of what I found interesting in the media business since the last time we were together. Might seem a little rando, but each seemed important in its own way. Most have already appeared on BlastofWinter’s FB page – you may want to follow that.
A lot of angst right now about Alden Global Capital taking a run at Lee Enterprises, the midwestern newspaper company. But Alden is only doing what private equity does, going after a distressed business. Less angst please, and more thought about how Lee got here and what we might learn from that https://www.theatlantic.com/magazine/archive/2021/11/alden-global-capital-killing-americas-newspapers/620171/
The Hill, the venerable DC political journal, was sold. And Axel Springer bought Politico, which was founded by Washington Post journalists, for $1 billion. That’s a lot of scratch, especially when you remember that Bezos bought the Washington Post itself for just $250 million. They just didn’t get it https://www.cnbc.com/2021/08/26/axel-springer-to-buy-politico.html
More than 250 newspapers owned by some 35 media companies have been quietly filing lawsuits against Facebook and Google since early 2020. Compensation for the market failure of the politically connected is probably not a good idea. Who’s next in line? Department stores? Rail companies? https://www.axios.com/list-newspapers-lawsuits-google-facebook-43f45195-1196-4db3-927c-fee0c22d1a90.html
The Athletic, the latest in a long line of sports-based digital news products that stretches all the way back to 1995 and Sportsline, (my god, I’m ancient) has run into the same problem they all did; local sports is really expensive to cover. They burned through $95 million in 2019-2020 [subscription] https://www.theinformation.com/articles/the-athletic-burned-through-95-million-between-2019-and-2020
Talking of spending, the New York Times sure knows how to do that. But then, they always did, which is why their margins have always been comparatively small. They had a great third quarter, adding some 455,000 subscriptions, but costs are increasing in line with profit. Never a good sign [subscription] https://www.nytimes.com/2021/11/03/business/media/new-york-times-3q-earnings.html?
Fox News turned 25 this fall. My old client Murdoch and his son Lachlan have lost control of the beast they created, but the money’s just too good to do anything about Tucker and the network’s other whackjobs, anyway. Still, he did at least repudiate Trump the other day https://www.poynter.org/commentary/2021/rupert-murdoch-has-a-stern-message-for-donald-trump-now-what-about-his-media-outlets/
Publishers like Bleacher Report, Time and Quartz minted their own non-fungible tokens (NFTs). Its top-selling token earned Bleacher $70,000 in one day. Time has 20 people working on crypto. Around here we think NFTs might help media companies with loyalty and retention https://digiday.com/media/more-more-dynamic-loyalty-driven-communities-what-comes-next-for-publishers-on-the-blockchain/?
Reddit gets little attention, but it has 52 million DAUs (daily active users). It’s latest fundraising round values the company at $10 billion. Here’s a surprise – Advance Publications, the holding company of the Newhouse family, holds a big stake. The company is planning an IPO early in 2022 https://www.thestreet.com/investing/reddit-reportedly-mulls-going-public-next-year
The phone company Verizon acquired AOL in 2015 for $4.4 billion, then Yahoo in 2017 for $4.5 billion. It then merged them into a beast known as Oath, before rebranding the lot as Verizon Media Group. Private equity company Apollo just bought VMG for $5 billion. It’s only money https://www.localogy.com/yahoos-next-era-begins/?
Let’s see now. Here’s a flash from the United Kingdom. A new glossy print magazine – in the age of digital. About men – but edited entirely by women. I’m a contrarian, but this is next level! And to my delight, it’s called “Decent” [registration] https://www.fipp.com/news/stirring-debate-maria-kivimaa-talks-about-creating-decent-a-mens-print-magazine-curated-entirely-by-women/?
Finally, I just had to include this one because it summed up all the pretention and naivete of the modern digerati in just one little sentence: “Good ads,” this fella said, “can actually be helpful.” Thus down the drain is sent the engine of the entire consumer retail economy. Help me, somebody, puh-leeze https://www.amediaoperator.com/newsletter/could-free-content-be-more-lucrative/
Happy holidays all. As always, thank you for your emails, including the ones from those who disagree with something or another. Keep ’em coming to me at peter@pwinter.com – and I’ll see you in the New Year.
Go in peace.
BlastofWinter 