An Essay on The Tie Between Business and Publishing and the Effects Social Media Has on Their Relationship
Written by: Mathew Sweezey
Edited by: Alberta Deacon
In our world of limitless information, it is hard to imagine that 100 years ago there were no newspapers with more than 8 pages. In the past 100 years of publishing, we have seen the invention of the Linotype, color printing, digital publishing, and social media. Each of these innovations changed the way publishing was produced and consumed by the public and used by business.
Marketers and publishers have always been in lockstep. The revenue generated by publishers was due to businesses seeing the value in mass marketing. This turned names like Conde Nast, Rupert Murdoch and News Corp household names. Now names like Dorsey and Zuckerberg have replaced these former titans and taken the throne as the new kings of publishing. Understanding where this new social publishing revolution was spawned, why it is so revolutionary, and seeing where it will take us will help you understand the new relationship between publishers and business, and the new worlds which social media opens.
HOW IT BEGAN/
In 1865 (post civil war), there were only 700 magazines in the United States. This number ballooned to over 3300 by 1885 due to the invention of the Linotype. Publications covered every topic from homemaking to political humor, with everything in between. These publications were usually sizable investments in content creation, production, and distribution. Despite the physical hurdles to creating a publication, the number of magazines grew to 20,000 by 2008. In the U.S., newspapers peaked at 1800 in circulation in 1940. Despite their limited number, every Sunday, the biggest publication day, they were able to reach over a combined 50 million people (40% of the U.S. population at the time.)
Fun fact: National Geographic published the first color magazine edition in 1910.
At the height of print publishing, advertising accounted for 80% of their revenues and allowed them to put writers all over the world to cover events as they happened. This revenue solved the dilemma of gathering content, allowed for larger editing staff, paid for massive fixed costs of printing equipment, and allowed for the creation of distribution channels. The quality of the publication and advertising revenue are always tied to each other. The better the content, the larger the audience, and the targeted nature of the audience meant more could be charged for the advertising. The size of reach and targeted nature of these publications solved a major problem for business, too. In 1960, there were only five marketing channels. With the lack of marketing channels which could be targeted by interest, print publishing offered a way to combine targeted demographics with relevant ads to a very large audience, hence it was profitable for publishers and effective marketing for businesses.
Fun fact: In 1993, the Wall Street Journal was the most read newspaper in print at 1.9 million readers per day
As time progressed and the number of publications grew, so did other technologies, mainly the Internet. The Internet started off as a way to connect computers and in the process connected people, ideas, and communities in a way never before possible. The Internet also allowed for instant publishing, removing the cost of actually printing anything, removed the cost of shipping physical products, and opened the doors for anyone to become a publisher with zero start up costs. This lead to an increase in online publications, especially blogs. In 2013, there were over 152 million blogs across the globe.
In addition to the Internet and blogs, social media came about while this was going on. Most people consider social media as a way to keep up with friends, but it should be considered simple micro-publishing instead. The content which is created and shared via social media is now replacing many people’s need for traditional content from publications. It is faster, cheaper, quicker, and many times more accurate as Twitter proved during the Arab Spring of 2013. News published and consumed in this social micro-blogging format was the first to break the news to the world. Just as every other traditional print medium did before, Twitter has already lent a hand in toppling dictatorships and facilitated many uprisings in other countries due to the ease of getting a message out to people quickly and at no cost. What used to be underground print shops for political resistances are now people with cell phones and Twitter handles. There are no more barriers to publishing.
Now the traditional media channels – print, radio, television, direct mail – are no longer kings of information or the best way for businesses to reach consumers. Just last week the BBC announced it was laying off another 500 employees, after a 650 person lay off just two years prior. These were field agents, journalist, and reporters who got the ax. The very people they were paying to find the great stories to make their publication more relevant. However, now they don’t need these people to find great stories. The new crown is being worn by social media mavericks. These new media forms are also finding better ways to monetize their channels by combining teachings from some of the early greats in marketing with brand new technology.
PERSUASION CHANGED THE GAME/
Edward Bernays (1891-1995), is a name you might not be familiar with, but hopefully you are with his uncle, Sigmund Freud. Bernays is singlehandedly responsible for changing the way the publications industry was used by business, and in the process, created the Public Relations industry. PR is his creation which he used to change the way businesses and governments reached consumers through media. In his book, Propaganda, he poignantly stated: “Who are the men who, without our realizing it, give us our ideas, tell us whom to admire and whom to despise, what to believe…Such a list would comprise several thousands persons. But it is well know that many of these leaders are themselves led, sometimes by persons whose names are know to few.” His theory was, control the source of ideas, and you can control the ideas which are spread.
The Public Relations industry created a new economy of specialized marketers able to help those with ideas get them in front of people. Even in the early days of print, people responded better to the messages in articles than they did to advertisements in publications. The trade off for PR vs paid advertising was the time to execution. For PR it might take months to get a piece into a publication, while an ad buy can be done overnight and published the next day. This has always been the major stumbling block for executing the PR strategy. The second stumbling block is, simply, great content. The “good content” issue is not a factor of the technique, but the practitioner, and should not be considered when evaluating a technique.
Since the number of publications also limited PR, the sprawl of the Internet gave this technique a new life as well. Consider at the height of printed media there were only 2,000 newspapers, and 20,000 magazines. Now consider there are over 152 million blogs in existence. Then consider ad networks, programmatic buying, and real time bidding which allow companies to market on all of those publications easily and cost effectively.
Facebook began in 2004 with a few college friends. Other notable new media channels are Twitter, which began in 2006, and LinkedIn in 2002. These three online sites account for more than 340 million unique users each day. That is seven times the size of the Sunday newspaper at its largest circulation of all time without having to print a single page! The reach of online publications is exponentially larger than print has ever been and will only continue to grow. Consider that currently more people have access to cell phones, have electricity, or clean drinking water, and all of this digital social content is accessible on those devices. This is a new revolution for published media because of low barriers of digital publishing, and the largest possible distribution ever before known on earth. This is where things begin to get interesting with businesses and social publications.
TECHNOLOGY CHANGED THE POSSIBILITIES/
Currently we have the ability to produce publications with none of the physical barriers of previous generations. We have free ways to create content, produce it, distribute it, access it, and a readership of epic proportions. The only problem facing social publications from taking over as the primary marketing channel was their inability to figure out how to make these channels valuable to businesses. The two traditional ways publishers would provide value to businesses were eyeballs and paid placement. The .com tech crash taught us that neither one of these is a great option for sustaining a publication or proving tractable value to a business. These social media platforms had to find a better way, and they saw an example to learn from.
Google does not receive any money from consumers, instead provides businesses with access to these highly targeted consumers. This is the standard publication and business relationship. They make their money from being the place to effectively target advertising to consumers. But Google did something different. They turned their ad inventory into a marketplace with bidding. This only provided a sizable value to businesses when consumers consistently used Google as their search engine. The addition of search words to the targeting of advertising was also a breakthrough. From this they made over $40 billion last year on digital advertising alone. The difference with Google vs a publication selling advertising, is that Google is selling advertising on content which they do not create, nor manage but simply help people find easier. This is now how social media platforms hope to find a better alternative for revenue and provide businesses with a more valuable relationship.
PR as Bernay’s theorized is a way of allowing consumers to self-discover predetermined messages thought their normal channels but under the pretext of authorship. We understood that core concept, and were able to use viral reach from fans and followers up to a point when Facebook seriously slimmed down the ability for you to influence your fans and followers for free. They realized that at scale they had also created a market place which is data rich for marketers and will provide even more value to businesses than traditional publishing marketing ever could.
To complete the perfect storm for social media, a break-though in advertising buying happened at the same time. It is the concept of Real Time Bidding market places. An RTB is the ability for a company to buy one ad, for one person, in real time. The market place allows you to contract across networks all with a single bid. So rather than pay $50k for a static ad in a magazine, you can buy one ad, for one person, in real time, and do it at scale. You can even take it as far as having the ad be smart and change based on a persons past behaviors. The break-though of RTB was the missing piece for social media’s true value.
Fun fact: Paid Social Promotion (social in-feed advertising) is already driving 20% of total lead volume to some of the largest B2B brands.
To help illustrate the value of a social media in-feed ad served up by an RTB system we’ll compare it to traditional side bar advertising, using programmatic buying. The side bar ads using RTB will place your message in front of how ever many targeted people you can afford, but a recent stat shows you’re more likely to survive a plane crash than click on a banner ad, so it is not driving engagement. You may then say, but people will remember seeing it. So it has branding value, but a recent study shows a person will not remember that ad 10 seconds after they’ve left the page. So the argument of visual repetition as a value is false. Now compare this side bar ad to a marketing option which combines an RTB systems and Big Data sets and to provides consumers with the all important self-discover element of content. This would be a dynamic in-feed advertisement. to show the perfect message, at the right time, to the correct person via in-feed (social feed) real time marketing. This is the ultimate value for a business. As Gary Vaynerchuck said, “I’ll pay $945 for a lead if it’s worth $946,” and this is why companies like Facebook and Twitter have such high valuations currently. Their ability to create a market place of this type of advertising is infinitely more valuable than print publishing ever was to a company.
Businesses and publishers have now found a perfect mix of innovation that will forever change the way companies market in the future, and the way content providers monetize their readership. The businesses who understand this includes those modern marketers who think with The Publisher Mindset and realize that with this power you can help or hurt your brand just as fast. These new innovations do not neglect the basics of marketing or the need for solid content. They only make it easier for the best ideas to rise and put a larger importance on the CMO as a key driver of a business goals. It’s a fast-paced world, and it takes a lot to keep up, but for a marketer, nothing could be more exciting than this new collision of media, technology, and consumer behavior. To quote Nina Simone, “It’s a new dawn, a new day, It’s a new life, and I’m feeling good.”