Many Americans are experiencing inflation for the first time in their lives. They have no memories of the gas lines of the 1970s. I have vague memories of being packed away, likely without a seat belt, in the far reaches of a wood-paneled Country Squire station wagon while we waited for gas that was in short supply. Inflation devalues a currency. Returning to equilibrium and stable pricing is a painful process.
While inflation is new to the overall economy, it isn’t new to digital publishing. The limitless nature of the internet has meant that audience numbers grew to absurd, Zimbabwe-like levels. Pageviews went from the millions to billions, soon to be joined by Facebook video views. GroupNine’s viral video news outfit, NowThis, was bragging about 2.6 billion views a month. There are 7.8 billion people on earth. The numbers were enormous, only they proved fleeting. Nobody paying attention was surprised when Facebook said its video view metrics were inflated. If they were, they were negligent or lying. There isn’t that much attention to go around for all the people claiming billions of video views.
In the Facebook era, the scramble was on to tap into the “bored at work network,” as Jonah Peretti called it. I suppose this was doomscrolling in happier times, as people sat in their cubicles after a sad desk salad lunch and killed time between meetings. Cheddar took this to a new level, as Jon Steinberg pushed aside questions of who exactly is watching Cheddar to peddle it “ambient media” that exists in the background of an office or when someone is pumping gas. This apparently added up to an audience of 148 million, enough to top 1 in 2 adult Americans. It’s no surprise that Ozy Media would want to construct an audience out of whole cloth.
Digital publishing is now in a painful revaluation cycle to achieve equilibrium. Outside of CNN, no publisher is bragging about their ComScore reach. You don’t hear much about how many billions of views are being done on social platforms either. Instead, publishers are talking more about their tight ties to specific audiences. There are, of course, still inflationary flareups. Publishers still choose to brag about their big overall subscriber numbers while skipping over how many are on cheap introductory offer deals – not to mention how much subscription revenue they’ve generated and the lifetime value of their subscribers.
This will be a painful but needed process as publishing becomes more focused, more profitable and more comfortable with smaller but real numbers. The simple truth of digital publishing is most top line audience numbers are nonsense. If you stay in business long enough, you’re going to get a ton of random visitors to pages that rank high in search, not to mention the dopamine of the viral hit. Instead, the name of the game in the coming years will be what one digital media veteran called “primary engagement media.”
Primary engagement is people subscribing to your newsletter or podcast, it’s people actively coming to a publication instead of arriving from a random link on a tech platform.
Primary engagement media knows its audience, even to the degree that audience is a community.
It has the kind of differentiated point of view that breeds loyalty. In publishing, this is content written for people rather than for algorithms.
Primary engagement media companies obsess more about content quality than distribution gimmicks.
It is often tied to an individual versus an institutional brand.
Primary engagement media can get people to take meaningful actions.
The catch of primary-engagement media, as this exec said, is it requires a comfort level with smaller numbers. The demise of the third-party cookie and restrictions on “surveillance advertising” mean that advertisers are going to need accept that they’ll need to work harder to reach engaged audiences rather than just dumping their budgets in Google and Facebook and letting the black boxes take over. The raw audience numbers of publishers with engaged audiences will more often than not be lower. This is a healthy development. Better to have smaller and real than big and fake.
On the subscription side, my former colleague Jack Marshall has written about this shift from the “volume-first mindsets” of publisher subscription programs.
“This growth-first, revenue-later approach has given rise to the deep discounting, aggressive introductory offers, dubious cancellation policies and armies of retention specialists that are now common across the marketplace. But as their subscription businesses mature and evolve, many publishers are now beginning to think more carefully about the long-term costs of aggressive short-term growth tactics, and what strategies and approaches are necessary to fuel sustainable growth.”
Prioritizing primary-engagement media will benefit upstarts. Often it’s difficult to compete with incumbents on the basis of indirect distribution. They have built-in distribution through the years through search and social, allowing them to optimize to incremental gains. It will reward publications that go narrow and deep on topics important to specific audiences.
Monetization models will evolve to reward primary engagement. You already see that, to a large degree, with subscriptions. In the long run, despite the intro offers and cancellation games, publishers with engaged audiences will benefit. The same goes for commerce, as publishers evolve beyond slapping up gift guides that are more SEO play than anything else. Getting people to take action is critical. As Troy Young puts it, publishing is moving from CPM to GMV. (GMV is an e-commerce acronym for goods sold over a period of time.)
I often cite what Packy McCormick is doing with Not Boring as the example of a modern media company. The other day, I tweeted how well done his sponsored deep dives product is, and soon after I got the reply that it won’t scale. As Packy said, “I work my ass off to make sure these much more valuable than an ad.” And they are: He’s often investing in the companies and getting equity instead of an insertion order. Having an engaged audience has upsides.
The quantity of audience data doesn’t matter much if the quality is not up to par. Audigent allows publishers to future-proof their businesses with a first-party data platform that both provides an omnichannel view of their customers and drives unique advertiser demand. The power is shifting back to publishers that can serve as the “source of truth” for media buyers. Audigent combines the best of both audience and contextual targeting through its Hadron ID, a proprietary five-point cookieless identity system. Hadron ID provides the ability to target audience groups across distributed publishers and SSPs in order to deliver the right message to the right person at the right time. Now and into the cookieless future, Audigent is a publisher’s secret weapon, making their audience data and inventory actionable to media buyers at scale.
5 things to check out
Trusting the government to sort out the rules of the road for digital privacy is a tall task. The New York Times puts needed mainstream focus on the messy results of GDPR, the EU’s landmark data privacy law. Joe Nocera points out how the ubiquitous cookie-consent banners haven’t added much beyond annoying people. While true, he misses out on the impact the regulation had behind the scenes. Companies of all sizes were forced to examine their data collection practices.
My most popular podcast episode was a conversation with Taylor Lorenz, who is leaving The New York Times, where she reported on digital culture and the creator economy. An interesting bit of her interview with Vanity Fair about her decision to jump to The Washington Post is when she hints at dissatisfaction with how the Times prioritizes the institutional brand over individual brands. I doubt that will ever change at premier brands like the Times, but the greater shift to individual brands will put pressure on how they retain stars.
The Roaring 20s of publishing is undeniably largely focused on the elites, leaving the problem of underserved communities. Capital B is following in the tradition of the Texas Tribune with a non-profit model focused on local news from the lens of Black people. I was happy to be a guest with Lauren Williams, a cofounder of Capital B, on Peter Kafka’s Recode Media podcast coming out later this week.
Every gold rush is followed by a consolidation period where you find out who’s truly dedicated and skills. The streaming gold rush is no different. The hypergrowth phase of discounts and bundles will now give way to a consolidation period where services try to build loyalty beyond signing up for Disney+ only to see the “Get Back” documentary and then canceling.
The best way to make money in publishing remains multiple ways. Simon Owens writes about the need for newsletter writers to not get hung up on one source of revenue and instead pursue multiple lines. The trick is finding two or three ways to bring in income while not stretching yourself too thin, particularly in the early going.
Thanks for reading. Send me a note with feedback: firstname.lastname@example.org. If you’re interested in sponsoring The Rebooting, check out the media kit and get in touch.
While I personally love the notion of normalizing small numbers, this is sadly a conflict of interest to every large agency and business model linked to display oriented metrics.
Break the cycle (endless loop) of spending to drive scalable audiences and you're on the path towards normalizing small numbers. Until then, everyone will talk the talk but behind the scenes every agency is recommending and placing buys in direct opposition of this logic.
At least there are some of us out there walking the walk.