Mark Twain said the above after reading his own obituary in the New York Journal, but he might as well have been talking about advertising as a revenue model for news publishers.
Publishers have all lost large sums of ad revenue, of course – $7.5B is a BIG number for anyone (except Wall Street bankers looking for TARP money). But Robert Niles wrote a great blog post recently discussing the 3 revenue models for journalism, and how they’re not going to change:
1. Direct purchases, such as subscriptions, copy sales and tickets
2. Advertising
3. Donations, including direct contributions and grant funding
His thoughts on #2, Advertising:
Despite fears about the death of advertising, I say that there will always be people willing to pay to gain access to others’ audiences. That, distilled, is the definition of advertising.
Social media may provide a new ways for retailers and other business to speak directly to customers and would-be customers, but as anyone who’s started a Twitter feed with no followers can attest – building an audience is hard. Buying access to an established audience that you’re not now reaching is, for businesses with money, a far easier way. Advertising endures.
Online, advertising takes new forms – from banner ads to interstitials to affiliate links – but none of these forms are fundamentally different from any form of advertising that has come before. They remain a way for a publisher to sell access to its audience to another. So long as a publisher builds an audience, it will have the ability to rent access to it to advertisers. At which price point the publisher will be able to do that will depend upon the audience, and the amount of competition also reaching that audience.
What does this all mean for publishers?
It means that, although ad revenues may be declining for publishers, they’re not dead… nor are they going to die anytime soon. As revenues decline for print and other mediums, publishers need to focus harder on the value that they’re creating through new distribution channels, and then move quickly to monetize these. Access to a publisher’s captive audience is always going to be valuable to advertisers, and that’s not going to change anytime soon.
Happy Assetizing,
Saif
