SIIA Digital Discourse

Digital ads. It’s a revenue stream that most members have not tapped into very much. The website Digiday brought it up last week in a good post. Josh Sternberg wrote that the old way of charging—CPM, cost per thousand views—doesn’t make sense for small publishers.

“While they may be large enough to have influence over a particular demographic, looking at them on a buyer’s spreadsheet, they’re still peanuts,” he wrote. “Instead, by positioning their expertise about their audience in a marketplace that has gone whole hog into pageviews, these smaller publishers are making a go at creating working models.”

He cites the “publisher as agency” model, where the publisher actually helps brands develop advertising content for their site and others. This, of course, moves closer to native advertising which I discussed here earlier this month. But it also takes advantage of some of the things that publishers do well—creating content, writing, knowing your subject and audience. The Digiday story referred to an interview on another site—AdExchanger—with Todd Anderman, the new president of sales, marketing and operations for Thrillist Media Group.

Instead of looking at your digital ad scope haphazardly, Anderman wants you to focus. “It’s not just about throwing up an ad unit around [your] content, though those opportunities do exist. It is about finding out from marketers what product they have that should be recommended to our audience.” He believes that ads on the site should be of value to your audience. And he even wants it in a similar tone to what you’re doing. “The idea is to do it from an editorial perspective so that it completely resonates with the users, as opposed to marketing messages that comes purely from outside.”

It’s truly amazing how far things have come—from that never-to-be-tread-upon line between editorial and business to the almost complete melding of them. Wasn’t it just yesterday that The Los Angeles Times was ready to fold when a scandal erupted with an article in their magazine that dared cross the line? Now that seems light years ago. There are no more lines—though one SIPA CEO suggested sales and marketing might be on the verge.

“If we make sure that you start with a complementary message to the content we run, it actually becomes the content,” Anderman says. “To the user, it is just as valuable as any other piece of content.” This actually has exciting possibilities. Say you post a video of a one-on-one interview with an industry player or government official. In the past, we’re used to seeing a preceding ad that’s of totally no interest to us—but if we want to see that video we ride it out. What if it’s interesting ad content to your audience? Maybe an ad for something espoused in the interview. That could be a win-win scenario.

Again, the line crossing of native ads sounds a bit extreme. But Anderman is one of the most successful players in digital ads. He was asked about where to draw the line, but except for saying, “We will clearly differentiate between the two for the user,” he doesn’t care that much. It’s quality he’s after—and dollars, of course.

Maybe that’s not so bad. Digiday quotes John Shankman, publisher of The Awl, which gets 425,000 uniques per month. “Data and production value will become what we compete on more and more.” (SIPA2013 will have a must-attend Pre-Conference session on data with Russell Perkins, the guru on the topic. He will be able to explain its growing importance AND how you can profit from it A LOT better than I can.) Shankman believes that “you can win business on production value.” In other words, who is providing the best overall experience for users? Content, ads, events, videos, etc. It’s all one.

Even a daily deals publisher like Thrillist is not after pageviews any more. Say they’re selling a bar crawl, then on the right you’ll see “native ads” for shirts, shoes, ties and a membership-only penthouse pool club. It’s all high production value, and then those same ads can be mixed and matched with their other content—chef tastings, March Madness get-togethers, turntable tutoring, etc.

Ties on a bar crawl?

Ronn Levine began his career as a reporter for The Washington Post and has won numerous writing and publications awards since. Most recently, he spent 12 years at the Newspaper Association of America covering a variety of topics before joining SIPA in 2009 as managing editor. Follow Ronn on Twitter at @RonnatSIPA

Every time I hear a member talk about having a good renewal rate but the company could use more new customers/members, I think referrals. I run a social group on the side and every day I see new people joining—the primary reason they list is that someone recommended it. Now that’s a much smaller and cheaper scale, but still the basic idea holds up: They’ve been referred.

Harnessing the power of references and referrals seems like an obvious win-win. But Bill Lee, author of The Hidden Wealth of Customers: Realizing the Untapped Value of Your Most Important Asset (Harvard Business Review Press, 2012), believes that “companies don’t take it seriously. You just can’t half-heartedly paste a few new tactics on top of your current operations and expect advocates to start singing your praises,” says Lee. “Nor can you rely on a few enthusiastic supporters with vibrant personalities to carry your message. He quotes Salesforce.com CEO Marc Benioff who said that even though every company knows customer references are important, most companies have a lax approach to actually managing them.

Here are 7 ways Lee advises to improve your likelihood of success:

1. Increase executive support. Too often, customer reference programs are rolled out with limited resources and staffed by junior people working off a spreadsheet—a recipe for failure, says Lee. A successful reference program must cross boundaries, working cooperatively between divisions. He’s worried about good references staying within sales and wants you to encourage your best customers to advocate on social media.

2. Use more imagination. Out with pdf case studies and long PowerPoints, Lee advises, and in with testimonials, serving on advisory boards, and participating in your customer communities. He believes customer advocates can also lead customer communities and forums, create content and video. That may be a lot to ask, but the idea of giving your customers a reason to go on social media or join a community to help plug your brand seems sound.

3. Commit to resources. Lee doesn’t want this to be an afterthought. “Enthusiastic references…can close deals that were stuck, convince skeptical analysts or media that your product or service is the real deal, build your brand on their social networks, provide referrals—the least expensive and most powerful marketing tool out there.” Giving a list of prospective references to an assistant is not enough, he says. You don’t know if they’re happy or strategically significant.

4. Install the right systems and processes. This includes an adequate reference management system (RMS) that automates as much of the data needs of the program as possible. To engage these customers you should have all the data. What is their history with you? “What policies have you established for references and testimonials in your sales and marketing efforts?” Lee asks. At what points in the sales process should references be used? What is your social media strategy? How will customer videos, stories, and other customer content be used?

5. Integrate references into the growth strategy. “Managers of reference programs that are well integrated into strategy can tell you, in your next product launch, how many customer references you’ll need,” says Lee. They’ll also tell you from which customer segments these references should come and who can be an early adapter? Keep everyone in the referral loop.

6. Measure and understand the business value of references. “Reference programs can dramatically improve sales productivity by freeing salespeople from the time-intensive task of hunting down references themselves,” Lee explains. Managers should continually measure the business value of referrals instead of the number of new references found. In other words, gather input, tout the output.

7. Give customers a good reason to reference them. Lee does not advocate “bribes” to get referrals. He believes the smart companies think through why their customers would advocate for them. Get creative in providing appropriate reciprocal value to your potential advocate, he says. “Does she like the limelight? If so, offer to do a joint case study or marketing piece. Does she want to affiliate with her peers? Invite her to your user groups or customer events. Would she like a higher profile in the industry? Hopefully, you know your customer well enough to know what is valuable to her.

Ronn Levine began his career as a reporter for The Washington Post and has won numerous writing and publications awards since. Most recently, he spent 12 years at the Newspaper Association of America covering a variety of topics before joining SIPA in 2009 as managing editor. Follow Ronn on Twitter at @RonnatSIPA

Max Hotopf, President, Healthcare Europa, London

SIPA: You have an interesting background.
MAX: Yes I started off working in public relations and advertising and then moved into trade journalism ending up on the Daily Mail. Being a journalist was great as it gives you so much more freedom from censorship. But it was very useful to have a PR/marketing background. It meant I had the rudiments of direct marketing.

Yes, most journalists stay clear of the business side.
Or are horrified if they are asked to sell. They position themselves as skeptical purchasers of information pumped to them by PRs. I think good journalists have to be good salesmen. They have to win the trust of contacts for instance. Bernstein and Woodward sold themselves to the Watergate story.

It takes time though, which I’m sure you know.
Yes. It’s hard to build a new subscription site from scratch. In fact I remember people on the SIPA listserv saying in 2008 that it would be impossible to launch a new newsletter in a new industry as response rates are so low.

Though you did do this before.
I set up my last subscription newsletter, IT Europa, in 1991—mailed stuff out, which [in some respects] was actually easier. The barriers to entry are harder today, don’t you think? Just the technology alone. Although I did launch this business on Subhub at just $70 a month. But IT is a huge cost these days.

What does Healthcare Europa focus on?
We write about private healthcare service across Europe. It was something no one else was covering. We’re all B2B, going to investors, nursing home groups, hospitals, banks. There’s really good journalism value about it. It seems good content has become more valuable now.

How often does your newsletter come out?
It’s weekly with a big 20,000-word pdf issue at the end of 10 months. We don’t necessarily always send the weekly on the same day—depends when news might break. We think of ourselves as the journal of record in this field. We dig deeper. I find Google news to be helpful there. It provides me with a good introduction when I ring people up for a dig around which often results in something totally different. I may also talk to a guy from Sweden and benefit from his news sources.

Did you have a hard time pricing your content?
We’re a niche market, so it wasn’t that hard to figure pricing. I knew about how large the market is and about what we would get, and what we needed to take in. It’s priced at about £900 for a year and £2300 for a site license.

And your renewal rates?
Around 90%. But getting new members is hard. I tried telesales without much luck. It’s hard to recruit good people to do it.

Have you done much with referrals since your renewal rate is so high?
No. I should try that. This is not the most open of industries though. Writers may not even put their names at the end of blogs. Healthcare is a bit secretive

I see you have a Conference.
Yes, this is our 3rd year and it keeps getting bigger. I find differentiation to be very important. No one else is producing a conference like this [whereas] there’s a plethora of events funded by academics or the public sector.

That’s a good foundation.
Maybe—or maybe it means there isn’t a particularly big audience. Actually, no there is a huge audience, it is a slow burn but we keep adding new constituents like medtech. Healthcare is tough to cover, and there are no shortcuts in subscription publishing. We’ve done well with personalized introductions. ‘Hi Ronn, here is your…’ in a little headline article. Just a jaunty little note. You can personalize with the new CRM system.

How much do you let people read before they have subscribing?
We have headlines with the first line of the story. The problem is I think they kind of get used to that level of “subscribing.” Maybe I should send them the whole article when it’s particularly good to show the difference.

And you do all this with just you and a deputy editor plus a part-time administrator and your wife working part time? Pretty good.
Yes, my wife works some on IT and has a medical background that helps sometimes. But we do take August off and two weeks at December plus a week at Easter as we have five kids. Sometimes it feels like a lifestyle business, other times like a build and sell.

Thanks Max. We’ll see you in September at SIPA’s London Conference.

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Ronn Levine began his career as a reporter for The Washington Post and has won numerous writing and publications awards since. Most recently, he spent 12 years at the Newspaper Association of America covering a variety of topics before joining SIPA in 2009 as managing editor. Follow Ronn on Twitter at @RonnatSIPA