Why publisher content studios were overhyped
The idea that a publisher’s branded content studio can match the quality of its non-advertising editorial output is based on a lie.
|Simon Owens||Jun 4||5|
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Why publisher content studios were overhyped
Remember when it seemed like every publisher was launching a creative agency that would collaborate with brands to produce sponsored content? Most ended up being more trouble than they were worth.
Brian Morrissey explains:
The reality was the world didn’t need more agencies. What’s more, the agency business is hardly a gusher of margins, difficult to scale and even more so to make efficient. … One top publisher to me a few years ago noted that publishers lacked the internal culture to expand and contract — that is, lay people off when there isn’t enough work or an account is lost — that agencies do as a regular course of business, not to mention forcing staff to work over the weekend to meet an arbitrary client deadline. Over time, the ardor for content studios faded as publishers looked to the recurring revenue of subscriptions as a far larger opportunity than dealing with finicky clients.
I’ve actually done quite a bit a freelance work for these types of agencies, and so I can attest that they’re not great at what they set out to accomplish.
In the ideal scenario, the brand would hire the publisher’s content agency and then get out of the way, trusting that the publisher knows how to craft content that will appeal to its audience. But in my experience, that was rarely the case.
One major problem in these arrangements is that there are too many stakeholders involved. Not only do you have all the executives on the brand side, but there’s also often an advertising agency that sits between the brand and publisher; in fact, that advertising agency is typically the entity that hired the publisher’s content studio. Then there’s the client services staff on the publisher side, most of whom don’t really have any experience in creating editorial.
Often, by the time I was brought on to write the article, the creative brief was already written, which meant I could give virtually no input into the story’s direction. Usually, my assignment was to interview an executive at the brand about some boring topic relating to the company’s products, and I’d be required to supply my questions in advance.
When it came time for the interview itself, there would be at least 10 other people on the line — the teams from the publisher, brand, and advertising agency — which made for an extremely awkward conversation where I basically read the pre-provided questions one right after the other and then asked a few meager follow-ups.
As for the drafts I turned in, they often went through three rounds of edits — one from the publisher, one from the advertising agency, and one from the brand itself. It probably won’t shock you that this didn’t make for very engaging copy.
Once the article was finally published, I wouldn’t promote it to my own networks. I took no personal pride in the end product, but simply viewed it as a means to a paycheck. The inefficient process took up hundreds of cumulative man hours, and I can’t imagine that all that many people read my articles.
Sure, once in a blue moon a publisher studio will overcome these hurdles and produce a truly engaging piece of content, but those are exceptions to the rule. The idea that a publisher’s branded content studio can match the quality of its non-advertising editorial output is based on a lie, and that’s why you don’t ever hear publishers brag about their creative agencies anymore.
You hear plenty about the subscription successes of national outlets like The New York Times and Washington Post, but there's a lot less written about the efforts of regional newspapers to grow their digital subscription businesses. A midwestern chain called Forum Communications has seen some success.
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The podcast-to-startup-funding pipeline
Insider published a good profile of what it’s like to work with Jason Calacanis, a startup angel investor who’s partly known for his impetuous tendency to spout off asinine opinions on social media.
I don’t follow the investor space all that closely, but I’ve always found Calacanis interesting because of his background in media. The guy founded a magazine called Silicon Alley Reporter at the height of the dot-com boom, lost it when the bubble burst, and then went on to cofound Weblogs, Inc, a blog network he sold to AOL for $30 million.
These days, Calacanis hosts a popular podcast called This Week in Startups, and I find it fascinating how he leverages his online brand to generate deal-flow for his startup investing:
Like many teenage boys coming of age in New York at that time, Calacanis was an avid listener of the radio shock jock Howard Stern.
Calacanis listened to Stern obsessively and was inspired by him, recalled Alvey, the childhood friend. "He really thought he could be the king of all media — print, audio and video." …
… Calacanis keeps the Murdoch dream alive with Inside and the podcasts, "This Week In Startups" and "All-In," which meld investment strategy with ramblings on current events from friends, Silicon Valley celebrities, and B-listers alike. He's also written a book about startup investing, offering "Timeless Advice from an Angel Investor Who Turned $100,000 into $100,000,000."
I’ve written before about startup investors who try to build out their own media outlets in an effort to hype their investments and create deal flow, and Calacanis’s antics certainly fit within that same vein. His podcast allows him to network with other investors, raises his profile within the startup community, and probably generates additional revenue through advertising. All he has to do is land an investment with one future unicorn startup and the podcast more than pays for itself.
Google is getting nervous about Amazon’s search advertising gains
In case you haven’t noticed, Amazon has quickly become a digital advertising giant, posting double digit year-over-year gains each quarter. While this revenue stems from a variety of platforms ranging from Twitch to IMDb TV, it’s pretty clear that the bulk comes from ads on Amazon’s product search pages. These ads are typically purchased with budgets that were previously allocated almost entirely to Google search ads.
Suffice it to say, Google has noticed. Bloomberg reports:
Alphabet Inc.’s Google announced Thursday that merchants using Square, GoDaddy Inc. and WooCommerce will be able to sell products more easily on Google search, Maps and YouTube. Last week, Google introduced that feature for Shopify merchants and is now adding the Canadian company’s payments product, Shop Pay, as an option for consumers. Google also plans to display buying options more prominently on its sites, adding even more ways to turn it into an e-commerce bazaar …
“Google loses if your homepage for e-commerce becomes Amazon.com,” said Bryan Wiener, chief executive officer of Profitero, an e-commerce analytics firm. Yet Google’s edge may be in helping businesses that already pay to promote their products on Google turn around and sell it there, too. That’s particularly true of smaller, older companies. “Going direct-to-consumer has been a lot harder than many of them anticipated,” Wiener said.
Why I left Medium
This week I did something drastic: I deleted 28 longform articles from Medium. I wrote about why I did this over here.
YouTube stars are getting so good at diversifying their revenue streams
Bloomberg wrote about YouTuber Logan Paul's massive success as a professional boxer:
Paul is now making more money from boxing than he ever made from hawking brands as a social-media influencer. The same goes for his younger brother Jake Paul, who has followed a similar career path from social-media provocateur to crowd-pleasing boxer and recently signed a deal for a future fight on Showtime. If the numbers they tout publicly are even remotely accurate — there is a long history of exaggeration in boxing — they are raking in millions of dollars per fight. Their time in the ring is also fueling other parts of their business. Logan’s merchandise line generated $40 million in sales during its first nine months.
It's yet one more example of how YouTube stars are getting really good at diversifying their revenue. I'm constantly impressed at the level of sophistication of YouTuber businesses. It’s not uncommon to come across a channel with at least four or five revenue streams. Here’s a sampling:
Programmatic advertising: Nearly every major YouTuber opts into the platform’s partnership program, which inserts pre-roll and mid-roll ads directly into the videos. These ads are great for the YouTubers because they require no additional effort beyond creating the content.
Video sponsors: In addition to the programmatic ads, the YouTubers often work directly with sponsors and will shoot short segments that appear at either the middle or end of the videos. Because the YouTube stars themselves are the ones pitching the product, they can demand much higher rates than what brands will pay for the programmatic ads. Many YouTubers even offer the option of creating entire videos around the brand.
Affiliate links: Creators will throw affiliate links into their YouTube descriptions for any brands featured in their videos. I recently wrote about how gadget reviewer Lon Seidman generates a good income by recording video reviews of tech products and including affiliate links in the description.
Merchandise: Most YouTubers will sell branded shirts and hoodies, but some have developed sophisticated product lines that are actually sold in stores. Toys licensed from the YouTube channel Ryan’s World, for instance, generated $250 million in 2020.
Beauty care lines: Technically, this should fall under the merch category, but beauty care really is its own ecosystem within YouTube, with top beauty influencers launching their own makeup and fashion lines. Even YouTubers who know nothing about fashion or skin care can make real money (Read: Shane Dawson)
Online courses: If there’s any sort of skill you need to learn in either your personal life or career, you can bet there’s a YouTuber out there who will sell you a video course about it. Probably the most comprehensive version of this I’ve seen is Bright Trip, a company started by YouTubers Johnny and Iz Harris that specializes in creating video travel guides.
Book deals: Book publishers love when their writers have their own built-in audiences and marketing channels.
Influencer agencies: YouTubers sometimes leverage their expertise and networks to manage other YouTubers. Insider recently profiled a creator who abandoned his YouTube channel entirely to run his agency.
Traditional TV/film: The YouTube-to-Hollywood pipeline is firmly established. Every day there’s a new announcement about a YouTuber who signed a deal with Netflix for a reality show.
Pay-per-view: Logan Paul’s boxing hijinks now represent yet another revenue source for YouTubers.
There are probably others I’m forgetting, but suffice it to say, the YouTube community has come a long way since the “adpocalypse” upended its primary business model and forced creators to get smarter about how they make money.
Will Gawker ever return to its former glory?
Vanity Fair published an update to the ongoing efforts to reboot Gawker, and it asks whether we as a society really need a 2021 version of the site:
“Nostalgia is a hell of a drug,” said former Gawker editor in chief Gabriel Snyder. “When Gawker alumni talk about how great Gawker was, I think they’re often talking about how great their Gawker was,” added Snyder, one of 14 editors in chief of the original website. “There isn’t real clarity in my mind of what it would even mean to bring Gawker back in 2021,” and “anyone who is going to do it would have to do a lot of defining.”
Is TikTok the new StumbleUpon?
Ben Turner notes the similarities between TikTok’s “for you” tab and StumbleUpon, a now-defunct platform that would bring users to random websites:
StumbleUpon helped me start to understand, almost at a humanistic level, how vast the internet could be. TikTok often yields a similar result, though with a key difference. On TikTok, almost all videos trend toward a kind of visual consistency and repeatability. Silly voices or bits of speech become “sounds”, to be reused, repackaged, and recontextualized. On StumbleUpon, however, a new discovery was almost nodal: your world would open up into something entirely, profoundly new. StumbleUpon was like a network of forest trails, where you follow in the footsteps of others but in ways you can't necessarily predict. On the other hand, TikTok feels like a mine shaft, where you also (somewhat more blindly) navigate to find disparate topics and ideas less connected but still accessed through the same network.
StumbleUpon was always a weird peculiarity for me. I never used the site, nor did I know anyone else who used it. Yet every now and then my blog would receive a crap ton of web traffic from it. I have no idea how it found its user base, and it seems to have just quietly disappeared from the internet without much notice. A decade from now most people won’t even remember that it was once one of the internet’s most powerful discovery tools.
YouTube is a stealth podcasting giant
If I asked you to name the three most-used podcast players in the U.S., you'd probably correctly guess Spotify and Apple Podcasts, but would you also guess YouTube as the third?
As Tom Webster writes: "There is no denying the power of YouTube to find, recommend, and sample content. It is the universal content engine."
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