Love him or hate him, Henry Blodget, CEO of Business Insider is a tireless evangelist for the future of news media and certainly knows a thing or two about chasing traffic and clicks.
In a recent piece published on his business news website, he essentially dismisses the notion of selling his online publication for a hefty US$100 million – an amount that was beyond anyone’s wildest dreams only a few years ago.
It seems that Blodget believes that with Business Insider he has a goldmine. He has hand-made this business news publication in and for the digital age. And while the company made a loss last year, things are on the up.
He makes the point that digital journalism is inherently different than print or broadcast. “To build a successful digital journalism business, you have to build a native digital newsroom, native digital distribution, a native digital business model, and a native digital cost structure.” It’s not about making print or broadcast fit – it’s about going native.
Business Insider now reaches 1-2 million readers a day and more than 30 million each month. With this level of readership, Business Insider counts as the third biggest digital business news publication, behind only the Wall Street Journal and Forbes. This fact alone is staggering for a media company that only came into being in 2007.
Shrinking ad revenues
While Business Insider goes from strength to strength, there’s no doubt that the value of traditional media assets are in decline. Publishing companies around the globe are struggling with readership numbers that are in free fall, and shrinking advertising revenues. Advertising revenues of old are simply not being matched by digital advertising.
Blodget asserts that the days are numbered for traditional media titles to charge premium rates for their digital ads. “Thanks to the rapid growth of ad networks, social networks, and native digital publications… these prices are increasingly unsustainable. This trend is what is clobbering the digital ad business of the New York Times and other traditional publications.”
As a case in point, take a look at this slide Blodget presented in his keynote at Ignition 2013 earlier in November. In terms of ad revenue, it shows that Google is now bigger than newspapers and magazines.
He says that Google’s 2012 results show that the company’s ad revenue is fast approaching the historic highs magazines achieved back in 2007 and it won’t be long before Google takes more advertising revenue that magazines ever did.
Cost effective reach
Blodget goes on to say, “Native digital publications like ours, meanwhile, help clients reach readers more cost-effectively. We also reach the next generation of business leaders — the digital generation — not just folks who read print publications. As a result, as we continue to introduce more clients to the benefits of working with Business Insider, our revenue per reader is actually rising.”
Indeed, I think the points raised by Blodget resonate with most businesses and brands today. It’s not about making old stuff fit. In 2014, the most successful businesses will reinvent themselves to engage and delight increasingly powerful consumers. These companies will put their customers front and centre and use mobile, social and the cloud to connect with them in new ways.
As Forrester says, “A great digital experience is no longer a nice to have – it’s now a make-or-break point for your business”.
Age of the customer
Brands that used to depend on media companies to reach their audiences, now have so many other options at their disposal. With their always-on, always-connected mobile devices, consumers can have what they want, when they want it. To get close to meeting consumers’ sky-high expectations, marketers must better understand customer behaviour and preferences and use this data in order to model content and personalise the experience across channels. The selection of media partners will hinge on media properties that resonate with consumers and allow brands to engage with them whenever and wherever it suits.
Already consumers dictate how they are marketed to. Forrester calls it the age of customer and believes it will ultimately shape not just 2014 but the next 20 years or so.
Simon van Wyk is the founder of HotHouse.