Thought leaders in the global magazine industry have learned quite a few essential lessons over the past five turbulent and transformative years, and Peter Kreisky of US-based Kreisky Media Consultancy, shared them with the audience of the 39th FIPP World Magazine Congress today in Rome. “Success is digital first: not digital only, not plus digital, but digital first,” was the mantra of his presentation.
Acoording to Kreisky, present thought leaders in the industry, such as IDG, Meredith, Hearst, Axel Springer, Condé Nast, Atlantic Media, and The Economist realised early on that the traditional magazine publishing model was broken and acted fast to reinvent and renew it, thereby attaining a much faster growth curve.
There are six main lessons that can be glimpsed from the pioneers. The first is to organise around markets with good potential for growth, as opposed to around products. Meredith did this by micro-segmenting its 100MM-strong female audience, studying each segment in particular and turning the data into actionable insight.
The second, and possibly most essential one, is to lead platform strategy with digital – that is, to differentiate between print and digital products. All future growth lies in new digital businesses – engines of growth funded by cash flows from the traditional print business, which will also act as brand anchors and promotional platforms for new digital businesses. “We manage print for profit and digital for growth,” Kreisky quoted Bob Carrigan, the president of IDG, as saying. “Mobile is a huge, huge factor: 90 per cent of our media interactions today are screen based. Follow the eyeballs, where you consumers are is where you should be, too,” Kreisky added.
The next lesson is to create new branded businesses across all platforms: to renew the core business through digital editions on all devices or to reinvent it by turning to branded e-commerce, branded events, branded data, branded video, branded television and new pricing and bundling models for digital that monetize heavy and light users differently.
It is likewise important to monetise communities, because “community is the new content.” “Now communities are being driven not by digital content, but by insights that editorial teams have of the markets that they are so close to,” Kreisky said. Examples of successful community monetisation strategies include The New Yorker, an existing brand community, Politico, a new brand community, and the Economist, which is successfully monetising a community of professionals.
One more lesson is to participate in inventing the future and to think outside the traditional business model. This includes investing in up-and-coming new media ventures, as Hearst Ventures did with BuzzFeed.
But in order to achieve all of the above, it is essential to move to a different cultural model and to empower the organization. Market leaders have legacy challenges to overcome: arrogance, feelings of entitlement, a corporate culture averse to change, a silo mentality. Smaller publishers also face challenges, such as allowing traditional revenue streams to dominate or becoming paralyzed by cannibalization threats. But while there are “no silver bullets,” many examples of successful small-scale business transformations do exist, so anything is possible.