Tech CEO to publishers: ‘Don’t underestimate the value of your brands, content’
Tom Ricca-McCarthy is CEO of Madgex, a technology company providing job board software among other services to media businesses. He spoke to FIPP contributor Felix Mago at the recent Digital Innovators Summit in Berlin, covering among others:
• Key strengths of publishers, but also serious threats to brand trust
• Alignment between mobile operators and content businesses
• The future with personalisation, AI and robotics
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When it comes to jobs advertising, Tom says publishers in the particular space still have strength thanks to “their trusted brands and content, in-depth data and understanding of their audiences alongside other services they are able to offer them”.
In the professional audiences segment specifically, where recruitment is typically positioned, there are furthermore “a number of joined up business opportunities, using data to create new revenue streams around professional development, for example courses and events.”
Then to now: Witness to change
Madgex was established 17 years ago out of Brighton, the UK, where it still has its HQ. The company has subsequently also opened offices in the US, Canada and Germany.
During this time, Madgex “has seen and experienced first-hand the changes in the recruitment market as digital disrupted print advertising”, according to Tom. Apart from LinkedIn in the recruitment market, there are “giant platforms such as Google and Facebook taking massive amounts of traditional advertising revenue from the market”.
In addition, people are “wrestling with the sheer volume of online options, from destination sites through to communities. Online audiences are distracted. Our challenge is to work with our publisher partners to cut through the noise.”
Don’t underestimate the value of what you have
In the above circumstances, the value of established brands come into play – it’s a powerful factor in challenging noise. The fact that publishers also have quality content is another plus. “That’s another thing that differentiates our customers a lot from newer brands entering the fray; they have good quality content.”
But, says Tom, one observation is that perhaps publishers do not use it enough. “I don’t think publishers always understand, or they underestimate, the amazing assets they have in their content and content generation capabilities compared to new entrants and substitutes. It remains critical to have good content, relevant to your audiences.”
However, despite this, there are warning signs. In as much as brand and quality content are major pluses for publishers, Tom is concerned for the state of journalism and potential impact on business.
Part of it has to do with political developments, part of it is through the industry’s own doing (Tom mentions as an example the phone hacking scandal in the UK) and part of it is down to disrupted legacy business models, including the jobs advertising space in print.
“If you look at the Guardian for example, as a brand it has incredible high integrity, quality journalism etc. I trust what I read in the Guardian every day, and that is good.
“But the business is under threat. On the Guardian site, they now ask for donations to become a Guardian member at the end of every article. This is a news brand that is, what, 200 years old [the Guardian was founded in 1821 as The Manchester Guardian] and here it has to ask for donations? The threat to quality journalism is worrying.”
The trust issue is something for publishers to solve, but when it comes to business models it is where tech companies such as Madgex and others come into play – working with publishers to diversify and expand revenue streams in multiple directions and improve audience engagement, to be less reliant on only one or two dominant sources of income.
Looking at the immediate future, Tom sees ongoing opportunities in areas like mobile, the personalisation of services to customers and artificial intelligence (AI) and robotics.
Madgex was an early pioneer with the move to mobile. “We have been mobile since 2008. But I listened to a talk the other day about how people now coming online only really know mobile. And my children simply expect all experiences to be mobile. It made me ask, ‘we’ve been doing mobile for ages, but do we really understand it?’ I don’t think we have. We will still huge changes driven by mobile.
“What is also interesting here is the alignment between infrastructure and content providers, like AT&T, Time Warner and those sort of mega-mergers. It will be interesting to see how it plays out. What changes will we see? Will other mobile companies, for example, Vodafone, become a content company? I don’t know, but if mobile follows terrestrial telecommunications there will be some major mergers and acquisitions going on. It’s because those tech providers need to differentiate themselves using content. We’ve seen it in other industries but not so much in mobile yet.”
While there is a lot of experimentation with personalisation, Tom says, “It is rare that [he is] impressed [with what is currently available]. In fact, most attempts are dreadful, so it remains a big opportunity.” This is particularly true as developments such as in AI and machine learning continue to advance.
He is, in fact, “fascinated by robotics and AI. We are experimenting with chatbots and robotic interfaces [at Madgex]. I believe chatbots and automated interfaces are going to get very pervasive and will change customer and business interactions, particularly around service and transactional interactions.”
Returning to the jobs market in particular, and Madgex’s current core markets of the UK, Germany and the US, they’re seeing very clear differences between the markets.
In the US, there are large newspapers that have been decimated by digital disruption – Tom quotes one example where a paper’s staff numbers went down from 3,000 to 290 people. “So, not a 10 per cent reduction rate, but a 10 per cent survival rate. It does not look good, by any stretch of the imagination, for those types of publishers.
“Then you come to a market like Germany and there are still massive print revenues. It is a somewhat conservative market, not very trusting of technology and very serious about data protection.
“The UK’s evolution is somewhere between the US and Germany.”
Although Madgex is currently not focused on the Asia market apart from a handful of existing customers, Tom believes it is important to keep an eye on developments there.
“Asia is interesting because it’s so big. They’re ahead of Europe in some ways, and behind in other ways. It offers companies different types of opportunities.”
More generally from a tech perspective, “if you look at Japan (where Tom visited the first time 20 years ago) for example, society just loves technology. Just loves it.
“I also remember being sat next to some South Koreans at the FIPP World Congress in Rome in 2013. They could not believe how slow mobile connectivity in Europe was because they’re used to these huge, fast connections to mobile devices or into the home. Some of those markets are incredibly advanced technically and the level of consumer electronics adoption is higher than in Europe. That’s something to consider.”
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- Find out more about Madgex
- Connect with Tom
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