Now that digital has proven its value as a marketing and advertising channel, we can expect to see South African publishers shift emphasis from building audiences and advertising market share towards monetisation of their online properties, says Marcus Stephens.
The question publishers will be asking themselves is how they can sell their aggregated audiences into marketing organisations in a way that gives them the best returns. This is the dominant meta-trend that is driving many of the other trends and will unfold in the online publishing market during the year ahead. Here are a few of the trends I expect to dominate the sector during 2012.
1. Putting social media to work Social media may seem like a competitor to traditional online media in the sense that many readers are looking to Facebook, Twitter and other social networking services as their primary news sources. But used wisely, social media is one of the most powerful tools publishers have at their disposal to drive engagement with their audiences and build website traffic.
Given that search engine marketing has become so competitive, paid search and banner ads are pricy, and email has fallen out of favour, leaving social as one of the cheapest and most effective ways to attract visitors. Publishers must use social effectively and integrate it into everything they do to maximise their traffic and revenue.
2. Becoming a link in the retail chain Publishers are beginning to accept that they will never make as much money as they’d like to from pay walls or traditional banner advertising. They’ll look to leverage their trusted brands and audience bases in a range of ways, including partnerships with retailers. South African publishers will work hard to get a foothold in the retail ladder during 2012 with the goal of driving more value from their web traffic.
3. Era of discounting draws to an end Premium customers (especially the ad networks) can expect to see decreased discounting from publishers. Howzit MSN is no longer offering aggressive discounts to its client base because we want to defend the value of our audience and data set. Increasingly, publishers are looking to take complete control over their traffic and inventory to maximise their revenues.
4. Marketers will see the branding value of online advertising In the past, marketers measured the effectiveness of online advertising only in terms of clickthroughs and gave little thought to the value their brands got simply from a user viewing a banner without clicking through. Now they will start to think about how online ads create brand awareness over the longer term.
However, publishers must work to educate marketers about the impact that online ads have, even when the user doesn’t click through. We will need to work with marketers to demonstrate how brand awareness from online ads shines through in their search results, translates into lower costs per action and so on.
5. The mobile land grab will begin in earnest Mobile internet subscribers in South Africa are growing at a rapid rate and will soon form a larger audience than traditional PC web users. But to monetise a mobile property, a mainstream publisher will need to capture a million or two million users. This year, expect the focus from online publishers to fall heavily on building mobile traffic as they try to position themselves at the forefront of this important market. Don’t expect to hear about anyone making huge amounts of money from mobile advertising quite yet, however.
6. Video keeps growing Online video consumption will grow at an exponential rate, thanks to falling bandwidth prices and growing penetration of broadband into the market. This is an opportunity that publishers cannot ignore, so expect to see them invest in generating unique and compelling video content. Online video will be big for advertisers, too: it’s one of the fastest growing ad formats in the world.
Marcus Stephens is general manager of Howzit MSN