There are still an enormous number of online portals, particularly in the media industry, that have been battling along for years trying desperately to make money, but only managing to break even at best.
These are the online ventures that still cling to the belief that the way to make money is to provide quality content and then flog ads, just like newspapers and magazines, or sponsorships of sections, just like radio and TV, along with banners, bubbles and all sorts of other goodies they dragged across into the online environment from the ark.
I know of some online portals that have up to half a million subscribers and still they battle to make ends meet.
What they possibly do not understand is that their assets are not their paltry number of advertisers or sponsors, but their subscribers.
Subscribers are 90% of online value.
Of course, when you mention this to them, the first thing they do is throw their hands in the air and make frantic exorcism signs with their arms, eyes and ears.
“We will never betray the trust our subscribers have placed with us by selling our lists…”.
Well, that’s not what monetisation of a subscriber base is all about. It makes no sense to sell subscriber details to anyone. Ever.
The real value of a subscriber base is to give them things they want other than the content they are being given for free.
In short, online information portals with large subscriber bases need to start becoming retailers.
(More panicky waving of arms and rolling of eyes).
No, they don’t have to start building warehouses and filling them with stock. What they need to do is to look closely at what their individual subscribers have listed as their interests, likes and dislikes when they filled in the online subscription forms. People really don’t mind providing that sort of information.
It should be possible to extrapolate subscriber data into product or service interests. And then to create strategic alliances with suppliers in order to be able to offer subscribers goods and services.
Nobody minds getting offers from companies to which they have made a voluntary connection. And anyway, according to law they have got to be offered an out from all offers, so no one can get angry about anything.
However, I have purposely simplified the whole process for demonstration purposes.
Yes, it has to be handled carefully and professionally.
But, it is well worth the effort because there is a lot of money in them thar retail hills – just ask Naspers who got it right yonks ago and continues to make money right, left and centre.
Chris Moerdyk (@chrismoerdyk ) is a marketing analyst and advisor and owner of Moerdyk Marketing with many years of experience in marketing and the media as well as serving as non-executive director and chairman of companies.
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