Of the many articles focusing on future of
publishing companies I have read over the
past few months, one particularly stood out to me.
It is an interview with Jakub Unger from
Centrum Holdings titled “Media fabricate content
that doesn’t make a profit. They self destruct...”(Mediaguru.cz, 15. 8. 2012).
Author is right about many things. Media did, in fact, provide people with its
most valuable asset which is information. Its regressive charge imposition is
today more or less of an illusion - similar to music, which undergone a similar
process (just quite earlier). Why would I pay for a full cd when I’m only
interested in 4 songs which I can get for relatively cheap on iTunes. After
all, even newspaper was read by readers on a rather selective basis. There is
an interesting thing about all of this. Why isn’t anyone asking where do people
nowadays invest the money they used to spend on periodicals? The answer happens
to be simple: elsewhere.
Publicly available information on media websites
(which originally meant to support the printed versions) incepted a slow process of
obliteration. This process was later reinforced by conception of Web 2.0 with social networks and
millions of blogs. Oversupplied with information,reader, with the exception of books, stopped
feeling the need to obtain more, particularly not formoney. So where does the money go these days?
Comparison of statistics tells us it is the sector of e-commerce. It grows in a faster rate
than the rate in which money disappears from media. Monitoring tells us that media lose around
one billion CZK of gross profit from advertisements each year (digital advertising
brings back about a half). This way, the volume of electronic trading rose from 2011 to 2012 from 33
to 37 billion CZK. This isn’t a surprise. It has to do with changes in demographics as well as the
fact that online stores provide target groups with more interesting content like reviews, tips
or tutorials. I took the time to calculate amount of text in the description
box of an iPhone at the online electronics distributor Alza.cz. There were 5992
characters which equaled to about 3,3 pages of text. Now, would you really
expect me to go out and buy a magazine about phones? Didn’t think so…
Big online stores are in the present time ahead of
publishers not only in the aspect of technology, but marketing as well. They work their
crowd better because they are directlydependent on the outcome. It was common for
publishing companies to gain more profit from advertisement than from the amount of copies sold
- usually more than 75% of total profit
originated in advertisements, this resulted in
publishers being more B2B oriented than target
group oriented. Current-day media keeps presenting
content that doesn’t bring profit while former customers now happily invest their money
into products they often times don’t even need - because the good arguments and well-crafted
online store marketing “hit the spot” at the right moment.
A gradual development brought us to these
conclussions with our own project, BODY IP.
The core product, a software virtual personal
trainer is on its own an interesting element, but if the visitor doesn’t exercise, there wasn’t much
else he could find interesting. This made us not only rethink and further work on some of our community
features, but also add content. From there, it was only a step away to add an
integrated store and the circle was closed. The written content supplies visitor traffic, web store
generates profit, and virtual trainer serves as anexclusive marketing tool. I wonder when are media
going to lose their self-centricity and take a look around. They will see a lot
of people who probably enjoy reading an article or two for free, but their
money will end up in e-commerce. Meanwhile with the content and amount of visitors
their websites have could surely be done a lot of things. It is all just about
the ideas.
