Disruptive Innovation

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Disruptive Innovation

Thinking bigger than native advertising

05 November 2014 · By Steve Gray

One of the biggest challenges legacy media companies face today is learning to think big enough to meet the real, 21st-century needs of advertisers.

There’s a lot of talk about native advertising right now. And – done right – it can help to meet those real needs. But native is, at best, only a small piece of a much bigger puzzle.

For those who learn how to solve that bigger puzzle for advertisers, the payoff can be much greater than just another sale of print space, air time, or digital display units.

The challenge

Everybody knows the old saw, attributed to Ted Levitt of Harvard, that the customer doesn’t want a quarter-inch drill. He wants a quarter-inch hole.

In the media business, the advertiser doesn’t want print, digital, native, e-mail, social, etc. He/she wants a customer showing up who’s ready to spend money. That’s the “quarter-inch hole,” and all forms of advertising are only means to this end.

In the old, pre-digital days, it was pretty easy to get that outcome. Put advertisements in a newspaper that everyone reads, or on television stations everybody watches, and you’re done.

It didn’t take a lot of sophistication to sell or buy those solutions; we were selling mainly media space or time – a commodity for which there were few substitutes.

Today, ...

...[more]




Core sales teams at media companies can’t sustain digital advertising future

05 October 2014 · By Steve Gray

What does the local media company of the future look like?

At this point, the answer is pretty clear. There will be two kinds of media companies:

  • Those that continue to focus on their traditional media channels — newspaper, broadcast television channel, radio station(s) — and therefore shrink along with the advertising spending on those media.

  • Those that morph into local media houses that can connect any advertiser with any audience, through platforms, technologies, and channels they own or dont, to win dollars that are moving into digital advertising and marketing.

I’ve been seeing that dual outcome since about 2007, when I was on the road preaching Newspaper Next to thousands of media people. Yet even today, quite a few people are still asking the question.

The answer hasn’t changed much in seven years. What has changed, and continues to change, is ...

...[more]




After media disruption: Human behaviour in “The Age of Knowing Everything”

07 September 2014 · By Steve Gray

Let’s look beyond the waves of media disruption we’re experiencing these days. Let’s try to imagine the end state, when media disruption gets done.

Wait ... will it ever get done? Yes, I think so — at the time when virtually everyone on the planet, during every waking moment, has instant access at will to virtually the entire body of human knowledge. (Maybe in sleeping moments, too.)

When we stand back and look at the big picture, what we call media disruption is really just a series of technological steps in that direction. Each step opens more hours of a person’s consciousness for access to more of the world’s information.

At some point, no longer very far in the future, that connected time will include ...

...[more]




Publishers, is your business model as ludicrous as a Scotch Tape Boutique?

11 August 2014 · By Steve Gray

If you’re old enough to remember Saturday Night Live in its glory days, maybe you remember the hilarious sketches set in “the Scotch Tape Boutique at the old mall.”

The bit was centered on, and got its laughs from, a ridiculously narrow business model centered on a single product, sold in a retail location that was no longer the cool place to be. (I’d love to link to a clip here, but I couldn’t find one. NBC must be closely guarding its copyright.)

Those sketches came to mind this week as I was trying to think of a metaphor for the newspaper business and its relentless concentration on news. News continues to be our industry’s central purpose and the heart of its business model for attracting audiences.

I laughed out loud when it occurred to me that we might be well on the way to becoming the Scotch Tape Boutique. But the idea is as painful as it is funny.

Before I go any further, I need to say this ...

...[more]




Native advertising: What is it, and why now?

14 July 2014 · By Steve Gray

“I want my ad to go right here,” Jerry Coolman said. He pointed at the middle two columns at the top of the newspaper page – right in the middle of an article. He wanted his ad for lawn tractors to hit readers smack between the eyes.

“Jerry, we can’t do that,” I said. “That’s the reader’s space – we can’t plunk an ad down in the middle of it.”

That was 1983. Now, 20 years later, it turns out we can plunk an ad down in the reader’s space. It’s being done more and more, and it’s being called a new name: “native advertising.”

Some are hailing it as a breakthrough for advertisers and for media company revenues. Others are reviling it as ...

...[more]




3 ways to reverse the industry’s biggest disruption: Loss of advertising accounts

16 June 2014 · By Steve Gray

About five years ago, on a weekend, Derek May — then publisher of the St. Augustine Record in Florida, United States — was doing what many publishers were doing at the time: trying to figure out the steep decline in advertising revenue he was seeing in his unit's financials.

His question: What was the main cause of the decline? The recession was the driver, of course, but was it mainly hitting certain categories of advertising? Certain types of advertisers? Big advertisers? Small advertisers?

Thanks to his background in accounting systems, he was able to plunge into the Morris Publishing Group’s business data warehouse to sort it out. After a while, he realised none of the standard reports answered a key question: How many businesses were advertising in the most recent period compared to the previous period?...

...[more]




Media companies must engage mobile users with more than news

20 May 2014 · By Steve Gray

To someone who has only a hammer, everything looks like a nail. In the media industry, the hammer we have is news. And right now, the newest nail is mobile.

With mobile usage exploding, our industry is determined to pound that nail with news as hard and fast as we can. It looks like a must-do, a matter of survival, and — we hope — a new opportunity to reach people, sell advertising, and make money.

But mobile is not the nail we think it is.

By thinking of mobile as a distribution channel for news, we are missing what mobile really is. It’s not a channel — it’s a situation. And that situation is producing a new set of human needs and behaviours that present new opportunities.

In that new space, news can expect to get a certain share of users’ time and attention. We want and need to get that share. But that share will be tiny compared to the new, uniquely mobile uses that are emerging.

Our fixation on news will almost surely cause us to miss things we could and should do to win in the local media space.

It’s happened before.

When the desktop Internet arrived, while we ...

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How media companies can reclaim recruitment services market

21 April 2014 · By Steve Gray

Say the word “recruitment” and most newspaper executives groan. Over the last seven or eight years, it has shrunk to just a fraction of its former size, and it’s still slipping.

At Morris Publishing Group, we’ve been looking hard at this vertical for several months. We’ve been trying to figure out two things:

  1. How can we do better at what’s left of our existing business.

  2. How can we create new wins in this space?

We’re beginning to see the path ahead, so it’s a good time to share some of what we’ve learned.

What’s happened to recruitment is a classic case of disruptive innovation. We ruled the space in the pre-digital era. Then new digital technologies enabled a new set of players to come in underneath our expensive print solutions. They attracted big audiences and took away huge amounts of our business.

Our industry went to digital, too, but we slowed only the revenue declines. And, of course, we had a whopping recession to accelerate the trends.

...[more]




Media disruption: bad for us, wonderful for humanity

24 March 2014 · By Steve Gray

Disruption of the mass media is a big subject. But here’s an even bigger one: the incredible amount of good this same disruption is bringing to humanity worldwide.

So this time out, let’s forget about the mass media for a few minutes. Let’s take a look at the massive and mostly positive impact this digital revolution is having and will continue to have on humanity.

To begin, let’s look again at the “infinite pipe” graphic I’ve used several times before in this blog.

This chart illustrates how the flow of information among humans has expanded from almost nothing during most of our 200,000-year history to near infinity in just the last decade or so. A few weeks ago, I wrote about this from the perspective of the media. Now let’s look at it from the perspective of humanity.

...[more]




Why the definition of news must change in the age of print + digital

17 February 2014 · By Steve Gray


Nothing is more deeply ingrained in the newspaper industry than the definition of news. It’s the foundation of what we do, the “product” we use to attract and serve consumer audiences, and the platform on which we sell most of our advertising.

Now the definition desperately needs fundamental change, as I’ll document below. If we hope to be relevant and engaging to the people in our markets, we need to start over, beginning with a fresh answer to the question, “What is news?”

Nobody in the industry wants to do this, and very few are. But a blog posting a couple of weeks ago by Andrew Davis, aimed at the magazine industry, pointed out what’s needed. Here’s the payload paragraph:

“What are you doing to change what you print? How can we blame consumers for canceling their print subscriptions when we haven’t redefined what role the print product plays in the digital world? I challenge you to put yourself in the shoes of your primary audience. Spend the day consuming the content they consume, visiting the Web sites they visit. Then ask yourself what you could do to make your print product more valuable, given the experience you’ve just encountered.” (Emphasis added.)

He’s talking about printed magazines. But the message is exactly on target for newspapers, and for both digital and print content. I’d rephrase that last sentence: “...what could you do to make all of your content more valuable, given the experience you've just encountered?”

...[more]




About this blog

I’m Steve Gray, and I blog about disruption in the media – why it’s happening and what to do about it. As the world’s information pipe expands to infinity, my goal is to help the news media industry see the new opportunities we can create in our markets. I led the American Press Institute (API) Newspaper Next project from 2005 to 2009, teaching thousands of media executives to create new business models. Since then I’ve worked on innovation projects with the newspaper, magazine and book divisions of Morris Communications in Augusta, Georgia, USA.


Contact Steve

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The basics of media disruption

Part I: The Mass Media era: a 150-year bubble

Part II: The end of the Mass Media Era

Part III: What about news?


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