News media companies spend too much time focusing on getting a customer to buy their product instead of helping readers with the next steps of enjoying the product, according to Thales Teixeira, a professor at the Harvard Business School and speaker at 2017 INMA World Congress in New York City.
For customers, purchasing content is only the first step, Teixeira said.
“Once they subscribe, or they buy a newspaper, that it just the first cost that the incur. They have to incur additional effort and time costs to first decide, one, which are the news articles that I’m going to read? So they have to browse and make that decision. Second, once they identify a news piece, they have to read it. And then third, they have to make sense of it.”
Media companies are in the business of delivering these articles and not very good at sorting them. Facebook, however, steps in and does just that — serving up articles read by readers’ friends.
“Media companies should think about recommendations,” Teixeira said. “How can you help your readers to evaluate what to read?”
Teixeira also discussed “decoupling” and what it means to the news media industry.
“Decoupling is essentially separating … a series of activities into two. One in which the disruptor will execute, and the other the disruptor will say, ‘Let the established player do it.’ So Facebook says, ‘We will do the distribution, and we’ll let you create the news. We don’t want to do that.’ That’s decoupling.”
There are two possible responses from the news media’s when faced with decoupling:
• Recouple: “Not letting Facebook distribute news. Just say, ‘This is my news and nobody else can distribute it apart from me.’ Unfortunately, that goes against the needs and wants of the customer.”
• Rebalance: “Letting the disruptor do what they want to do on behalf of the customer. But make sure you coexist peacefully and you make money every time you create value. So if you’re creating content, you can make sure to figure out who can pay for the content you create.”