Hear from the Financial Times on how it monetizes its online content, and why it has been so successful in doing so.
Sales reps increasingly want a 'bigger bang for their buck'. They demand better rates and threaten deletion from media plans unless prices are slashed. This rash behaviour doesn't have all the client's best interests at heart, and idle threats cannot replace reliable research.
Nonetheless, there's no denying it's a buyer's market in digital advertising and for some media it's all about rates and volume. At the Financial Times, however, we don't think that way. Our content attracts a loyal, paying readership. Our readers will pay a premium for the newspaper and to read online content, like the Lex column. FT.com is increasing its registered users and subscribers while simultaneously boosting traffic; in fact, we are enjoying record traffic numbers this year.
Our hybrid subscription model has worked very well for us and is considered a "third way" by other media owners seeking to commoditise their content. News and analysis sites like ours create independent and reliable quality insight sought after by high demographic audiences that B2B advertisers and high-end brands want to reach.
Obviously, we are not Google or even Google-like. Nor do we offer CPC/CPL/CPA. We try to resist pricing pressure, and have found that we continue to be chosen by advertisers in spite of this premium pricing. We are able to do this by adhering to three main principles.
1. A high demographic audience who are loyal to our content
Marketers are under pressure to justify ROI, preferably in the easiest way possible. Our advertisers know that they're reaching a C-suite audience within an environment that is important to them and that this audience is worth paying for.
2. Measurement & content association
We believe that a client's B2B ads should be exposed to C-suites when they are reading the news that helps them understand how the current financial crisis impacts their businesses.
A brand's high-end product ads are better shown to business executives when they are reading reviews for the latest high-end gadgets or reading travel tips for luxury holiday destinations. This allows measurement of ads based on engagement, interaction, time spent on pages and brand awareness/favourability improvement.
3. Innovation
We need to keep evolving. In the digital media market, publishers are only as good as their latest innovations. Video is a great example -- two years ago, video was the hottest app in town and commanded good sponsorship yields. Now, every site has a stream and as supply increases, prices decline. Pre-rolls are regarded in the same way as an MPU these days.
Publishers and advertisers should look at new in-video advertising creatives and bespoke video channels for sponsorship. We must innovate online and offline cross-packaging, and follow the right media consumption trends. Quality audiences are reading and watching business news through various new media; websites, iPhones, e-papers and e-readers. At the FT, we create bespoke channels for advertisers and help collect quality traffic from other media to the custom channel.
The market will start to pickup by the end of this year, despite the danger of a few more wobbles along the way. My policy is to plan with an eye on the horizon. Online continues to evolve and it's important to create new solutions, but smart business models are not based on giving your products away for free and sacrificing the bottom line. Clawing your way out of this hole is simply a distraction when you should be preparing to make the most out of recovering markets.
Hiroko Hoshino is regional online director for Asia Pacific at the Financial Times.