Back in the old days of print publishing at Emap, I rather enjoyed the measurability and science of large scale subscription acquisition campaigns, ranking lists by response rate and calculating acquisition cost against subscriber lifetime value. I was perhaps rather pitied by my colleagues in the more "creative" and intuitive field of newsstand marketing, filled with the excitement of choosing cover images and selecting promotional gifts. But now the publishing data geeks have the upper hand: they can justify their marketing activity and editorial proposals based on hard data not just gut feel and their own skills of persuasion.
As more of publishing moves to digital media, whether online subscription services, tablet and mobile editions, or even e-commerce, and the focus of marketing is on email marketing and social media, the power is shifting to those who can capture information on previously elusive readers and track what they are consuming, when and how best to present other options to them.
The recent Audience Revenue conference organised by the MediaBriefing shone the spotlight on the new discipline of audience analysis and development, uncovering some rather surprising truths about how media businesses can make money in digital, sharing tips on gathering and making sense of audience data, and how best to turn it into action. Data geeks from Incisive and the FT stepped away from their graphs and spreadsheets, shared their experiences and highlighted the potential for publishers to profit from audience analysis.
Diving into the data provides us with new insights into audience behaviour, but it also provides challenges in gathering and assimilating all this information and being able to make sensible business decisions without drowning in it.
What we are learning about how audiences behave and where the profits are
The big shift from print to digital publishing is that profits are driven by what people actually consume, rather than what is distributed to them. First publishers need to move their focus away from the big traffic numbers, and accept that there is no longer much revenue attached to anonymous audiences. The crucial step is capturing a visitors' email address, as this allows the behaviour of one individual to be tracked across multiple media, and permits them to be marketed to directly.
The second realisation is that profits are generated from the minority of loyal readers, not the mass of flighty transient visitors. Tracking and segmenting audiences based on their level of engagement with content is the key to understanding how they use your editorial.
The moment of truth for the FT was putting the customer at the centre of their business, and using a single user ID to track exactly what content was viewed by one individual, when and on what device. This builds up an individual DNA signature for each reader, showing that some sections that are rarely accessed on desktops during the day are far more popular on mobile during evenings and weekends. The FT's analysis of its consumption patterns show that mobile hasn't cannibalised its print and online readership; instead it has extended the opportunities for readers to explore new types of content. The peaks on mobile during the morning commute and on tablets during down-time in the late evening at home were enlightening. The explosion of new mobile platforms has complicated the media landscape, but the FT's HTML5 platform and investment in data analysis means that they now see their data as a truly valuable asset.
Incisive Media are also using their audience data to understand what content is most popular, help editorial teams fine-tune their features and also maximise the SEO potential of their content. Marketers can now see exactly when people drop out of the subscription sales funnel and target their marketing activity more precisely. The ease of running multi-variate tests has encouraged Incisive's marketing team to come up with three or four alternative options, not just two, dramatically speeding up their learning. Looking at the level of use from different subscriber groups has identified renewal risks with low usage, and up-sell opportunities with high usage.
For diversified media owners, there is real power in aggregating audience data across digital media, web and mobile, plus print and face to face events, putting together a full picture of all their interactions with customers.
How to gather and make sense of audience data
In order to be able to track audiences across web, mobile, tablet, publishers have to create a single user ID, connected to an email address. Multiple mobile platforms and proprietary analytics complicate this. The FT argues the case for HTML5 web apps, enabling them to set their own tags across all devices. Across digital media, consistent tagging is essential, and Incisive invested a significant chunk of time in aligning tags across all their brands so they could generate standard reports.
Many publishers have a range of suppliers for subs fulfilment, event registration and email newsletters; luckily new services such as ADvance from Abacus can accept data from these multiple sources and bring them into one central audience database. They can also export data to a wide range of different visualisation and analysis tools.
Publishers need to become familiar with some new acronyms. ARPU is Average Revenue Per User and ARPE is Average Revenue Per Email address. Both aggregate advertising, subscription and events revenues to work out the total value of an individual customer to the publisher. When combined with renewal rates, this can generate LTV or lifetime value, an idea very familiar to traditional print subscription marketers. Once you have a way to calculate these two measures, the real value is in being able to analyse the relative importance of different audience segments. If these can be tracked back to the original source, publishers can begin to work out whether search, social, email or referrals are their best source of new customers.
Segmenting your audience by engagement level, for example using the Fans, Regulars, Occasionals and Fly-bys model used by Scout Analytics, can result in some surprising statistics. Publishers commonly learn that 80% of their revenues and profits come from their Fans, who are a small minority of their total audience. This puts the emphasis onto finding new ways to develop occasionals and regulars into lucrative fans.
How to turn it into action
Now that torrents of data are available and the capacity to analyse is practically unlimited, there is a real risk of creating a flood of data that simply paralyses publishing teams. Jon Bentley of Incisive tackled this issue head on with some very practical suggestions.
Managers frequently specify long lists of data requests and KPIs, and then never look at their data team's carefully created dashboards. Analytics teams must keep it simple, and gently guide managers into a shorter list. Incisive have found that regular face to face meetings to review brand data and agree how to turn this into action are the most effective approach.
Providing events and subscription sales teams with hot leads in real time is greatly appreciated. Giving ad teams accurate profiles of the audience their clients want to reach is welcomed. Some advertisers are highly sophisticated and request specific metrics about the audience they are targeting; others can be overwhelmed.
Tracking users’ lifetime value by original source can help marketers decide how much investment to put into search or social media, or email marketing campaigns.
A common theme among all the speakers was to be guided by actual audience behaviour, not what they tell you in research. Scout Analytics showed how a US B2B event organiser tracked hot topics on their website to identify new conference themes. As their database was largely registered, they were also able to create targeted marketing lists for each new conference based on individuals’ reading behaviour. Plus they could use geolocation to identify the best venues for each new event.
Building up segments from behaviour patterns can help identify opportunities for creating new editorial products. If these are all linked to a known email address, the marketing campaign is straightforward.
Power to the data geeks
So publishers now have powerful tools available to fully understand their readers’ behaviour, develop new content and services that meet their emerging needs, and provide a fuller service to their advertisers.
The first step is converting anonymous users into registered users by developing email registration tactics. The second is turning them into engaged and loyal subscribers by offering top quality content and services. Then developing processes to collect and analyse this data in a form that allows publishing teams to take practical action.
Perhaps this new data-driven marketing isn't so very different from old-fashioned print subs marketing after all!