What's next for publisher content studios
Forget about publishers competing with ad agencies
This week, I wrote about the changing nature of publisher content studios as well as some thoughts on the return of events in the fall. If you’re not already a subscriber, please sign up to receive The Rebooting every Wednesday morning. Also, big thanks to Hashtag Labs and John Shankman for their run as sponsor of The Rebooting. (If you’re interested in sponsoring, find out more here.)
The future of content studios
It can be hard to remember now, but all levels of digital publishing once had BuzzFeed and Vice envy. Publishers pined for BuzzFeed’s scientific mastery of Facebook distribution while they wished they could pull off Vice’s ability to use its brands as a front for an agency and production business.
Publisher content studios were premised on the ability to create content efficiently, but also that they could bundle creative with distribution -- and make sure the two match well. But along the way, publishers saw an opportunity for revenue by acting like standalone agencies.
Vice positioned its agency arm Virtue as a standalone agency. That, of course, led to many publishers playing a game of tagalong. These were the heady days of The New York Times running over-the-top brand content efforts like its 2013 “Women Inmates” feature to promote HBO’s Orange is the New Black. In 2016, The Times even managed to win the top award for mobile advertising at the Cannes Lions, normally the exclusive preserve of ad agencies, for its virtual reality work. The thinking was T Brand Studio would more frequently compete with ad agencies. The Times even bought agencies Fake Love and HelloSociety in 2016. That turned out to be high water mark for its efforts. HelloSociety was slimmed down and combined with Fake Love three years later, only to shut the entire effort down last year.
The reality was the world didn’t need more agencies. What’s more, the agency business is hardly a gusher of margins, difficult to scale and even more so to make efficient. I was reminded of when Google hired a couple ad agency execs in the late 2000s, leading some to think Google wanted to get into the agency business. (Turns out, Google was OK sticking to tech and adding creative services as a freebie.) One top publisher to me a few years ago noted that publishers lacked the internal culture to expand and contract -- that is, lay people off when there isn’t enough work or an account is lost -- that agencies do as a regular course of business, not to mention forcing staff to work over the weekend to meet an arbitrary client deadline. Over time, the ardor for content studios faded as publishers looked to the recurring revenue of subscriptions as a far larger opportunity than dealing with finicky clients.
That’s why I was surprised to see The Atlantic moving counter to this trend with its planned spinoff of its in-house agency, rebranding it to Long Dash. (Personally, for an agency owned by a publisher, I’d have gone with Em Dash.) The 50-person agency will mostly operate as “a separate entity,” according to its head, Kate Watts.
This is seemingly counter to the maturation of the content studio model, which has gone from being billed as a gamechanger to yet another tool to differentiate publishers’ marketing solutions offerings.
At Digiday, we went through this rollercoaster with our content operations. Back in 2012, we started the Digiday Content Studio with my former colleague Deanna Zammit. Here’s how I described it at the time:
Digiday Content Studio grew out of what we were hearing from sponsors: that they wanted to produce content of their own. The trend of brands as publishers has begun to establish itself. Forward-thinking publications like Buzzfeed and Gawker already provide high-quality content services for advertisers. Through the Content Studio, we hope to apply our expertise in creating quality content to help companies with their marketing efforts. It will also allow us to help our own sponsors create content for Digiday events and publications that resonates with our audience.
The concept of the content studio was that nobody wakes up in the morning and wants to suck and waste people’s time. Companies know how to talk about their products but don’t have the years of experience of knowing how to present compelling content to specific audiences. With the Content Studio, we could improve our own product while also making money.
The struggle came when we got Vice envy. We even had an ex-Vice executive who consulted for us and urged us to expand the Content Studio into an agency. That lead to a multiyear odyssey where the Digiday Content Studio became a quasi-independent agency, Custom, serving Digiday and sister brands but pitching services that didn’t involve our own media products. The agency moved to a different floor, couches arrived, walls were exuberantly painted, people who looked Very Creative started to appear. And it was mostly a disaster.
The reason: Clients wanted to reach our brands’ audiences and in the same context, not have another agency. Chasing bigger standalone projects, often competing with far more experienced agencies, was a strategic mistake.
Content studios aren’t going away. But like Industry Dive CEO Sean Griffey, I believe they will become even more closely tied to the brands at the heart of publishers. You have to dance with the one you brung, and publishers need to double down on what makes them unique. That means proving marketing services is a baseline but the real differentiator will be the insights publishers can provide. That will put a premium on publishing brands that have narrow and deep brands that can mine their audiences for true insights -- or, if you must, first-party data -- that gives marketers a better understanding of their target markets.
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Will events require vaccination?
Be sure to enjoy the summer, because come fall you’ll be faced with wall-to-wall events of all kinds. I think there will be a sharp rebound in all manner of events due to pent-up demand, before normalizing for industry events to a slightly lower level as businesses try to keep lower levels of expenditures on possibly unnecessary business travel.
The key question: How will events handle vaccinations? NYCRUNS, a group that puts on running races in New York, is setting up a corral that requires proof of vaccination. Runners there won’t need to mask or practice social distancing. Those not vaccinated, or who refuse to show proof, can still partake in the race but with added mitigation requirements. Events will be tempted to pursue some elements of the same approach as people ease back into the world. The wrinkle will be, of course, in Florida, where many will look to restart events in the fall. The state has a law forbidding businesses from requiring proof of vaccination status in return for services, creating a headache for businesses like cruise ships.
Other things to check out
Kyle Chayka has already sketched out his vision of a crypto publication. Now he’s putting his thoughts into practice with a project that looks to non-fungible tokens to underpin a newsletter business model. I’m going to write more next week about ways crypto can underpin a fairer, more robust media model.
Publishers now have Masterclass envy. More publishers like The Economist are spinning up pricey courses as a new incremental revenue source. The question for all these incremental efforts is inputs vs outputs. My hunch (like Skift’s Rafat Ali) is that many of these initiatives will remain small margin opportunities compared with the front-end effort required.
Required Substack reference: Substack is branching out internationally. I’m not sure I agree with cofounder Hamish MacKenzie’s belief that a model that works in one place works everywhere. There are vastly different propensities to pay based on geographies. Getting someone to pay for content in Sweden isn’t the same as in India.
I came across this drawing of Peter Drucker’s advice on managing yourself. It reminded me of a rarely noted upside of being in a company: Your days are mostly managed for you. All the excitement around “the creator economy” often glosses over the attractiveness of this aspect of work.
Thanks so much for reading. Please shoot me a note with any thoughts and suggestions -- and please consider passing this newsletter along to someone who would find it valuable.