Google: friend or foe for news publishers?
Tom Richardson writes:
It’s hardly new news, but the Google vs. publisher showdown is no less interesting for that fact. And as The Times has become the canary in the coalmine with the fourth estate’s first mainstream paywall, it’s reaching a critical turning point.
I was recently at the Frontline Club in Paddington, listening to Peter Barron, a former journalist and now Head of Communications and PR at Google UK, defend the company against the accusation that it is, by default, the ‘foe’ of newsprint publishers. Peter was joined at the top table by Matt Kelly from Mirror Newspapers’ digital division, Wired Magazine and Press Gazette columnist Peter Kirwan, Robert Andrews from Paid Content, and Patrick Barwise from London Business School.
The journalists’ respect for Barron, one of their own until recently, prevented the discussion from turning into a ding-dong battle, but there were some interesting points of contention.
The first point that Barron took issue with was the suggestion that Google ‘steals’ content. He was emphatic that news publishers were putting their content on the web for free, and Google simply helps people to find that content. He said that Google’s technology sent 1 billion clicks to news publishers per month, while Peter Kirwan pointed out that the Guardian has budgeted for £40 million in revenue from digital this year. So, Google makes a lot of money from news publishers, but it also helps publishers themselves to make more. And given that 70-80% of the cost of running a newspaper comes from paper, printing and distribution, there seems to be a cost-cutting opportunity created by the move to online.
Barron was also keen to point out that people should not confuse Google and the internet, identifying the latter as the technology that really threatens newsprint, and that had already begun to do so before Google came on the scene in 1998.
Matt Kelly was scathing about his own industry’s failure to adapt, refusing to lay the blame at Google’s door. He argued that reach does not mean audience, and that reading does not mean engagement, so newspapers must stop the mad scramble for ‘reach’ and return focus to their readers. After all, what use is it to ‘reach’ 40 million people if you can’t make money out of them?
It seems clear that although this feels like an old story, there’s plenty of mileage in it yet, and not even the top executives know exactly where it’s heading. I think though, that there are some certainties:
- Mobile devices will never replace the pleasure of watching television and films at home;
- People like the tactile experience of a newspaper in their hands;
- People will remain attracted to quality news content from their chosen news print brands;
- Uploading photos and comments about breaking news, tweeting or writing blogs will never replace the work of quality journalists.
But, sadly, that’s not the whole story. People have to be willing to pay to ensure quality. The next challenge for the news publishing industry is: how do you convince people that quality journalism is an essential expense? Mr. Murdoch’s first paywall then looks like a brave and well-timed venture. The Times will have mopped up a lot of early adopters who are already convinced of this. If the canary keeps chirping, its rivals will face a mad scramble in a much more competitive market.
You can see the discussion in full here.
Add comment 25 August 2010
Losing interest in Facebook
Andy Stubbings writes:
“If you want to know how people will use technology tomorrow” a popular saying goes, “look at what young people are doing today”.
To add to the bubbling anti-Facebook resentment that we have discussed here before, we’re seeing growing signs of disenchantment and dipping enthusiasm for Facebook amongst younger people. One survey of teens by gaming site Roiworld shows one in five are using Facebook less; the main reason for this is ‘lack of interest’. After the buzz around ‘defriending’, there seems to be more interest on ‘deactivating’ or leaving the site – apparently quite an exhilarating experience, at least according to this account of a ‘post-college calibration’. And there are earlier discussions of why young people leave social networks – there’s too much drama, it’s not their space anymore, and people prefer face to face interaction where possible.
Curiously, this also tallies with a general trend that we have picked up with our Global Monitor survey this year – when asked, people in almost every country overwhelmingly expressed a preference for a small number of quality connections they can rely on rather than a large quantity of connections they can call on (levels of agreement are practically the same across all age groups as well – which you might not necessarily expect from those gregarious Millennials). Facebook’s business model is built on the opposite assumption – that people want to continually add as many contacts as possible (and then lump them all together in the same group as their ‘friends’).
There has been attention given to the fact that the average age of Facebook users is increasing, often arguing that this is a sign that the site is broadening its appeal by going mainstream. However, I’d suggest, tentatively for the moment, that a fall in engagement amongst younger people – and in this context the leading edge – represents a decline that will eventually ripple out to a mainstream made up by mainly by over-30s, a decline that will accelerate as soon as a genuine alternative to Facebook emerges.
Facebook isn’t growing up; it’s growing old.
The image is from the site of the web designer Sharath G, and is used with thanks.
Add comment 2 August 2010
Why context matters more than ever
J Walker Smith and David Bersoff write:
We’ve just had a piece published in Admap where we argue that the challenge of context is the biggest challenge facing marketing – and until it’s addressed, everything else is a waste of time. Research at Columbia University illustrates why. In a web-based experiment respondents were asked to listen to and rate unknown songs by unknown bands, then given the opportunity to download as many as they liked. One group of respondents made download choices independently. The other group of respondents made download choices after first being told, in different ways, choices made by previous respondents. The influence of others turned out to be far more important than the individual’s own opinions.
The implications? As the Columbia team noted in their summary, most studies “view the individual as the relevant unit of analysis”. But “when individual decisions are subject to social influence, markets do not simply aggregate pre-existing individual preferences”. In other words, when context is missing, the research results are wrong. Both marketing, and marketing research, will have to change to keep up.
Fragmenting technologies, and fragmented markets, have disaggregated the audience for marketing, and the mass market has splintered. But we’re still using models that were developed when mass media was dominant. Now that people are ever more deeply embedded in narrowly drawn networks of information and influences, contextual reference points play a bigger role in moulding choices. People are surrounding themselves with input they have chosen. The result: people get more of exactly what they want, but are closed off to other ideas.
What this changes for marketers is that they must actively manage both ads and the context for ads, and managing context becomes a primary consideration, not a secondary one. In turn, this calls for an attribution-based marketing model, not to displace persuasion, but to nest it in the bigger picture, like Russian dolls inside one another. Attribution works by shifting how people think of themselves, rather than how people think of brands.
Attribution-based marketing aims to make people attend to alternative aspects of themselves. When people see themselves in new ways, they adopt new reference points for calibrating their opinions, and then behave in ways consistent with their new sense of self. Persuasion must still get the brand message right; attribution sets the context within which a brand message can succeed. The implication for research is that it needs to understand its users’ reference points as well as their opinions. It doesn’t do this well at the moment. It’s a big challenge, and also a huge opportunity.
Add comment 21 July 2010
The future’s here – even in Thanet – it is just unevenly distributed…
Eleanor Cooksey writes:
We often use this quote[1] but, as far as I know, have never applied it to thinking about this part of the country. Thanet (the area of Kent made up of Margate, Broadstairs and Ramsgate) doesn’t tend to crop up in discussions about places that are doing new or interesting things, in the way, that for example, we talk about Totnes with its own currency, or Hay with its literary festival now gone international. Thanet, despite being in the south east, has high unemployment, relatively low income levels and poor health indicators.
However, after having spent a week in Thanet, I am struck by how it does appear to contain elements of what we think will be significant in the future. There are three features in particular which make me think this:
1. Old people make up a significant proportion of the population here. When working on futures projects, we often talk about the ‘ageing population’ with perhaps a reference to the impact this will have on the workplace, but I am not sure we have thought through what it means for general day-to-day living. What I see here is a perhaps a taster. It means that I see many bungalows with neat gardens full of paving stones, gravel and flower pots (meaning no stairs, lawns or flower beds to worry about). I see lots and lots of small cafes offering all-day breakfasts for very good value, where people, who may be living on their own and therefore less inclined to cook for themselves, can get a meal without incurring great expense. On the pavements and in garages, I see mobility vehicles. At the sparkly new Westwood Cross shopping centre built in the area, I couldn’t help noticing that, in addition to M&S, Debenhams, Thorntons and the like, there was also a shop specialising in mobility vehicles.
2. Renewable energy is very visible in the form of the Thanet Offshore Windfarm. On completion this year it is scheduled to have 100 wind turbines, making it, according to the website, the largest operational windfarm anywhere in the world.
3. There are new ways of growing food. Kent has traditionally been regarded as the ‘garden of England’ and the new Thanet Earth greenhouse complex represents a way of achieving this in a resource efficient and technologically enhanced way. Thanet Earth grows salad vegetables hydroponically (meaning the roots of the plants are in a type of rock wool as oppose to soil). Everything in the glasshouses is computer controlled – from the blinds in the ceilings to opening the windows, the liquid feed make-up, the heating, lighting and carbon dioxide levels.
So if you want to experience the future, or at least parts of it, go to Thanet.
[1] The quote is actually ‘The future is already here – it is just unevenly distributed’ and is from William Gibson.
The image is of Thanet wind farm and is from Warwick Energy, used with thanks.
Add comment 2 July 2010
New consumers, new rules: branding the World Cup
Alex Steer writes:
In Cape Town, ‘This is Africa’ is normally a sort of verbal shrug. It’s what you say when you see a road that’s more pothole than tarmac, or when a breakfast meeting finally starts at noon. In the last few months, though, ‘This is Africa’ has taken on a rather different meaning, as every media channel, and every brand, scrambles to ‘welcome the world’. This is Africa, and this is Africa’s World Cup.
The more optimistic see it as a chance for one of Africa’s most successful countries to show that the whole continent is coming of age. The more pessimistic see the World Cup as a cynical commoditisation of the idea of ‘Africa’: a cheap shorthand of Lion King imagery and broad cultural stereotypes lending a false exoticism to a Euro-centric and hugely commercial football tournament. The evidence for the prosecution rests on the shambles of ticketing, which either incompetently or viciously priced the vast majority of South African and African football fans out of attending matches.
If FIFA had paid more attention to its hosts, it might have avoided mixing bland pan-Africanisms with repressive corporatism. If brands are paying attention, there are a few deeper lessons they might draw about South Africa’s new consumers (the ones that didn’t make it to the stadiums) – lessons that even consumer research sometimes misses, to its cost.
The first is the need for specificity. Just as vague nods to ‘Africa’ will not wash, neither will any brand proposition that is not explicit about why it deserves attention. FIFA’s major sponsors are spending hundreds of millions on media and global brand campaigns – yet an increasing share of purchasing power in South Africa is in the hands of millions of low-income consumers who are driven by a fundamental conception of value. Brands thrive because they offer low cost, quality, safety and personal status. Global sponsor? Nobody cares.
The World Cup has also revived the lingering stereotype of the ‘new African consumer’: young, upwardly-mobile, black and with disposable income. This isn’t confined to advertising: hugely popular soap operas like Generations and Rhythm City are dazzling cocktails of social issues and fetishisation of commercial success that make Dallas look tame. These ‘new consumers’ look remarkably like the old ones, though, and there are some signs that the use of aspirational ‘black diamond’ images to sell existing products to new target audiences is wearing a bit thin.
‘Emerging consumers’ do not think of themselves as if they were playing catch-up with richer ones – or as if they were the same as each other. The smarter brands are segmenting these markets attentively, and looking for genuine insights. Asking the wrong questions can lead brands astray. Few low-income South Africans, for example, report having life insurance (24%) or investments (17%; see Global Monitor), in part because they do not associate these labels with membership of informal burial societies or stokvels (rotating credit unions), widespread in these markets. Insightful financial services brands are developing formal versions of these, tailoring their products to their new (not ‘emerging’) consumers.
If the World Cup has given us anything, though, it is the sound of the vuvuzela. Raucous, unfamiliar, disruptive, it’s an apt metaphor for the new South African consumer landscape and its challenge to brands. You can’t block it out, you can’t change it, and you’d be churlish to try. Sorry, brands of the world, but you’ll have to get used to it. This is Africa.
Alex Steer is a WPP Marketing Fellow and worked in our London office in 2009. He is currently a planner at Ogilvy Cape Town and rejoins The Futures Company in New York in September. The picture at the top of this post comes from the internet guide to Cape Town, and is used with thanks.
2 comments 1 July 2010
Changing transport
Andrew Curry writes:
I was asked to speak at an event held last week in Leuven in Belgium on The Future of Transport by Said El Khadraoui, an MEP who’s a member of the European Parliament’s Committee on Transport and Tourism. I went because it was a chance to revisit a large scenarios project I directed a few years ago, for the UK government’s Foresight project, on Intelligent Infrastructure Systems, and because some of the other speakers were at the forefront of work on intelligent transport systems. (And not, of course, because Leuven is the home of Stella Artois).
Transport is a problem because its carbon emissions keep on growing – unlike every other sector – and because it is almost completely dependent on fossil fuel to power it, against a backdrop of expected long-term price increases. One speaker argued that given the carbon impact and the risks, and given also the level of external costs generated by transport, it is likely that transport – especially car use and road freight – is simply too cheap.
The argument which I teased out of the Foresight scenarios was that one of the problems is that we confuse the benefits of mobility with the benefits of access; a century of increasing car use has made services and facilities more distant, and therefore harder to access by anything other than a car. The long-run solution is to redesign the built environment to reverse this process. This takes a generation or more, although it is starting to happen; there are more food shops closer to homes, and road space, certainly in towns, is being taken away from cars across Europe.
In the meantime, technology offers both carrots and sticks. The combination of wireless technology, open data, and smartphones opens up the possibility of applications which make public transport more attractive, and alternatives to car ownership more feasible. This requires more than just better, live information. It also requires the smartphone or a smartcard to be a form of authentication (not necessarily identification), of permission, and preferably of payment as well. The stick is some form of road pricing; the technology is well advanced, and the reasons for implementing it more pressing. The Netherlands is likely to be the first, although Belgium is not far behind. One other issue that’s becoming more prominent is that of the noise impact of traffic.
Leuven is a university town with quite a lot of industry associated with it (a Belgian equivalent of Oxford, perhaps). One of the speakers conjured up a vision of the city using technology to manage its transport issues better – everything from guiding traffic and managing traffic flows, to a drivers’ reserved parking space, to integrating information about different transport systems, to supporting car sharing, to helping people use bikes or walking instead of travelling by car.
The picture at the top, by Andrew Curry, is of the Grote Markt in Leuven, a ‘shared space‘ used by pedestrians, cyclists, and service vehicles. It is published here under a Creative Commons licence.
Add comment 28 June 2010
Opening up in Latin America
Crawford Hollingworth writes:
We’ve been doing quite a lot of work in Latin America in recent years, and it seemed both inevitable and desirable that we’d want to open an office on the continent, not least because – in terms of social change – it’s one of the most innovative regions on the planet. And we’ve now managed to do this – working in partnership with Ogilvy in Buenos Aires. We’ve been lucky to find two outstanding people to launch the office for us, in Bernardo Geogheghan and Sebastian Codeseiro, who’re flanking me in the picture above.
I visited Buenos Aires for the launch, and while I was there I was interviewed by Clarin, Argentina’s largest paper. Here’s part of the interview – approximately translated.
- What emerging trends are we seeing?
“One of the trends that we analyze is that people feel that we live in a society which has greater risks than at other times. The way this risk emerges in each society is different. In Europe is related to the fear of others, the immigrant, and also with the possibility of a new economic crisis. In the U.S. it is the risk associated with the possibility of terrorist attacks. In Latin America it has other components linked to problems such as poverty and insecurity of property and people. In each area the trend is expressed differently.
- What other phenomenon can be anticipated for the coming years?
I think the one of the most important trends is the rise of protectionism in many forms and at many levels – national to regional and even at a city level [imagine a sort of new medievalism in which cities only care for, support and protect themselves]. This will be brought about by growing global and local power struggles, resource issues and social unrest.
Add comment 18 June 2010
The rise of Wordle
We’ve been having a debate in the office about the merits of Wordle. These are Russ’ thoughts.
Russ Wilson writes:
Wordle, word clouds, Tagxedo: all online apps for taking a load of data in the form of words and presenting it in a design friendly way. As a lover of language I’m all for anything that encourages people to explore words, think about how and why they’ve been used and analyse their meanings. However I’m not really sure that any of these tools do this.
I have two main issues with Wordles, and they’re exemplified in the wordle above, based on David Cameron’s coalition speech. First, they remove the word from its immediate context. Take the word interest, represented as one of the more frequently occurring words. But it could equally indicate curiosity and engagement or interest payments. The Wordle doesn’t help; it only tells us the word occurred often in the speech. Similarly, coalition also figures prominently. But it doesn’t help with context. We can’t tell, for example, whether they said ‘this is a coalition’ or ‘this is not a coalition’!
The second issue is that frequency is being proposed as an indicator of importance, but that’s not how we actually interpret speech. Imagine a Wordle which captures responses to a question such as ‘What do you think of the coalition?’ One person might say the new government is ‘absolutely the most important and exciting change in politics in living memory’; others might respond that it is ‘quite troubling’, ‘not very troubling’ or even ‘not troubling’? The Wordle would look, well, troubling:
Frequency of use is simply that – frequency of use.
Wordles do look good. But they become dangerous when presented as meaningful analysis. They don’t tell the right story, and worse, they are also capable of telling a completely different story altogether. Yet the mainstream media are happy to present them as semi-serious analysis: The Guardian says that from its Wordles for Nick Clegg and David Cameron’s acceptance speeches ‘you can get a good idea of the two leaders’ use of language – and which words were important to them’. As a linguist I know there are many ways to explore their language use, but I don’t think I would include a Wordle as a method of analysis or of display. Their visual appeal gives them more credence than they deserve.
As a final test, here is a Wordle of this post – do you think it reflects the views I’ve expressed above?
4 comments 3 June 2010
Facing off about privacy
Andrew Curry writes:
The current row over Facebook’s successive changes to its privacy settings has several strategic implications for the way that businesses – not just in the digital sector – relate to their customers. In case you’ve missed the story: Facebook has radically reduced the default privacy settings for its users since the autumn of last year, meaning that users are likely to be sharing far more details across the internet than they previously did. (I’ve written about this at length elsewhere, but a visit to ouropenbook.org gives a sense of the scale of it.)
The reason? Well, the company says that ‘radical transparency‘ is good for you, in a moral sense. Others say that it is part of a long campaign by Facebook (two steps forward, one step back, according to Nick Carr) to set itself up as the owner of its users’ online identity, which is a more lucrative proposition than being a mere social network, even one with several hundred million members.
So what are the implications of this for businesses?
#1: When the mental map which your customer has of your product or service becomes too divergent from their experience of it, the business suffers. (This is what happened when Gerald Ratner described one of his company’s products as ‘crap’). In the case of Facebook, the actual experience is no longer represented by the map. The researcher danah boyd has explained this well:
A while back, I was talking with a teenage girl about her privacy settings and noticed that she had made lots of content available to friends-of-friends. I asked her if she made her content available to her mother. She responded with, “of course not!” I had noticed that she had listed her aunt as a friend of hers and so I surfed with her to her aunt’s page and pointed out that her mother was a friend of her aunt, thus a friend-of-a-friend. She was horrified. It had never dawned on her that her mother might be included in that grouping. Over and over again, I find that people’s mental model of who can see what doesn’t match up with reality.
#2: Privacy isn’t dead, although it is fashionable for digerati to say so. People still expect organisations they do business with to maintain appropriate levels of privacy – and to be able to check these for themselves. We think that this expectation increases as the web becomes more ubiquitous and more portable, and there are more opportunities for breach. At least some users will engage reluctantly because of fear of theft, fraud, or inappropriate social exchanges. In the digital world, companies which take care of their users’ privacy will be less profitable in the short-term, but more sustainable in the long-term.
#3: Facebook is effectively polluting the “commons” represented by the internet – all of the public resources and protocols – through self-interested behaviour. It is possible that other suppliers which also depend on a trusted internet for their business will intervene; Google, its own privacy problems notwithstanding, has done a little of this recently. But usually what happens when public interest goods are polluted by commercial interests is that regulation follows. The cases brought against Facebook under trade and competition law, along with the initial responses from privacy regulators, are harbingers of this.
The cartoon at the top of the post is one of a string of acerbic strips about Facebook at the excellent Joy of Tech, and is used here with thanks. You may enjoy this one as well.
Add comment 25 May 2010
