Managing people vs managing content
The next rollups, the end of the easy button, everything is shoppable, email eats the web.
Hello... Thanks to all of you that read last week’s inaugural email. This newsletter is a work in progress. I appreciate your feedback and encouragement as I try to figure this out.
I look for patterns in media, business and culture. My POV is informed by 30 years of leadership in media and advertising businesses, most recently as global President of Hearst Magazines, one of the largest publishers in the world.
Want to contact me directly, reach out at firstname.lastname@example.org
A still from Grimes 3x, a NFT by Roe Ethridge, postmodernist commercial and art photographer (and dear friend). Last week he dropped his first NFT collection, Genesis NFTs. "I didn't know what a NFT was but realized, in a way, it's the same as the social media campaigns I make for commercial clients. It feels more democratic and Pop in that way.” (See the full NFT on OpenSea.)
The smart money: CMS to CRM
I’ve spent a lot of my career building multi-brand media businesses around common operating structures and technology platforms, the content management system (CMS) in particular. At Hearst the platform strategy worked well because we had scale to invest in product, tech and data with dozens of media brands and hundreds of publications around the world. Bringing everything together had obvious cost benefits. More importantly, smart publishing and analytical tools built around best practices helped content and growth teams work more effectively together, accelerating audience and revenue growth.
A generation of rollups and platform investment focused on making digital content, advertising and distribution more efficient. Many companies have executed a variation of the CMS rollup strategy with good success (Maven, Recurrent, DotDash, Bustle, Vox).
The next rollup opportunities will bring together businesses around platforms to manage customers, not content. These are subscription media properties, DTC sellers and lead gen companies - anyone who has the permission to hold your data and ultimately, your credit card. Businesses that start with an email connection to a consumer and go deeper to grow lifetime value. Synergies will be found across brands by lowering acquisition costs with shared data and cross selling, eliminating operational inefficiencies in managing sales funnels and customer relationships.
A few other things on my mind this week:
1. The end of the marketing easy button
One of the things that doesn’t get reported on amidst endless Facebook coverage is its importance to small business as a primary marketing channel. For many, it’s a revenue lifeline. Facebook and Google did something the open web was never able to do - offer self-serve, performance-based ad buying interfaces and connect them to all parts of the digital ecosystem. It worked extremely well, gutting old school channels (Yellow Pages and local print media) and massively expanding the digital buying market (today Facebook has over 10 million active advertisers). I have been in countless meetings over the past few months with companies whose over reliance on Facebook is becoming a real vulnerability. Apple's IOS 14.5 tracking changes are disrupting attribution and therefore investment. The machine just doesn't work as well as it used to.
Many observers would suggest we have reached Peak CAC (customer acquisition cost), where competition and data inefficiencies are draining all margin from the Facebook acquisition funnel. Inevitably investment will migrate to a broader set of channels and, importantly, to retention efforts. It will be interesting to watch how the market reroutes around Facebook and more broadly privacy-driven shift to first party data. Seems to me Google and Amazon will benefit, but how else will we see the market evolve? A couple of thoughts here.
2. A shift from public to private
We are starting to see investment shift from public to private marketing channels - finding ways to turn light contact into deeper connections via email, SMS, loyalty marketing and personalization. The Information has reported on booming business in companies providing services in this space like Klaviyo (personalized email), Yotpo (SMS, reviews, loyalty) and Rokt (personalized e-commerce, funnel optimization). Related, your email box is only getting more important and so is The Algorithm that determines where stuff goes in your Gmail box. I have been frustrated lately the Gmail's rules around what goes into my main mail folder and what goes under the "Promotions" tab. Many of my favorite newsletters are getting lost in the shuffle. I’ve got to figure out how to fix this.
3. Can the open web pick up share
The open web has never been an easy place for small businesses to advertise. Retargeting was an on ramp, easy to understand and effective. The challenge here was the scarcity of signal. Many small business couldn't gather enough cookies for retargeting to move the needle. And now, privacy constraints are neutering retargeting. Scale is also an obstacle. The open web is fragmented and impossible to access through a single buying mechanism. Effective acquisition needs huge audiences to power very narrow segmentation based on geography, demographics and purchase intent.
Self-serve SAAS platforms like DanAds are making large publishers accessible to small buyers. Content recommendation platforms like Taboola will grow share particularly as their platforms evolve to serve SKU based performance marketing needs of direct sellers (see Taboola's recent acquisition of ecommerce marketing platform Connexity). That said, small companies need advertising that is creatively simple, hyper-targetable and entirely performance driven. Web publishers have made scant progress here.
4. All surfaces become shoppable
Related, as tracking rules tighten and commerce infrastructure matures, more transactions will happen at point of impression. Instead of redirecting a consumer from media back to a commerce site, transactions are moving to media touchpoints. We have seen this with shopping functionality on Instagram, TikTok, YouTube and Snap. Soon it will become a feature of every video interface, including platforms like Roku, Netflix, Amazon etc. Where there is media there will be commerce. Store API's, like Shopify, will enable the distribution of SKU data and transactional experiences as seamlessly as adtech enabled instantaneous targeting, pricing and impression delivery. This will challenge how we think about an online ecommerce destination. New tools will emerge to manage distributed commerce merchandising, analytics, and optimization
5. Email eating web media
I was thinking about my media habits this week and noticing that newsletter consumption has become a much bigger part of my media diet. I am spending less time with traditional news sources like NY Times and Post, less time on the web-based media (FWIW I find time for the Financial Times. I love that paper especially on the weekend...the champagne background, a well designed app, the ad-lite experience). I started thinking about why and came to the conclusion that email was just media rerouting around the ad-littered car crash that has become much of the open web (the latest scourge: floating video players… everywhere).
Email's virtues reflect the weaknesses of the web as a publishing platform. It has a built-in notification system - it comes to me. I opt in. It's fast and finite. It's still uncluttered and refreshingly free of rich media. It always works on a phone. I don't have to log in. It's easy to share. Importantly, it's usually from another human whom I've selected to listen to. As such I can manage my own editorial roster, from Bari Weiss to Casey Newton.
This renaissance is surprising given the flameouts of first generation innovators (NBC shuttered Daily Candy in 2014). What changed? While we've seen format creativity with Axios, the Skimm, Morning Brew, the bigger reason is the world embraced subscription media and Substack gave individual creators the business model in a simple platform solution. It is the intimacy that feels good. Andrew Sullivan describes it well: “There’s something wonderful about writing just for readers,” he said. “Because your people are there, you have to be accountable, but it’s a very pure relationship. It reminds me of the wonderful old days of the blogosphere.”
Is email just a thing for old people? Numbers would suggest otherwise. More than half the world actively uses email (4.3B globally in 2021, Kinesta). 78% of teenagers use email (Lifewire). 90% of Americans aged 15 and over have active email accounts (99 Firms).
If there's an innovation opportunity with email, I think it will come from crypto wallet integration. It's not difficult to imagine your email interface as a place to also manage your crypto account. More on this in a future note.
1. Recipes, now wearable. Allison Roman has tasty merch for you.
2. Bari Weiss visited Jaron Lanier on her podcast Honestly this week. "Was the Internet a Horrible Mistake" is worth a listen.
3. Andy Shauf, a personal favorite from my home town, Regina, Saskatchewan releases Wilds (Spotify).
If The Neon Skyline was Shauf’s opus, à la his Breaking Bad, then Wilds is his Better Call Saul: a companion guide carrying a much richer self-interrogation and presentation. Wilds is all killer and no filler, not taking itself all that seriously—instead, it opens up and gives us honest glimpses into how a relationship came together and failed, without forgetting to showcase the parts where hopeful sparks just never really had it in them to turn aflame in the first place. - Paste
4. I love Mac Miller. His 2014 mixed tape, Faces arrived on streaming services this week (Spotify). Swimming and Circles showed a much more mature artist… but you can see the seeds here.
Thundercat says he and Mac were able to recapture the alchemy of their time at The Sanctuary. You can feel it in Miller’s hugely popular 2018 NPR Tiny Desk Concert. Thundercat joins him to play bass on one song, and not only are they in perfect musical lockstep, but they share warm laughs and profound grins throughout. These are moments where we can see glimpses of the camaraderie and love that went into making Faces, which, even with the heaps of generational talents he worked with before and after, Thundercat says remains a truly singular era in his life. The Making of Faces, Mac Miller's Most Crucial Project - GQ