Is there really a problem in online media today?
2015 will be viewed as a watershed year for digital media. Social network audience growth plateaued, and everything changed from that point.
Digital media has been built on CPMs, but with reducing content revenue sharing agreements, and organic reach falling off a cliff, the predicted ‘bloodbath’ in digital media1 seemed imminent but never happened. The closest we got was online media giants, including Vice and BuzzFeed, missing revenue targets in 2017.
How did we get here?
As everyone knows, Google and Facebook continue to dominate digital advertising, with the duopoly attracting 84% an estimated of global digital spend in 20172 which is expected to grow by 3.4% to an estimated $100Bn3 in 2018.
The only threat to this runaway train in the past year, were concerns with advertiser safety, when brands including Diageo, Mars, Hewlett-Packard, Deutsche Bank and Modelez all pulled campaigns from YouTube.
Content revenue sharing has remained under-valued, ‘placing quality creators at a financial disadvantage’4. Organic reach is forecast to be ‘dead’ in 2018, whilst social ad rates reportedly increased by 35% in Q4 20175.
Whilst the outlook appears great for the duopoly, and bleak for publishers, in reality few have reacted so there might not be a crisis but online media is in search of solutions, which now includes George Soros calling for regulation to control the Duopoly at Davos.
So what options are being considered to mitigate the constant shifting sand of social networks business models? At GLOBALDRUMTM we speak to brands every day and whilst we have an interest, there are common strategies being considered.
The response from UK online media is typically ‘algorithm changes are nothing new’6 but there is a consensus that any brand simply wanting to adapt to the latest series of changes, needs to proceed with caution and position themselves for change.
The best-protected publishers are those without a dependency on social networks, who have the agility to reposition.
1. Reduce dependency on social networks
Retain the value of social, but become a social entity, synchronised with today’s social networks, to return control, revenues, and live audience insights, implementing diversified social business models that deepen partner relationships.
2. Data is a quick win
Improving data accessibility and analysis is a quick fix. Switch from buying in third party data, to monetising it, reinforcing CPMs, tracking active interests and building more effective audience profiles, including contextual and behavioural campaigns.
3. Deepen partnerships
Offer partners segmented and targeted campaign management to monetise and build audiences on your platform for themselves. Improving audience understanding enables partner’s to boost conversions, giving incentive to raise CPMs.
4. Audience authentication
Perennial problems of illegal content and abuse are much easier to resolve if audiences are authenticated. The resultant dilution on traffic now seems less relevant as business models adapt to maximising audience value versus scale.
So is there a crisis after all?
There is a crisis, but not today. It is less about the latest changes to algorithms, which are symptoms, and more about progressive solutions to a broken business model.
At its core is the funding of high-value content, that’s crucial in maintaining audience engagement, and the difficulties of maintaining a secure online experience for audiences, which is mandatory for brands.
Brands fund the entire social ecosystem. Publishers have potential solutions within their grasp. Those with defined audiences, content that engages audiences, operating diversified business model, with the agility to operate social business models on demand, and diversified distribution could thrive.
Thriving publishers will encourage social networks to reassess their own proposition, to attract and retain the most engaging content, and create a sustainable ecosystem.
 Shane Smith, CEO Vice Media, 2016
 GroupM, December 2017
 Financial Times, December 2017
 Jonah Peretti, CEO, BuzzFeed, 2017 and Rupert Murdoch 2018
 Digiday 2018
 Liam Harrington, CEO Unilad, 2018