Making Sense For Media: PriceWaterhouseCoopers

PriceWaterhouseCoopers released its Global Entertainment and Media Outlook: 2009-2013 yesterday, and the findings will set the stage for some companies to excel while others will be forgotten. Not surprisingly, the migration to digital entertainment platforms and convergence will accelerate as companies seek advertising distribution efficiencies while consumers want more value and more control over their content streams.

The future is bright, but not for everyone.

While the report shows declines in consumer ad spending through 2011, PriceWaterhouseCoopers sees industry growth returning in 2012-2013. Specifically, global spending on entertainment and media will reach $1.6 trillion in 2013 and then grow by 2.7 percent in digital content, which will eventually offset declines in traditional media revenue models. In the United States, the entertainment and media market will ultimately grow at a 1.2 percent average annual rate to $495 billion in 2013.

The primary challenge, it says, will be that some media companies will struggle to attract revenue from fragmented and mobile audiences. On that one point, we couldn't disagree more. The emphasis on mobile audiences is leaning toward more convergence, not less, with audiences being able to import and make portable their favorite content from their desktops to their laptops and mobile phones.

If any fragmentation is occurring, it's a direct result of consumers finding a continually increasing amount of content that would otherwise be unavailable. More choices simply means not all people will pick from the most popular three, but rather any number of options from a list of 3 million.

The decision that media companies have to make is whether their product is strong enough to capture any audience at all. For example, as one large publishing company reported months ago, its greatest challenge on the Web is competition. Rather than compete with the only other daily in a major market, they have to compete with several more migrating print sources, broadcast news sites, radio news sites, and the seemingly endless supply of amateur op ed blogs and network content.

They're asking the wrong questions. They're searching for the wrong conclusions.

Digital demand is increasing, but not everyone sees it.

"The current decline in revenues is not because of declining demand," Bill Cobourn of PriceWaterhouseCoopers' media and entertainment practice said. "In fact, demand for (entertainment and media) appears to be increasing."

The struggle that some media companies are facing is where that demand is increasing and their own ability to be able to meet that demand. Rather than continuing to find ever-narrowing niches where no competition occurs, they ought to be asking what do they have to do different to demonstrate a clear product contrast.

The right content mix would ensure that the publisher would never compete with other migration print sources, broadcast news sites, radio news sites, and the greater content sources that make up social media, including former advertisers who are finding it easier to develop direct-to-public online programs.

Ergo, today's news doesn't have to be the same on every station. If anything, that is the model that died when consumer choice began to grow exponentially. Consumers no longer have to choose which newscaster or print reporter they enjoy more as much as they choose which stories interest them the most. It changes, daily.

Coupled with the media's focus on preserving old distribution models, e.g., print and broadcast, they miss the bigger picture. While there will always be room for some print (assuming it is not duplicated online), distribution stands to sort itself out.

Even PriceWaterhouseCoopers sees it. It projects mobile and digital platforms expanding at the highest average growth rate of 12.2 percent through 2013 in contrast to a non-digital growth rate of 1.2 percent. So traditional-minded media might ask itself: which growth sector makes more sense to pursue?

Tomorrow's media model will be everywhere or nowhere.

When migrating media learns how to deliver valued content over the same old coverage and shift its one-way communication model into two-way community development, then advertisers will have a real reason to invest advertising dollars in order to capture those communities. However, and in the meantime, right now it makes more sense for companies to develop their own online communities while media struggles to sort it all out.

After all, digital spending is projected to rise to 25 percent of total industry revenues in 2013, up from 17 percent in 2008. And advertisers will continue to shift toward new media, boosting Internet advertising to 19 percent of U.S. advertising by 2013, from 13 percent in 2008. In other words, the hard choice media needs to make today is whether they want to be everywhere or nowhere at all. And that choice will not be made by media alone.

Content Related To The PriceWaterhouseCoopers Report

Digital spending to fuel slower media growth-PwC by James Pethokoukis

Pricewaterhouse Coopers Notices We're Going Digital by Catharine P. Taylor

PricewaterhouseCoopers Study Finds A Positive Outlook For Digital Media Growth by Stuart Elliot

Retooling Spin: MySpace Layoffs

"Simply put, our staffing levels were bloated and hindered our ability to be an efficient and nimble team-oriented company. I understand that these changes are painful for many. They are also necessary for the long-term health and culture of MySpace." — Owen Van Natta, chief executive for MySpace

That is the message being floated by MySpace in the face of layoffs that will leave 420 employees jobless. But one wonders if that is what has really happened to MySpace or whether some observers are right in saying that the portal approach cost the company its lead position in the United States.

Or, perhaps others are right in saying that MySpace was overshadowed by the fast-paced migration of Internet nomads to Facebook, which doubled its membership to 70 million users while MySpace was losing 3.4 million. Worse, lost members only tell part of the story. Tracking MySpace over the last year reveals a steady drop in activity by the people who have stayed.

The trend began late last year after a long period of flatness. Indicators such as reach, page views, and page views per user have all declined by 50 to 80 percent in the last 360 days. It was one of many reasons while some social media tacticians were setting up MySpace pages at a premium, we needed a compelling reason to recommend the platform.

The real issue is probably platform simple over staff nimble; ease-of-use over innovation.

Simplicity continues to be the number one attracter in a country of voyeurs over content creators. So while MySpace was developing MySpace Music, which did less than impress, Facebook focused on simplifying everything from its message service to friend connections. Simply put, it's easy to join Facebook; MySpace takes some work.

While Facebook has also had its share of missteps, usually centered around sweeping changes that prompt members to remind Mark Zuckerberg that Facebook is more their network than his, MySpace is now faced with a communication mess that will be not be cleared up by uttering "whoops." Layoffs, after a year-long lingering decline, are an admission that something ought to have been fixed some time ago and now employees and investors will be left to pay the price.

Assuming MySpace can reinvent itself after what it calls a complete reset, the next question it will have to address is how to overcome the communication damage. It will likely take some time to overhaul the network without alienating its members, which can only mean more trouble ahead while people wait and wonder what's next.

So what's next? Here are a few ideas...

MySpace: After the Layoffs, Here’s What’s What and What’s Next by Kara Swisher

What Will MySpace Become After A 30% Headcount Reduction? by Scott M. Fulton

MySpace Isn’t Done Yet: Big International Layoffs Come Next by Michael Arrington

Spotting Talent: Copywrite, Ink.

While there are many personality and assessment sets that claim to know when someone might show promise as a leader, there is no substitute for spotting top talent than seeing their work. This holds true inside and outside of the organization.

What To Look For In Talent

• Performance. When you're an outcome-based communication company, the numbers don't matter as much as meeting the specified objectives. We look for people who do what they say they can do. It's surprisingly rare to find such people because so many have been coached to tell you what they think you want to hear as opposed to what they can actually do.

• Initiative. Some large firms have positions that are easily taught with turnkey systems, but communication is mostly situational. It requires initiative at every turn, with everyone looking for solutions that have yet to be considered by anyone. The best of them are seldom found in compilations of best practices that litter the net.

• Relationships. Some people mistake the concept of relationships as those who have the largest networks. The irony is that most communication firms benefit from the strength of the established relationships and not the number of contacts in today's electronic Rolodex.

• Problem Solving. Since every communication program is unique, it often requires the best practitioners to find new solutions. With the current state of change within communication, there are plenty of challenges to overcome.

• Work Under Pressure. Some things never change. Communication remains an industry that is built upon increasingly rapid response and a steady stream of deadlines. However, even with shrinking production windows, those who stand to excel are the people who can do it but never show it. As G.K. Chesterton once said "The reason angels can fly is because they take themselves lightly."

Welcoming Hadley Thom

Several months ago, I had the pleasure of meeting someone who exhibited all of these characteristics, first in class and then as a point person for our not-for-profit account. So when she met with me over coffee a few weeks back and said she was looking for a fun and challenging position with our company, it only seemed natural to find ways to make it work.

As an events manager for Aid for AIDS of Nevada, Thom was responsible for fundraising and event planning, including the AIDS Walk Las Vegas and the Black & White Ball. She was also responsible for the organization's marketing and public relations efforts, which included the development of its first social media program. During her time with AFAN, the AIDS Walk Las Vegas set records in total fundraising and individual donations. In 2009, more than 8,000 participants raised over $401,000.

She is now joining Copywrite, Ink. as a communication manager, and will be responsible for communication program development and client services for a diverse range of clients. Over the long term, we envision her taking a lead position for our growing team of communication analysts and specialists.

A few months ago, I wrote a post about what it takes to be a leader during an economic downturn. However, the lessons applied there aren't really confined to management or financial outlooks. They are meant for everyone.

After all, as much as companies can easily energize new employees, new employees can sometimes energize a company. And if you haven't found anyone like that lately, there is a good chance you haven't been looking. You can find our newest addition here (LinkedIn) or here (Twitter).

Reinventing Public Relations: Edelman PR

You don't have to agree with Richard Edelman of Edleman PR, an independent global PR firm, to appreciate some of the finer points of the presentation delivered at Georgetown University. Social media has changed public relations and mass communication in ways that few people ever expected.

From Edelman's perspective, public relations is faced with the challenge to evolve from pitching to informing, control to credibility, from one-off stories to continuing conversations, from influencing elites to engaging a new cadre of influencers.

Yet, for some, in looking at these four points for the evolution of public relations, they might wonder where public relations took the red pill. Was it ever about the pitch? Were they ever in control of communication? Was the focus on one-off stories? And was public relations really a game of expanding influence? Was the public relations world so bleak or is that the tone to make a brave new world seem twice as bright and shiny?

There is probably too much content for the confines of a single post to address those questions. So it might be best to stick with just three.

What Was Public Relations?

Bill Sledzik, an associate professor at Kent State University (and one of the few people I know who has an aversion to online typos like I do, even our own), still reigns with one of the best sum-ups on what public relations might be, assuming it never became what Edelman suggests it is today.

The point is that Sledzik's post has become required reading for my students, specifically because none of the definitions presented include words like "pitch," "control," "influence," or "one-off stories."

Who Owns Social Media?

If there was ever a misnomer in communication, it's the constant question of who owns social media. Does public relations own it? Marketing? Advertising? Social media experts?

While I often share the idea of integrated communication because social media skill sets tend to pull from all communication-related disciplines, the less obvious answer is no one owns it beyond the people who participate.

Why Are Influencers Nouns?

While there is enough good in Edelman's presentation to encourage people to read it, there is plenty wrong too.

The best of it mirrors some recent research we completed. It demonstrated to one of our clients that engaged citizens are much more likely to promote the organization's message than are members of the media, despite the fact that the organization devotes more than 90 percent of its time to media relations.

The worst of it keeps reinforcing this notion that there are new influencers. I used to think so, and might use the term for simplicity on occasion. However, Edelman keeps missing that while anyone can have influence about a subject or within a network for a varied period of time, the bigger picture suggests there aren't any influencers. And even if there were influencers, that noun is seldom permanent.

Selecting Tools: Social Media For Business

The most common question communicators ask about social media is which tools, if any, are best suited for their companies. At least, that seemed to be the consensus among communicators attending the International Association of Business Communicators' (IABC Las Vegas) "Six in Sixty" program last week.

While there seems to be a general propensity to lead companies to the most popular social media tools, platforms, and communities, I provided an alternative solution for attendees with the premise that the long tail of social media need not always wag the company dog. During the 10-minute presentation, I shared a small deck to reinforce key points for three very different organizational needs: B2B, B2C, and nonprofit.

View more PDF documents from Richard Becker.

While there were strategic communication objectives for all three organizations, the simplified answer (given that each speaker had ten minutes) is that most are best served by considering two critical questions. 1. What communication assets do or will they have? 2. What tools, platforms, networks, and communities do their publics tend to use?

For a niche engineering firm presenting case studies and abstracts to a generally passive audience, a blog seemed best suited to help position them as subject matter experts. Within 90 days, the blog attracted a regular readership that included manufacturers, government regulators, and environmentalists.

For a nonprofit organization with an existing but underutilized blog, it made sense to redevelop it before developing a Facebook group to help them establish a sense of community. Within 60 days, the redeveloped blog had a following of 700 readers, which would be later invited to join a Facebook community.

For an independent film that had exclusive interviews and behind-the-scenes clips featuring several well-known cast members, YouTube seemed to be the best match (with Revver as a backup in the event YouTube didn't work out). Within 60 days, the various clips earned 350,000 views (with an additional 350,000 views of fan-duplicated videos). Revver proved important too. After a YouTube error caused the account to be suspended, we were able to retain the videos on a production blog until a new YouTube account was established.

All three programs employed other social media tools as well. However, the short- and long-term priorities were determined by considering how each organization could add value for their intended audiences and where those audiences were most likely to find that content. How did we know? We listened, which is the first critical step in developing any social media program.

Riding Coattails: Palm Pre

If conversations are any measure, it becomes much more challenging to say whether the new Palm Pre from Sprint will have a real impact on the smart phone market, especially as it relates to the iPhone. Despite a strong sales start, which some analysts predict to be between 50,000 and 100,000 units over the weekend, the iPhone continues to dominate online conversations.

Specifically, the iPhone captures 67 percent of the conversations when compared to the Palm Pre. When another well-known brand is included, such as Blackberry, the numbers show where the impact might land and it's not on the iPhone. Split three ways, the iPhone captures 50 percent of the conversation while the remaining 50 percent is unevenly split between the Palm Pre and Blackberry. Even then, Blackberry retains a small majority with 26 percent.

So Why Target The iPhone?

From a purely public relations perspective, comparing the new Pre to the iPhone ensures more attention than comparing it to other smart phones. However, from a strategic communication perspective, it might not work.

While the new phone has some distinguishing features, it immediately loses to the more than 50,000 applications offered by iPhone. And, according to Research in Motion, it remains well behind BlackBerry Storm and HTC's G1. The Pre public relations push to compare to the iPhone also loses on price point with the iPhone's new $99 price (the Pre offers a rebate). It also seems to be providing a forum for people to talk about the new iPhone 3G S (which will retail for $199) due out at the end of June.

What Telecommunications Needs To Know

The iPhone has been a strategic communication success story as much as it was a technological leap forward two years ago.

Once its initial branding dispute was settled, Apple not only delivered a phone that was everything but a phone, it also captured 1.1 percent of the mobile phone market in two years.

Where the strategic communication coup shines through is that every other phone maker has struggled to catch up by attempting to adopt iPhone technologies. Ironically, the copycat business model fails because it continually reinforces the notion that all other smart phones still have to catch up.

When consumers consider that fact, the Pre, despite some sales successes, seems to be another public reminder that even though Apple's 1.1 percent market share is much smaller than Nokia's 38 percent or Motorola's 8.3 percent, everyone considers it to be the product to beat.

Long term, as long as Apple continues to stay ahead of the curve, most phone makers will continue to look left behind. Short term, the telecommunication competitors will be hard pressed to win a comparison as long as they continue to define their products against the one with a home court advantage.

In fact, other than trying to ride the iPhone conversation coattails, there wasn't any benefit at all in attempting to cast the Pre as an iPhone alternative. At least, there was no benefit that we could see.