The Future of Marketing in Media Industry

Like any other business, the media industry evolves in cycles.  In the past few years, the job openings at media companies have been few and far between, but now, as content converges and more media companies are looking for interesting and engaging ways to branch out and reach larger population bases, there is an increase in the availability of highly coveted marketing positions.  However, the availability of new technologies and new developments in the media industry have created a demand for new kinds of experience, cultural knowledge and skill sets that candidates must be aware of it they wish to vye for such a position.

The media industry, historically, has not provided much in the way of career potential for marketing executives.  Today, though, it is currently exceeding more mature industries, such as consumer packaged goods, in career opportunities.  When searching for a marketing position in the media industry, it’s important to know that the industry itself is highly varied.  There’s online media, traditional print media (newspapers, magazines, trade publications, etc.), television media, music media, etc.  All these forms have different revenue models that require a different forms of marketing.  For example, an e-commerce focused company might be interested in hiring marketing professionals to support customer acquisitions or product development, while a newspaper might need marketing support for circulation.

Newspaper executives know that online classified-advertising services are taking a bite out of industry revenues. Recent announcements by Google and Microsoft suggesting their interest in the classifieds business only add to the newspapers’ concerns, which also include rising costs and declining circulation.

From 2001 to 2004, online players such as craigslist, Monster, and Realtor.com captured approximately 5% of the newspapers’ U.S. market share—resulting in a loss of $2 billion of the $34 billion classifieds market.  In some categories of classifieds, the loss was far greater: 40% or more.  Lost market share is only part of the story.  Newspapers are having difficulty raising advertising rates to make up for sagging volume, since online competitors offer advertisers an inexpensive (and inexhaustible) supply of ad space in local and national markets.  In some cities, newspapers find that they must offer small advertisers general classified ads free of charge.  Newspaper publishers cannot afford to give ground, because classified ads make up more than one-third of their advertising revenues.  display ads account for most of the rest.

Any company that sells similar products at a range of prices fears cannibalization.  Take the case of a subscription media company that expanded from one product line to a mix of offers that included several similar but lower-priced products sold through a number of channels.  Executives felt that the new offers were necessary because the original product, while quite profitable, was losing market share and might never penetrate certain customer segments.  The new products did indeed attract these elusive customers, but the lower prices also lured some established customers away from the mature product.

Deciding how aggressively to push the new offers proved difficult.  The company’s customer-relationship-management system allowed marketers to pinpoint the extent of the cannibalization.  Yet the data implied simplistic recommendations—for instance, abandoning the new products without regard for their strategic importance.  Unless the implications were clarified, product managers balked at exploring the trade-offs between market share and profitability. Indeed, they had an incentive not to do so, for each product was organized as a separate, competing business with its own sales targets.

To break the stalemate, smart senior executives are looking beyond traditional marketing and media buying approaches to data and search engine optimization techniques for planning new marketing expenditures.  Expanding and embracing new forms of marketing that engage and attract younger audiences (to stave off natural attrition rates) are the salvation for traditional print media.  Not to completely replace it… but to make for a more rich and enticing user experience.