building and packaging digital products
TRANSCRIPT
Using Analytics to Drive Revenue
Introduction – Mather Economics
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• President and Founder, Mather Economics
• Extensive expertise developing pricing strategies through customer specific predictive modeling
• VP of Business Development• Former Sr. level executive with
Dow Jones, Gannett, and McClatchy leading audience development and marketing efforts.
Chris ChristianMatt Lindsay
• Director, Digital Services• Doubled ESPN Insider Digital
subscription services to over 750,000 paying subscribers
Kent Schacht
Mather Economics: Firm Overview⋙Founded In 2002 to bring leading practices in applied
microeconomics to businesses⋙Extensive experience in yield management for media companies⋙Focus on advertising and subscription revenue optimization⋙35 Employees ⋙Based in Atlanta, offices in New York, Europe
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Client Portfolio⋙Newspaper Publishers⋙Magazine Publishers⋙Digital Subscription Businesses⋙Instant Lottery Game Manufacturer⋙Satellite Broadcasting Company⋙International Hotel Company⋙Cell Phone Service Provider
⋙Telecommunications Company⋙Cable Television Companies⋙Temporary Staffing Agency⋙Electric Utility & Power Coop⋙Multinational Financial Services Firm⋙Leading Fast Food Chain
Digital Media Revenue Optimization
Media Evolution: Coverage, Platform Change, Revenue Model Does NotNewspapers : Content sold in a bundle∙Focus on classified revenue∙Focus on advertising revenue∙De-emphasis on direct-to-consumer revenue
Magazines: Content unbundled∙Focus on rate-base, advertising revenue∙Paying for subscribers
Media Evolution: Coverage, Platform Change, Revenue Model Does Not
⋙Digital: Opportunity for depth, niche coverage∙Heavily reliant on reliance on advertising∙Traffic moving to mobile, along with lower CPMs
Media Evolution: Coverage, Platform Change, Revenue Model Does Not
Today: Trying to Put the Genie Back in the Bottle – At Least Partially
⋙Direct to Consumer products emerging throughout the digital media landscape
⋙Diverse revenue models offer more predictability
Because the Digital Revenue Model of Choice in the Future Will Contain D2C
⋙Self-sustaining digital growth
⋙Diverse content, evolving with platform growth
⋙Traditional Thinking: How to Increase Digital Subscription Revenue⋙Investment∙Product development∙Marketing initiatives∙Platform
⋙Business model disruption∙Meters∙Paywalls∙Hope and pray
The Secret Weapon - Data⋙Revealed behavior through data analysis has replaced stated preference⋙Gives digital media companies the power to make truly informed business decisions∙Product∙Price ∙Marketing
⋙Integrate direct-to-consumer revenue with ad sales revenue
-- Derrick Harris, Gigaom.com March 4, 2015
⋙Promotion⋙Programming ⋙Product ⋙Pricing
Mather’s Focus: Using Data to Fuel the Four P’s
⋙Use data to make smarter decisions about what content is produced and posted
⋙Know exactly what each piece of content is worth
⋙Factor in CPM, subscription conversion, impressions, traffic
Programming
⋙Build product offerings based on audience behavior and likelihood to engage
⋙Package digital subscriptions outside of the bundle tradition∙Focus on how users engage with content
⋙Present products to customers based on how they’re able to be monetized∙Aim users into the appropriate funnel based on how they bring value
Product
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sports:footballsports:rosenblogsports:columnistsnews:localsports:baseball:cubssports:basketballsports:breakingnews:nationworldsuburbsnewssports:collegesports:hockeysports:smackblognews:opinionsports:baseball:whitesoxbusinessnews:local:politics
⋙Focus on the demand curve
⋙Segment pricing based on audience and value∙Airline model – price based on a number factors, one-size does not fit all
⋙Different content has different value to different types of users∙Technology allows for targeted messaging and experience
Pricing
⋙Data analysis builds efficiency and maximized yield based on preferred KPI∙Build subscriber base∙Build subscription revenue∙Build ad revenue
⋙A/B Testing ⋙Segmented offers by customer value
Promotion
⋙Every media company is full of customer data∙Data is like oil∙Refining into action
⋙The key to monetization:∙Program∙Product∙Price∙Promotion
⋙The future is bright – quality content will always have value
Summary
