Online advertising: How media companies are monetizing their online presence
Published on June 20th, 2011 by Steven La Barbera
Based on the diagram on the left, we can see here that these results indicate the online space is a crucial component for business to manage their brands.
Yet, in countries such as the UK, Thailand and most others, online advertising still trails traditional, even though Web is clearly people’s first choice for news and information. Clearly, we are on the cusp of an even bigger boom in online advertising. Increasingly, we are finding certain major players emerging as dominant forces. Facebook now controls about 5% of all online advertising. Meanwhile, Google’s AdWords and AdSense generate massive revenue for the company, helping to make it the world’s No. 1 brand.
So how then can the traditional media get a piece of this huge online advertising pie while they’ve been struggling to stay in the black due to a decline in their own advertising numbers?
The good news is that traditional media outlets do experience transference of their brand recognition, be it ABC News, the Los Angeles Times or The Toronto Star. This is an important starting point as it will naturally generate some traffic. What happens from there depends on the strategy each one adopts.
Traditional media channels need to understand that the Internet allows for a combination of the written word, sound and video that has never really been possible before. They also need to understand that old-school deadlines, like “news at 11” or “putting the paper to bed at 10:30,” don’t apply online. They are dealing with a different type of news consumer, the kind who craves instant gratification in today’s information age. If you don’t have the content they want, they move on.
However, it’s important for traditional media, print especially, to take advantage of this convergence of mediums, and establish a brand there as well. Forbes magazine has established an online video brand, and many newspaper chains have as well. This strategy helps develop a loyal audience, and can help steer additional traffic to their pages containing written content. This is key as it helps Forbes retain its online traffic longer, which gives them additional page views to monetize.
Once these steps have been taken, media outlets can take one additional step to monetize their online traffic. If their days of paying for media content aren’t over, they are certainly numbered. However, what if a newspaper’s website allowed people to view its content by opening a free account? This allows the public to get free access to the content, gives the owner of the site important information on the reader, which they can leverage into higher advertising rates. This is because they know the age, income and geographic location of the reader – information that he or she provided during a registration process to obtain that free content. This allows the advertiser to select the exact demographics they want to reach, and to be assured of reaching them, which is something mass media, in the traditional sense, simply cannot do.
And based on the numbers we’ve seen, now is a great time for traditional media to make these investments in their websites and SEO capability, as the curve in total online advertising dollars continues to get steeper.