Lucky attendees at Borrell’s annual local online advertising conference in New York next week will hear Clayton Christensen’s view of where media is heading. I’ll be looking forward to the video, because I’m unable to attend. However, I’ve read and studied Christensen over the years, and I think I have a pretty good idea of what people will hear. I want to write today about one thing in particular: that it’s very hard, if not impossible, to reinvent yourself from within. That IS the innovator’s dilemma and why the field of disruption is open to those not from within. They’re neither bound by the rules and processes of maintaining the status quo nor blocked by adherence to a set of traditions. They are free to create and innovate, and that is a significant problem for any institution of the West in the 21st Century. To paraphrase my dear friend Michael Rosenblum, “You’re all hosed.”
Indeed, and the innovator’s dilemma is why. Very smart, very well-intentioned people with all the reason in the world to innovate simply can’t, because they’ve got to protect the mothership at the same time. It’s driving the car and fixing it at the same time. Mr. Spock, where are you? (“raises eyebrow”)
Case in point: why are companies like Topix, Outside-In, Patch, and Examiner not run by traditional media companies? I’m always reminded of the old “railroad business” saw about how the railroad barons of old would have been running the airlines, if only they’d realized they were in the transportation business and not the railroad business. Same thing here. You can ask virtually any local media manager if the barriers to entry in their business are gone, and they’ll honestly tell you yes, but internal mandates of the legacy product force them into behaving otherwise or, at best, inertia. Clayton Christensen knows why.
There is, I believe, a way to drive the car and fix it at the same time, but it requires managers to step outside their comfort zone and behave more like leaders. The mission is to establish beachheads ahead of everybody else, so that when the vision materializes, they’ll be prepared to monetize it. This is a risk, of course. There’s no spreadsheet, no revenue projections to manage, no best practices, no charts and graphs, because it’s not about seeing who can outsmart, outthink or outspend the next guy; it’s all about anticipating new value and going for it. The risk, however, can be mitigated if the beachheads are based on broad trends.
This can be very tough for certain groups, because we’re so used to being able to hedge bets with facts and processes. Here, we’re leapfrogging processes to intercept a moving target. It’s Wayne Gretzky’s brilliant tactic of “skating to where the puck is going to be,” instead of following its current position.
In our war for future relevance, here are five beachheads we need to establish in order to drive our car and fix it at the same time. Four of them relate to content that, we hope, will be somehow monetized. The fifth deals specifically with enabling commerce via a form of advertising.
- Real Time Beach — It is absolutely essential that media companies understand that news and information is moving to real time, and that real time streams are what will really matter tomorrow. It’s already happening today, but until somebody makes big money with it, we’ll continue to emphasize that which we CAN make money with, the front-end design of our websites. These streams take place throughout the back end of the Web, and they will make their way to the front end, and soon. There are early signs of advertising in the stream, and we should be experimenting with this, too. This is an unmistakable trend, and if we don’t move and move fast, it’s one I’m afraid we’ll lose.
- Curation Beach — Examples like Topix above show that curation beach is really already here, although I’d call those types of applications “aggregators.” They’re dumb in that they’re simply mechanical aggregators of that which is — for the most part — being published by others. Curation is more the concept of helping customers make sense out of all the real time streams that are in place. We’re all using the streams of social media, for example, to “broadcast,” but the real value is to pay attention and curate. This is a beachhead ready for the taking.
- Events Beach — One of the key local niches still left for the taking is the organizing of all events into an application that helps people find and participate. The ultimate user application here will be portable, for it must meet the needs of people already on-the-go. I refer to this beachhead as “event-driven news,” and it is largely created and maintained by the community itself. Since many events dovetail with retail seasons, this is easily low-hanging beachhead fruit.
- Personal Branding Beach — If everybody is a media company then media is everybody. This is a fundamental reality within which we’re doing business today, and it presents a unique opportunity for us and our employees. The aggregation of personal brands is a winning formula for online media, and we should be exploiting it before somebody else does. Our people are our strongest asset for competing in the everybody’s-a-media-company world, and we have the advantage of a bully pulpit from which to advance their personal brands. This is more important than most people think, because the dynamic local news brands of tomorrow will be associated with the individual brands of the community. The time to begin establishing this beachhead is now.
- Proximity Advertising Beach — The mobile beachhead is both obvious but obscured, because we’re all waiting for somebody to show us how to do it. This could be a real problem, for we know what happened when we allowed the ad industry itself to commodify banner advertising. Outsiders set the value for our products. The same thing is likely to happen here, unless we stake out territory for ourselves downstream first. There are predictions that mobile CPMs will hold at between $15-$25, and that’s enough to make any mobile content creator smile, but I would argue that the real money hasn’t even been discovered yet, because these CPMs are merely targeted display. Remember that the Mobile Web is the same Web as the one that’s wired, and it behaves the same way. The new value for mobile is proximity, and that’s where we need to be focusing. Let’s do what we can to make money with mobile content, but let’s also establish a beachhead in the proximity marketing arena, too, because that’s where this particular puck is headed.
If we approach these beachheads entirely with the question “where’s the money,” we’re likely to miss the boat. This strategy is to get us ahead of that and let the revenue grow into it. None of these will break the bank, and they’ll position us to move quickly regardless of which direction things move or how fast.
We can’t always keep attacking the market head-on by reacting to its changes. It’s too resource-intense, and we’re fighting an uphill battle against the pureplays, who already own the bulk of the local online advertising marketplace anyway. We might, instead, view the battlefield from a distance and deploy our resources where they’ll run into what amounts to a moving target downstream.
In war, victory doesn’t always go to the biggest and baddest. It also takes a sense of the battlefield itself and where and how to attack.