What Digital Publishers are Missing with Big Data

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matt-lindsayIn this special guest feature, Matt Lindsay of Mather Economics discusses the current technology landscape and how digital publishing industry concerns are evolving to embrace the era of big data. Matt Lindsay is president of Mather Economics, a global consulting firm that applies proprietary analytical tools and hands-on expertise to help businesses develop and implement pricing strategies that maximize operating margins, grow revenue and improve customer loyalty.

The changing economics of online and traditional advertising has required many businesses to put more focus on digital subscriber acquisition. While this shift applies to many types of native digital businesses, traditional publishing also is facing this challenge. The opportunities and challenges publishers are experiencing resemble those felt in the early days of e-commerce by many brick-and-mortar companies as they transitioned their businesses to use new digital sales and distribution channels. Many businesses perceived the opportunity of e-commerce but were uncertain where to begin and how to measure their progress. They saw potential, but struggled to transition to successful online business models. At the same time, they had little choice because consumers were driving the shift to shopping online.

Fortunately today, publishers and other native digital businesses have a few advantages over the early adopters of e-commerce. The biggest advantages they have are vast amounts of data and the tools to extract valuable insights from it. If used properly, these data and insights can provide a deep understanding of what current and potential subscribers value and how they interact with online content, which will spur the evolution of new and profitable business models.

To take advantage of this data and information opportunity, many businesses are investing significant resources in capturing data without a clear understanding of how to earn a return on their investment. A significant gap continues to exist between having the data on hand and actually putting it to good use.

The first problem lies in the silos that exist within businesses, and publishers in particular. Typically, the advertising function operates separately from the audience group and neither work closely with content creation and editorial. When it comes to data, these functions operate independently of each other, each using their own tools to manage digital business operations. Combining the data from these tools, at a level of detail necessary for meaningful analytics, is often impossible due to inconsistent definitions or a lack of common fields for merging data files.

That brings us to the second problem. While there are countless options for tools and “data management platforms,” most of them focus on analyzing digital audiences for the purpose of delivering targeted ads, which leaves a big gap for companies wanting to focus on better understanding and acquiring digital subscribers. And let’s face it – without digital subscribers, appealing to advertisers is going to be a challenge.

What’s missing is visibility into digital operations and revenue all in one place. Digital businesses need a data environment that provides a holistic view of user data across all platforms, tools and business systems. Ideally, these businesses can create a “data spine” that is application agnostic so that businesses can gather data from all applications in use, analyze the combined data to form insights and push desired strategic actions into operating systems. If one of their applications becomes outdated, the business can replace it with a better application without affecting the underlying data and analytics structure in place.

With this big picture perspective, businesses can capture the right data, at the right time and price, to support analytics that will generate real, actionable insights and help them:

  • Understand, on an individual level, which customers are most likely to subscribe and what value their engagement creates for advertising revenue.
  • Use data to drive engagement and share information and offers that move potential subscribers along the path from casual reader of the site to paid subscriber.
  • Capture revenue from all sources, including advertising and audience members, so that strategic decisions that affect multiple revenue streams are modeled accurately.
  • Combine online and offline data to create a complete record of an individual’s engagement with the company and to calculate their contribution to the operating margins of the business.
  • Track key metrics so that performance can be measured.

For most publishers of online content, striking the right balance of advertising and audience revenue is an objective complicated by a lack of accurate and actionable data.

At Mather Economics, we have analyzed digital audiences for hundreds of publishers and understand that acquiring paying customers and maximizing yield from digital advertising inventory is a frequent challenge. However, it is possible to easily overcome with the right combination of data, analytics and effective implementation strategies.


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