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At one of AOP’s events earlier this year, one of the speakers said that publishers are sitting on a ‘goldmine’ of data, which may be the most powerful in the entire media eco system – is this true in your view, and if so, why?
I couldn’t agree more. In my mind the key is the volume of transactions a publisher does with their clients and the information that can be linked across these individual interactions.
Think about the platforms publishers now have available to them – web and mobile of course, but also print and face-to-face and the volume of transactions and interactions these generate.
A series of transactions might be around registration for an event, purchase of a subscription or a web visit but in each case we are capturing and processing hugely valuable information about the audience.
If information about these transactions can be linked in a meaningful way and patterns of behaviour analysed across them, then we can begin to build up a very powerful insight into our customers’ profiles and their needs.
But the trouble with most goldmines is that while the shiny stuff at the bottom is incredibly valuable it can be pretty tricky to get at. The analogy holds true. All too often the publisher’s data is inaccessible or disjointed.
And it’s no good holding the data if you can’t be sure you have the permissions or right to use it. So to be able to take advantage of these significant opportunities publishers are going to need to rethink their processes, rebuild their systems and in some cases apply a bit of technical wizardry before they see some of the benefits.
To summarise, what would you say are the main areas publishers are or should be making money from data?
Cross-sell and upsell are incredibly important. Cost of customer acquisition is often high so it’s essential to make the most of them once you have them. If a client has registered for an email newsletter then use the data to sell them a place at a related conference. Similarly if you’ve got some good demographic profiles on your web users then source some high-value content and data for specific audience segments and sell a premium access.
Given that digital throws up such a wealth of data, how can we separate the wheat from the chaff, finding and utilising data that is really valuable and can bring financial return?
There is so much data out there it can be easy to get swamped or simply end up with analysis paralysis. It’s not good enough to simply ‘warehouse’ billions of transactions in the hope that you can find some way of ‘extracting’ the value.
In most cases the raw data is pretty worthless. It always amazes me how many times I am presented with web stat reports containing hundreds of individual data points and dozens of graphs most of which are pretty to look at but ultimately pointless.
As with any data it’s about how you join the dots to create something meaningful.
At Abacus we talk about actionable intelligence. For example, if you can isolate consistent activity patterns amongst groups of demographically similar users then you can feed this information into your product development thinking.
For example, if all the chief execs in your audience spend a lot of their time looking at salary surveys you’ve got a pretty good idea of the type of functionality or content that’s most likely to appeal to them.
Which publishers, in your view, are currently successfully monetising and making the best use of their user data?
Sadly I think the publishing sector is way behind the curve in this area. I often argue that publishers should start to think and behave far more like Tesco. Retailers really understand the value of collecting data about customers via their loyalty cards and then using the information they’ve gathered to tailor offers and benefits to suit the individual customers.
In the web sphere think of the elegant effectiveness of Amazon’s ‘you bought this, so you might like this’ approach to see a demonstration of how publishers should be thinking.
The good news is that publishers are finally waking up to the possibilities and at Abacus we’re getting very high levels of interest in some of the audience development tools we’ve been working on.
What are the legal issues publishers need to be aware of in this area?
Of course there are significant legal and compliance issues around opt-ins and data protection to be considered. But while these shouldn’t be understated, I think it’s even more important to consider the sensitivities of your audience.
You only need to look at Facebook’s recent tribulations to see how much damage can be inflicted on a strong brand when it gets it wrong.
However, I believe that audiences will volunteer phenomenal amounts of data and accept responsible data mining providing the outcome adds value for them – look at LinkedIn. Clients won’t tolerate indiscriminate spamming but they will accept data sensitively used to create products mapped exactly to their needs.
Ian is speaking at AOP’s next event, Driving Revenue through Data, on 8 September –
Book your place online now // more information on the event.
