There aren’t too many things that we can be sure of in these increasingly bizarre times. But here are two.
Firstly, that anyone who says they know what is likely to happen to the Coronavirus outbreak, the global economy and even the media in the coming years is lying. We are clearly in uncharted territory. By the end of the year the crisis might be a receding memory or very much still part of our lives
Secondly, the media as an industry is more than ready to embrace the challenge of Coronavirus. Following on from a decade of digital transformation, media companies are highly adept at evolving at a rapid pace. The current unprecedented times could present significant opportunities which might help larger companies develop their businesses and entrepreneurs begin new ones.
The challenges are fairly obvious. Just as Brexit brought a degree of uncertainty to the media in the UK, so Coronavirus is repeating the process writ larger and on a global scale. And businesses hate uncertainty. The first casualty of the era has been advertising, especially in sectors such as travel and events which are most impacted by the effects of the virus. For some companies this will be compounded by the fact that their forecasts also took into significant revenues from both the Olympics and the European Football championships. One event has been postponed until next year while the other is surely hanging on by a thread.
The New York Times recently announced a slowdown in advertising bookings due to ‘uncertainty and anxiety’ caused by the coronavirus”. It is predicting a 10% drop in digital ad revenue this quarter. It is a story that will be depressingly familiar to many publishers.
Of course it isn't just advertising. One of the great media mantras of recent years has been to expand revenue sources to encompass events. Indeed for many b2b businesses conferences is their key revenue stream. Events are being postponed rather than permanently cancelled, but ultimately publishers might have to wait to see a return from their investments.
Print magazine publishers will be concerned too if there is an extended period of social isolation. Fewer people commuting will mean casual sales of titles from railway stations and airports will fall. For some media companies the virus might finally trigger decisions to move away from print for good, as is the case of Playboy Magazine which announced this week that its Spring 2020 edition will be its last.
There are also logistical issues for media companies. Many have experimented with working remotely, but even so managing and organising teams using platforms from Slack to Trello might only provide partial solutions. Humans need humans to bounce ideas off.
And then the good(ish) news
More positively though over the coming weeks, maybe months and possibly years we are going to see key new trends emerging.
1. An insatiable demand for content - No one knows how long countries will have to go through periods of social isolation and indeed lockdowns, but inevitably more time spent at home will increase demand for quality content such as podcasts, movies and extended reads.
There is also the issue of whom to trust, and for many consumers that will see them look to established media brands over gossip from social media.
Joe Martin, vice president for commercial partnerships for the Wall Street Journal, summed it up during a September 2018 presentation at a FIPP Asia event in - ironically - Wuhan, China, where the current virus apparently originates: “In a world of ever evolving digital-offerings, the wheels of change can also work in favour of traditional media companies…(this happens) in an era of fake news, when the virtues of traditional and trustworthy journalism are more crucial to society than ever before”.
2. More opportunity for publishers to charge for the content - Admirably, as the crisis has deepened several media companies have pulled down their paywalls and offered content for free to consumers. I have hunch this won’t go on forever if individuals become more used to social isolation in its various forms. They will think less of paying for subscriptions movies and music, and in a bizarre way the impact of the virus could indeed accelerate the take up of memberships and subscriptions as individuals become ever more accustomed to paying for the content they cherish. Maybe too from a print perspective people will not only buy magazines by subscription but actually have the time to properly consume them.
This notion was confirmed by the CEO and President of the New York Times Co, Mark Thompson, who recently said there was no adverse impact on the media company's subscription growth.
3. A dropping down of the quality barrier which might offer opportunities for entrepreneurs - Durings the 00s a number of companies, from Mashable to Gawker, grew out of the explosion of blogs. Arguably the content that they produced initially was not of the same quality as established companies, But they created it faster and it chimed with audiences who were prepared to overlook some of the more obvious editorial shortcomings.
In 2020 people are going to start to get used to consuming podcasts and video content which may lack the sophistication and polish of previous years, simply because it is either live or the producers haven't got the time or resources to maintain ultra high quality standards. Ultimately, as was the case in 2007-2010 I think people will once again forgive quality of execution if the substance of the content entices them.
4. Virtual events could be a new opportunity - Within the last few weeks several media companies have switched their conferences to online events. There are inevitably new issues to contend with. Firstly sorting out the technology. There are a bewildering variety of options for hosting video events from well established communication systems like Skype and Google GChat through to more sophisticated offerings from Zoom, Webex, Shindig and others.
Get the technology right though and at least you have a virtual event. UK media company Tortoise have been shifting their daily events online using Zoom, and it appears to be working for the company so far. The event I attended had over 100 people following an insightful Covid-19 related discussion with the protagonists in the room successfully interacting with the many people who had logged on to watch and listen.
In the US newly launched Protocol announced a series of events called Protocol Virtual Meetups, which it will host through video conference platform Zoom. They feature interviews with Protocol journalists as well as tech industry executives. And there are many other examples.
The other issue for media companies is how do you replicate the networking that is such a big part of live events and conferences? It appears there is no ideal solution, but clearly many media companies are working on how to create best practice for this.
A downside is that companies don't charge delegates the same fees for online events as they do for live ones. Conversely though the fees for hosting online events are much smaller, with limited costs for venue, staff etc.
There is also the challenge of building and maintaining an audience for virtual events.
“Covid 19 will be challenging but businesses able to truly glean insights from their audience, be creative in transforming their offering to respond to behavioural changes, to segment (slice and dice their data) to offer new ways of targeting to advertisers etc will stand in better stead,” argues John Cheney, CEO and Founder of Workbooks, a customer relationship management (CRM) and marketing automation software vendor, specialising in the media and publishing industry.
“The more a publisher is equipped with insight into their audience and sponsors, the more equipped and able they will be to be responsive and creative in substituting a revenue stream like a live event and turning it into a digital opportunity.”
In the long run it could be that by establishing online events will have created a new revenue stream which will supplement real world events when they begin to occur again. We will have to wait and see.
What of the future? “Black swan events, such as economic recessions and pandemics, change the trajectory of governments, economies and businesses—altering the course of history,” wrote Hamza Mudassir, Visiting Fellow in Strategy, Cambridge Judge Business School in a piece for Entrepreneur. He also points out that the SARS pandemic of 2002-2004 was a key factor in the meteoric growth of Alibaba. This growth was fueled by underlying anxiety around traveling and human contact, similar to what we see today with Covid-19.
Three months or three years... However long we are in the shadow of the virus one thing is for sure. Digital transformation, not just in the media but across all companies, is going to accelerate significantly.