When social media becomes the digital strategy for news publishers
The rise of mobile and social networking have been forcing news media publishers to re-imagine and re-invent their business. Facebook and other digital platforms have posed both opportunities and threats. While there is no single recipe for success, there are strategies that work.
With 1.7 billion active monthly users worldwide, Facebook has become the biggest newspaper, or the largest news source. 44% of people across 26 countries surveyed by the Reuters Institute for the Study of Journalism at Oxford University say they use it for news.¹
Combined, Facebook-owned platforms — that include Instagram, Messenger and WhatsApp — reach 86% of Internet users aged 16 to 64 in 33 countries surveyed by GlobalWebIndex.²
Social networking has dominated time spent online: on average users interact with Facebook and other platforms for 1 hour 51 minutes daily. In some countries they spend even more time, in Brazil social networking takes 3 hours 37 minutes and beats TV viewing by an hour a day.
While Facebook has become last year the primary driver of digital traffic for publishers, it has also become their competitor for advertising revenue. In 2015, Google and Facebook claimed 64% of the richest U.S. digital advertising market worth US$ 59.6 billion, according to Internet Advertising Bureau. In the first quarter of 2016, 85 cents of every new dollar spent on digital went to the two companies.³
The seismic shifts in consumer behaviour and advertising landscape have brought another wave of disruption to news media and their digital transformation strategies.
The Guardian in the United Kingdom, one of the finest digital newspapers out there, has vigorously expanded globally in recent years betting it would be able to monetise the reach with advertising. The strategy though has failed to deliver revenue. The former editor Alan Rusbridger said The Guardian’s prediction never materialised “because it all went to Facebook.”⁴
Evaluating distributed content strategies
News executives across the world struggle with answers to question whether Facebook is a friend, or an enemy, or maybe both.
I was struggling too as a news editor and a head of new product development at Gazeta Wyborcza, Poland’s leading newspaper, until 2015. Since last year I have been investigating the rise of platforms and their impact on media industries at Harvard University in the U.S., firstly as a Nieman fellow, and now as a research associate at Harvard Business School. I published two reports on the subject with the International News Media Association; the most recent one focused on the complicated relationship between Facebook and the media.⁵
Studying news brands worldwide, I have developed an original framework of three generic strategies towards social platforms differentiated by objectives of the companies and their digital business model:
1. Omni-channel strategy prioritises aggressive growth of content consumption by distributing publishers’ content beyond its own properties.
This might be a viable strategy for publishers that don’t really need to monetise digital traffic with advertising, e.g. public or state-owned broadcasters funded by licence fees, taxes or donations like BBC or Al-Jazeera; non-profit organisations engaging the public with news content like Greenpeace, an environmental campaigner and educator; or brands building private newsrooms like Red Bull, an energy drink brand and a leading sports and culture news provider based in Austria.⁶
This strategy may work also for publishers that see great opportunities in scaling beyond their home audiences, e.g. the ones chasing young and/or global audiences. Some of these publishers don’t need to monetise the traffic in the short term because they make most of their money elsewhere, as for example CNN does in cable TV. Many digital native players are enjoying access to cheap, external capital that is funding their growth, e.g. BuzzFeed or Vice, news brands targeting millennials; their end game might be just to scale as much as possible, and sell the company one day.
Publishers that have built sizeable e-commerce businesses like classified sites might be aggressive in content distribution too because they basically use news to aggregate traffic and then funnel it to their marketplaces.
2. Relationship strategy prioritises control of customer base over growth.
There are plenty of publishers that wish to guard a direct relationship with their users, want to collect data beyond the scraps that platforms share, or charge for content — therefore treating platforms mainly as content marketing channels.
There are publishers like The New York Times or The Wall Street Journal that have built great subscription businesses and don’t want to spoil this revenue by giving away content. They may wish to engage with platforms but will be very strategic about how much content they share, or whom they target. They might focus on converting social visitors into subscribers rather than on collecting “likes”.
There are publishers that don’t see big opportunities in expanding their reach, e.g. niche or local brands that have already reached more people in their communities than platforms have, and brands that have maintained healthy direct traffic. Publishers like Austrian Russmedia, owner of VOL.at, focus on super-serving their audience, online and offline, and they use platforms for networking or social journalism but not so much for content distribution.⁷
3. Digital laboratory is a stand-by option for publishers who haven’t set yet a clear digital strategy’s end game and have embraced an idea to learn through experimentation.
These publishers may wish to keep their core business intact, so they engage in small-scale tests, e.g. publish a few Facebook Instant Articles to track effects on engagement or check whether Facebook Audience Network delivers better CPMs that they can get on their mobile sites. Publishers may also choose to launch new brands to learn and grasp opportunities in expanded reach or other platforms’ capabilities, as Poland’s Agora has done with their fast-growing social channel for foodies called Haps (English: Bite).
Obviously, publishers may mix these strategies, or may adopt different strategies for individual brands.
Investigating Facebook’s algorithms
Surveying news publishers worldwide for the INMA report, I found that many of them think of Facebook primarily as a distribution channel for content and a source of cheap referral traffic that they monetise with advertising on their own properties like Web sites or apps.
Publishers usually focus on building organic, or free reach and spend most of their social media budgets on channel curation, re-purposing content for different platforms and — some at least — create original content dedicated to platforms and published natively, e.g. Live video.
Their success heavily depends on platforms’ algorithms and therefore any change, like the one announced by Facebook in June prioritising private content over publishers’ in its News Feed, raises blood pressure in newsrooms from New York to Berlin to Delhi.
I have investigated Facebook’s patent applications to understand better how its mysterious algorithms had been designed.⁸
The network has been designed to facilitate private interactions between users, and has always prioritised their private content.
- The June change has just reflected the fast-rising flood of content from brands and digital publishers in people’s News Feeds, and tried to improve visibility of users’ friends and family content and increase revenue by selling paid passes, or Post boosts. (Pro tip: content overload is shrinking organic reach on Facebook, and is pushing brands and publishers to pay for distribution. The more Page owners will start paying, the more price will increase, as in auctions. Opportunity for the cheaper paid reach is now.)
- Interestingly, within Facebook architecture content is not a destination, it’s a connection between people. So it has a value only if it is part of somebody’s conversation. (Pro tip: a publisher’s story shared by users may get higher score from Facebook than the same story shared by the publisher on its Page. Those wishing to grow their organic reach may benefit from making sharing a natural, frictionless and encouraged activity on its Web site or app, instead of just pushing content to their fans.)
- The News Feed algorithms are clearly optimised for engagement. When Facebook ranks stories, it calculates the probability of a user interacting with a story, like sharing it. Various psychological studies show that sharing online is triggered by people’s deep socialisation needs and emotions. Content on a network is not something users just consume, as when they access the news Web site; content is rather a form of expression of their identity and emotions. (Pro tip: Content that might do well on a Web site or an app may not perform well on social platforms. Publishers who mindfully choose and create original content for platform distribution, designed for sharing, may improve the performance.)
How to grasp opportunities on Facebook
There is plenty of risks associated with business dealings with digital platforms, and constantly changing algorithms is just one of them:
- Platforms set rules of their ecosystems and exercise their powers as they wish (e.g. Facebook censored pictures posted by Norwegian Aftenposten newspaper and the country’s prime minister Erna Solberg, as its algorithms recognised nudity but failed to understand the context — the horrors of the Vietnam War).⁹
- Platforms introduce new products or features and lure partners to adopt them until they change their minds and abandon these products unilaterally (e.g., Facebook persuaded publishers to invest in timeline news apps in 2011 and then killed the project in 2012).
- Platforms pick winners and break them as they wish (e.g., Zynga, a social game maker, had become Facebook’s top developer and business partner in 2010 but it lost the partnership by 2012).¹⁰
These are all serious threats. Sometimes though publishers forget about opportunities that Facebook and other platforms pose. Especially, those publishers that focus on interacting with their Page fans and getting referral traffic may miss other use cases or tools provided by the platform.
Facebook may be a catalyst of digital transformation of the whole publishing house:
- editorial processes (e.g., social journalism, newsroom analytics),
- storytelling (e.g., native Video, Live streams, 360’ video interactive features and future Virtual Reality platform, bots on Messenger and rumoured future B2C communication tools on WhatsApp),
- content marketing (e.g., targeted posts using Facebook’s profiles, Custom and Lookalike Audiences),
- e-commerce (e.g., sign-up tools for newsletters and other e-commerce tools like “Shop now” buttons, mobile app ads and event tools),
- and advertising (e.g., programmatic ads via Facebook Audience Network, boosting native ad campaigns with Branded Content).
Managing the publisher’s relationship with platforms can’t be a domain of “our young social media editor” anymore, as it is still the case in many newsrooms. It can’t be a newsroom business only anymore either — promotion, e-commerce, advertising opportunities need to be evaluated and negotiated by staffers responsible for these areas.
Many publishers — as diverse as Vox, the digital native news player, or Conde Nast, a magazine conglomerate — appoint platform partnerships managers who can initiate and manage contacts of their publishers with Facebook, Twitter, and others. These new managers advocate on behalf of their brands to get access to information, better service and maybe deals like the one enjoyed by nearly 140 publishers and creators who are paid by Facebook to produce Live video.¹¹
Platform partnership managers work with the publisher’s product, editorial, and revenue teams on strategy direction, coordination, and integration.
From newsrooms to board rooms
For a growing part of the news audience, platforms have become the Internet. And social media strategy is becoming the digital strategy.
Facebook outperforms publishers in all major activities that previously created or captured value in the industry — from aggregation to distribution and advertising sales — pushing publishers into the sole role of content producers.
Consequences of decisions taken today — for example: whether to adopt Facebook Instant Articles and how — may actually shape the company’s digital future. And monetisation deals publishers negotiate with platforms determine the business model of news media.
Discussions on business with social platforms need to leave newsrooms and reach board rooms of news media companies. Mathias Döpfner, chief executive of German publisher Axel Springer, warned recently:
“If there is not a real, sufficient and big business model on the search-driven side… and there is no business model at all on the social [media] side, the number of content producers will deteriorate fast.”¹²
If the future of news distribution is digital, the strategic questions are: What role do publishers want to play in the value chain of news? And what role can publishers play in the value chain? Just creators, aggregators of content and audiences, or distributors? What unique value do publishers really add today? What’s their competitive advantage versus global platforms?
About the author:
Grzegorz Piechota is a research associate at Harvard Business School in the United States, and a former news editor of Poland’s Gazeta Wyborcza. He can be reached at @g_piechota and firstname.lastname@example.org. He blogs at the INMA Web site.
Send questions to Grzegorz Piechota on his latest report on Facebook
The Facebook-Media Relationship Status: It’s Complicated is a report that explains how Facebook’s algorithms work, surveys publishers about their relationship with Facebook, and explores strategies to use Facebook to engage readers and generate advertising revenue.
Send your questions for Harvard Business School researcher Grzegorz Piechota, to @geninnovate on Twitter.
Emily Bell—Columbia University
“The mobile advertising market is already effectively owned by Facebook, so with the stick of adblocking and the carrot of instant articles publishers are finding themselves surrendering what were previously the most important parts of their businesses.” (The Guardian, 21 February 2016)
Meredith Artley — CNN
“Yes, there are these algorithms on Facebook and all the other players. We don’t control them. But we control what stories we do, how we do them and we control where and when we publish them.” (GEN Summit, 16 June 2016)
Janice Suter—GSD&M Ad Agency
“With Facebook you don’t really own the space. You rent. You’re at the mercy of the changes, the algorithm.” (Mashable, 26 September 2016)
Alan Rusbridger—Oxford University
“They [Facebook] are taking all the money. They have algorithms we don’t understand, which are a filter between what we do and how people receive it.” (The Financial Times, 5 September 2016)
Nilay Patel—The Verge
“The future of the media is almost entirely dominated by the dynamics of mobile platforms.” (The Verge, 3 October 2016)