24 June 2005

ChasNote Has a New Address

Well, I should have guessed it would lead to this.

About a year ago I started ChasNote as an excuse to talk to all of you about trends and innovations in online marketing. And, through these conversations, I've convinced myself--or maybe it's your fault!--that I need to move out to the front lines.

I am leaving CNET Networks to join John Battelle's "record label for bloggers," FM Publishing (FM Pub's blog), as VP of sales and market development, starting July 11. It's been a very tough week saying goodbye to the innovators, trend-setters and good friends among whom I've worked here at CNET for the past six years. But I'll tell you what I've been telling them--why my heart and soul required me to enlist with FM Publishing.

A few thousand, maybe a hundred thousand, of the 10 million bloggers are doing something remarkable. In today's media-saturated, viewing-multiple-channels-at-once climate, they have grabbed the undivided attention of an audience. For all the talk of "audience engagement" by Big Media, it's a handful of moonlight publishers who have actually pulled it off. They've created intimacy, authority and real live dialog with their readers. While three-fourths of PVR users skip commercials and everyone else has learned to tune them out, certain bloggers have convinced their constituencies to tune in.

Two big challenges remain, though. First, most of these bloggers haven't figured out how to quit their day-jobs and pay rent at the same time. Second, marketers--who are willing to kick in rent money for the opportunity to participate in this high-energy connection between blog publishers and their audiences--don't have a scalable mechanism for doing so.

I won't pretend that I know exactly how these issues will resolve, but I'm signing up--by way of FM Publishing--to work on the solution full-time.

21 June 2005

Wall Street Journal's Prolonged Slump

In September the Wall Street Journal will launch Weekend Edition, a Saturday version of its daily paper. According to rival NY Times (reg required), "The goal is to attract a more diverse base of advertising to pull The Journal out of its prolonged slump."

The chart that accompanies the article, with data from JP Morgan, shows that The Journal's print-advertising revenue for the most recent fifteen fiscal quarters is still below levels set back in pre-bubble 1998. Goldman Sachs analyst Peter Appert wonders "if the decision to pursue the Saturday edition isn't a tacit acknowledgement that their core franchise is challenged, that the base business is less attractive than it used to be." Mike Neiss, SVP and managing director at Universal McCann, is more direct: "this is an experiment in recycling." And even with average daily circulation down 2.3% from last year, to 1,750,400, that's a lot of recycling.

In the meantime, Dow Jones has signed up 320,000 paid subscribers to and spent $538 million to expand their online presence with the acquisition of MarketWatch--two strong indicators that the gang at The Journal isn't oblivious to the changing patterns in news readership.

So I'm baffled by their renewed investment in print. Given declining circulation, revenue and relevance for traditional newspapers--even for titanic brands like The Journal--Weekend Edition strikes me as a harebrained idea. But with an estimated net operating loss of only $12.5 million this year (it launches September 17), the optimists among you may argue that at least it's an inexpensive mistake.

(All quotes above were lifted directly from the NY Times article.)

18 June 2005

Product-Placement Clutter & Jon Fine's New Column

Jon Fine's MediaCentric column made its debut (reg required) in the June 27, 2005, edition of BusinessWeek. The kick-off debate: With ad pages down and showing no sign of recovery--every year this decade magazines have sold fewer total ad pages than they did in 1998, 1999 or 2000--is product-placement in magazines inevitable?

Several online news sites, including the New York Post and, ran short-lived experiments with Vibrant Media's IntelliTXT ad links embedded in their editorial stories. It's obvious to me that product placement within news will meet reader resistance that is unlike the blase acceptance of ads snuck into movies, sit-coms or reality TV (ChasNote, 8/30/04 post). Fine agrees: "The Contender is not 60 Minutes, [and] Inside TV is not The New Yorker." Outside the marketing offices of the big auto and CPG brands, I bet we'd be hard pressed to find anyone who thinks product placement in news programming is a good idea. Pretty safe terrain for MediaCentric, Column Number One.

But his closing thought, though, is especially interesting. Fine reports that Viacom's Les Moonves promises growing ubiquity for product placement throughout television programming, CBS and otherwise. "The irony, of course, is that this practice arose so advertisers could break through a cluttered media environment. But mushrooming product placements will soon create lots of clutter on their own."

Given that consumers are bombarded with thousands of ad impressions every day, what are the odds one more impression--embedded or not--will catch their attention? Forget about sneaky tricks to get your brand in front of unsuspecting consumers; figure out how to engage the willing ones instead.

10 June 2005

RSS: Is There Money in Text Ads?'s Matt McAlister (his blog) looks back on the first 2 years of ad insertion in RSS feeds. So far the click-through rates are high, and early experiments with graphical ads seem promising. We can bank on this: If RSS usage can achieve critical mass and those users don't rebel against graphical units, real ad dollars will follow.

McAlister's take on the current state of RSS text ads, though, is pessimistic:

"...when you're able to serve branding campaigns, custom sponsorships, lead generation programs and rich media at high volume levels [at your website], you're never going to do more than offer an incremental revenue source to your publishing business with little text ads in your feeds. We're hopeful that this new [graphical] format is going to be good for people who want our content and for advertisers who want to connect with those readers."

I don't agree. "Little text ads"--as long as those links are served to enough readers, as Google's AdSense and Yahoo's Overture have accomplished-- can stir up a pretty good business in their own right.

08 June 2005

Killing the Myth of the "General Interest" Reader

Fast Company editor-in-chief and blogger John A. Byrne took offense (or was it defensiveness?) to David Carr’s column in the 5/30/05 edition of the NY Times.

David Carr: "When the Meredith Corporation announced its purchase of Gruner & Jahr's women's magazines last Tuesday, Meredith said that Gruner's business magazines, Fast Company and Inc., were not 'material' to the sale. What that means is that two magazines that sold for more than half a billion dollars four years ago now have a value of zero" (NY Times, reg required).

John A. Byrne: "The reason it's not material is because Meredith intends to make as much or more selling us than it has agreed to pay G&J for Fast Company and Inc. These are two very valuable national magazine brands being sold at the worst time for G&J but the best time for any smart buyer. Smart investors, after all, buy low and sell high" (Fast Company's blog).

But the big story isn’t Fast Company, it’s that the Big Three business books—Business Week, Fortune and Forbes—appear to be in decline. According to Media Industry Newsletter, the three magazines collectively sold around 10,000 ad pages in 2004. Of course that's way off from the go-go days of 2000, when they sold 18,300 pages. But to think it's below the 11,500 pages sold in 1995! Eek.

According to Carr, the migration of audiences and ad dollars to the Internet is part of the explanation (agreed!). The other half of his explanation, though, is that "there is no longer general interest in business."

Hold on a second.

Advertising spends are a trailing indicator, meaning that audiences migrate well before ad buyers shift budgets. Think back to cable TV in the 1990s: viewers spent half their TV time watching cable programs years before cable's ad revenues reached parity with the broadcast networks. So Carr should be citing audience data, not ad spending reports, if he’s going to make a claim like that.

According to MRI data, the aggregate readership for the Big Three business books in 1995 was 10,746,000 (MRI 1995). Last year—combining data from MRI (9,567,000 average-issue print readership) and Nielsen NetRatings (7,591,000 unique online visitors), minus the estimated 14.3% print-online readership overlap (IQ CIMS Business Online Behavior Study 2004)—the aggregate readership for the three brands had grown to 14,704,000. So business-publication readers didn't die off with the 20th century. They're just starting to move online to get their business information.

Why? Efficiency. Even the simplest website version of a print publication makes finding the key stories—those that are relevant to each discrete reader—vastly easier. Online, wealthy investors and can track their portfolios and sectors without flipping to the back of BusinessWeek or waiting for Fortune’s year-end Guide to Investing special issue; business executives can read the news that pertains to their industry without paging through irrelevant coverage; and the CFO can get a whitepaper from SAP without mailing in a postcard that he or she plucked off a print ad.

In effect, readers are using the web to create their own niche publications, their own business-information tools. It's worth noting the online success of stand-alone niche business publications like CNET's (same parent company as ChasNote), which reached 1,825,000 monthly uniques in April 2005 (Nielsen NetRatings) versus PC Week's 902,000 average-issue readership in 1995 (IQ CIMS Business V.2).

So perhaps David Carr hasn't spotted a new trend, this death of the general-interest business publication reader. The Internet has just pulled back the curtain on readership patterns to show that selective reading—cherry-picking relevant content by flipping through a general-interest publication—has been going on all along.

03 June 2005

Video ChasNote: Micro-Targeting

Here I am "at the whiteboard" discussing the risks of over-zealous targeting (ZDNet video whiteboard).

My earlier post on the topic, Micro-Targeting's Hidden Costs.