Brands are becoming media, fixing the broken business model for online journalism

While the media is still trying to figure out better business models and monetization to enable them to produce content, brands have figured out how to use content to sell better their products and services.


Traditional media jumped into the high-speed tech innovation train. They made all their content available online, but kept the same monetization models: brands pay for ads seen by the content-consumers (ads that interrupt and are more and more ignored) OR people pay to access the content (though in online that does not work out so well) OR employers pay for job ads. In time, media struggled to fix their business models for the digital side. They came up with all sorts of tweaks. But they still didn’t find the Holy Grail.

Linsey Fryatt, former Editor-in-Chief at VentureVillage and current MD at ClarityPR Berlin, pulled the alarm in a very good article starting with: “these are uncertain times for online journalism and its business model”.

For example, The Kernel – probably Europe’s most controversial tech blog – was shut down in March 2013 due to a lack of proper business model and funding. “Regrettably, we ran out of money.” said its founder, Milo. In June 2013 it came back to life, backed by Axel Springer, one of the largest multimedia companies in Europe.

“Axel Springer seems to have grasped what smaller media start-ups have known for some time: that the only thing consumers will pay for is focused, high-quality content – normally comment and analysis – professionally produced and attractively presented. All else is noise, commercially speaking.”, whiteboard quoted from Milo.

Still, not so many will pay for content on a media website, no matter how high-quality it is. But they do tend to pay for products and services that they need.

As a matter of fact, Axel Springer got that too. “2012 was the first year that Axel Springer derived more revenue from its digital properties than from its national newspapers – and those print publications are not the least (Springer’s tabloid Bild, still printed on 3 million copies, can move public opinion all by itself).” said Raf from whiteboard. And they continued to grow their digital revenues. But where do those come from? Mainly from their investments/ acquisitions of classifieds (like Stepstone, a job board, and SeLoger and Immoweb, real estate listings), marketing tools (like Zanox and Idealo) and so on. As you can see: products and services, not content.

Meanwhile, most of the media companies fail at improving their business models for better monetization in the digital age.


Brands on the other hand were used to spend money on ads in the media, plus flyers and catalogs. “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” said John Wanamaker, the first retailer to place a half-page newspaper ad and the first full-page ad, in the 19th century.

But once brands moved into the digital arena, and once they started to track precisely the ROI for each channel and campaign, they realized that creating their own content is bound to bring results. Hence, they jumped into blogging, social media, video channels etc. and counted happily the growing number of readers/ visitors, followers, likes, and email subscriptions. They started building communities for their brands, luring them with content related to the products and services they sell.

And since in the past 2 years we produced more data than in all the previous time in human kind history, the battle for quality content started in order to stand out. Google also pushed in this direction with its SEO rule changes, forcing marketeers to produce better quality content for better results.

Many brands succeeded to build amazing blogs and write guest posts that drove traffic, and that turned traffic into customers. And of course, it all paid off as they were selling their products to the readers.

“We said: can this post get us at least 100 visitors? If yes, that means two paying users (we have a 2 percent conversion rate) and we have a LTV of $220/user. One article takes around 1-2 hours, so we get around $450 per post. That sounded like a good calculation and has worked very well for us.” said Leo from BufferApp in an interview.

My RSS is packed with brand blogs because they are highly informative on specific topics I care about and they are not only self-promotion. Some of my favorites:

And as it seems, more and more brands want to invest in Content Marketing in the future: 71% of marketeers will increase their Content Marketing budgets for 2014.


And this opens the door for better opportunities for those who create quality content too. They are migrating from media journalists to brands, as companies are encouraged to hire journalists for marketing positions in an era when content is king.

I have been myself in the past years in between choosing a journalism life joining a media company, or playing the marketing cards for brands. I love to write, but as it turns out, journalism doesn’t pay that well. Nor it gives much space for career development. But Content Marketing opened the door to a whole new world. Journalism (metamorphosed into Content Marketing) is now a key in-house asset for every brand. And they can pay much better – simply because they afford and it pays off, as they manage to monetize well, turning part of the readers into customers of their products and services.

Will be interesting to observe how this will evolve though.

What is your take on the topic?