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Pete Sheinbaum

Insure Your Content

Pete Sheinbaum emedia and Technology - 08/01/2013-13:52 PM

 

You buy a home and you get insurance to protect it. You buy a car and immediately sign up for insurance coverage. But, how many web publishers are insuring their content, which is their most important asset? The stark truth is none, or at least very few.
 
I’m not referring to insurance that protects media companies from hackers stealing their information or people re-using content on their own websites without permission. Rather, I’m talking about publishers making sure they’re not losing money on every page view and that they’re getting the most out of every site visit.
 
I’ve heard Steve Horowitz, COO of Ziff Davis, liken visitors coming to websites as a game of “Plinko for publishers.” Users come in, bounce around and fall into a slot. If the chip falls correctly, they land in the $100 slot, but, more often than not, it’s the $1 slot. It’s a complete game of chance. And this is a very risky game, now more than ever, as publishers and marketers find themselves shifting more of their budget from SEO to traffic acquisition.
 
Risky why? SEO has helped publishers yield readership for more than a decade. The rule was you spend a $1 on SEO, and you could predict the return. The recent changes in search algorithms (e.g., Panda and Penguin 2.0) have turned this upside down for publishers, effectively shaking this very predictable model to its core. Enter content marketing and other direct traffic-acquisition models. While these new techniques are a more stable and predictable way for publishers to spend money on readership acquisition, they’re also producing smaller margins.
 
To succeed in the Plinko analogy, publishers need to do their due diligence before acquiring readers and bringing them to the site to ensure they’ll remain engaged once they get there. This includes optimizing them for engagement, and instituting a process to funnel visitors to their most valuable pages and sections. Without this forethought, they can quickly find themselves with a bleeding budget.  
Here’s an example: A publisher named someawesomesite.com gets traffic on their site organically. They make a $20 RPM from ads or other monetization strategies, which equates to 2 cents per page view. Each visitor spends about three pages per visit (PPV), which puts 6 cents into the publisher’s pocket. If it costs them 4 cents to build their content and keep their site running, their profit is 2 cents or a 33 percent margin. Not bad.
 
But, if they are also buying some of their traffic, then this formula could quickly go sideways into the gutter of unprofitability. Think about this—6 cents in revenue, 4 cents in cost, and now 4 cents to purchase a visit? They just instituted a program that could cause them lose 2 cents on every visit. Ouch. This is actually a common occurrence within larger companies that have disparate teams responsible for purchasing traffic, operating the site and selling ad unit space.
 
So what about this insurance idea? How can publishers safeguard against losing money when rolling out their traffic-acquisition strategy? First and foremost, before any publisher decides to launch a traffic-acquisition program, they need to take a hard look at their website and figure out how to squeeze every ounce of engagement they can out of each visit. A/B testing must be employed to peer into the effectiveness of changes made to page architectures and layout, in addition to analyzing which content performs better than others. Are visitors drawn to video, slideshows or text articles with photos? What are they inclined to touch or click on to go deeper? Are in-content text links, interstitial or sidebar units effectively guiding readers to other high-quality pages? It must be balanced to ensure you’re upholding a premium reader experience, yet tested to determine the best efficacy with the audience itself. Rinse and repeat when the analytical tealeaves show their pattern.
 
By optimizing their websites, publishers can ensure that their marketing dollars are stretched to the limit. The math starts getting better too. If our publisher someawesomesite.com can increase each user visit from three page views to four, the 2-cent loss they were seeing now turns to break even. And, if they can stretch this to 4.5 or five pages per visit (not impossible), they are back in the black.
 
Traffic acquisition should be one of several techniques to increase awareness of a publisher’s website and generate page views. However, it’s exceedingly important that publishers and marketers take the time to optimize their websites before they acquire traffic or they risk quickly losing money on every visit. In essence, insuring their content to protect their profits.

 

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