Once a startup strategy, it’s become a cynical punchline among publishers in recent months: Dissatisfied with your audience engagement and revenue? Just fire a chunk of your existing digital staff and “pivot to video.”
The tired joke traces its origins to last summer, which saw a wave of digital media companies laying off writers and other editorial staffers to invest in their video operations. Following an early example established by Mashable in April 2016, MTV News, Fox Sports, Vocativ, Vice, and Mic all dramatically shifted their resources to pursue higher advertising CPMs and broader viewerships in the span of three months.
The herd mentality inspired skepticism among observers, launching derisive think pieces with grim headlines like “Why 2017 Feels Like a Media Apocalypse” and “Let’s call ‘pivot to video’ what it really is: Desperation.”
Critics pointed to declining traffic numbers among pivoters and Mashable’s hasty retreat from its sizable video ambitions after its acquisition in December as indicators of video’s failure.
But the medium’s true value remains in development, some publishers and experts say. Video isn’t the panacea to all of publishing’s woes as acolytes cracked it up to be. Still, is it too early to call it a placebo?
Publishers shouldn’t take the failures of 2017’s great video pivot to heart.
The fortunes (and misfortunes) of venture capital-funded digital media startups like Mashable and Mic shouldn’t speak for the publishing industry as a whole, says Brian Wieser, a senior analyst at Pivotal Research.
“The plan was always and always will be for venture-funded companies that you get an exit. An acquisition, public offering or recapitalization via private equity,” explains Wieser, who covers all things advertising for his Wall Street investment research firm.
Running low on funding, with investors seeking returns on their capital, Mashable chose option A. The online news site founded by Pete Cashmore in 2005 sold itself for a fire-sale price of $50 million to Ziff Davis, a 90-year-old publisher known for its technology-focused titles, at the end of 2017. That sum amounted to less than a quarter of the company’s estimated value the previous year, when it closed a $15 million round of funding from Time Warner’s Turner unit.
“There was way too much hubris and hype,” as well as “willful optimism,” Wieser says of Mashable’s trajectory prior to its sale. “You shouldn’t necessarily believe [digital media executives] when they talk their businesses up.”
Precipitous dips in page views at news outlets that tracked Mashable’s pivoting example (most saw a 60 percent drop in traffic in August 2017 compared to the same period from a year ago, according to an analysis by Digiday) forecasted doom for its new video strategy.
Publishers like Mic, however, argue that website traffic isn’t a germane yardstick for their reach. That’s because their objective isn’t to draw viewers onto their own websites, but to engage them on platforms like Facebook, Google and Snapchat via video distribution. (The web traffic tracker comScore has acknowledged it doesn’t measure viewership on Facebook.)
Beyond short-form, social video
The problem for publishers—as one-time Mashable business editor Heidi Moore underlined in a recent essay for the Columbia Journalism Review—is that social platforms aren’t the most reliable of partners. They’re actually rivals for advertising money, with Facebook and Google raking in a combined 63.1 percent of digital ad investment in 2017, according to an eMarketer forecast published in September.
Distribution platforms are also notoriously opaque about their metrics and algorithms for social feeds, so when Facebook announced in January plans to rebuild its news feed in a way that would prioritize private posts from friends and family and show less public content, including videos posted by the media, it gave publishers an unpleasant start.
“As we make these updates, Pages may see their reach, video watch time and referral traffic decrease,” warned Facebook’s News Feed chief Adam Mosseri in a blog post.
Dawn Ostroff, president of Condé Nast Entertainment, the publishing giant’s in-house production and distribution studio founded in 2011, says she remains hopeful that “monetization opportunities will become clearer” as referral traffic stabilizes once again, and that her company will remain a part of Facebook’s “business ecosystem.”
The past year has been good to CNE’s digital video division, which saw a year-over-year increase of 263 percent in views on Facebook, the company says. Altogether, the studio’s content across a digital network of nearly 60 partners and about 2,300 websites logged a record-setting 11.8 billion views, a 161 percent bump from 2016, according to in-house metrics.
But Ostroff’s operation—profitable for the last two years, Condé Nast says—has other irons in the fire, too.
“We’re very, very prolific in terms of the types of projects we do,” the former TV network executive notes.
CNE has distributed three feature films based on Condé Nast articles, with one more slated for release in 2018, three targeted for production, and 35 more in development. It sold or renewed eight of its unscripted TV series (including a comical GQ digital short called “Most Expensivest” with 2 Chainz) and closed deals with broadcast networks for five scripts in 2017.
Ostroff would not disclose revenue numbers for CNE’s motion picture and television units, but pointed to the sheer number of projects as a sign of success.
Bolstering her statement is the fact that Condé Nast isn’t the only publisher pitching and selling long-form video content. In January, Vox Media’s nearly three-year-old entertainment division locked down an eight-part docu-series about the aftermath of the Flint water crisis and another multi-part explanatory-style series with Netflix in January. BuzzFeed Motion Pictures, launched in 2014, also has a few film and TV projects based on its reporters’ work in development.
Far from video’s final inning
Not every publisher has ambitions that grand. At trade publisher ALM Media’s offices, video is seen as a “value-add product that deepens the impact of a [written] article or Q&A,” chief content officer Molly Miller says. “Videos are crafted to tell the story visually.”
With a foundation in print products like periodicals, books and newsletters, ALM began its transition to a digital-first mindset in 2016, and the company — which offers professionals insight into the legal, financial services, property and casualty insurance, benefits, consulting and real estate sectors — has modest expectations for how its videos will perform. Asked about views across digital brands in 2017 compared to years past, Miller declined to share exact numbers, but described the general trend as “certainly increasing.”
“We are in our infancy still and expect to spend more time experimenting with video in the next several months,” she adds, noting that some ALM brands (like the claims adjusters-focused title PropertyCasualty360) lend themselves better to visual content than others.
Miller recommends that same lean, experimental mindset to other print-heavy publishers: “Be prepared to kill many ideas as you test and learn.”
Ostroff agrees that agility and open-mindedness are key. CNE’s five-year-old digital video division often runs “three or four episodes of a concept before we can tell if it’s really worthy of being its own franchise,” she says.
One instant success, a pilot called “Lie Detector” that featured actress Jennifer Lawrence answering questions like whether she’s a good tipper while attached to a polygraph machine, racked at least 4 million views within 48 hours. That happens on a “fairly regular basis,” according to Ostroff, “but you just never know when they’re going to hit and where they’re coming from.”
Although much about video remains an enigma, her advice to companies still debating a venture into murky waters is to weigh for their own business portfolios the benefits—reaching younger audiences, for example—versus the hefty costs and complications. Pivotal Research analyst Wieser, who expects to see incremental growth in video ad units and video content in the near future, advocates that newbies consider not just video content but events as an ancillary revenue stream.
“I think that one thing we’re fairly clear on,” Ostroff says of video, “is that it’s a business that’s going to be here for the long-term.”