Google search put many content producers out of business by systematically giving away their content for free, but this model isn’t sustainable and will shift back to a paid model in many content categories. For example, journalists can’t make money reporting the news anymore because it is so easy to find it for free through Google’s search tool. The crux of the problem with free content is that the quality and the value it offers is often severely hindered because the producers need to focus their efforts on what is bringing money in. Content has become a commodity meaning that many people don’t care who provides it or where it comes from. This mindset has caused both producers and consumers to believe that content in and of itself can’t be charged for because there are so many people who offer something similar for free. Why pay if you don’t have to. As a result, people now expect content to be free.
This expectation of free content combined with the declining effectiveness of disruptive, hard-sell advertising, has born a new, highly effective model called Inbound Marketing. It is based on giving away free content to build a relationship that will eventually turn into a sale. For example, an individual doing research on an upcoming vacation to New York may find a blog article about tourist sites to see written by a travel suitcase retailer. That article can build a trusted relationship between the customer and the company and by giving away value for free, increase the likelihood that traveler will trust and then buy a suitcase from them. This has proved to be extremely effective for many businesses, but publishers just focused on content production can’t take this approach because they don’t have a related product, service or software to sell. They can either develop one of these to sell or change the content they produce to something people want to buy.
Publishers must change their focus to deliver high quality and highly relevant content before they can effectively monetize it. Apple has taken the opposite approach that Google has and it seems to be much more effective and sustainable. They sell very high quality, copyrighted, highly relevant, professionally produced content for a nominal charge. iTunes serves as a great example. Professional musicians can continue to be professional musicians focusing on developing the best music they can full-time because of iTunes. If Napster’s give it all away for free model were dominant, musicians would slowly migrate to other forms of work and only produce relatively marginal music as a hobby. The demand for good music will keep people buying it. The same concept applies to the app world. A traveler to New York City can read tons of free blog posts about what to see, but the $3.00 app is much more detailed, accurate, updated and better overall because the producer is no longer producing as a part-time hobbyist but as a full-time professional.
Newspapers are in the midst of the same battle and are struggling to compete with free sources offering the same or an even better product. Their value proposition has historically been to serve as one of the very few sources bringing the people news and facts. This need can now be met by blogs, and online niche publications that can offer much more relevance and don’t charge anything for it. The reason many newspapers are struggling to be able to charge for their product is that they don’t offer as much value as the free sources do.
If you truly offer value, you won’t have any trouble getting people to pay for it. The user experience drives everything. Are they delighted and eager to share after reading, watching, or listening to what you have to offer? Giving away content that isn’t worth consuming doesn’t offer value to the user just because it’s free. All that being said, the first step to monetizing is to build a consistent reputation for providing value.
The key indicator of this trend is that people have voted with their dollars and behavior what they prefer and Apple’s approach has won out. Well over 15 billion apps have now been downloaded. There are many niche blogs or publications that produce a very relevant, high quality product and can charge a mint for it. This is not the only approach. Inbound marketing along with other a few other approaches will continue to be hugely successful if done correctly, but the pendulum for publishers and many areas of content will begin to swing back to a user paid model. After all, you get what you pay for.
Listen to me speak on 7 Social Media Trends on November 27th in San Diego.