As of the middle of this month (April, 2018), following a torrent of bad press related to what can be described — generously — as *undisciplined* security practices, the Facebook and Google so-called “duopoly” have never been more vulnerable to competition from big publishers. As a result, the time is right for the influential, legacy outfits — which have been rapidly losing advertising market share to FB and Google for more than a decade — to double-down on digital publishing strategies that have been working in recent years, and also test new ones in pursuit of reclaiming territory they’ve surrendered.
If you still need convincing that the duopoly is — at the very least — distracted these days, consider these news items coming from three of the most influential publications on the planet, over the course of just five days in April:
- A coalition of 20 consumer groups are about to file a federal complaint against YouTube/Google for violating a children’s privacy law (NY Times)
- Facebook’s CEO admitted to a “huge mistake”, and the platform may have leaked info from 87 million users (Wall Street Journal)
- A lawmaker said the scandals plaguing the social media giant might be “too big” for it to fix alone, and that he might “be in favor of regulating Facebook” (Washington Post)
These are in addition to (but not unrelated) the monstrous developments involving Russian meddling in the U.S. presidential election, with the Facebook platform at the center of the controversy. That these venerable newspapers, which lean politically both liberal and conservative – collectively influencing millions of readers around the world – are all attacking the practices of the duopoly, is in itself unusual and noteworthy.
And while it can be reasonably argued that neither Facebook nor Google have not been overtly negligent or enabling during these developments, that’s not really the point. Congressional hearings and privacy violations attract attention, and stories require good guys and bad guys, and Google and Facebook are currently labeled as the latter.
A Perfect Storm
A variety of marketplace events, occurring over many years, have lead to today’s market conditions: shifting consumer needs and demand; thinly-veiled, monopolistic corporate behavior characterized by overreach and insufficient self-governance; and unintended consequences of streamlining the advertising supply chain. To be sure, the past decade has been tumultuous. But the current state of affairs in digital advertising will not come as a surprise to industry specialists; indeed, from a certain point of view, it’s rather surprising that it’s taken this long for the internet gravy train to implode again. (The first time being around 2000, with the infamous bursting of the ‘Dotcom Bubble‘.)
Market analysts have been explaining the implications from myriad angles. Last week, on the Digital Content Next (DCN) platform [the trade organization for digital content companies, formerly known as the Online Publishers Association (OPA)], Mark Glaser warned publishers to be careful about gloating in the wake of Facebook’s troubles. In March, DCN’s president addressed Google’s “battle with transparency” when reporting its online advertising revenues. And at the beginning of the year, I offered ideas for publishers to consider in their efforts to sell more advertising to media buyers, with a particular focus on differentiating from their digital-only competitors. Yet even when accounting for the considerable attention the topic’s been given lately, few anticipated that conditions would get quite this ornery for the duopoly.
Having experienced extraordinarily challenging conditions since the late 2000s – and being in the unenviable position of reporting shrinking revenues in the face of a growing marketplace –– publishers now have a compelling talking point, a reason to reach out to customers, prospects, partners, and the press. And that’s not nothing.
To be sure, behaviors change slowly. Customers are risk-averse, and the duopoly has entered the realm of: “No one gets fired for buying ads from Google and Facebook”. They are in vogue, as is digital advertising in general. But now the duopoly is in the news for all the wrong reasons, and that translates to potential opportunities for everyone else (if only temporarily). Media buyers are obligated to pick their heads up from Google and Facebook dashboards and assess alternatives.
If Not Now, When?
Last year, and for the first time, companies spent more on digital advertising than TV spots. We all saw this coming, but it actually happened last year, and it signaled an official changing-of-the-guard in the industry. Most professional prognosticators believe digital ad spending will continue to grow for the foreseeable future, to eventually capture 40% or more of the overall marketplace. Gold rush conditions are behind us, but opportunities remain abound.
Publishers certainly continue to face meaningful growth challenges. However, it’s difficult to imagine conditions being more fertile than today for building market share. The time is right for making aggressive moves.
Tim Bourgeois is a director at East Coast Catalyst, a Boston-based advisory firm specializing in digital strategy consulting, and has worked with The Boston Globe, Glide Magazine, and Wonderlust Travel.
This article was originally posted on InContext, which is published by Digital Content Next—the only trade organization dedicated to serving the unique and diverse needs of high-quality digital content companies that manage trusted, direct relationships with consumers and marketers. Follow Digital Content Next (DCN) @DCNorg and subscribe to their email newsletter.
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