However, recent successes of digital media have allowed for a renaissance in respect to media’s futures and revenue potentials, and provide handy lessons for entrepreneurs and the similarly aspirational in any industry hoping for success in the digital landscape.
In early August, media monolith News Corp reported an increase in net income for FY22 to the tune of $US760 million, 95 percent higher than the $US389 million reported for the previous year. For the country’s Australian arm, revenue for the full year to June had increased nine percent, thanks in part to the success of the company’s streaming platforms Kayo and BINGE respectively.
Still, according to News Corp chief executive officer Robert Thomson, a large part of the company’s success owes to newfound breakthroughs in the space of digital news.
“The News Media segment was the single largest contributor to the enhanced profit picture this fiscal year,” Thomson said, “Bolstered by growth in digital advertising revenues and record digital subscriber numbers.”
To back this up, News Corp Australia’s digital subscriber numbers as of 30 June, 2022 sat at 964,000, a more than 12 percent increase from the previous year’s numbers of 859,000. There is also reason to assume that this is not even the full picture of the contributions to the company’s overall revenue by its assets in digital media, with the company’s digital asset news.com.au ranking third in Australia for unique audience numbers as recently as December 2020.
It is a similar story over at Nine Entertainment, who own streaming platform Stan, digital media assets such as Pedestrian.TV, and legacy mastheads formerly under the purview of Fairfax Media such as The Sydney Morning Herald, The Age and Australian Financial Review. Releasing its results for FY22 on 25 August, Nine reported a total revenue of $AU2.7 billion and the company’s highest ever group EBITDA. In this period, digital subscription and licensing revenue increased 66 percent, with the digital boom paying dividends for the company’s shareholders.
“Our ambition to accelerate profitable growth from our digital businesses is being realised, with more than 50 percent of EBITDA now attributed to our digital expansion, tracking ahead of the long-term targets we have previously communicated,” said Nine chairman Peter Costello, “For our shareholders, from our FY22 profit, we have also paid or announced a record, fully franked dividend of 14 cents per share.”
Elsewhere, the growing appetite for digital news has also begun to deliver rewards, with lower profile digital media assets such as Guardian Australia and Private Media – which owns digital publications SmartCompany, Crikey and The Mandarin – announcing recent plans for expansion on the back of recent successes. The latter, particularly, flagging earlier this year plans to increase internal headcount by 15 percent in FY23 citing “strong ongoing revenue and margin growth”.
It isn’t all necessarily smooth sailing, however, as the ever-changing landscape that is digital inherently demands all participating in digital media and marketing to stay ahead of the curve and abreast of trends dictating where customers and audiences are coming from and/or can best be reached.
An immediate example of this is the growing prominence of social media platform TikTok at the centre of people’s digital habits. In terms of news, a recent news consumption report from UK media regulator Ofcom identified TikTok as the fastest growing news source among adults in the UK, used by seven percent of UK adults according to the 2021/22 reports’ findings – an increase from only one percent in 2020.
Digital news and media is not the only landscape into which TikTok’s prominence has grown. For example, Google Senior Vice President Prabhakar Raghavan, who oversees Google’s Knowledge & Information organisation, revealed illuminating findings from the company’s internal research in July.
“In our studies, something like almost 40% of young people when they’re looking for a place for lunch, they don’t go to Google Maps or Search,” Raghavan said, “They go to TikTok or Instagram.”
This is ultimately demonstrative of how digital media, much like any business or venture hoping to survive and thrive in the digital landscape, require a willingness and ability to adapt to developments that often emerge in challengingly hard to predict ebbs and flows. Something acknowledged by Tory Maguire, Executive editor of Nine Entertainment’s The Sydney Morning Herald and The Age.
“That’s a huge challenge for us – engaging that audience who gets a lot of their news and views from TikTok, and Instagram,” Maguire says, “We have put a huge amount of resources into engaging that audience.”
Far from a perfect science, the future of digital media doesn’t only rely on adapting to new platforms, but also recognising new audiences. In this sense, TikTok looms as a unique proving ground for the staying power of recent digital media successes.
And the lessons from such developments and the recent successes in the area of digital media for all aspiring to succeed and grow in the digital landscape, be this in digital media, e-commerce or otherwise, are primarily twofold.
First, the benefits of seizing upon the opportunities afforded by advertising and marketing through digital media are clear, and the relationships ultimately mutually beneficial. Digital media can continue to grow through such partnerships, while the successes and development of digital media as a renewed force offer prospective partners unique opportunities to reach audiences wilfully and actively engaged with digital futures.
The second lesson to be learned is about the necessity of adaptation, an omnipresent truth within the digital landscape, compelling competitors and participants in the same landscape to understand how technologies, softwares and audiences have changed and are continuing to change. TikTok, as the example, has become far more than the hub of questionably awkward choreographed dance videos and whimsical cat videos. More frequently, websites and apps such as TikTok and Instagram are becoming the front pages of the internet for a rising number of digital audiences.
The e-commerce potential on TikTok, for example, has gradually begun being realised by industry pioneers since the platform’s meteoric growth during the previous two pandemic years – headlined by a growth of 180 percent of users in the 15-25 age bracket during the pandemic periods. Thanks to partnerships with Shopify and Square finalised in 2021, the platform itself offers opportunities to shop for and sell products directly on the app.
This functionality is far from being TikTok’s only relevance in this space, much like with other social media platforms such as Instagram and YouTube. According to Deloitte Digital and explored by customer engagement platform Braze during a presentation at Power Retail’s Connect event on 31 August, 75 percent of consumers say that product information they found on social channels not only influenced their shopping behaviour but also contributed to enhancing their brand loyalty.
This loyalty, especially, is of equal importance to both e-commerce and digital media. The audience, or the customers, not only find options to engage with but continue to engage with them. For digital media, this manifests in subscriptions, while for e-commerce this presents in repeat sales. In both instances, they’re crucial not only to digital survival, but also to digital success. The tickets to success, if you like.
Ultimately, not only are the lessons clear, but so too is the potential – both with regards to the renaissance of ‘traditional media’ through digital, and also the growth of new, alternative hubs of digital community and information such as TikTok.
If participants in the digital landscape hoping to reach an audience, or customers, are pursuing success without having considered the value of such emerging (or re-emerging) platforms to the growth of their endeavours, it might be time to dust off their dancing shoes and get with the times.
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