July 2, 2009
Former IAB chief offers predictions and advice for thriving in the 2010 new media landscape.
Peter Horan knows how to build a new media company. As a CEO and independent director, he’s had four profitable exits in the last five years including the sale of About.com to the New York Times for $410 million. He’s been CEO of IAC Media and Advertising, About.com, AllBusiness.com and, currently runs Goodmail Systems.
Horan gave a keynote Friday at SDForum’s Business of New Media conference on 10 predictions and 10 “Ideas” for new media in 2010. He began with the obvious fact that Google is having a phenomenal year as old publishers like Conde Nast are imploding. Small content companies are running out of cash, while companies with no business models are getting $1 billion valuations.
Below are his thoughts on where new media world is headed.
10 Predictions for 2010
1. Online Ad Market will continue to grow, but the benefits will not be evenly distributed.
2. The intersection of ad networks, data providers and exchanges will flourish. (The market has been flooded with cheap crappy ads. The average cpm for a banner has gone down 60%. Myspace is lucky to get 25 cents per 1000 impressions. Cookies let people know who you are. This has changed media. For the last 100 years, we’ve bought media based on estimation impression surveys. But only 25-30% of ESPN is the target demographic; 20% of MTV’s audience is teens an college students, same with the WSJ. The media market has been inefficient; there’s a tremendous gap between nominal cpm and effective cpm. That’s why…
3. Marketers will focus on the “Audience of One.”
4. The success of this combination will further destabalize traditional media companies (which benefit from inefficiency).
5. The top players in each category will command greater and greater price premiums and bigger share.
6. Reader payments, pay-per-action, and transaction fees will be more lucrative than CPM display for most players.
7. Much of the budget that traditional media loses won’t actually be spent in online or mobile ads. Advertisers will simply benefit financially from the increased efficiency.
8. Marketers will take social media seriously—but more as PR than advertising.
9. The government will seriously try to regulate cookies, data ownership and targeting. [IAB is taking a strong position for self-regulation, but it’ll be a battle.]
10. Major shift in consumer attention from hub and spokes to the Edge of the Network.
10 Ideas
1. Consumer engagement is the strategic high ground (always has been).
2. Push the edge—get content, commerce and applications as close to the consumer as you can. (Think ATMs and Startbucks)
3. Hyper growth always commands a premium.
4. Get close to the transaction.
5. Focus—be the best at something.
6. Innovate—be the first at something.
7. Keep business progress and fundraising aligned.
8. Raise $1 more than you need but not $1 less.
9. Throw nickels around like they’re manhole covers.
10. Look in the mirror and decide if you’re really a company, a product line, or a feature.
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