On the first of December, we will celebrate the 105th anniversary of Henry Ford’s installation of the first moving assembly line for the mass production of automobiles. His innovation reduced the time it took to build a car from more than 12 hours to two hours 30 minutes.
Henry, of course, didn’t invent the assembly line. It was a relatively well-worn invention when he installed it into his business. His true innovation was integrating the assembly line, along with other changes such as doubling worker’s salary and mechanizing the assembly line to move into a new business model. It was the new business model, not the assembly line, that enabled Henry to change the world and democratize the automobile.
This is a perfect metaphor for where content marketing is in 2018. For product and service brands, building an owned media strategy as a strategic function in the business is akin to how companies were using the assembly line in 1913. Some companies only see it as a more efficient way to do classic, direct marketing. Some others see it as a complete alternative to advertising and treat it as such. And content marketing is neither of those things.
Value of the owned media business model
In my book with CMI founder Joe Pulizzi, Killing Marketing, we offered the historical, strategic value of owned media (our content marketing) as a function in the business. We identified this idea as follows:
The graph shows that, as the production and distribution of content becomes more commoditized through technology, the business value of original, high-quality content increases. Put slightly differently, as “reaching audiences” becomes more difficult, fragmented, and filtered, the ability to generate and hold attention from an audience with original content becomes increasingly more valuable to the business.
You can certainly see this happening at tectonic scale. Amazon, Apple, Google, AT&T, and Verizon are quickly becoming the largest media companies on the planet. Why? Because there is tremendous value and competitive advantage in having direct access to audiences.
And you can see it happening at the smaller level as well. Microsoft’s recent acquisition, and amazingly high $7.5 billion valuation, of GitHub had little to do with the company’s technology. It had everything to do with the ability to more easily engage one of the hardest to reach audiences on the planet – software developers.
Put simply: All of these incredibly successful companies have installed owned media as business models within their company.
But, OK, if content marketing is best structured as an integrated “business model” in your company – what is the best way for you to structure it?
What is the right content marketing business model
As part of our consulting and education practice, we’ve worked with companies for the last 10 years on figuring out the right method of mechanizing content marketing for companies.
Recently, we established a bit of a new framework for companies to consider when looking to structure their content marketing business model. We took huge inspiration from the remarkable media strategy work that Deborah Bothun and John Sviokla at PwC expressed in the summer 2016.
As they looked at the overall structure of owned media, we looked at four internal business models for content marketing against two scales. The critical conclusion isn’t that any one model is better than another (though perhaps there is a maturity curve to be seen).
Rather, the insight is that as businesses look to integrate content marketing more deeply in their strategy, they have clarity around which model they are installing. Each model has a different investment strategy, optimal team structure, discrete measurement goals, and road map to evolve. Thus, being able to communicate which model you will pursue helps to deliver a clearer content marketing strategy.
4 content marketing business models
We have identified four types of business models: Performer, Platform, Player, and Processor.
Each fall along two scales. The first is the business integration scale. At one extreme, content marketing exists to simply support other parts of the marketing and communications teams as a contributor. The other end of the business integration scale is content marketing as a core business strategy.
The other scale is function. At one end, content marketing is internally focused, supporting internal constituencies for their strategic needs. On the other end, content marketing is externally focused on direct relationships with audiences, drawing in audiences to be managed with the same care that you might give customers.
Each business model within that framework is labeled as one of these:
HANDPICKED RELATED CONTENT:
Player – content as contributor
Content marketing is seen as a contributor to broader and deeper demand generation, product marketing, or other business communications strategies. Many organizations begin content marketing with this model.
Content teams are often virtual or perform roles divided between traditional marketing and/or other skill positions within the business. This model is primarily seen as a supporting element of integrated marketing campaigns. Thus, strategic editorial strategies may consist of an alignment with campaign-oriented marketing or other departmental goals. There may be few or no owned media platforms at work.
On the more sophisticated end of this model, content marketing is developed by highly refined content creation and production teams that feed demand generation, brand awareness, or even native advertising campaigns. These are usually smaller teams that become more mature and may evolve into the Performer model (directly above on the graph).
Example: Read how software company Symantec evolved from a successful Player, campaign-focused business model to a Performer center-of-excellence model.
Performer – content as center of excellence
Content – and most importantly, building addressable audiences through owned media platforms – is seen as a discrete and focused strategy. Content may also be a support system to other parts of the organization. The primary driver for this business model is direct access and use of a relationship with audiences to drive marketing and communications goals.
For example, a center-of-excellence team in this model may take ownership over all or some of the owned media platforms (e.g., blog, the magazines, the resource center) and be responsible for providing the strategy, management, content, and ultimately the business value for those owned media platforms.
Example: This is Intel’s media company mentality. And this is the model that software company Frontline created with its original research institute.
Processor – content as a service
In many businesses, content as a function can be highly specialized, and thus the need for specific strategic content services emerges. In the Processor business model, a direct team may take responsibility for some centralized content functions but not for the creation of content.
For example, a company may deploy an integrated, centralized content marketing strategy for a global region. The remit of this organization is to provide centralized governance, budget, best practices, and agency engagement services to all the practitioners who manage content.
At the most sophisticated end of this spectrum, the strategic content group may perform this service for every aspect of all corporate content, including product, sales, marketing, documentation, etc.
At the lower end of this spectrum, the group is simply a specialized resource to manage part of the strategic content for the business. It may, for example, manage only content management and SEO aspects of all content for the business.
Example: Read how Carlos Abler leads the content enablement initiatives at 3M.
Platform – content as integrated business
The business views content marketing as an integrated and often fully functional business within the business. Whether the model comes through acquisition or through an original build, the teams are responsible for managing all aspects of a media operation within the confines of the brand.
The team may be responsible for a set of corporate publications or media platforms separate and discrete from the marketing and communications departments of the business.
At the more sophisticated end of this spectrum, the teams may operate autonomously from other parts of the organization – but provide strategic business value by assisting with access to core audiences that the brand wants to reach.
At the lower end of this spectrum, a team may simply be focused on a single owned media platform and deliver value through its direct access and insight into the audience.
Examples: Of course there is Red Bull Media House. But also read about Johnson and Johnson’s BabyCenter.com strategy. And, most recently you can read how Arrow Electronics is maintaining its viable addressable market.
Networking models and understanding your strategy
It shouldn’t surprise anyone that larger enterprises frequently use multiples of these models. There are times when having multiple business models is an intelligently designed strategy. And there are times when multiple models are simply the organic growth of content teams within the business.
Whichever the case, the critical point is that as a leader in the business you should know which is which – and audit why you have what you have.
Ultimately, as a business leader you must have the ability to leverage the different business models to optimize the innovation and install the right models that will help you create the success you seek.
We will be exploring these models much more – including here on this blog, in our consulting, and in upcoming master classes in December. We’re currently working on answering the questions around:
- What kind of team organization, and roles and responsibilities are necessary for each model?
- What are the appropriate measurement goals, and how is success defined in each model?
- What technology facilitates these business models?
- What is the evolution and maturity into new or different business models?
Understanding your business model helps you understand how to evolve it, and what the future can bring.
Future of the business of content marketing is bright
As you might expect, we see the future of content marketing is bright – independent of whether it continues to be a separate practice or a core part of an evolved business model.
Just as with Henry Ford and the moving assembly line in 1913, content marketing will be one piece of an overarching innovative strategy to evolve businesses in today’s very different, digital world.
As we move to 2020 and beyond, the beloved practice will begin to completely permeate the function of marketing. It is the strategic use of content that will not only build audiences and drive the creation and retention of customers but do so at a profit for the business.
Content marketing as a business model will evolve the practice of marketing and can move some or all the functions of marketing from cost center to profit center.
As my colleague and friend Joe Pulizzi indicated in the introduction of Killing Marketing, “This is the future of IBM, of General Motors, of Cisco Systems — creating owned media that not only can generate more leads and opportunities but is so good that the marketing pays for itself.”
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