Having racked up over 4 million iPad app downloads to date, Flipboard has built a business aggregating and repackaging content from around the Web, without paying for access to any of it. Despite that fact, the company maintains it has publishers’ best interests at heart, and that its success depends entirely on that of the content owners as its partners.
“It’s all based on our partners thriving. If they thrive, we succeed,” the firm’s editorial director Josh Quittner told Digiday. Given the support the high-profile support it has received from the likes of Conde Nast and the Oprah Winfrey Network, it appears publishers would agree.
Flipboard bills itself as a social magazine, pulling in Web content in real time from sources such as Facebook, Twitter and numerous other sites, and presenting it specifically for consumption on the iPad. The firm currently works with over 50 publisher partners by, first, ensuring they approve of the way their content is being presented and, second, by giving them the opportunity to sell ads against it. Flipboard is handed a cut of the resulting ad revenue but doesn’t sell inventory itself.
Despite the fact the majority of its publishers are already attempting to monetize that content either on the desktop Web or through apps of their own, Quittner suggested Flipboard provides publishers with an additional revenue opportunity rather than one that cannibalizes their existing sales efforts. “Smart media companies understand that they need to make revenue in a variety of different ways. In the old days, they made that from one print product, and in the 90s they started to grapple with print and the Web. Suddenly, it’s become apparent that a successful media company needs to make money from multiple revenue streams,” he said.
These are still the early days in Flipboard’s evolution — and the wider iPad-based content-aggregation field in which the product has competitors — but publishers appear receptive the concept, at least. Josh Stinchcomb, vp of digital sales at Conde Nast, said his company was approaching the model with cautious optimism. “If an aggregator is pulling in our content, we’re very interested in how it’s being used and presented, and equally interested in whether there’s a business opportunity there for us,” he said.
Through its partnership, Conde Nast has already sold ad campaigns into Flipboard, Stinchcomb said, including one as a package deal alongside Web and print inventory and one exclusively aimed at the application. Echoing Quittner’s sentiment, he too seemed unconcerned by potential sales conflicts with other channels, stating, “We’ve done a very good job of monetizing our content on the Web, but this is an opportunity to grow that.”
Besides the availability of additional inventory, Stinchcomb added that he also sees Flipboard as a marketing opportunity, allowing it to establish a relationship with consumers before potentially upselling them to its print products or iPad magazine editions, for example. Quittner described that use of the product as a “sampling platform,” allowing publishers to reach audiences they might not otherwise have access to. “When I was working in traditional, we used to think, ‘where have all the young readers gone?’ Flipboard has those users,” he said.
Quittner emphasized that Flipboard has no interest in building sales teams of its own, though it does have staff that will help connect advertisers to suitable publisher partners and educate them on the opportunities that might be available. It might not be selling itself, but its revenue is still derived from ads, nonetheless.
So far only Conde Nast and the Oprah Winfrey Network are selling ads into Flipboard, but others are also serving house ads. For now, Quittner said the firm’s focus is on building its relationships with more publishers, from which it currently has more interest that its 50-strong staff can cope with. “If we wanted to open up the doors we could have hundreds of publishers on board right now, but we want to manage it and be strategic. All our partners have different requirements and we want to get it right,” he said, adding that a self-service platform might be offered to new publishers in future.
A Flipboard iPhone application is also currently in production and is likely to be released within months. Stinchcomb said Conde Nast hopes to be involved with that product also, though he expects it to take a different form than the iPad iteration thanks to differences in the nature of the devices.
Besides that, the firm’s focus is on exploring further ad possibilities and formats, Quittner said, though those solutions will likely always be sold on a full-page, interstitial basis. “The current iteration of ads on desktop websites just doesn’t seem like a very good experience. That needs to be fixed. The full-page model is absolutely the right way to go, but what you do in that space remains to be perfected,” he concluded.
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