Why AI, revenue diversification and ad spend are the defining 2024 trends for media companies
Will Barker, manager, strategic customer success, BlueConic
The media and publishing industry is constantly evolving. With this, it’s often difficult to keep up with the latest trends, especially with fast-evolving technologies emerging all the time and ripple effects remaining from the global pandemic.
To ensure 2024 is a fruitful year, media companies and publishers should look out for the major trends likely to dominate the industry and how first-party data will come into play. Between the rise of AI, the lack of subscription growth and a challenging market, publishers and media companies are focusing on engaging their readers for continued loyalty, diversifying offerings, reaching younger generations and using AI to all its advantages.
The rise of AI is pushing publishers to focus on direct reader engagement
Research shows declining website traffic has been a critical challenge for publishers in 2023 with almost 50% citing it as a significant concern. As if that wasn’t enough, the advent of generative AI technologies like ChatGPT is creating a new paradigm where users can directly ask AI models questions and receive answers without sifting through a list of search results. This further compounds the issue for publishers heavily relying on SEO traffic to their websites.
In the coming year, future-proofing businesses will be a focus for more publishers, likely by building direct relationships with readers and leveraging first-party data to deliver personalized content recommendations, targeted email campaigns and customized experiences. Such measures will enable these publishers to mitigate the emerging threat posed by AI-powered search while keeping readers coming back to their sites for more.
Subscription growth is slowing but paving the way for loyal, sustained revenue
Since the introduction of The New York Times content meter in 2011, publishers have continued experimenting with subscription programs to drive revenue and growth. However, there are signs that the subscription business is beginning to contract. Recent research shows that 57% of publishers expect their subscription revenue to grow in single digits this year, remain flat or decline.
Amid these slowing growth rates, publishers will experiment with new and innovative content metering strategies and transition from pursuing growth at all costs to battling churn and managing average revenue per user. By analyzing user behaviors, preferences and engagement patterns collected through first-party data, publishers can gain valuable insights into subscriber dynamics, including the factors contributing to churn and ARPU. Publishers can then use these insights to implement targeted retention and ARPU strategies that ensure the continued viability of their subscription-based revenue models.
While ad spend is growing, it’s slow — publishers need to keep diversifying
Against a backdrop of economic and geopolitical crises, rising inflation, supply chain disruption and technological shifts, global ad spend grew a modest 4.4% in 2023. However, the latest predictions suggest ad spend will turn a corner in the coming year, rising to 8.2%.
While this is good news for media and publishing companies, more is needed to offset the broader challenges and uncertainties that persist in the market. This will put more pressure on these companies to tap into revenue opportunities beyond advertising, such as subscription services, e-commerce ventures, sponsored content and other forms of content monetization.
As revenue diversification becomes a necessity, e-commerce channels are proliferating
The push to diversify revenue has already seen many traditional media and publishing companies add e-commerce channels to their revenue streams. Examples include Accelerate360’s UsNow.com eCommerce Shop, America’s Test Kitchen’s ATK Shop and The Denver Post’s online store.
In 2024, more media and publishing companies will likely leverage their first-party data to create personalized, targeted and effective e-commerce experiences. When used as a foundation for understanding and meeting the needs of their audience, publishers can cultivate stronger relationships, optimize their product offers, and ultimately, drive the success of their e-commerce initiatives.
To continue thriving, media companies and publishers need to reach younger audiences
People under 40 are a vital market for many media and publishing companies. Yet, new data indicates that digital-first Gen Zers lack exposure to traditional news sources, even when parents are well informed.
For 2024, publishers must find creative ways to attract and engage with a younger audience. One example is the Newspapers in Education program, which offers a free one-year digital subscription for high school graduates and news access to all students K-12.
First-party data will also play a critical role in reaching these younger generations. By applying AI to their customer data for lookalike modeling and personalization, publishers can extend their reach to a younger demographic and dynamically deliver content and experiences that align with their interests.
AI is for more than generating content — publishers are using the tech for testing, too
The impact of AI on media and publishing will be significant in 2024 and beyond. AI technologies, such as natural language processing and generative models, will enable media and publishing companies to generate high-quality content automatically while streamlining production processes and enhancing efficiency. Moreover, publishers can use AI to create nuanced variations of this content for A/B testing purposes. These variations can be tailored to specific audience segments or personalized based on user preferences, ultimately enabling them to refine their content strategies and optimize audience engagement.
The media and publishing landscape is poised for dynamic changes in 2024, and with change comes opportunity.
As technologies such as AI evolve, publishers and media companies are using it to help jumpstart content and aid in A/B testing. To tackle the slower subscription growth and traffic, they’re improving direct engagement with their readers to build loyal reader bases while diversifying offerings and expanding to younger audiences. By strategically leveraging first-party data, these companies will weather current uncertainties and lay the foundation for sustained innovation and growth in the years to come.
Sponsored by BlueConic
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