TVN Executive Session | LMA: COVID-19 Opens A Window For Membership Prospects

The Local Media Association’s Jed Williams was working with a trio of TV stations on a pilot membership model when the coronavirus struck. He says the moment made clear TV broadcasters’ importance to their communities. It may also be an ideal moment to deepen the relationship with viewers with an endgame of new revenue streams when normalcy returns.

The coronavirus has put all manner of ambitious local TV projects on hold, but Jed Williams says membership models shouldn’t be one of them.

Williams, chief strategy officer for the Local Media Association, launched the TV Membership Project last November. The project is a pilot with Fox Owned Stations, Meredith Corp. and WRAL/Capitol Broadcasting aimed at tapping into a model that has met with mixed success in newspaper and nonprofit digital news circles.

While the nine-month project never accounted for a pandemic in its trajectory, Williams says the moment has underscored the crucial role television stations have in their markets, and it has delivered an opportunity to tighten bonds with their most engaged viewers.

In an interview with TVNewsCheck Editor Michael Depp, Williams says that reflexive local TV news gestures like COVID-19-themed email newsletters may beget key viewer data opportunities — and revenue — for when the crisis abates. He says that first-party viewer data is the brass ring for multiple monetization opportunities beyond local news. And he thinks the coronavirus-imposed isolation we now endure offers additional opportunities for local OTT channels.

An edited transcript.

With all that has happened in the past few weeks, it seems this might not the best time to be talking about a membership model for local television. But you think there’s an opportunity now?


LMA’s Jed Williams

The amount of sudden ad and revenue loss is staggering. You could do disaster planning, recession planning, but I am not sure that there is a way to completely prepare for the rug being swiped out from under the feet of broadcasters and all local media to the degree to that it has happened. But there may be opportunities around the audience, continuing to serve the business and advertiser community.

[This event] further elevates the critical importance of being front and center in communities, and that means delivering more coverage and finding new ways to deliver coverage. It also comes back to knowing who these folks are. Why do existing users come to you? What do they want more of? Are there opportunities to engage new viewers? Is there a need to serve communities that aren’t being fully served during a time like this?

Website traffic, engagement, all of the metrics are off the charts. What do we learn from that? How do you continue to build greater intelligence into who your audience is?

Some ready-made things are pop-up newsletters and special sections online, things where there is an ability to better understand who is consuming content and also capture first-party data. Get an e-mail address, start to build a direct conversation and relationship with someone around this crisis and around critical public health and information needs and then expand upon that relationship.

There is also a real opportunity for broadcasters to accelerate their efforts in an area that many realize they should have been putting more effort and investment into for a while. Now they have got to play catch up in a hurry.

Where are you seeing good examples of this?

Graham is a great example. They are thinking about how to build out different content experiences around COVID-19 that may serve niche communities, underserved communities, business communities.

Morgan Murphy and Heartland are launching COVID-19-focused products that enable them to not only create an initial bounce in traffic and engagement but bring those users back to build some habit-forming behavior.

The simplest way to do it is capture e-mail addresses. Then the question becomes what is next. How do you build and nurture that relationship around this coverage and beyond?

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E.W. Scripps tried and essentially sidelined a membership project at WCPO in Cincinnati a few years ago. Why come back to it now?

The consumer economy shifted in the past two or three years and not just through digital subscriptions. If we look even beyond media and the decisions that consumers make with their money — whether it’s gym memberships, fitness classes, recipes or financial services — there is clearly this movement to having deeper relationships with brands in media or beyond.

Those are often taking the form of monthly recurring relationships. We see it in newspapers and with digital publishers with subscriptions. We see this notion of a membership economy blooming in a lot of different industries.

So we start with that notion of how might that apply to local media in general and how might it apply to different verticals or sectors within local media. What is our permission to play? What are the things that we can do for consumers and audiences in our markets that may start with news and expand well beyond?

I am not suggesting Scripps was too far out in front, but has that market matured and changed in a way that opens up this opportunity? There are different ways to approach this. It’s not a one-size-fits-all model. It depends on who you are serving, your capabilities and your skills.

For one company it might be creating a new content vertical and for somebody else it might be building something more experiential that has curated things to do in the community, delivering experiences and value with savings or events. We approach it with a very broad lens. There is not going to be one model here.

You’ve come out of a three-month research period. What are the key takeaways?

At a macro level, there is a certain level of appetite for membership programs delivered by local brands. Now, that doesn’t just mean local television. That could be local gym, a magazine, any number of things, but if we put television into that group, the consumers that we talked to both in focus groups and surveys in several markets said we pay for content right now either through subscriptions or memberships, we pay for an experience, across a number of different categories, but we don’t really pay for it at a local brand level right now. We might if it was delivered in ways that deliver value for us, that meet our criteria around things like convenience, personalization, saving time and making my life easier.

What we learned is right now there is not a very big existing market for it, but the potential market is at least worthy of exploration.

What is your sense of the size of that potential market?

Fourteen percent. Closer to 40% are interested and see value in it. There is a gap there. It may be a step-by-step graduating process over time where you are bringing something to them that they didn’t associate with your brand historically, earning more credibility and permission from them. Over time, you graduate to a point in the relationship where you can capture value.

Underlying this is a question of gathering consumer data, which you say is the endgame. Membership may be an iteration of where that data finds a use, but it’s a question of gathering first-party data that TV doesn’t have a lot of, traditionally. Newspapers tried this not long ago. Did they ever succeed?

In general, they have far more data than television. They have subscriber data at the bottom of the conversion funnel. They have stronger email databases. Generally speaking, most newspaper companies have far more audience data at every stage of their funnel. They can tell you what a casual user looks like versus what an engaged user looks like and then the steps to take to move somebody down a funnel.

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Were newspapers ever successful with taking that data and doing something meaningful with it?

It’s very much a work in process. You talk to a newspaper publisher and they will say look at Delta Airlines or financial services or consumer packaged goods, and we are nowhere close to that. But if you look at the Seattle Times, they have made a seven-year investment in data capabilities, deepening their first-party data and then building product, content and marketing strategies through that. Broadcasters generally are not at that place of maturity.

Even if broadcasters get a lot of really good data, how much could they actually do with it? So much of their news content is just ephemeral product.

We need to be thinking about audience value in terms of content and experience in a much broader kind of way, in a much more holistic sense. I work with a number of newspaper companies on digital subscription programs and it’s generally the same thought, which is that your hard news content by itself doesn’t have the back catalog value that going and watching Seinfeld episodes on Netflix does.

It doesn’t work that way in news. We are thinking if that has commodity or ephemeral value, what are things that have greater value? The manifestations could be a membership model, an events business, a commerce business and selling products, a new vertical content brand, virtual learning.

Coming back to the membership project, how is the pilot going to play out?

The whole life cycle is about nine months, three months of research, which we just completed, and now we dive into this five- or six-month pilot phase. LMA will work with each of these three broadcasters to help them wireframe, design and bring to market some minimally viable version of a membership model for a direct to consumer brand.

Will we see that within the next five months?

We will see that by early summer. You are going to see very different things from each of the three. They have different audiences that they are serving, different business goals and different ways they think they create value. They are in very different places in terms of how much data they have, how usable that data is and what their marketing and technology stacks look like and those are drivers of or inhibitors to being able to bring anything to market.

You’ve got some thoughts about opportunities local TV stations may have in this pandemic period with their OTT channels. What are they?

There are opportunities, in the short-term, to think about and invest differently in branded OTT channels, specifically with lean back OTT. I spoke with a broadcaster in Washington state who was talking about doing a concert series, things that they have done [as events] that they are doing virtually now. Can they find success underwriting that with sponsorship dollars, maybe even getting people to donate?

Building out an OTT channel isn’t even half the battle. How do you brand it, market it? How do you build audience? What is your content wheel? This is starting to force some resourceful thinking about how to use branded OTT assets that maybe have fallen a little bit stagnant and utilize them to engage audiences that suddenly have lean-back time.

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