It all sounds so familiar. If online users won’t buy content in the usual offline model of subscribing to individual titles, let’s try aggregating a number of top offline brands like Esquire, Family Circle, Variety, Forbes, and sell ’em all for one low monthly price. A smorgasbord of familiar, trusted brand—that’s what Webizens really want. Sound like Time Warner’s original plans for Pathfinder? Or perhaps Steve Brill’s short-lived ContentVille?
And so it does to many critics of KeepMedia, the service that launched last summer with recently archived content from 140 such titles on board. This aggregated content play sells at a low price point of $4.95 a month, yet comes with big money backing from book superstore mogul Louis Borders. But company CEO Doug Herrington insists this content supermarket will be different because he himself has been there and done that. The former WebVan (you recall the online grocer idea?) executive argues that post-bubble audiences, technology, and business models have all moved in the direction of his plan.
“We are not betting on changed consumer behavior,” says Herrington, with a conviction that could only come from a man who once banked on consumers buying corn flakes online. “The trends are well in our favor for paid content.” Consumers are recognizing the need to pay for quality content, he argues, but they are not willing to pony up for multiple titles across the Web as they do for magazines offline. By pulling together recent editorial from recognizable brands at a very low price, he thinks he’s created a painless buy-in.
More to the point, Herrington says he and others have learned to make the technology serve the bottom line and the user. KeepMedia claims to have invested substantially up front in a personalization engine much like Amazon’s, which uses high-level meta- tagging to push highly relevant content to subscribers according to their own search and viewing history. It even emails users weekly with new, personalized article links. And this engine gets great mileage on low octane. “As we architected the platform and built the business model, we made sure you could automate the key heavy-lifting components so it didn’t have to scale up as the business scaled up,” says Herrington. As a result, he has only 50 employees and “We don’t have an editorial team hand-picking editorial pages.”
One of the things Herrington learned at the last Web crash was the wrong way to build a brand. “I and everyone else learned that you could buy traffic, but it was an incredibly expensive way of going about it.” The new model online is to piggyback on your partners’ existing marketing channels, but at the same time make money for them out of the gate. Content companies like Kiplinger’s can swap their own ad inventory and promotional clout for bigger cuts of the KeepMedia take. The base deal gives the content partners a straight revenue share of the site’s subscription fees pro-rated to the amount of use their content gets among users. That rate can go up, however, if the partner agrees to promote KeepMedia. “The more you market with us, the higher the revenue share. We pay for marketing through giving a higher share of the revenues.”
KeepMedia also shows partners the money by emphasizing direct print subscription sales. In effect, KeepMedia is a newsstand as well as an “up-to-date archive” of content that generally comes online two to four weeks after the print street date. The site pushes and sells subscriptions for the publisher at every turn and demonstrates some smarts by putting relevant headlines from content that is not yet archived, but in the current issue of the magazine into search results. If the user wants to see that article right now, she can buy a print sub and get instant access to it or just buy the article on the spot for about a buck or two. To its credit, the KeepMedia engine does, in fact, serve the interests of the business model and the consumer quite well.
But will consumers find and embrace it? KeepMedia has built a superior technology and business model to predecessors like Contentville and apparently Borders is a more patient sole investor that will give the company “a long enough runway to make the model work,” says Herrington. But in order for this to fly, they almost certainly will need the very proactive marketing support of their partners. The task here is not just branding and exposure. The marketing has to really drive home to users that established brands and superior editorial are worth the money, and only the big brands can make that case with their own loyal readers. The fact is that most of us get “good enough” free content off of a search engine query. In fact, integrating KeepMedia’s fee-based content with standard search engine results might be one effective way of contrasting high-quality content with the rest of the Web. KeepMedia has wisely reinvented a number of things in this Web 2.0 model, but it has not vaulted the biggest jump of all: how do you get people to pay anything—anything at all—for general interest editorial?