Thursday, July 12, 2007

Can't make money with content? Make money because of it.

I read the following on 'Confused of Calcutta' (see recommended blogs, left)

"When something that was originally scarce starts becoming abundant, something strange happens. You find that you start making money because of that thing rather than with that thing. That’s the Because Effect." Click here to read it in its original context.

Based on Doc Searl's original thinking, is there a clue here as to what to do with all the expert-created content traditional media companies are heavily geared towards producing?

When it was scarce we made money with it. But now that great content is abundant, we have to move to making money because of it.*

In the case of Prince and his Mail On Sunday new album giveaway, he understands that great content (music files) are abundant. The scarce resource he has is his concert tickets. Because he has an abundant thing to give away, he is working on the theory that this will engage a level of fan commitment that leads to the purchase of concert tickets (and, presumably other merchandise).

What is the equivalent in the world of traditional publishing models?

There are authors (eg Cory Doctorow) who offer their complete novels for download and sharing. And they see the sales of actual books rise as a result.

I'd guess people who read the downloads become fans, who then evangelise others to buy. And some of the original downloaders decide that even though they've read the download, they want to own the product - to put on their shelf - to have and to hold. The content is abundant - the product itself is scarce.

So where does that leave your thoughts on what to do with all that content your media company is producing? Could a free DVD or download activate people to go the movies? Buy merchandise (games, toys, go to see the next film in the series..?) Maybe?

And where does this leave periodical publishing? Could it be as simple as putting all your content online as the initial draw for the formation of communities of shared niche interests (aggregation of vast audiences... if you must), leading to the opportunities of "We Media" (Communities Dominate Brands)?

The challenge here is working out, or even recognising, what the scare resource we have to sell is? Perhaps its experiences, events, engagement marketing opportunities, co-created services and products that will emerge as values from the network of the community we'll be part of.

New rules apply. Persuading your stake holders of the value of these may be the toughest part of all.

* Corrected with the kind assistance of JP Rangaswami - 'Confused of Calcutta'

The rate of change is so rapid it's difficult for one person to keep up to speed. Let's pool our thoughts, share our reactions and, who knows, even reach some shared conclusions worth arriving at?