Recently I was invited to speak on topic of Media Convergence and Management as keynote speaker in an annual event held at GLS University, Ahmadabad. I shared following thoughts at the event. My speech text:
Setting tone of the day is never easy but I guess this is what life throws to us. We constantly need to learn, adapt, unlearn, relearn and adapt. And this makes our life simpler, for betterment. Please don’t think that I am here to preach you all on life lessons. I am here to talk on the topic of Media Convergence and Management and I see precisely similar thing happening on this topic too.
Fast changing technology and it’s adaptation in our everyday life is impacting and forcing us to do, what we do in a new way every day.
Media convergence as a word often misunderstood. And it is used in reference of – using or optimizing different medias such as YouTube, other Social Media platforms, Print and TV etc to promote or advertise products or services. Or how a brand engages with their customers using social media.
But, that’s not right. Convergence means coming together of two or more things. Similarly when 4 things Interconnection of information, communications technologies, computer networks, and media content comes together it is referred as Media Convergence. Media Convergence is a new thing and all started with digitization of content and popularity of internet connectivity.
But before we talk more on Media Convergence, I will take you all little bit backward. First big shift in media took place in late 1960’s when telephone switching technology was invented and self dialing telephone exchanges came in existence. People could speak to each other as per their wish and when they wanted to connect with other people.
This was the first media convergence instant and information started traveling faster than ever. Telephone Switching technology not only eliminated the distance between people but also became one of the key factor in invention of World Wide Web which now we call Internet. And with invention of Internet, content what was served in older days changed fast.
Before internet became popular all mediums like TV, print, radio were bombarding information of their choice on to us. All this while we as consumers never had any choice on what information we wanted to consume through media. It was like, Mom has prepared “Karele ki Sabbji” and we have to consume it whether we like or not. We only had two options – eat it or leave it.
But then came Internet and smart phones, which changed everything. Today with smartphones in our hands each one of us is a journalist and a media owner. Today, now we can create websites, video channels and populate content created by us using social media. And within few minutes, information travels to millions of people.
You and me are the new media distribution channels. You and me are as powerful as a TV channel.
No wonder, popularity of TV and newspapers is fast diminishing. So much so, that in next 2 to 3 years we expect newspapers will disappear in developed countries though in developing countries like India they survive till 2034.
So, in such case what are the medias we are left with? We now have 4 types of media:
- Paid Media: When we pay to promote. Means when we advertise. TV, print, OOH or digital.
- Earned Media: When public and media relations efforts start gaining coverage in both on and offline.
- Owned Media: Media assets which brands controls such as website blog and newsletters etc.
- Shared Media: Brand’s social web participation and interaction with consumers on social media.
Internet and Social media are now key drivers of the convergent media. This single change has not only changed the media landscape but also empowered consumers. Consumers no longer can be taken granted for.
Therefore; Media convergence is a phenomenon which concerns numerous areas such as media technologies, industries, business models, consumer behaviors and content management. With media convergence, new technologies, new thinking and new business models are emerging.
Who would have thought of Uber like taxi company, which owns no cars?
A hotel company, which owns no hotels but we have AirBnB.
MakeMyTrip like travel company, with no offices.
A music company which doesn’t produce any Music – Apple Music Store.
Or a market place, which has zero inventory but we have Alibaba and Amazon.
These businesses are the resultant of Media Convergence where technology and interconnection of content has created new business model using digital media. These business models are forcing older companies to re-look their business and reinvent the way they do business.
New business models are consumer focused and are based on value creation. Our new business model not only need to create value for its customers but also for suppliers and partners.
So how we need to manage Media Convergence? Or what methods companies should adapt in age of media convergence to remain in the game?
There are 4 distinct ways which companies can follow to create value using Media Convergence.
(1) Efficiency: Efficiency means, cost of transaction decreases. Efficiency also means product search cost, selection range, systematic information, simplicity, speed and economies of scale. Take example of Amazon – we now need not to spend fuel on travel, visit multiple shops to search right product or best deal for us. And most important, time wasted in this whole process.
(2) Complementarities: Complementarities means bundle goods or services to deliver additional value to consumers. Like Smart TV with internet where we can watch a movie of our choice on Netflix or Tablet PCs.
(3) Lock-in: Lock-in means attract customers to repeat transactions. Loyalty programs, use of dominant design, trust and customization. Apple is a very good example of dominant design, trust and loyalty.
(4) Novelty: Novelty comes from innovative methods of transactions or by creating innovative business models. Like Uber business or PayTM payment wallet.
In the age of media convergence, Customer is king. Whether it’s a B2B business or B2C business. Customers must be the priority. With the development of technology the cost of products and services got lowered and satisfaction of customer has increased.
From the consumer’s point, the increased convenience of information provided by converged stories makes usage of the media a better experience. So companies now need to focus more on how their brand interacts with consumers on various paid, earned, owned and shared medias.
Let me tell you all how we handled media convergence in our business…
In 2009, we were making TV ads practically for all FMCG & OTC companies with presence in 32 countries and our big challenge at that point was trying to work – how digital change will impact the FMCG industry? How FMCG players will adopt new technologies in their marketing function and apart from advertising on digital mediums? How we as a vendor to FMCG companies, be useful in new digital age?
We were anticipating that there may not be big shift in the way companies promote their brands but we knew that a direct threat was coming to our TV business due to converging media technologies.
In 2011, our company founded HoemTesterClub.com. Goes without saying that first 5 years were painful for us and we kept burning money in keeping the website breathing in South Africa and in India. There were hardly any takers for our services than.
If you will visit our website, you will find it’s as a Grocery Product rating and review website. But that’s not the complete truth. That’s the way we engage us with consumers.
In reality we have reinvented product testing and research methodology. We have challenged old ways of city centric product testing and research methods. We have challenged that how one or few cities can be representative of consumer preferences for a state or a country?
Today, using club members spread across 500 plus towns of the country, we courier them products. Consumers tries products at home, they comeback on our website and participate in product research survey. We share a live research finding dashboard with our clients.
Best is that no consumer is paid a single penny, their opinions are not moderated and there is no bias.
So what is the benefit to us as business or to our clients?
Old product testing and research methodology costed around Rs. 1.8m to Rs. 3.5m or even more, depending upon numbers of towns and sample size. And time taken for research was 4 to 8 months.
We can now do a product testing research spread across hundreds of towns using sample size of thousands of consumers at one third or even one fourth of the old cost. And time taken is around a month.
Using Media convergence we brought new product testing research practice globally.
That’s not all. With this website we also help our client’s generate testimonial content. We help them with sampling and in creating positive word of mouth and brand advocacy campaigns.
Our clients are happy as their research data is robust, cost and time consumed is less. We are happy as we could build a new revenue stream using media convergence in our business after 28 years of existence. Media Convergence has showed us the way in not only in adding new services which we now offer to our clients but also in expanding business’s geographical boundaries.