Sifting Through the Noise on the Web
August 8, 2008 4:39 PM
The Internet had burned enough companies the last time around (aka Web 1.0), leaving it nearly deserted by corporate America for many years before the boom time we’re seeing now.
While the Web lay there relatively untapped, the playing field was left to anybody interested in creating a site, and create they did. On a larger scale, it was MySpace and YouTube; on a smaller one, popular blogs and the “Internet famous.”
Without much competition from corporations, these players have been able to take the market, some with enormous success.
I don’t believe it’s a case of their understanding the Web more than big media/entertainment, so much as that they haven’t faced major competition. And, contrary to the buzz and traffic many of these sites have, most are struggling with making money. Guess who they’re eyeing for their exit?
For entertainment and television executives, it can be difficult to sift through the noise and find solid small companies to partner with or purchase.
What are some of the key things to think about as you consider partnering with or purchasing smaller players?
First, understand that many Web properties are high on unique visitors but low where it matters: session times and repeats. One million unique visitors who spend less than a minute on a site and do not return are not truly “traffic.” Ask to see all of a site’s analytics—where the audience is coming from, what it’s doing, how long it’s doing it, etc., before you get into bed.
Second, watch the hype machine. It’s been widely discussed online that many of the information sources covering the Internet space feature companies based on friendships, relationships and other interests. That can skew opinions and, worse, a company’s value and market position. Watch for players with excessive coverage on one or two sites, or a site that covers one company regularly but no others in a category. These are the signs that tip audiences to bias, and should do the same for entertainment executives.
Last, don’t limit your scope. A lot of entertainment and television execs tightly focused on social networks and blogs. Consider small blog networks, e-mail newsletters and other platforms in the market as well to ensure you’re taking a well-rounded look.
When in doubt, ask. Some of the most insightful people in the market are more than happy to offer a realistic look at the landscape to digital media and entertainment executives.