2017 was the year brands buy media companies, according to Joe Pulizzi and Robert Rose who made the declaration in a This Old Marketing podcast last May. Did it happen? Has your organization bought any media companies or even maybe built its own media arm?
Maybe. Maybe not. Either way, you’re probably curious about what it looks like for a brand to run a media organization. What’s the best way for the marketing and media teams to relate to each other? Should they keep a “church-state” separation (like the separation that newspapers traditionally uphold between reporting and advertising teams), or should they collaborate? What can organizations do to ensure that the brand –and its audiences – benefit?
One person who can speak to these questions is Victor Gao, vice president of digital and managing director at Arrow Media Group at Arrow Electronics. He did just that at Content Marketing World in his talk, How the Enterprise Marketing Department Can Build and Scale Media.
This post reviews Victor’s story of what Arrow Electronics has learned from its bold foray into the media business.
What Arrow Electronics has learned about running media companies
In their new book, Killing Marketing, Joe Pulizzi and Robert Rose recount the story of how Arrow Electronics, one of the world’s largest companies, spent millions between 2015 and 2016 to purchase more than 50 media properties to acquire their valuable subscriber lists and editorial talent. In all cases, the subscribers are electrical engineers, the company’s target market.
Before making the media acquisitions, Arrow Electronics had been watching the struggles of the publications because it advertised in them. Here’s a passage from Killing Marketing that tells the story:
For the company’s customers, electrical engineers, not only were these publications how they kept up with what was going on in the industry – they were how kids became enamored and inspired to become electrical engineers. These publications are … the lifeline for increasing the knowledge and population size of the Arrow Electronics customer base … Arrow has seized this opportunity. The company saw the tremendous need to serve engineers.
Arrow Electronics bought media properties because of the niche they appealed to, not the size of their audiences. Many of the publications had been “buried in the belly of much larger media conglomerates,” as Victor explained in Joe and Robert’s book. “Arrow believed it could deliver the very best information to smaller sections and segments” of the electrical-engineer audience.
Your company doesn’t have to buy 50 media properties – or even one – to benefit from the lessons that Arrow Electronics has learned, including these shared by Victor:
- Align your media teams in a meta-architecture.
- Let journalists be journalists.
- Focus on engagement over reach.
- Involve managing editors in all the information your customers see.
1. Align your media teams in a meta-architecture
The first thing Arrow Electronics did was reorient the newly acquired media teams so they focused on customers in a coordinated way. Victor compares this effort to the movie Transformers, in which three of four transformers get together to form a bigger, more powerful transformer – Combiner.
Think of your portfolio of media companies. Each serves an audience. How do you bring them together so there is an inner relationship between the media brands? The way we did that was to look at the life cycle or design cycle and the production cycle for a typical electrical-engineer team.
The Arrow marketing team created a wheel model and mapped each audience segment to part of the cycle of electronics design and manufacturing. One audience segment, shown at the top, develops concepts. The next creates detailed designs. The next creates prototypes and tests them, and so on, around the wheel.
Think of each of these segments as a Transformer.
When you fit the segments together to form this wheel, your independent media teams form a powerful media outlet with a unified purpose. This new Combiner Transformer – a whole greater than the sum of its parts – is Arrow’s media arm.
To create its media arm, Victor’s group consolidated some media teams and created new ones. “We re-architected the whole structure,” creating a “meta-architecture” that all the media teams fit into, aligning them to serve the company’s customers in a comprehensive, strategically integrated way, Victor says.
In Killing Marketing, he notes, “We wanted to make sure that we can go along that journey for the engineer so we can … help them soup to nuts.”
All the media properties are housed in a separate division of Arrow – AspenCore – which creates a sort of firewall between the main company and its media properties.
2. Let journalists be journalists
While you want to re-architect your media teams at a high level so they fit together, there’s a counterpoint. As Victor says, “If an editorial team is really good, don’t mess with them.”
He points to Junko Yoshida and Rick Merritt with EE Times as among Arrow’s star reporters. They are the biggest reasons the company bought that portfolio. Below, you see Rick and Junko’s faces along with several other professionals Victor identifies as significant talent on Arrow’s media teams.
These are the reporters, editors, journalists. They’re not just rewriting press releases and calling that an article. They’re insiders. They go into companies, like Synopsis, a huge electronics design-automation software company in Silicon Valley. They sit down with the CMO and ask, ‘What are you going to do for the next 18 months that you haven’t talked about?’ They show enterprise. They interview multiple companies. They interview skeptics. They interview end users of that company’s products. They provide a 360 view. In other words, good journalism.
When you buy (or build) a media company, you want talented people on that team – including staff and freelancers – with the skills and integrity to create stories that people will care about.
And, yes, that means covering all the issues the audience cares about even when they put your competitors in a favorable light. “I can give you eight examples in the last six months where we wrote prominent articles that touted the advantages of our competition,” Victor says. “If a competitor comes out with a better product, we will talk about it. We will interview the customers. That builds trust.”
Arrow, he says, is committed to its media properties taking a customer-centric view and telling stories of value to their readers. “Think like an editor,” Victor says. “When customers go online, they don’t care about what you’re selling. They care about finding solutions. They care about the problems they’re trying to solve.”
3. Focus on engagement over reach
“Reach is a byproduct of focusing on engagement,” Victor says. “Help people sift through the noise. Engagement is a right you have to earn.”
You do it by showing in article after article that you are getting to the essence of what people need to know. “When you focus on narrow segments of your audience, engagement will fan out and help you build the reach,” Victor says.
If you buy a media company, don’t stay stuck in the product-centric view. “That would ruin the strategic value of your acquisitions,” Victor says. As the Killing Marketing authors write, “Arrow is playing the long game here. By transforming a part of its marketing into an editorially led strategy, it is doing more than just focusing on describing the value of Arrow’s products.”
Arrow is giving people something to engage with that they can’t get elsewhere. “Let reach take care of itself,” Victor says. It doesn’t work to “blast people with random information they can get anywhere.”
4. Involve managing editors in all the information your customers see
Managing editors must be involved in all the information your customers see, Victor says, including at events and in ads.
This view is controversial. Journalists typically call for a separation of the editorial and advertising sides of a media business. Victor calls for companies to abolish any strict separation.
A lot of people in editorial rooms cringe when they see that the separation between church and state is coming down. But ads are going to show up next to your articles, or your gallery, or whatever it is. For the editor not to pay attention and not to participate in the discussion of that overall experience – including advertising messages – is abdication of editorial responsibility. You cannot pretend advertising does not exist. All media teams need to get involved in those conversations.
It’s a tricky subject. The point is the editorial staff must be in on the dialogue. “Ironically, this is the best thing for the marketer and for the advertisers that work with you,” Victor says.
As Robert and Joe say in Killing Marketing, the marketing skills of tomorrow are equal parts marketing and publishing. For marketers like Victor and his colleagues, tomorrow is today.
Was 2017 the year for your brand to buy – or build – a media company? Will 2018 be? What steps are you taking in that direction? Let us know in a comment.
Here’s an excerpt from Victor’s talk:
Marketers embracing opportunities to gain from traditional media – whether it’s an acquisition or a proven model for content creation – will want to make plans to attend Content Marketing World this September. Register today.
Cover image by Joseph Kalinowski/Content Marketing Institute