Raise your hand if this question sounds familiar. “So are you a tech company or a media company?” Sometimes, it’s an easy one to answer. But often, that question is met with a pause, and a few moments of pondering. “Well, that depends . . .” is often the reply. But the real answer is: Every company wants to be a tech company to a certain degree, but tech and media, more than most industries, have quite a bit to learn from each other.
This labeling game sometimes centers around how a company wants to be perceived. To be a “tech company” is often to be seen as more innovative, disruptive, and valuable. Sometimes the label has other significant implications—for example, a media company may be held responsible for content posted on its site in ways that a social media platform would not.
Netflix is an interesting example. While other companies call themselves “platforms” to avoid more traditional labels, CEO Reed Hastings recently called Netflix, “a content company powered by tech.” Netflix uses big data in very innovative ways, like leading tech companies. (Just look at how it came up with the idea for “House of Cards.”) Financial services juggernaut Goldman Sachs has been calling itself a tech company for a few years, and engineers make up over a quarter of their workforce.
Though the labels can get confusing fast, tech and media’s goals are often next-door neighbors, and these two powerful industries seem to be embracing the opportunities to learn from each other.
For Media, Advertising Goes Digital
The Washington Post is one example of the benefits of the mutual learning. While (appropriately) structured like a newspaper in many ways, it’s tripled its technology staff and digital ad revenue growth has consistently grown by double digits in the last few years. More and more, newspapers’ revenue is coming from digital; for the Guardian, it’s 56 percent of its total revenue, and 80 percent of its advertising revenue is digital.
New research by Workday finds that 68 percent of media industry executives anticipate digital will account for half or more of their revenue in three years.
And that trend doesn’t appear to be slowing down. In a Workday research study titled, “Organizational Agility at Scale: The Key to Driving Digital Growth,” 68 percent of media industry executives said that they anticipate digital will account for half or more of their revenue in three years. And in the same survey, the media industry had the most leaders who exhibited all five attributes of organizational agility. Maybe it’s the journalistic spirit of “on deadline” speed and agility? Whatever the reason, the benefits keep rolling in.
Happy Customer = Spending Customer
Both tech and media are doubling down on customer satisfaction and finding new ways to monetize. The New York Times spent $30 million to purchase product review site Wirecutter, and it generated $150 million in e-commerce revenue in 2015. Premium subscription models, microtransactions, and entirely new business models are springing up to make customers happier (and freer with their wallets) than ever. If you’ve ever paid to get unlimited access to New York Times articles or made an in-game purchase because you just had to get to that next level, you’re a success story for digital monetization.
Big Benefits from Big Data
Getting the most out of big data is another common theme and goal for tech and media companies. Remember the “House of Cards” example with Netflix? That genius use of big data by a media company is very tech-like. As they work to get the most out of big data, tech and media are knee-deep into making sure they’re compliant with increasing regulations, like GDPR and CCPA.
As they work to embrace new ways of thinking, tech and media companies are using the power of big data and analytics to find hidden value, and using that newfound value to fuel future growth and increased customer engagement. And when colleagues from tech and media companies gather, a common theme rings true: they want more opportunities to move away from disparate systems, and put all the right big data in all the right places.
Resiliency and Active Planning Are Key
“What have you done for me lately?” More than many other sectors, media is well acquainted with the phenomenon of only being as good as its most recent product or service. Our recent organizational agility research also revealed that considerably more media organizations claim the ability to react quickly to market shifts (38 percent of media companies versus 18 percent overall). Movie studios and broadcasters make real-time choices about programming based on anticipated changes in audience preferences. When demand signals shift, active planning (backed up by advanced analytics) helps tech and media companies move R&D funding to new products that will meet those demands.
Adapt to the Changing World of Work
And finally, the changing world of work is hitting home in many ways. The gig economy is creating entirely new ways to produce films, create video games, and build software. Fully distributed companies are commonplace. And the battle for talent continues as companies work to find new ways to bring the best team members on board. With so many opportunities for talent across the industry, becoming a “best place to work” is more important than ever.
Tech. Media. “Platform.” “Content company.” Whatever your company calls itself, your goals are likely cut from the same cloth, and by learning from each other, tech and media companies are building a world with software as the cornerstone.