Facebook will take publishing and it’s ok (ish)

Paul McIntyre
By Paul McIntyre | 20 February 2015

Hanging on the wall in Neil Ackland’s office is a proclamation of profanity and purpose; harsh to some, no doubt, but it’s a butt-kicking affirmation for the online publisher who has corporate advisory firm Grant Samuel halfway through a review of the business for a possible trade sale or IPO.

“Believe in your fucking self,” screams the opening stanza. “Stay up all fucking night. Work outside your fucking habits. Fucking collaborate. Get over your fucking self. A computer is a Lite-Brite for bad fucking ideas.” And that’s just the start. “Educate your fucking client. Trust your fucking gut. Ask for fucking help,” screams more of the wisdom from goodfuckingdesign.com. There’s so much more, but so little time.

Ackland hit trouble a few years back when the ominous reality struck that online advertising CPMs were heading south fast and were not going to fund the sort of editorial resource Sound Alliance needed to stay a prosperous media youth-orientated company, despite ongoing market rhetoric about hard-to-reach younger audiences being a premium proposition for advertisers.

That’s when Ackland and his crew sparked an early crusade in Australia for native advertising via the launch of Junkee.
In two years, native ad formats now account for 40 % of group revenue and its recent Qantas-funded AWOL content play for young travellers is considered the biggest native-come-content marketing project yet in Australia.
“The desktop display advertising business is still there but it’s a legacy business now for us,” says Ackland. “The next evolution is how do we create content that can exist within the framework of social media – Facebook or Instagram, for example.”

That’s been Ackland’s trick for a while now – mastering audience flows inside Facebook. “You’ve got young people spending increasingly large amounts of time with their mobile being the first screen,” he says. “And when they’re on their mobile the social media of choice is still Facebook. It’s essentially their home page. So we need to create content that is not only engaging, but shareable and written to tear up the Facebook feed. Facebook has been a huge source of growth for Junkee.”

Actually, it’s a big dollop of Facebook as a distribution channel and an equal whack of content with the right angle and tone. Ackland saw that with Junkee’s coverage of politics. It’s not the style that would impress Canberra’s press gallery, with all its seriousness and manufactured tension, but more quirk, wit and insight. “Our take on politics is quite a unique voice – it’s all young people writing for young people and it’s really resonating,” he says. When the Coalition’s leadership spill was on, for instance, Junkee went out with a story around the “10 great Tony Abbott memorabilia that you can buy right now on the internet”. Junkee told the story of the spill through “the lens of this really funny, engaging piece of content that people like,” says Ackland. “It’s not straight up and down hard news. It’s more taking the hard news and then putting the analysis over the top that resonates with young people in the language they understand.”

But back to Facebook and its rising influence in content distribution. It’s mightily impressive how the social media juggernaut has managed to onboard expensive content funded by other publishers for free to build and keep its highly engaged audience. Moreover, Facebook sells that content to the same advertisers that the original creators and funders of the content are also trying to woo through ads, typically at a fraction of the price. Few media companies legally can get away with using rival media company content to sustain a business model and not pay. How sustainable that whole approach is remains unclear, but Ackland, for now, is resigned to the reality.

Like many publishers, Sound Alliance has seen the carnage when Facebook tweaks its algorithm and traffic takes a dive. So is he concerned at all about the massive reliance on one revenue-hungry global tech player generating 70 % of his traffic?
“Of course,” he says. “We’ve seen several Facebook algorithm changes in the last year or so. But what you’re actually seeing is that the algorithm is being refined to focus on delivering more quality content, not click bait.” Ackland is essentially for ‘Team Facebook’ because its focus and need for outside quality content that it doesn’t fund keeps users sticky. If Sound Alliance remains nimble and agile, Ackland says it can slipstream Facebook’s algorithm or switch to other platforms as they emerge.

As for other online publishers, Ackland says they have to get with the Facebook program. “If you set your business up to be mobile first and you’ve got a native offering and you understand your audience really well, you’ve at least got a fine chance,” he says. “The media business is becoming more global and we’re seeing a lot of them come down to Australia at the moment, and that’s definitely going to impact on the market in the next two or three years. If you work on the theory that the US is two or three years ahead, it’s why we think it’s really important that we’re not looking to the Australian market for our lead. The challenge we have here is you’ve got big companies, essentially startups that have raised significant investment funding out of the US, and their game is about scale, it’s not about profitability. So they’re coming here to play a scale game. They can afford to burn cash.”

And what about Sound Alliance’s future cash? Ackland is staying mum on the current status of the Grant Samuel review. “The thinking is: ‘Do we take an investment? Do we essentially sell the business? What are other potential options?’ We should know what’s happening in the next couple of months.”
Any conversations with offshore players then? “I can’t comment on that,” he says wryly.
But the last line on the poster of profanity on Ackland’s wall says it all: “Think about all the fucking possibilities.”

This story first appeared in the AdNews print edition 20 February 2015.
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