How Will the Internet of Things Impact Publishers?

The next wave in digital publishing is on the way. And it’s built on the Internet of Things, the growing network of connected objects that collect and exchange data and information. For publishers, it’s the smart future of communications that enables intelligent and intuitive two-way delivery of content and preferences. It’s no surprise then that many in the industry are moving quickly to test, measure, and incorporate IoT strategies. The good news is that IoT, in many ways, is an extension of digital publishing—something many of today’s successful publishers have already figured out. The new opportunity in IoT is better informed data that can generate more relevant and useful integrations into the homes, businesses, and lives of consumers. Part of the reason for the push is that publishers realize that, just like with the rise of mobile, their content distribution channels must continue to grow along with consumers' more connected, and increasingly interconnected, lives. “Being able to meet readers where they are is an obvious priority for the business, and while it can create unique challenges to support the ever-growing number of devices, the payoff is that doing so gives us a 360-degree view of readers' habits and preferences—and that in turn allows us to build better content experiences for our customers, which fosters brand loyalty,” says Heidi Cho, vice president and head of digital at Rodale. Indeed, the sheer number of devices is daunting. In 2017, there will be 8.4 billion IoT devices—that’s more than one for every human on the planet—according to Gartner Research. By 2020, the number is expected to jump to 20.4 billion. For consumers, the connected devices will mostly be digital receivers, smart TVs, and automobiles, while businesses’ main connectivity will come through smart electrical meters and commercial security cameras, Gartner reports. While the publishing industry is still in the early stage of developing IoT strategies, eMarketer reports the overall media and entertainment industry will spend an average of $72.6 million on IoT by next year, an increase of almost 54% since 2015. It’s worth noting that even though IoT seems like another “new new thing” causing stress and business plan panic, it’s not that new. The term was first coined in 1999 by Procter & Gamble brand manager and RFID tag enthusiast Kevin Ashton to describe the connection of products to the internet. Think about some of the IoT devices that now go back into decades of use: General Motors’ OnStar has been around for more than 20 years, the BlackBerry smartphone debuted in 2003, ADT bowed web-connected home security in 2001, and even the Fitbit has been around for eight years. Publishers haven’t played a big role in IoT to date, but that’s changing as they adapt content and data in new ways to continue to be relevant in consumers’ connected futures. An Ernst & Young study of media and entertainment companies refers to IoT as “interactions between human and machine that unlock possibilities,” and listed specific publisher opportunities in the space. Those include increased content personalization, content discovery, recommendations, and gesture-based commerce. Meredith Works With Amazon to Provide Connected Recipes & Commerce While publishing in general has been slower than industries such as healthcare, automotive, or consumer electronics in IoT adoption, they’re catching on and catching up quickly. Leading food publication Meredith’s Allrecipes is a good example with its push to be an early adopter on Amazon Alexa and on Samsung’s Family Hub refrigerator. The digital-born brand began working with Amazon and its Alexa voice-driven intelligent app, which Amazon calls “skills,” last year with the Allrecipes Skill launching in November. The skill works across the Amazon family of devices—the Echo, Echo Dot, and Echo Show—with cooks using their voice to ask “Alexa, open the Allrecipes Skill.” From there, home cooks can ask for specific recipes, ingredients, or instructions with the ability to skip, pause, or repeat. Amazon is still fine-tuning its entire skills database and doesn’t give out user numbers to its skills brands yet, says Stan Pavlovsky, president of Meredith Digital, but Allrecipes has done its own research among its base of 85 million unique monthly users. They found that the Allrecipes skill usage peaks between 4 and 6PM and is heaviest on Sundays. Regarding voice IoT use in general, one indicative finding for Allrecipes is that 71% of its home cooks say that in 20 years, they won’t read recipes anymore, but will have them dictated by voice assistants. Allrecipes integrated with the Samsung smart refrigerator last year as well, using similar app smarts to offer recipes and more. The refrigerator’s additional features, such as interior cameras, can enable new interactions—for instance, taking a visual inventory of ingredients in the refrigerator and suggesting a recipe. “There are a lot of points or hubs in the kitchen where we believe we can play a role. Our strategy around the Internet of Things is to enable our users in a very useful way, but also make sure whatever bets we’re making will scale with our business,” says Pavlovsky. Rodale Makes IoT a Cohesive Part of the Reading Experience Rodale is also experimenting across its various publications, focused on a commitment to ensure its IoT content experience is seamless across devices and platforms. Cho says, “So if I purchase and start a workout program from the Men's Health mobile app on my phone, and then decide I want to continue it on my Apple watch, that transition is seamlessly connected via my user profile, which tracks my purchases and content consumption. Or if I buy one of the brand's video-on-demand streaming programs on my desktop, but then want to watch it on my TV screen using a streaming device like Roku, a unified profile allows us to connect all of those disparate channels together to deliver a cohesive content experience.” Hanley Wood Wants to Bring IoT Devices to Construction Sites B2B publishers have different challenges, in part because consumer IoT has grabbed the lion’s share of attention while commercial information uses have developed more quietly. Hanley Wood, a publisher for the residential, design, and commercial construction industry, is one of the B2B publishers currently building out its plans for IoT. One promising use for IoT is with its publication the Journal of Light Construction, which produces digital field guides of how-tos and local codes for the contracting audience. IoT is being explored for those field guides use on-site where a device can not only offer spoken word guidance, but also video how-to guides, says Dave Colford, Hanley Wood’s chief revenue officer. The strategy includes thinking about what kind of things or devices consumers will use to get access to the content. “We know that a lot of companies are not investing in job-site technology beyond tools to empower their teams. But in a world where technology is driving installation and driving product development, we as an information provider have to accept the fact that distribution of technology and information might be on us. It’s changing our approach,” says Colford. How To Get Paid? Revenue Models Still Nascent Revenue models are still emerging for publishers using IoT. Many are concentrating on the experience for now, while patiently plotting multiple revenue scenarios. Rest assured the nascent revenue models will likely rely on IoT’s more comprehensive data streams. Allrecipes, for instance, does not have advertisers on its Alexa skill yet, but Pavlovsky has ideas about how those might work and what advertisers they would appeal to. Manufacturers could sponsor certain ingredients, for example, while grocery retailers could sponsor recipes, especially in cases where the cook might need to pick up a few more ingredients. “Over time the business model will evolve to whatever the experience is,” says Pavlovsky. “There are numerous ways brands could get involved in this experience and bring value to consumers, which ultimately drive performance for those advertising partners.” That kind of super-targeted marketing to a single person or moment in time, in a specific place, is the appealing play of IoT’s extensive data and personalization. But it could also mean new revenue streams that were not possible before. Colford from Hanley Wood gives an on-demand sales example from the construction industry: “Imagine a scenario where Bosch is advertising a new warm drive circular saw in a video on the job site and someone’s circular saw has just broken down. They might say ‘Hey, I need that saw now.’ And not only can they stop the advertisement and order it right then through their business account, but also potentially receive it the same day, by picking it up at an Amazon box at the gas station.” Hanley Wood is also thinking beyond advertising and sponsor partners and looking at layering different kinds of subscription models on top of the ad model. For instance, because on-site experiences require rugged hardware to show content, they’re thinking about how to get that hardware into the construction site. One model under consideration is a membership model, says Colford. Instead of subscribers, Journal of Light Construction members would buy a certain number of content products and then JLC would give them a 32-inch TV and IoT device for use on job sites, along with that full access to content. Advertising would still be included, but possibly on a graduated scale. If someone wanted no advertising, the membership price would be higher and then tier down to the lowest price for all-advertising allowed, says Colford. Since devices or objects are needed for IoT, other publishers may consider similar models. Publications, for instance, could give out corporate branded Echo Dots or other IoT devices to certain level subscribers. “There was a time when the distribution onus was on us -- the paper, the printing, the postage, and everything we did to get the magazine into the hands of people who paid for it. This model is ostensibly the same, it’s just how we distribute it is different,” says Colford. “Now we potentially become responsible for actually delivering the hardware to access our information.” Advice for Getting Started With IoT As the IoT is growing rapidly, publishers and industry experts agree that media companies need to formulate a plan to use it. In some cases, that means launching trials like Allrecipes Alexa skill, while in others like Hanley Wood, it means researching and developing a plan. No matter where your company is along the IoT timeline, publishers must consider the need for scalability, think creatively about revenue models, work to make content feel seamless, and optimize data to inform content and context. Meredith’s Pavlovsky says, “My advice to other publishes is you have to focus on the consumer experience when you’re making your bets around innovation and where to innovate. You can’t do it all, so be really smart about how and where. We know there are going to be connected devices that we decide don’t make sense for us and that’s okay.” Colford advised investing in data streams to best understand the proprietary information about their audiences, noting that the IoT is “not even an option without that data layer.” “The challenge isn’t migrating from print to digital. The challenge is making the final leap to accepting that media companies today have a short-term opportunity to become data companies unto themselves. But you’ve got to invest to do it,” says Colford.

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How Will the Internet of Things Impact Publishers?

Beth Snyder Bulik

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Beth Snyder Bulik