The start of a new year offers a clean slate: a chance to evaluate where you stand, and what you can do to grow over the next twelve months and beyond. But the digital landscape is ever-changing, and with dozens upon dozens of trends to watch, it can be difficult to know where and how to pivot your business model so you can grow your revenue year over year.
Have no fear! We want to help you get your business planning off on the right foot in the new year. These seven strategy questions can help you refresh your business tactics and focus on the handful of areas where you can grow in 2019.
1. What’s Your “Breakthrough Experiment” for This Year?
Eighty-eight percent of Fortune 500 companies have gone out of business over the past 50 years. If you aren’t innovating with new products, you’re leaving yourself vulnerable to shifts in the industry.
While it can be hard to push for change, trying new things breathes life into your company. In fact, you should try at least one new initiative at your company each year. If you haven’t already set aside room in your budget for innovation, this is the year to start.
Throughout December, we shared useful tips for identifying organizational inertia in your business and ways to overcome it by stopping the cycle and introducing new curveballs. If you’re looking for ways to break out of the status quo in 2019, this series offers practical advice for shaking things up.
Don’t expect every attempt to be your prize-winning racehorse. Your investment in something fresh is an experiment. You will learn how to turn that experiment into a success once you try it, measure the results, and pivot accordingly.
2. How Much of Your Revenue Comes From Digital Sources?
The future of publishing is digital. If you’re not pushing for at least half of your revenue to come from digital, you’re at risk of falling behind the competition.
We’ve seen some publishing giants, like the New York Times, successfully navigate the switch from a print to an online focus. There’s a lot that any publisher can learn from looking at their paywall strategies and the way they’ve diversified their online offerings.
These sorts of strategic shifts take time. Now is your chance to enact a plan that turns digital into your primary revenue source over the next three to five years.
3. Have You Diversified Your Digital Revenue Streams?
Now you know that half of your revenue should come from digital. But did you also know that half of your digital revenue should come from sources other than programmatic advertising?
That figure may seem like a lot, but the truth is, the digital ad market is challenged. Rates continue to decline, and ad blockers threaten mobile revenue models.
The key is to supplement ad revenues with consumer revenue streams (think subscription models and paywalls). Your readers should be paying to access your premium digital content.
Like the New York Times, Medium has also successfully moved away from advertising and towards membership models to build profits. Your business shouldn’t be far behind.
Ready to get started? Here are four ways to monetize your digital content.
4. Do You Have a Marketing Plan With Specific Goals for Each of Your Consumer Segments?
One-size-fits-all marketing no longer works. Have you segmented your consumers into three to five different groups? For example, a finance-oriented magazine might want to segment their readers based on the size of the company, role (CFO versus staff accountant), and/or technical sophistication.
Develop unique marketing strategies for each consumer type. Attention spans are decreasing, so it’s more important than ever to reach your audiences on a highly-personalized, individual level. Don’t clutter your marketing message with materials that are not relevant to a given segment.
A great way to achieve true personalization for your customers is through the use of a Customer Data Platform (CDP). We’ve written about the benefits of this tremendous technology in the past, covering how a CDP can drive revenue, outlining how to find the right tool for your business, and sharing tips for successful implementation.
5. Do You Have a Robust Account Management Strategy?
Understand the business objectives of your key partners, and develop a list of projects to work on together. This way, everyone succeeds.
Distributor hoping to get into a new market? Position one of your products to help them enter. Advertiser looking to target a certain psychographic? Work with them on a custom advertising campaign to drive leads to their website.
Care for your most important advertisers and distributors so you can go head-to-head with advertising giants like Google and Facebook. They might have the numbers, but you can offer a personalized approach.
6. What Initiatives Will Improve Your EBITDA Margins by at Least One Point?
Your earnings before interest, tax, depreciation, and amortization (EBITDA) is a measure of your company’s operating performance. You should always look for ways to improve your EBITDA margin by at least a point, but remember, you don’t want to cut so deep you hit bone.
- Can you renegotiate a major contract?
- Are there tools you don’t need? Opt out of a software license you rarely use.
- Find ways to motivate your sales and marketing team to promote higher gross margin products.
- How can you take advantage of lower-cost marketing and distribution channels?
This does not mean, however, that you should be using cost-cutting exercises as an excuse to underinvest in new products or services. In fact, pruning out-of-date systems and processes should free you up to redirect spend and energy to important innovation initiatives (see question one).
7. Have You Set Goals for This Year?
Have you distilled your company objectives into five or so goals that you can broadly communicate to the company at large? A fresh calendar year is a perfect time to get everyone on the same page.
Summarize your strategy into five easy-to-remember goals, and communicate them broadly. Update the company on progress against your targets at least quarterly. If everyone understands the “why” behind your business decisions and feels like progress is being made against lofty ambitions, you’ll nurture a much more engaged and effective team.
If you can develop solid answers to these questions before you get caught up in the daily grind of a new year, you can set yourself up for success in 2019 and beyond!
About the Author
Rob Ristagno, Founder and CEO of Sterling Woods, previously served as a senior executive at several digital media and e-commerce businesses, including as COO of America’s Test Kitchen. He started his career as a consultant at McKinsey. Ristagno holds degrees from the Harvard Business School and Dartmouth College and has taught at both Harvard and Boston College.
Rob is the author of A Member is Worth a Thousand Visitors: A Proven Method for Making More Money Online. He regularly speaks at key media conferences, including at Niche Media events, Specialized Information Publishers Association meetings, and the Business Information and Media Summit.