NBC Universal CEO Je Zucker once amously dismissed the digiti-zation o media and entertainmentas having traded “analog dollars or digital pennies.” Although Zucker has recently upgraded his assess-ment (he thinks revenue generationhas now achieved at least the levelo “digital dimes”), companies stillhave a long way to go to generatethe kind o revenues one shouldexpect rom digital channels.To be sure, companies in the mediaand entertainment industries havebeen among the hardest hit by thedigital revolution. But almost everycompany is struggling in some waywith how to leverage digital com-munications technologies and trans-late digital capabilities into cash.Part o the problem is the usual lagbetween when new technologiesand oerings are created and whenthey are embraced by customers.But the biggest sticking point byar is the lukewarm embrace bymany companies o the essentialand distinguishing characteristicso the digital world.Too many companies still hold ontotheir analog mindsets, which pre- vents them rom leveraging what isunique about the digital experience:the ability to develop interactiverelationships with customers, romthe earliest points in the buyingcycle. Without a sustained relation-ship, companies are let trying tomonetize single website visits, ban-ner ads and one-o downloads o mobile applications. But i you candevelop an ongoing dialogue withcustomers, then you’re on the pathtoward the digital Promised Land.
The digital difference
Unortunately, most companies havea long way to go beore they will beable to monetize these relationships.To this day, many corporate websitesare little more than online versions o analog sales brochures hosted on plat-orms that are incapable o deliveringa customized, engaging experience.I companies are to eectivelymonetize the digital relationshipwith consumers, they must get threethings right.
Engage consumers through relevanceand dialogue.
Companies need toimprove their ability to engage andinuence consumers through rel-evant and timely experiences basedon their interests—engenderingloyalty and proftable behaviors.This means adopting a truly digitalmindset. The age o push marketingis behind us. What counts now aredialogue, engagement and relevance.
Use technology to deliver a custom-ized digital experience with a morepredictable cost structure.
Companiesmust adopt more exible and scalabletechnology platorms capable o creating a tailored experience or consumers over both online andmobile channels, and they must doit with a more predictable cost struc-ture over time.
Establish revenue models based onthe success o relationship building.
The ability to engage consumerswith relevant and customized expe-riences becomes, then, the basis or monetization. Instead o ocusing oninputs such as numbers o banner ads or page views, companies—especially media and entertainmentcompanies—will be able to ocus onrelationship-based outcomes: a knownquantity o consumers whose interestsare well understood. Digital chan-nels that can deliver consumers withestablished interests can charge hand-somely or that capability.In short, engagement, relevance andcustomization lead to longer-termrelationships. And those relationshipsare the key to digital monetization. At the heart o digital technologiesis the potential or delivering unique