Even with a 125-year history, Coca Cola says it's just getting started. So, for the few years that the content as value asset model has been in existence, the content ecosystem and changes to the content industry have also just begun.
The next 10 years will be about the development of content networks and providing value to everyone who participates in content ecosystems. It's too easy and misguided to simplify all marketplaces into supply and demand. The evolution of marketplaces is tied closely to distribution and closing the information asymmetry gap between supply and demand, also known as lead generation. New marketplaces are now cutting out the middleman and allowing the supply side to keep and earn more of the rake. From a marketing point of view, relationships in the content generation for asset value is leveraged powerfully by WOM (word of mouth), referral and organic growth. Notably, 50% of users of products and services are generated by WOM, so to get to this state of things, companies must have a transformative vision that’s easily understood by B-to-B partners and consumers. WOM virality is about growth: People referring our product(s) to others. The network effect is all about retention and defensibility of the business. The key role of marketing in this case is to grow market share and then defend that share of market as you grow into new markets. Once a strong network effect has been achieved, it becomes difficult for competitors, existing or new, to challenge and compete. Marketplaces that don’t benefit from network effects that drive CAC down over time are in a costly race to raise capital to grow and grab market share while trying to develop a cost-effective model where unit economics are positive. A differentiated supply of quality and desirable content creates market defensibility, continuous value, and keeps costs of acquisitions and marketing down.
Some observations and fundamentals to keep in mind:
1. A network effect working in one market has no bearing on this working in another market. Geography, culture, influencers in regions around the world will drive messaging and market decision-making; 2. Market to everyone who has or needs quality content; 3. Build upon the professions: Asset class users, creators, creatives, and collaborators to create WOM and network effect; 4. Build the social proof and reputation to attract asset class supply and demand sides, so that talent on the supply side is apparent and we also show off a prominent demand for the management of content assets.
Content is on its way to being treated like stocks and bonds and other assets, curated, promoted and distributed carefully. Soon the content industry will be revolutionized by true and mature network ecosystems. But only by companies who understand the transformative power of this emerging asset class that will power company economics and markets.