The notion that there is more value created in the process of delivering purchases than in the process of creating the content which makes people want to buy in the first place has been buzzing round my mind since I read Chris Dixon’s post Why content sites are getting ripped off. He makes a distinction between ‘intent generation’ and ‘intent harvesting’, arguing that it is original content which generates the intent to purchase, but that intent is then harvested by Google, Craigslist, affiliates and other participants in the link economy who take all the value, hence ripping off the content sites.
I buy all of this except the ripping off bit.
Prior to the web intent generation and intent harvesting happened in the same place, to some extent at least – e.g. in newspapers. But the web has torn that bundle apart and current evidence suggests that the value is in the harvesting (e.g. via classifieds) rather than the news and reviews that sat alongside them.
It was reading on the newsweek blog this morning about Rupert Murdoch complaining about Google stealing his content, but not doing anything about it which crystallised this thought for me. He could stop Google from indexing his sites, but doesn’t because his traffic would plummet as all his readers went elsewhere. They can do that because news, and hence intent generation, is an abundant commodity. The site that delivers the consumer is different though – ecommerce companies will pay as much for that as they can afford, and they will do it over and over again.
Don’t take this as meaning that I think content sites don’t influence the purchase decision, of course they do. There is a lot of talk and innovation currently aimed at understanding this better and at getting away from the last cookie pays paradigm, which I welcome. I suspect though, that when these innovations see the light of day and the dust has settled, advertisers will continue to place the lions share of value on the site that actually delivers them the customer.
Taking an offline analogy I would argue that in a sense this has always been the case. If I’m on Oxford Street I can choose whether to go to Selfridges or House of Fraser to buy many of the same items. No-one has a problem with the one I choose taking all the retail margin regardless of how I got interested in the product in the first place.
The thing that has definitely changed though is the way we find information on what we want to buy. In times gone past our only sources were the very limited number of TV channels and print publications at our disposal, and a lot of the information was in the ads. These days nobody relies on ads for information, which reduces their value, shifting it to the intent harvesters.
These thoughts are a little more half-formed than usual, hence the ‘musing’ in the title. I’d love to hear your views.