Monday, March 27, 2006

Factiva Moves to Affiliates to Power Reputation Management Drivers

Reputation management and media intelligence services have been hot on the lips of many content providers as of late, but selling content services into a specialized community such as public relations professionals can get a little sticky for a content companies. There are ways of doing business in the trade and consultancies that have been in the space for decades that are going to be far ahead of publishers in industry knowledge and networking. So its no great surprise that Factiva has announced a new affiliate network program to support its marketing efforts to support its line of services supporting public relations consultancies and agencies. This logical move, though, points up one of the continuing challenges faced by aggregators as they identify more and more specific market niches into which they can deploy content services: how to sell a content solution for business problems when the solutions providers in that space have their own way of doing business. Working with I.T.-oriented companies as partners to provide premium content services in enterprise and online portals is one thing: working with business solutions providers that may touch upon content technologies only lightly in their main line of consultancy is quite another.

Yet this is the future for many content service providers identifying specific niches for complex services that can drive up revenues and margins. Working with affiliate networks can be difficult and can eat into margins, but where a content provider's brand is not well established in a specific market segment affiliates make great sense for supporting an initial penetration into narrow but lucrative niches. It makes sense especially for a company such as Factiva, which has a lot of irons in the fire and cannot afford to hire and train over-specialized sales professionals to service a specific niche with relatively limited market potential. As more and more business content providers define more niche-oriented opportunities on the high end of their markets the search for effective sales affiliations will become more important -and will inevitably push business content providers more into the roles of the companies with which they affiliate in order to maximize their revenues.

Sales and marketing channel conflicts are likely to erupt in these affiliate programs as content companies try to build more home-grown penetration, but if content providers are interested in becoming business solutions providers that can dominate given solutions niche they will have to juggle affiliates and their own sales and implementation capabilities quickly and carefully to extend their relationships as broadly as possible. Over time this may mean that many business aggregators will come to resemble management consultancies more than content vendors - and that may not be a bad thing. It may also indicate the types of companies to which many high-end business content solutions providers may market their exit strategies in the years ahead. But in the meantime, there's lots of money to be made via affiliates to enhance business content's value in specific market sectors.
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