How Mochila Created an iTunes-Like Marketplace for Editors

Traditional publishers face an online marketplace crowded with competitors. Blogs, niche Web publications, social networks and user-generated content all vie for traffic. But these sites aren’t just competition -- they could be customers if content syndication can adapt to the Web 2.0 world.

Creating customers for publishers is the goal of Mochila, an online content marketplace. “We set out to solve a big problem -- the scalability of licensing. Publishers are asking, ‘Why can’t we make more money from content?’ It’s because licensing is hard. You have human beings negotiating business issues. We’ve taken the complexity out of the process,” says Keith McAllister, CEO, Mochila.

Mochila needed a business model that would attract content buyers and sellers. In addition to simplified licensing, it meant a system that established control over content distribution and offered flexibility for searching, buying and displaying materials.

Mochila has attracted approximately 2,000 members since it launched in April 2006, and the number of transactions in the online marketplace has increased 350% in recent months. Here are the five key steps behind Mochila’s content-syndication model:

-> Step #1. Store content in centralized database

Members looking to sell their content start by loading materials into the Mochila marketplace, either manually or by using special adapters that establish content feeds to Mochila.

The system was created to accommodate a range of content types, including:
o Text
o Photographs and images
o Video

To stock the database, McAllister and his team focused on creating partnerships with major content suppliers, such as:
o Major newswires, including The Associated Press and Reuters
o Large magazine publishers, including Hearst and Hachette Filipacchi Media
o National, international and local newspapers, including The Washington Post, The Los Angeles Times and Metro International
o Large photo agencies, including Getty Images, ZUMA press and jupiterimages

-> Step #2. Set syndication rules and licensing arrangements

Mochila knew that publishers still worry about protecting their rights while experimenting with distributed content models. So, the team had to add a range of features that let content providers control who can use their content and what terms they’ll accept.

The solution was an automated system that lets publishers establish their own syndication rules to cover any piece of content in the marketplace.

- Publishers can set filters that govern the use of their content, including:
o Who can and can’t buy content (e.g., competitors or companies you already have a syndication deal with)
o Editing rules
o Embargoed stories
o Pricing, which typically depends on the size and frequency of the buyer’s publication

- All members are screened before joining to ensure that sites don’t feature pornography or hate speech -- kinds of places most publishers wouldn’t want their content appearing. Members also must prove they are a legitimate media property by including their two most recent issues with their application.

- Built-in analytics let content providers monitor who buys their material, how frequently those materials are used, page views, ad impressions and other metrics.

-> Step #3. Search the database for content

Creating a viable marketplace meant making relevant content easy to find. To do this, McAllister’s team developed options for different types of buyers:

- A basic search feature lets editors enter keywords describing the subject they’re interested in. From the search results, editors can select content from different sources resulting in a customized mix that best matches their editorial voice.

- Searches can be saved as RSS feeds that automatically alert editors when new content is available that matches their terms.

- For editors who don’t want to be as active in exploring the database, they offer pre-made channels on popular topics, such as:
o Business
o Entertainment
o Food
o Health
o Sports

Offering both unique searches and pre-made channels helped McAllister and his team capitalize on demand for different types of content: news-driven subjects and evergreen topics.

- To date, the most popular topics in the database have been news-driven subjects, such as politics, the war in Iraq, sports, celebrity news and entertainment.

- The team also has seen smaller, niche sites looking for evergreen content on affinity or hobbyist topics, such as:
o Food
o Green lifestyles and alternative energy
o Automotive subjects

-> Step #4. Purchase content

Another strategy to encourage participation in the marketplace was to develop two payment options. Content buyers could either:

- Pay for each article, video or photo on an a la carte basis, with prices determined by the original publisher.

- Receive content for free but supported by embedded advertising. In this model, known as AdMatch, the buyer, the content provider and Mochila divide the advertising revenue generated from the content. The creator gets 40% of the revenue, the buyer 30% and Mochila gets 30%.

Currently, the majority of transactions in the marketplace are conducted through the AdMatch platform. Whle free content is obviously appealing to buyers, Mochila CMO Craig Calder says the model has benefits for content providers as well:

- Capitalizing on the long tail. The impressions generated by a small, niche blog might not seem significant to a major publisher such as Reuters or Esquire magazine, but the aggregate value of the impressions generated by dozens or hundreds of such small sites can be substantial.

Calder cites a recent case when a niche telecommunications blog featured a report about a kidnapping victim who was found thanks to her cell phone signals. The news value of that article led to several other blogs linking to the story and resulted in a spike of impressions 20 times higher than the telecom blog typically received.

- Brand building. Some large publishers welcome AdMatch transactions simply as a way to spread their content to far reaches of the Internet where they can capture new readers.

- Inbound traffic. AdMatch allows publishers to place up to five related story links below a purchased piece of content, which bring readers back to their own homepage.

“By letting content go you have created a prospecting tool to pull people back to your own site, and you engage a new audience that wouldn’t otherwise come to the site on their own,” Calder says.

-> Step #5. Download and publish content

Besides simplifying licensing arrangements, Mochila simplified the distribution of purchased content.

- When buyers choose an article, photo or video, they receive a piece of Web code they can cut and paste into their own sites to display the content.

- For pre-assembled content channels, the team also created online widgets, called Badges, featuring headline links to articles and videos. Those badges can be embedded directly in a buyer’s homepage.

Badges are linked back to the Mochila network and updated automatically via RSS with new content that matches the topic and keywords.

- Buyers can customize those widgets with fonts and colors to help them blend with their sites’ design.


Useful links related to this article
Creative samples from Mochila's online content marketplace:
http://www.marketingsherpa.com/cs/mochila/study.html

24/7 Real Media - partner in Mochila's AdMatch program:
http://www.247realmedia.com/EN-US/

Quigo - partner in Mochila's AdMatch program:
http://www.quigo.com/

Tacoda - partner in Mochila's AdMatch program:
http://www.tacoda.com/

Mochila:
http://www.mochila.com