06:07 AM

ChipWatch - Where Next For Semiconductor Trade Press?

By Matt Grimshaw, Editorial Director of the Semiconductor Technical Journal Future Fab International.

As the year draws to a close I've been trying to take stock of where the semiconductor world stands as we collectively look forward to a period of growth and try to put the disasters of 2008 and 2009 behind us.

I've been having many conversations and meetings with some of the largest semiconductor PR firms and gurus on just what the hell is going on in an attempt to get a handle on what the future holds for the semiconductor segment and in particular the media in this space.

The results were unsurprisingly about as clear as mud; I have never in my ten years in this industry seen such a mass of confusion as to what to do - it makes a riot look like a Gold medal synchronized swimming team.

Fear is the prevailing emotion; communications people at vendor companies in all segments of the semiconductor support ecosystem are being asked to come up with answers to unanswerable questions. Questions like "If I give you X dollars how much money is that going to make the company?"

Companies want to calculate a return on their marketing and media investments in ways that don't quite make sense. They want detectable business as a result of their spending and while this is certainly attainable with modern technology, if you are selling cars or any number of electronic gadgets that number in the tens to hundreds of thousands, when you're selling big shiny tools/software/materials that cost tens of millions of dollars, and your total sales for a year equal 30 units...the market dynamics are incomparable.

When just one sale can be 5-10% of a company's income...how can it be attributed to any one avenue of communication such as advertising?

The chip business is now entering a state of maturity that's pretty much equivalent to late teen angst. The pimples and days of gaining a couple of inches in height every month are gone, now the personality must mature and integration into society at large begins. In the world of the semiconductor supply chain this means that the good old days of massive double digit growth (and subsequent crash) with cash flowing faster then water over Niagara Falls are gone and have been replaced with a game where the stakes are now so high that one error or slip could lead to a company's destruction.

No one talks about the 'killer application' (the one product that drives a boom - i.e. PC's, cellphones etc.) anymore - the consumer is now king and they are more fickle then a cat offering its belly for a good scratch...those with mangled hands know the dangers of which I speak. This leads to fear that filters through the infrastructure of all companies and leads to hesitancy and resistance to the unknown.

On the one hand no one wants to support the old models, on the other they also don't want to try something new. The old media models are not just dying, in some cases such as trade shows, they have done their jobs so effectively they are putting themselves out of business. When trade events came into being it was because customers and vendors didn't really talk - over the course of 30 years they have learned not only to talk, but now are codependent. Trade shows ceased being places of trade or places where wares are shown and became PR events with some technical aspects thrown in for good measure.

Everyone that can afford a new big shiny chip production tool has already been contacted long before the show in order to develop the product, so no one needs to show it off to prospective clients at an event because the clients have already seen it and have most likely had a hand in its development. With no reason to show up at events, the people the exhibitors want to meet -- the buyers stopped going.

So what about virtual conferences and social networking, will they fill the void? While these virtual events and sites do serve a purpose they miss out on the one thing that still makes trade shows valuable; meeting new contacts and people. You simply cannot build personal relationships in a virtual environment in the same manner as those built in person. The camaraderie is reliant on being there.

I could tell you numerous stories that start with "I met these folks and xyz show and we went out for a drink..." that end up with hilarity and a bond that remains in place for years.

Similarly with magazines and trade publications, the marketing folks now want leads from advertising that turn into sales as a direct result of $$'s spent and magazine ads simply don't perform this function.

Good products lead to success - advertising, PR and all forms of marketing are just the mechanisms to let people know that a good product exists. However, marketing people need leads in order to justify their spending to those that create budgets, hence the problem.

Advertising doesn't need to be sold to marketing folks, it needs to be sold to accountants...and they simply don't see much value in it. Advertising, yes even web advertising, simply doesn't supply leads. At best it supplies interest or curiosity.

So with budgets being limited, marketing spend has been pulled back from that which funds magazines/websites and journals. It is being funneled into press releases, interviews, and articles as they do not cost as much as advertising.

While seemingly logical to the buyer it means that publishers in the semiconductor media sector are forced to cut back on editorial space. Which means that marketers and PR folks find it harder and harder to get anyone to publish press releases, interviews or articles. And it all goes spiraling towards the ground with neither party seeming to be able to do anything about it.

Media companies have few choices left to them; 1) Get the hell out of the game 2) start charging for promotional content/articles 3) experiment with new ideas.

Option 1 isn't really feasible as media companies create media...what else shall we do? Option 2 is considered a dirty phrase known as "pay for play" in the segment which stirs marketing folks into a frenzy of witch-hunting that which hasn't been seen since the Spanish inquisition (and nobody expects the Spanish Inquisition). Marketers would rather stab themselves to death with toothpicks then admit to paying for the inclusion of content.

This leaves option 3 but nobody wants to jump first... there's a prevailing "I'll go if you can show me others that have already succeeded" mentality that completely negates the meaning of NEW. So, have we reached an impasse?

What do marketers want? What's next for the Semiconductor trade press?