With the rise of digital comes the inevitable scrutiny of revenues. Publishers are increasingly talking about alternative revenue streams – amping up the interactivity of advertising, running new homepage ‘takeovers’, and in general working on how their ads are targeting people with specific needs (see the rise of advertising networks in digital).
There are two running themes from this model: firstly, they are all themed around the traditional publishing model of ‘display’ advertising (which is an exceptionally print based model, particularly as customisation is virtually impossible to scale), and secondly, they are based on flawed metrics.
Looking at the first point – advertising is still based around the concept of buying ‘space’ for a brand to market against an audience. And increasingly, developments in ad tech are basing themselves around this concept – how do we better develop and monetize the engagement of display ads?
Take, for example, the rise of Hearst UK’s content arm, working on how best to leverage homepage takeovers. Or the rise of Conde Nast’s push to interactive display advertising. Alternatively, even News’ programmatic approach to creating ad buying networks for their display ads.
And then there is the measurement of ads. Internally, and with clients, these publishers and media companies all base their targets (generally speaking) on a few key metrics: views, click through rates, or an interactive engagement.
All of this points to an outdated model – one driven by traditional print thinking, and sold to advertisers in a slightly different way. After all, the display ad is only a way of advertisers buying space, rather than buying results. Even Click Through Rates are an often inaccurate measure.
As if to reinforce this, there are a number of statistics on the effectiveness of display advertising. 0.6% click through rates are about industry standard. Around 50% of clicks on mobile are accidental, not intentional. And you are more likely to have a prospect go through Navy Marine training, than click on your banner ad.
Those are some scary statistics.
Why then, are display ads failing where print and TV ‘display’ ads succeeded? In advertisers minds, there are two factors likely at play. Firstly, print and TV are not disrupted environments. A disrupted environment is where the methods of switching are quick, and will immediately satiate another demand. Think smartphones, PCs, tablets – content on demand devices.
The second factor at play is likely to do with the mode people are in when they are consuming content in the digital age. Most consumers are in ‘search’ mode when they are on the internet – hunting down content they like, want to see, want to hear from. As if to reinforce that, Search Engine Marketing often sees Click Through Rates of 3-8% – markedly higher than that of any display advertising.
Even on social, consumers are more likely to engage with advertising they see. Often this is because it is based on a contextual interest – e.g Facebook, for example, has the data on what you look at, and so is better placed to serve display advertising on a one to one basis than the traditional publishing company.
What does all this mean for publishers going forward?
Increasingly, it means that display advertising is not going to be the model where publishers can replace print revenues in digital. And the best publishers are recognizing this: the rise of native ads, for example, or microsite partnerships are a good start.
At the end of the day, though, publishers have a distinct advantage over the Facebook’s and the Google’s – they are producing content at high editorial quality and integrity, that people trust, and know they want. More importantly, they do this again, and again, and again.
This means that publishers are more than capable at understanding at what their audience want rather than what they say they want.
That’s an important distinction to make. Agencies, for example, often rely on client briefs and a deep understanding of the audience to produce content for brands that aligns with their client’s values. Affiliate marketing companies offer compelling offers. Social media companies align with what offers people say they want. Search engines align with what people want once they know they are looking for it.
In a sense, this makes publishers unique – they are the only ones who make it their business to anticipate audience wants and needs, first and foremost (agency planners, like myself, do this as well – but we are always compromised by market positioning for the brand, rather than a singular objective).
What does this mean for advertising solutions? It means that to create the advertising engagement that publishers need to monetize digital, they have to think more laterally – primarily, about how they can use their audiences and bridge them to quality brands.
Native ads are an example of this in it’s infancy. BuzzFeed is now working with it’s advertisers to create socially viable content. Shortlist now runs partnership emails where it helps partners write compelling content to it’s audience.
But there is so much more to do in this space. Looking at how publishers can deliver results, outside of the traditional ‘display’ paradigm, is the way they will succeed in digital. The question now becomes: will publishers take up the challenge?