As Chief Technology Officer at Purch, John Potter brings a wealth of experience having spent more than a decade with CBS Interactive/CNET, where he held many roles. Most recently he served as Vice President, Software Engineering, managing a staff of 100+ developers in support of brands like CNET, CBS News, ZDNet and Download.com. John holds multiple patents for his system designs that improve Internet connectivity and document classification. At Purch, his role entails managing all aspects of technology, engineering and operations, and he has successfully participated in, and integrated 10 acquisitions.
Could you describe / define ad fraud?
John: Ad fraud is a persistent problem that, according to the IAB, costs the industry $8.2 billion a year in the U.S. While ad fraud is found in various forms, from a publisher’s vantage there are two main problems: One is fraudulent copies of sites that are created, and whose advertising inventory is then presented on programmatic platforms as coming from the original publisher sites. To add insult to injury, most of the traffic on these fraudulent sites is from bots. The other is non-human traffic on legitimate publisher sites from bots scraping the sites, attempting to insert comment links, or coming through content recommendation systems in an attempt to defraud them.
Each of these problems causes different issues and needs to be responded to differently.
How have issues such as bot traffic and audience verification impacted the digital advertising marketplace?
John: The prevalence of non-human traffic and fraudulent or non-viewable advertising inventory has led to an undermining of marketer trust in internet advertising. This directly harms all publishers. Just as importantly, it has led to the need for marketers to add software to their creatives to confirm viewability and detect non-human traffic. This increases the size of ad creative degrades the user experience on publisher sites. Then there are multiple, competing measurement systems in use. All this complicates the ability of publishers to deliver on marketing campaigns.
Are these issues particularly problematic given the rise of programmatic?
John: Yes, all of these issues have been compounded by the rise of programmatic. Marketer’s campaigns are running across a larger number of sites, most of which they have no direct contact with. This makes fraud a lot harder to detect than when you are signing a direct deal.
Why is it important to understand/have an accurate picture of the audience being reached?
John: In the end, all marketing is targeted at particular audiences. As publishers, it’s our ability to provide those audiences that makes us valuable to marketers. At a minimum, marketers should be able to expect that any ads they purchase will be viewed by real humans on a legitimate site that is brand-safe. Publishers and programmatic platforms need to do everything they can to make sure we meet that minimum expectation, and initiatives like TrustX can help with that.
How should the industry be addressing ad fraud?
John: First, publishers and the programmatic platforms need to cooperate to wipe out fraudulent advertising inventory. Ads.txt is a great start towards this, but it’s just a first step. I’m really enthused about the potential of blockchain solutions that will track advertising at every step of the process, and leave an auditable trail. Ideally, we get to the point where every advertising impression sold and served is auditable by all parties to the transaction.
Publishers also need to work hard to block fraudulent traffic on their sites. At Purch, we already do a lot to block bots from our sites, and to prevent advertising being served to any that get around our blocking attempts. We’ve now moved on to integrating real-time bot detection and ad blocking into our server-to-server header bidding platform. I know other publishers and programmatic platforms are taking this issue seriously as well, but it will need to be a continuing concern for a long time to come.
The illustration used in this article, Picco Robots, is reproduced, with modifications, under a creative common license.
The UK TV industry has always punched above its weight class. Smaller than Oregon, with a population equivalent to that of California and Texas (66 million), the British TV sector is a vibrant £14 billion a year ($18.58bn/yr) business, which has created formats, content, and executives, who have made their mark around the world.
So, what the can media organizations everywhere learn from their smaller cousins across the pond? Here are seven ideas and considerations (not, by all means, unique to the UK) worth exploring:
1. Consider moving millennial orientated services online only
We know that millennials consume content differently. They’re more likely to watch video content on devices like smartphones and laptops than older demographics. They’re less likely to watch TV-like services on an actual TV.
Against this backdrop, in 2016 the BBC made their youth targeted TV network, BBC Three, online-only. In part, the move reflected the fact that younger audiences are increasingly consuming less linear TV. But, it also yielded major savings (estimated at c.£30 million / $39.6 million p.a.) as the online-only service requires less original programing, and isn’t burdened with the same transmission and distribution costs.
The BBC’s move didn’t just make financial sense, it was also an effort to more explicitly take content to the spaces that their younger audiences inhabit.
2. Explore opportunities for ad free options
British viewers have grown up in an environment where TV advertising is much less pervasive. The BBC, for example, has no adverts at all, just trailers for other BBC programs and services.
“Seven in ten (67%) say they like to watch TV programs and films on demand to avoid adverts, or because there are no adverts,” UK communications regulator, Ofcom, recently noted.
This preference – coupled with the use of ad blockers on web based TV services – should be a cause for concern, given the continued importance of traditional advertising. One potential solution, explored by the UK’s oldest commercial broadcaster ITV, is to offer a premium IP delivered service that mirrors the ad-free experience provided by HBO and Netflix.
In 2013 the network launched an iOS app that allowed Apple users to watch the last thirty days of their content (from five different TV services) without advertising, as well as live simulcast of ITV3 and ITV4, for £3.99 ($5.27) per month.
The service, called ITV Hub+, has now been rolled out to other platforms including Smart TV’s. (It also costs £3.99 a month.) Will consumers pay more for this convenience? Evidence suggest they will, and this is therefore a model that other broadcasters may want to emulate.
3. Be everywhere
Given the range of ways in which audiences consume – and access content – it’s increasingly incumbent on broadcasters and other content providers to be as accessible as possible.
The BBC iPlayer, an internet streaming, catchup, television and radio service from the BBC, which celebrates its 10th anniversary this year, has always been available across wide range of devices, including mobile phones and tablets, PCs, gaming devices and Smart TV’s.
BBC Three, their youth orientated service, doesn’t just live on the BBC’s own app and web services, it also has its own YouTube channel with full episodes – and entire series – available to watch.
Other UK broadcasters have followed suit. The ITV Hub, for example, is now available on 30 different platforms, including Google Chromecast, and Xbox. At the end of 2016, the broadcaster noted that consumption (the measure of the number of hours watched) is up by 43% in the past year; and, interestingly, that Live TV accounted for c.30% of all requests.
4. Embrace bingeing, archive access, and offline viewing
On-demand services like Amazon, Hulu and Netflix have changed viewing behaviors. As a result, traditional broadcasters need ask whether they too should go “all in” and do things differently.
That might mean releasing new series in their entirety, offering new content for download and offline viewing (which the BBC and others offer) as well as providing “digital boxsets” so that audiences can binge on older shows.
These moves are not just designed to protect revenues and audience share, they also reflect evolving consumers behaviors. Failure to respond to these expectations means that traditional broadcasters risk being left behind.
5. Serve better ads, because audiences still watch a lot of TV
It’s not just online ads that are often terrible, many TV commercials aren’t great either. And yet, we continue to watch a lot of TV, creating prime conditions to deliver strong, effective, advertising to captive audiences.
“The average time spent watching broadcast TV across our 15 comparator countries,” the UK communications regulator noted, “was 3 hours 41 minutes per person per day in 2015.”
That’s a lot of screen time (most of it live viewing) which, when coupled by the mass audiences TV can still reach, continues to remain attractive to many advertisers.
6. Innovate and experiment with new forms of ad delivery
TV’s mass reach makes it an appealing medium for advertisers. Yet, at the same time, we also know that audience’s attention is increasingly fragmented. For many younger audiences, TV is already the second screen, and has been for some time.
As far back as 2012, the Pew Research Center found that 58% of smartphone owners used their phone to keep themselves “occupied during commercials or breaks”. But, Pew found, respondents were often engaged in second screen activity related to what they were watching. This resulted in advertisers trying to find new ways to engage audiences on their second screen. (See some great examples below targeting Game of Thrones fans).
How some advertisers have tried to engage Game of Thrones fans on Twitter.
Personalization, time-shifted ads and the use of products (like Sky AdSmart in the UK) to serve different ads to different households (or different people in the same household) against the same content, may still be relatively small markets, but they’re expected to grow quickly. As such, they’re a technology that broadcasters need to be doing more than keeping an eye on.
7. Recognize online revenues can be a major growth area
In 2016, TV revenues in the UK were worth £13.8bn, a figure which is remarkably resilient considering that TV revenues in 2011 stood at £13.3bn.
Key UK TV Industry metrics. Source: Ofcom/broadcasters/Ampere Analysis/Advertising Association/Warc/BARB
The sector’s revenue mix has also proved to be surprisingly durable. In 2016, 30% of UK TV revenue was generated by advertising, compared to 29% in 2011, subscriptions accounted for 46% of revenues in 2016 and 44% in 2011, and broadcasters enjoyed 30% of total UK display advertising in 2016, down just 1% from five years ago.
However, this relative stability doesn’t mean that sector can rest on their laurels. Finding new revenue sources, remains important. And in this space, online revenues are growing fast.
In 2011, online revenues were worth £0.3bn for UK TV companies. Jump forward to 2016, and this figure was £1.7bn, a substantial increase. Given this rapid growth, and stagnation in other areas, expect more efforts to be focused on this space.
Final thoughts
“Despite fundamental changes in the advertising market over the last ten years,” writes regulator Ofcom in their latest UK Communications Market Report, “the television advertising market has remained very resilient due to its primacy in providing mass audiences.”
That’s not going to change any time soon, but as viewing habits on both sides of the Atlantic continue to evolve, so broadcasters and advertisers need to refine their strategies accordingly. This means finding new ways to capture attention, serve relevant – and increasingly targeted – ads, and experiment with new revenue models.
Three areas that I believe merit more attention are: more flexible pricing models – recognizing that many audiences love to watch certain shows, series or events, but that they don’t necessarily want (or can afford) a year-round subscription – simulcasting shows (nationally and internationally) to prevent piracy, and identifying opportunities to both reduce churn, and discourage the illegal sharing of logons and subscriptions.
What we see in the UK, as well as here in the US, is that although TV’s business model is changing, there are opportunities to diversify both content distribution and income strategies. How broadcasters continue to respond to the challenges – and opportunities – presented by digital disruption, is a subject many of us will continue to watch with interest.
Damian Radcliffe is the Carolyn S. Chambers Professor in Journalism at the University of Oregon, a Fellow at the Tow Center for Digital Journalism at Columbia University and an Honorary Research Fellow at the School of Journalism, Media & Cultural Studies at Cardiff University. (And, by way of disclosure, Damian is originally from the U.K.)
Over the past 20 years, the “digital transformation” of the publishing industry has been—for the most part—a slow, incremental process. For too long, the publishing industry was mostly concerned with digital replicas, ebooks, and other superficial “transformation” efforts which, in fact, didn’t so much transform the business as copy legacy models in electronic form.
Suffice it to say that legacy media models are oriented around the process of producing a book, magazine, or newspaper and not necessarily based on the experience and circumstances of the digital consumer. As digital transformation enters a new, more advanced phase, many publishers are recognizing they have an opportunity to provide products that raise the value proposition to customers.
What does it all mean?
The term digital transformation can be defined as a multitude of activities and attitudes that a business could potentially pursue. But what digital transformation really requires is that business owners adopt the customer’s viewpoint and change their business philosophy accordingly – from a process orientation to one that is customer-centric.
Publishers in education, reference and professional segments are beginning to execute operational change which supports this evolving viewpoint. And of course, there are “born digital” media organizations that aren’t wedded to legacy models. However, some of the best examples come from sectors outside media. Amazon.com is frequently cited as a proponent of the customer-centric view and their willingness to continue to rethink their operations from the customer perspective results in initiatives such as ‘one-click’ ordering to their recently announced wireless checkout process. Payment is made automatically via the Amazon app as the customer leaves the store. And we’ve seen what Amazon-owner Jeff Bezos has done in terms of transforming processes at The Washington Post since he acquired it.
Creating an environment where change can occur is no easy thing. Detailed and comprehensive change management activities need to be adopted to help guide an organization through this process. By definition, a legacy business model carries with it deeply entrenched legacy processes that need to be changed, adapted, or discarded in order to forge a new environment for success. Engaging in a formal digital transformation initiative endorsed and supported by the highest level of management is a requirement, and nothing less will suffice if the business is going to succeed.
Where to start
Before this can happen, though, it’s important to understand your starting position. A complete review of the current state of the business is critical to defining your future objectives and targets. Digital transformation is a process that takes place over time, along a spectrum of capability, where the endpoint is a business (or a product line) that has been digitally transformed. Points along that spectrum should be predetermined, well-defined objectives, which also serve as opportunities to reevaluate and reassess whether the business is going in the right direction.
Recently, I was asked to conduct a workshop with an educational publisher that recognized the business imperative of digitally transforming their business. This is not an unsophisticated publisher; they realize they are still too far removed from the consumer experience and must establish new business processes, product development strategies, and distribution/access models to remain competitive over the next 20 years. That’s a tall order for any organization, which is why the digital transformation process needs to be embedded into the organization in a consistent and repeatable manner. So, I took a team of senior executives through a day session to explore how this transformation process could be executed within their organization. An important takeaway from our meeting was the recognition by the group that taking on too much to quickly will doom a transformation project before it has started.
On a project I worked on several years ago, we avoided this trap in three ways. We:
recognized that our content and editorial workflow needed to become digital-first;
identified three to four workflow products to implement early in the transition; and
implemented a number of quick wins such as metadata improvement, copyright clearance integration and the implementation of process improvements with our distribution partners.
Doing the first brought uniformity and control to the creation and management of content, while the second enabled the team to learn by experience. The third built confidence in our ability to execute. During the first and second year of this project, as progress was made on these initial initiatives, the team gained the time necessary to test their market and product assumptions directly with customers.
As a result, toward the end of the third year, the publisher had established and expanded range of integrated products combining traditional textbook and reference content with assessment, collaboration, and other tools that improved their effectiveness and established a sound foundation for further digital growth. Across a variety of products, they had begun to adopt a customer-centric publishing model with revenue models to match.
Leading long-term change
Generally, the critical components driving the success of the transformation effort will be collaboration, resources, leadership, a clear understanding of business value, creativity, and a deep understanding of customer wants/needs. No one person can affect all these factors. Therefore, a strong statement of intent from senior management, ownership of the process by the senior leadership team for the business unit, measurable performance factors, quick wins and identifiable success stories are critical to creating an environment for transformation success across the business.
Securing executive buy-in to support this transformation effort (led by the CEO reporting to the board) must be a given. The imposition of technology on businesses today is so vital to medium- to long-term business viability that this effort demands the active support of senior management. An effective tool in this process is the establishment of targets and key performance measures tied to the desired improvement in the customer experience. To drive change, these objectives should represent significant “step change” performance improvement. Setting these out clearly helps prevent back-sliding and guards against good-enough results masquerading as real change.
Taking an organization’s senior management through a workshop like this one is the first step in a good first step in driving a true digital transition process. But because digital transformation will ultimately touch every part of the organization in some way, all staff must be included in the process. All employees must understand the importance of the effort to the success of the business, how the process will unfold, its impact on their work and what their contribution will be.
And remember that a digital transformation effort is never over. In a truly customer-centric organization, the business will always be anticipating changing behavior, rapidly adapting, expanding capabilities, and building new and better customer solutions. Increasingly, legacy processes do not allow for that type of flexibility and that’s the imperative for digital transformation.
Michael Cairns has served as CEO and President of several technology and content-centric business supporting global media publishers, retailers, and service providers. He blogs at personanondata.com and can be reached here.
There is little dispute about the popularity of the Apple iPhone. Since the it debuted in 2007, the company hassoldmorethanabillionunits. Last quarter alone Apple sold more than 41 millioniPhonesworldwide. Most of those phones are running Apple News, the news app that has been a standard component since Apple released iOS 9 in 2015.Ap
Simply because of the sheer number of iPhones running Apple News, it’s something that publishers need to pay attention to. After all, you don’t want to ignore a source that could give you access to hundreds of millions of potential of readers. But like so many things related to Apple (or any of the big tech platforms), understanding that potential and tapping into it are two different things.
Apple has some deals in place tomonetizethecontent inside the Apple News app, and according to Advertising Age, could allow somepublisherstousetheirownadtechnology to sell ads in the way they prefer. Some media companies are benefiting from exposure that has led to increased subscriptions, but the platform remains a challenge to publishers as they work to understand how it works.
Measuring success
When you have a user base that large, you want to understand how to take advantage of it, and reap the benefits it could provide for your publication. Chris Schieffer, Slate’s senior mobile product manager, says it certainly gives his publication access to readers who might not see Slate articles in other sources.
“The traffic numbers are meaningful to us but we’ve been looking at this as an investment. It’s not a pure traffic play. The more folks that see us in News, the more folks we can introduce to Slate Plus (our membership product), and the more folks that may come over to our homepage or download our iOS app to check out our podcast,” Schieffer explained.
Dave Merrell, who is lead product manager at The Washington Post, believes that the key to Apple News is similar to working with any platform. It involves a tight integration of newsroom, product, engineering, design, and analytics.
“Apple News traffic and subscriptions didn’t just fall into our lap. We recognized the opportunity of a news platform built directly into iOS and made Apple News an integral part of our editorial processes immediately. We spent a lot of time studying the Apple News audience and their habits, and our editors watch Apple News analytics every day in order to ensure that audience is getting our best journalism,” Merrell said.
Driving revenue
The challenge of every publication using Apple News is turning that traffic into revenue. For publications that are using the subscription model, the goal is turning the casual reader who found you on Apple News into a paying customer. Making that leap isn’t easy, but it is the objective.
Slate plans to try and take advantage of the tools Apple has provided to draw in subscribers. “We’re excited about introducing our Apple News users to Slate Plus by implementing subscriptions next year. There’s still more to be done on the backfill revenue front but we have seen a small uptick as Apple has introduced additional backfill partners. We feel like the real opportunity though is through subscriptions with the ability to pay through your Apple ID. That’s a good experience for users and publishers,” Schieffer said.
The Washington Post has also been seeing a significant rise in subscriptions. “[We have] had a subscription offer in Apple News since the launch of iOS 10, and we have been pleasantly surprised by this audience’s propensity to subscribe. After only a year, Apple News is a thriving subscription channel for us,” Merrell said.
Making it better
While companies are trying to work with Apple to make Apple News work better for them, publishers would like to see more transparency. In particular, Vox’s engagement editor Blair Hickman would like publishers to have more control. “With Apple, as on many other platforms, there is a certain lack of control that publishers give up. We see views spike when Apple chooses to feature Vox. Over the year, we’ve built a presence on the app that has let us start to organically drive views. But it would be great, as with most platforms, to be able to drive that relationship with the audience a bit more,” Hickman said.
The Post’s Merrell would like to see more personalization. “Apple knows so much about me based on my phone usage. So, I would love to see more personalization that doesn’t require a big upfront investment from the user. I also think there is a great opportunity to incorporate Siri recommendations directly into the Apple News platform – and there is a great opportunity the other way as well, with News surfacing in more areas of the iOS and MacOS ecosystem,” he said.
Nobody can deny the potential of a captive audience that’s already addicted to the iPhone. However, media outlets and publishers are really still feeling their way to understand how to best use the platform. Schieffer sums it up when he says, “I think the value of all distribution platforms, not just Apple News, has taken a little while to shake out. It’s a big leap for publishers to start sending large portions of traffic without the immediate promise of equal revenue or more subscriptions. But I think the investment is beginning to pay off and that’s exciting.”
The phrase “pivot to video” has become something of a cliché in the media industry. Lately, the mere mention of this phrase triggers a slew of mean-spirited tweets, resentment and existential mourning for the written word among those who wonder what publishers are thinking — and where their strategy lies.
And that’s the rub when it comes to pivoting to video. Mashable, Vocativ, Mic, FoxSports, Vox, Vice Sports, and BuzzFeed, among others, have all jumped on the video bandwagon in the past couple of years. But just as they differ in how they restructured staff and resources, so too does the quality of video produced.
It’s easy to feel the schadenfreude when hearing that web traffic dropped at a video-pivoter by 88%. Wow, how stupid was that move? But the reality is that pivots to video are not about pageviews at a website, but about serving up quality video that moves the needle on revenues, and engagement. They can be done right – or very, very wrong.
The premise – and pitfalls – behind the pivot
With the Facebook-Google behemoth eating up nearly all of the growth in the U.S. digital ad industry, publishers are under pressure to somehow make money from ads — and banners and programmatic advertising aren’t doing it alone. In comes the promise of video advertising dollars, which are expected to generate more than $18 billion by 2020, according to eMarketer (nearly double the $10 billion in 2016). A survey by IAB of more than 350 advertisers found that advertisers would spend an average of more than half — 56%, to be precise — of their ad budget on video.
Mashable was an early mover in the pivot to video last year when it laid off a slew of text reporters to double-down on video. More publishers followed this year. A major risk when pivoting is over-reliance on distribution platforms such as Facebook, YouTube, and Snapchat, which run these videos according to their enigmatic algorithms. Essentially, publishers relinquish control to third parties that have their own objectives and often provide poor and inconsistent metrics. Topping that off is data from Pew Research showing that millennials (often the target audience in these advertising goals) still prefer to read news in text.
Heidi Moore, writing at CJR, has called these pivots an outright failure:
“There are four reasons the pivot to video has failed: faulty metrics for measuring the audience; trusting other platforms, like Facebook, to do the hard work of distribution; low-quality video production and weak technological support for video content; and, ultimately, a failure to effectively turn video views into either higher readership or ad dollars.”
While she might be a little heavy on the hyperbole, she’s right when she says the main problem is that the video being produced by some publishers are all flash and no substance.
Mashable, Vox and BuzzFeed: A tale of three strategies
Obviously, traffic isn’t the only measure for success for publishers, so traffic drops aren’t always a dire sign. Pioneer pivoter Mashable says it actually grew its revenue 36% in 2016 while increasing the traction of its videos on Facebook, YouTube, and other distribution platforms. It’s now facing a potential sale. And, while nothing has been confirmed, its valuation — likely at more than $300 million, based on trends — suggests there may be something to their pivot. Any smaller valuation would signal more skepticism.
Meanwhile, publisher Melissa Bell has argued that Vox’s pivot, which includes four new shows on Facebook’s Watch tab, is much more of a “leaning in” strategy. That doesn’t mean Vox will relinquish a priority in text based content. “As a robust and dynamic media company, we have to leverage our talent and our expertise across all formats,” she wrote. “We do not believe video comes at the cost of our journalism or people with non-video skillsets. Writing is a crucial component of what we want to offer our audiences – as is photography, video, sound, graphics, and illustrations.”
Meanwhile, BuzzFeed, which restructured last year in order to generate more video for its entertainment and news divisions, recently launched an original live-streaming program, “AM to DM,” on Twitter. In the same vein as Vox, BuzzFeed hasn’t shied away from admitting much of its strategy comes from trying and potentially failing. But unlike several other media outfits that have tried video, BuzzFeed has the resources to back up its editorial focus. “Video is an extension of what we do, not a liability or a threat to our journalism,” BuzzFeed head of U.S. news Shani O. Hilton wrote in a post.
While much outcry has surrounded the traffic decline experienced by some of the publishers that have pivoted to video, it’s worth remembering that this is a correlation, not a causation of the pivot. It’s important to note that the publishers moving to video were looking for increased revenues and not pageviews.
Among publishers, there’s a flight to subscriptions and paid content, as well as video – and they don’t have to be mutually exclusive. But for those going “all-in” on video, they better make sure the strategy pans out, attuned perfectly for social platforms, and for audience members. Not all video pivots will work, but not all video pivots will be flame-outs.
When Spirited Media launched Billy Penn in 2014, the online publication had a broader mission than simply covering local news in the City of Brotherly Love. Co-founders Jim and Joan Brady wanted to do no less than rejuvenate local journalism itself by building a new business model that made local news coverage relevant to a younger audience, who saw traditional print media as old and stodgy.
It was a tall order by any measure. Brady and his intrepid team had just five people to cover Philadelphia—a huge city. They knew they needed to pick their coverage battles and find ways to engage with their target demographic to make their stories resonate with them.
Brady, a 20-year veteran of the news business, had witnessed the decline of local media first hand and knew it was time for a new approach. It was clear the old ways weren’t working. Local papers were either shuttered or had severely cut back coverage, and citizen journalism had not filled the gaps as many had hoped a decade ago. Without local news, there was a news gap that left uninformed citizens in its wake. And, as Brady knew all too well, a local news vacuum also left room for corrupt politicians to operate unimpeded without the white-hot journalism spotlight shining on them.
Brady understood that Spirited Media couldn’t fix all that ailed local journalism, but they were going to try to deliver news in a new way that would attract audiences and revenue. Today it consists of three local publications with Pittsburgh and Denver joining Philadelphia (in May of 2016 and this March, respectively).
Building new models
When Brady and his team prepared to launch Billy Penn, they knew that the under-35 crowd wanted to get their news digitally – and they wanted news with a voice. “We decided the site wouldn’t have a dry unemotional voice. The site had to reflect energy,” Brady said.
What’s more, they’ve found that their audience wants to go beyond the news and get involved to help shape the direction of their communities. “We have a fair number of stories about things in the community you can get involved with and how to connect with issues you care about,” he said.
Instead of trying to be a publication that delivers all the news from sports to art to politics, they decided to focus on a smaller set of stories that Brady and team believe their readers care about. Then, to create that larger scope, they plug into a broader system of sites. “There is a whole little solar system of smaller sites biting off pieces of everything the big papers once did – art, sports, education, city hall. You have a lot of journalists covering a lot of interesting things in Philly,” he said.
Getting readers together
While the Spirited Media approach still uses an ad model, it concentrates on mobile ads, not display ads, which Brady says don’t really work for digital news. Even more importantly, Spirited wants to be more than another publication pumping out posts with ads to support the mission. It wants to get its readers involved.
That requires putting readers together with the people behind the stories, whether the reporters themselves or the subjects, and having an advertiser sponsor the event. Brady says they learned the hard way that a panel on a stage wasn’t what people wanted. Instead, they host smaller, more intimate gatherings. As Brady said, if you put a bunch of interesting people in a room with food and drink, interesting conversations tend to happen. A happy byproduct is that advertisers can buy a package that includes ads and event sponsorship, which means additional revenue.
Spirited Media is also planning its own take on the membership model, which is slated to kick off in October. Readers who become members will have special access to the publication’s events, which will include meeting interesting people from the community and accessing places they might not typically get into like a tour of the Steeler’s locker room in Pittsburgh or a VIP City Hall tour in Philadelphia.
The Spirited Media approach appears to be working as the company has grown its team to 26 and expanded to two additional cities. Brady notes that the company earns just 40% of its diversified revenue from ads. And as for that younger demographic target, all three publications have more than 40% audience in the under 35 age group – with Billy Penn hitting 45% in that demographic. For ages 44 and younger, it’s more than 65% with Billy Penn’s audience comprising 71% in the 44 and younger age group.
It’s still early days for Spirited Media. However, it has developed a fresh take on the local model that publications of all types can learn from. And that is certainly good news.
In the early days of digital, media companies believed that more was better. However today, they are waking up to a hard truth. Stockpiles of content – without technology platforms to make it widely available in ways people find valuable, meaningful, and dead-simple – can destroy competitive advantage, rather than build it. National Geographic, an iconic brand with over 360 million social fans, including a significant audience across desktop and mobile for its editorial and video content, is exploring technology platforms and partnerships to open the aperture of the content they offer and the audiences they reach.
Peggy Anne Salz – mobile analyst and Content Marketing Strategist at MobileGroove – caught up with Marcus East, National Geographic executive vice president of product and technology. They discussed the company’s strategy to build strong emotional engagement with global audiences through deep personalization, intuitive access, wider app distribution, and an intelligent platform codenamed CHIP. National Geographic has no shortage of compelling content. Here’s a look at their strategy to deliver experiences to match.
PAS: You joined National Geographic from Marks and Spencer, where you ran e-commerce, digital product, digital operations and technology platforms. Before that you ran e-commerce solutions for Apple in EMEA, and later at HQ. How does your experience prepare you to define and drive mobile strategy at National Geographic?
ME: Spending half of my career in technology and the other half in consumer brands allows me to understand what it takes to deliver mobile content consumers love. Your app is only as good as the content and the utility that sits within it. And for us, the emphasis is on making sure that we’re investing in both of those areas. That means having the right technology platforms and the right app strategy, but driven by content. Ultimately, it’s the content that our consumers love and why they come to National Geographic.
PAS: So, we are back to Content is King…
ME: Yes, and everything we do has to be about making the content king. The content is what drives the experiences that consumers love. That’s fascinating for me because I’ve worked in e-commerce environments where consumer value is very much about utility. At National Geographic, it’s about bringing our brand to life on mobile. The reality is many of our consumers are right now interacting with us through their mobile the way they want, which may be on Instagram or it may be on Facebook. So, what we do need to be complementary to that experience.
Social reach and engagement is important to us. We have 360 million social media fans, and that’s an incredible footprint. However, we also think there’s an opportunity to build upon that and to extend and optimize our mobile experience for that audience that is dedicated and comes directly to National Geographic and wants to get deeper and further into the stories behind the pictures.
PAS: Your mobile app is work in progress. It’s already breaking some exciting new ground when it comes to helping users navigate and personalize content. We can’t all access it yet, so what can you tell me about the user experience you offer?
ME: Right now, we’re redesigning elements of our website to really be optimized for that mobile experience. Around 50% of our traffic comes on mobile, which is no surprise. At the same time, we’re also building a new app strategy, which we’ve launched and tested in one market: Australia. We launched the app with a telco partner, and we’re seeing a great deal of success there and that is informing our wider global mobile strategy.
Content is king in the app and so the experiences that we deliver through our app put the content front and center. We have a 129-year heritage of photos and articles and, more recently, videos. We don’t want the interface to get in the way of that. The interface has to allow our consumers to explore the content and go further. That means moving the navigation into the background so that it really highlights the content. We achieve this by thinking about what the consumer wants to do first, and there are three concepts. Rather than presenting consumers a complex navigation that groups content into pictures, video and articles, we’ve decided to design it the way people to engage with content. We have ‘Read,’ which is where users can engage with the editorial and the magazine; we have ‘Watch,’ which is where they can access to our video content.
Our app approach is about the consumer and the content. For this reason, the app experience also provides a level of personalization, allowing the user to specify what’s most interesting to them. Over time, the app will learn exactly what things are most interesting to that consumer based both on their preferences and on what they’re actually consuming.
PAS: The navigation is invisible and intelligent. What about the platform that powers it?
ME: We want users to log in to the app and experience the content that’s right for them, and we’re applying this same principle to our websites. We’re also looking at how we can, using some advanced techniques like progressive web apps, for example, to create a more personalized experience for consumers. This is why we want to build an intelligent platform to support the ambitions of our business.
So, what we’re exploring and building is what we’re calling a cohesive intelligent platform, codenamed ‘CHIP’. We’re building an innovation lab here in our headquarters in Washington, D.C. and we’re working with lots of technology partners and companies to explore all that. The idea is, as users come into our platform, we want to learn more about them, give them an opportunity to tell us about their preferences so that we can improve that experience, and let them see the content that’s most valuable for them. Offering personalized experiences where content is front and center – this is really the future of mobile.
PAS: It’s an ambitious strategy. But what is really interesting is how you are building the platform to deliver it because you are also orchestrating the best pieces of the other platforms, like social …
ME: I like your choice of the word “orchestrated” because the platform that we envisage is, you could argue, a virtual platform because we aren’t going to build every component of it. We are making it by orchestrating the right content management systems, the right personalization engine, the right distribution system. For some parts of the platform we may work with third parties, and for others we may build it ourselves. It all starts with experimentation; we are iterating in an agile way and building.
We’re unique in that we’ve got unparalleled global reach. We touch over 745 million consumers across 172 countries, and that’s every month. But it’s also across lots of different content types. People watch our TV channel, which is the most widely distributed in the world. People read the magazine, and they also interact with us in social.
As we build out and execute our digital capabilities we want to create a way to allow our consumers to go beyond how they experience our content today. Take consumers who read the magazine. We want them to also be able to consume our digital content on our website and watch our TV channel. It’s all about pivoting away from the different products and channels that we have and bringing it to life for the consumer and giving them new ways to explore National Geographic and the world around them through National Geographic.
PAS: You want to enrich consumers’ lives through content. That also sounds a lot like you may have a new twist on native advertising. Where does monetization fit in and how do you plan to also put content front and center in that experience?
ME: We’re exploring all the ways in which we can create the best experience, including sponsorships and e-commerce opportunities that can become part of that experience. Let’s imagine we have a consumer who absolutely loves penguins and they are on our website where they search for and engage with lots of content about penguins. We see that as an opportunity to maybe share with them details about our products that are related to penguins. It might be a penguin cuddly toy, or it might be a book about penguins, or ultimately, it may be a trip to Antarctica to go and actually see penguins in real-life. This is where we will have delivered on the ultimate promise of digital and making content part of everything that we do.
PAS: You also offer educational content. How does personalization of content and advertising extend to that audience?
ME: Ten years ago, media brands and publishers would’ve expected people to come to the website, do the work, go through the navigation and find the content that’s right to them. The Nirvana, for us, is to create a personalized experience, one that allows us to know enough about those two personas – the consumer and the educator. So, when they interact with our brand, we can give them access to content that is relevant to them, and that meets their needs.
To that point, one of the things that we’re embracing is the Jobs To Be Done paradigm that Clayton Christensen and other academics have proposed. Yes, we look at all the metrics as any media company would, but we’re also deep diving into what consumers really want and why they come to our website. Getting a deeper understanding of those consumers want to do, powered by technology. We need to have the right technology platform in place to do that in the first place. This will allow us to maximize the brand opportunity.
PAS: You can also maximize your opportunity by getting your brand in the hand of all your readers – across all 172 countries. How do you see this global opportunity and what are you doing to grasp it?
ME: There is a real opportunity at distributing apps using alternative channels and app stores. And it’s a cost-effective way to reach and interact with consumers and markets where we haven’t necessarily had a strong proposition. We recently did an audit of app stores globally – of which there are over 200 – to better understand their focus and their audience. We have a good relationship with many telco partners around the world that have their own app stores. Various technology companies have also come to and asked us to publish out app in their app stores as well. So, right now, we’re auditing to make sure that we, in a deliberate way, prioritize which of those app stores are right for us.
PAS: I am researching this alternative app store landscape, which is over 350 stores and counting. In China, for example, alternative Android app stores dominate…
ME: I was quite intrigued to see the range of app stores in China. From WeChat to handset maker, there is a wealth of opportunity. We also want to minimize the cost of being in all these different environments, and that’s why I attach so much importance to orchestrating an intelligent platform so that if our teams in Asia, for example, can identify a new app store and a new partner in the region and be able to embark on a relationship without having to build everything from scratch, and without having to do lots of development work.
The number of app stores is quite remarkable, and as you well know from your research, many of them are quite different – with different audiences and different demographics. So, it’s fair to say that in the short term our priority will remain the best known and most established app stores, but we are exploring all of them.
PAS: Of course, being in app stores – even if it’s just Google Play and iTunes – means investing effort to ensure brand integrity. As a global and iconic brand, how do you ensure this?
ME: On the one hand, protecting your brand online and in apps is incredibly important. One of the things I’m responsible for here at National Geographic is information security. However, I believe if you build the best experiences for your consumers, ultimately, that’s the best way to protect your brand. Consumers will come directly to you to get content because they know your website or app is the right destination – and the only way – to get the most up-to-date content and personalized experience. It’s all about creating a compelling content story and a compelling user experience because that will make sure consumers come to us first.
Peggy Anne Salz is the Content Marketing Strategist and Chief Analyst of Mobile Groove, a top 50 influential technology site providing custom research to the global mobile industry and consulting to tech startups. Full disclosure: She is a frequent contributor to Forbes on the topic of mobile marketing, engagement and apps. Her work also regularly appears in a range of publications from Venture Beat to Harvard Business Review. Peggy is a top 30 Mobile Marketing influencer and a nine-time author based in Europe. Follow her @peggyanne.
Amazon Echo Show, Alexa, and Google Home have been positioned as the next big thing for companies and consumers. Content companies, marketers, and advertisers have scrambled to get up to speed on the technology behind them and are actively trying to figure out how to incorporate them into their planning. Certainly, there are a slew of companies anxious to get in on the Internet of Things (IoT) home automation game. However, they all realize that what will make them the most money is delivering their messages on the home automation system that reaches the most number of households.
Nevertheless, home automation is a new game with a whole new set of rules. The winner of this space will be whomever can master a very different skill set: providing subsidies through tax credits and insurance claims, and developing tight relationships with residential and commercial general contractors.
There are two main obstacles to mass adoption of home automation:
1. It’s too expensive: To get the full effect of the IoT transformation, a homeowner would have to replace every appliance in their house. That includes everything from the garage door, the thermostats, and doorbell to every light bulb, roof, pool pump, possibly even an entire music library, and more. Not many will be able to afford this.To reach mass adoption, someone else will have to pay for it. But who?
Using smartphones as an example, they didn’t hit mainstream until carriers helped subsidize the cost of the phone by rolling it into the service plan. Similarly, broadband effectively crossed the chasm when it started getting bundled by default with TV and phone service. Providers and appliance companies need to figure out a way to subsidize the cost of every upgrade. This can be accomplished through tax credits and subsidies for environmental upgrades or through insurance companies willing to foot the (partial) bill to replace elements of the home due to age and wear-and-tear.
2. Integration is too difficult: Seamless integration is another major obstacle to the adoption of home automation. Setup is prohibitively difficult. Many products won’t work together because they’re made by competing companies. Users often are forced to use separate apps or hubs for each appliance.
Thus, whichever company can offer a full-package solution has the best chance of solving this integration problem. And whichever company has the capacity to work closely with residential and commercial general contractors will have the advantage since selling a “full package” is only financially realistic when rolled into the mortgages of new-build homes. There’s a domino effect here since the solar roof you choose will require a battery store, and that battery store will work best with the related fuse box, which might act as the control hub to the rest of the house. This, in turn, will determine most of the other appliances, such as wall switches, light bulbs, thermostats, ceiling fans, etc.
Who Will Win?
One may argue that there is already a company set up to dominate the home automation market, which already has cachet with consumers, and is both full of shine and substance. Tesla is the only major tech company making it an integral part of their business to embrace the complexities of insurance companies and residential and commercial general contractors. This is necessary for them to drive adoption of their Solar Roof. They are also already masters of helping consumers with government subsidies that come with environmental tax credits from buying their cars. These are the types of moves needed to, gradually over 20 years, deck out a house, top to bottom, with a seamless, consistent, single-vendor solution that was paid for by rolling it into standard maintenance costs or mortgages.
There’s another reason why the winner in home automation won’t be one of the usual giants in consumer tech today. This will be unfamiliar territory for them since they focus on glamorous consumer electronics rather than practical products meant to last a generation of home ownership. Apple will miss the boat by trying to “design” their way to success. But let’s face it: Home appliances are not “objects of desire” like jewelry. Amazon will try to reach success by slashing margins but “cheap” is still more expensive than subsidized. Google will try winning by having smarter devices than their competitors but most devices only need to be smart enough to turn themselves on or off.
For now, it’s a dream state as we wait to see how home automation can work together for an entire household in a way that’s not cost-prohibitive. It must also be seamlessly integrated into the home. Until these hurdles are “solved problems,” home automation—and the opportunities that come with it for content companies of all types—simply cannot cross the chasm.
Rylan Barnes is the co-founder of ShopSavvy, one of the largest shopping/deals apps, that is part of Purch’s portfolio of brands, and Vice President of Software Engineering – Mobile and Emerging Platforms at Purch.
From the advance of AI and bots, to the explosion of mobile and apps, media companies must understand and evaluate a myriad of “hot” technologies. Business outcomes are linked to technology choices. Make the right choices, (and investments in the right platforms) and media companies can send traffic into the stratosphere. Miss a step, or a trend, and media companies can lose their shirt. Either way, the ability of media companies to determine their destiny as publishers is inexplicably intertwined with their willingness to experiment and innovate as technology companies.
Since Amazon founder Jeff Bezos bought the Washington Post in 2013, the publication has become a sandbox for digital ideas that span a wide spectrum. At one level, efforts to re-imagine old-school audio podcasts have won the company recognition as a top 10 podcast publisher, according to May 2017 data from podcast measurement company Podtrac. At the other end of the spectrum, experiments with Alexa and Snapchat are breaking new ground, and building new audiences.
Peggy Anne Salz, mobile analyst and Content Marketing Strategist at MobileGroove, spoke with David Merrell, Manager of Product Development at The Washington Post, to discuss how the company is harnessing audio content, exploring voice interfaces, and preparing for the opportunities and challenges of storytelling on new platforms.
Peggy Anne Salz: Podcasts are popular, with almost 20% of U.S. adults ages 18 to 49 listening to them at least once a month. It’s a trend the Washington Post embraced early. Now you have a string of podcasts, several of which hit 1+million downloads as early as a month after launching. Tell me about the chief factors you considered before making your move.
David Merrell, Manager of Product Development at The Washington Post (Photo by Marvin Joseph/The Washington Post)
David Merrell: We saw that smartphones are ubiquitous and—because podcasts are now available in everyone’s pocket whenever they want—we saw the opportunity. We then reviewed the studies, did research with our own readers and made the decision to go this route. We saw a fit with our efforts to expand our audio offerings in general across voice platforms such as Alexa and Google Home. But we also knew this was not a core competency. Our traditional competencies in news and storytelling were not what we would need to have a big impact in podcasts since podcasts are not about breaking news. We had to look at storytelling beyond breaking news, and really bring the analysis piece of it, as well as our own perspectives, into the podcast.
Since taking the plunge, we’ve launched several podcasts. There’s the historic focus podcast called Presidential, which was a huge success last year with one episode focused on each president. Now history wasn’t what you could call a core Washington Post product, but we were able to take our expertise and apply current thoughts and questions to historic aspects of the country and create a very compelling podcast that counts more than 9 million listens since it launched in January 2016. We just launched a sequel to Presidential called Constitutional that looks at the history of the Constitution and applies this to current events. With our lineup, we recently cracked the ranks of the top 10 publishers in the U.S. for podcast listens, which given the size of our team and where we were just a year ago is pretty incredible.
Podcasts and traditional news and investigative journalism—both are forms of storytelling delivered by mobile and apps. Some publishers might have been concerned one product would cannibalize the other, but you obviously weren’t…
It is a concern that comes up a lot. But we balance. Our big focus, in terms of business growth, is on digital subscriptions. Sure, it would appear at first glance that podcasts do not drive that since they are also available on iTunes. But we have seen very impressive results from successful marketing campaigns where we will tell people, “This is part of the wide breadth of Washington Post content that your subscription supports.” We’ve also seen huge engagement with our podcasts by our subscribers. So, even though this is a product that is widely available, it’s also a product that is highly engaging – and Washington Post subscribers access and appreciate the content.
Is this important in your efforts to attract new audiences?
When we’re talking about getting in front of new audiences, audio is a component of that. But we’re not limited to one way to get to this goal. Take our presence on Snapchat Discover. It’s also allowing us to get in front of people who wouldn’t necessarily have seen the Washington Post otherwise. Like all traditional media, we have an older audience that is very engaged, like other newspapers, we have had trouble reaching a younger audience and showing them who we are and what we offer in a way they can understand and see value in. And that’s important because don’t have to just get in front of them; we have to demonstrate value and show them why they should make the Washington Post part of their daily lives. Podcasts offer a way to do that, but so does Snapchat.
The Washington Post also launched a Reddit public profile, so another example of being on a platform to reach new audiences and find what a new home for your content. How do you choose and pursue these opportunities, without spreading too thin?
In the case of audio and podcasts, we made up our mind early that it was a boat we wanted to make, not miss. We launched Presidential, and after we were convinced of the success we hired people for audio roles. That’s what’s fueled the explosion is bringing in people with audio experience to help with the recording, to help with the scripting, to give feedback to the folks, internally, who are recording the podcasts. Since then, we’ve hired a product manager, who is almost wholly-focused on audio, and especially on Alexa, and then another hire in the newsroom focused on conversational audio. Now we are at the point where we are figuring out how do we record for new platforms like Alexa and Google Home, and what can we do to create a really sticky voice UI experience?
Frankly, the answer is always part tech and part user experience. What’s your approach?
There are different pieces to our Alexa strategy. The biggest one, is what you just described: the user experience. Right now, it’s like you wake up in the morning, you go to your kitchen where your Alexa likely is, and you say, “Alexa, what’s news?” Alexa cycles through a list of sources that you choose when you first set up your device, and that’s called your flash briefing. Alexa plays the briefing and you hear short bits of news from each of those sources. We’ve determined that this is the the stickiest news experience on Alexa right now because it’s so simple and baked-in to the device itself. It’s one word: news. The user just says news and gets news.
But it’s also a huge learning curve—for us as well as the consumer. As it works right now, people need to install a skill, which you can think of as an app. But there’s no home screen on Echo to remind people to tap on a Washington Post icon. Instead, users have to remember to say, “Alexa, open the ‘Washington Post’” in order to get to our news on the platform. We’ve found that is really difficult. It’s a whole lot easier for people to remember to say, “What’s news?” and then go into their flash briefing.
So, how do you plan to change that behavior or introduce new habits?
We’ve found it starts with marketing. We have to direct people to install our skill, and that means promotions to get our skill in front of people. So, we either need to reach them in exactly the right moment to tell them to enable “Washington Post” on their device, or we need to market to them on other channels away from the device. In which case, the marketing has to also educate them to remember to say, “Alexa, open the ‘Washington Post’” when they are back in front of their Echo. It’s a hurdle for every company with a skill. To encourage habits and get people to remember, we have also introduced a news quiz feature that’s updated fairly frequently to get people to come back in so they can play. They can only access the news quiz by saying, ‘Alexa, open the ‘Washington Post.’
As you said, every company that has a skill, or plans a skill, will struggle with this. What is your advice about how should they approach this?
We have not figured it out, so we don’t have a magic bullet solution. But I would say that content companies should go through the process of building a skill as a way to find out if there is a fit and find what users will value. If you are a smaller newsroom, and you have fewer resources in both engineering and editorial, then I would start with a flash briefing. Direct and educate your audience to add that to their flash briefing lineup, and go on from there since that is really the most engaging way and easiest way to get news on the platform.
Specifically, which channels and formats work to move users from accessing news via mobile apps or whatever platform they are currently using to consider getting news from Alexa.
We are in the very early days of experimenting with that now. To start, use a survey to figure out how many of your users have Echo devices. Then also look at your engaged users and target them. For us it’s our subscribers because they are the “Washington Post” super fans likely to switch. If anyone’s going to remember to say, “Open the ‘Washington Post’” every day, it’s going to be people who are already subscribing to us. As far as the precise channel, we start with email.
The Washington Post is exploring a plethora of platforms and technologies. But it’s also a company that has the resources to do so. What is your advice to companies that can’t be early adopters, but can’t afford to be late to the party either?
First, let me tell you about our approach. We dive in and define a period of time when we’re in all the way. After that, we look at the data to determine if what we are doing is worth further investment, or if we need to pivot. We do this will all the platforms. We go all in with AR, we go all in to test new storytelling format in Facebook Instant Articles, and we did it to create content for Apple News. We do this because we feel like that’s the only way to get enough data. It tells us where these new platforms fit strategically for us, and, it’s not working, we use the data to see how it could work for us and how we could work with these large tech partners to move their roadmaps in a direction that we would want to travel.
The point is I think media companies should be experimenting all the time. The status quo is not going to sustain anyone’s publishing business for very long going forward. So, I would encourage everyone, no matter their size, to experiment. I think it’s the scale of the experimentation that matters, not the company. If you’re a smaller publisher, look at where your audience is. If you have a huge percentage of your audience coming from Facebook, then I think it makes a lot of sense to focus some energy on Facebook products such as Instant Articles.
But don’t just look at your audience; look internally at the skills sets you have. You know, it’s a very low technical bar to start a podcast. I’m not saying that anyone can do it – you need some setup and training – but many companies and even individuals have achieved and engaged huge audiences with podcasts. It’s really a matter of trying it, seeing what resonates, and doubling down on that. And that’s the ethos of experimentation. Doubling down on the success to grow that success is something that any newsroom of any size can tackle.
So, is the post-Bezos Washington Post a publisher or a tech company?
Both. We think of ourselves as a technology company and a publisher at the same time. Our Arc Publishing [software-as-a-service] business continues to expand its client base, and we’re now licensing our tools to other companies including Tronc, which has adopted Arc as its fundamental platform throughout its nine-city metro chain. And there are more clients in the pipeline. Now that isn’t a business for a traditional publisher, but it’s something that we do and that’s all technology that we develop.
I’d say, we defy classification. We are a journalism company, we are a storytelling company and we are a technology company. You know, next to where I sit is a quote on the wall from Jeff Bezos: “What’s dangerous is not to evolve.” And that’s what it feels like to be owned by Jeff: to be constantly evolving and realizing that staying static is not an option. Staying static is the most dangerous thing a publisher can do.
Peggy Anne Salz is the Content Marketing Strategist and Chief Analyst of Mobile Groove, a top 50 influential technology site providing custom research to the global mobile industry and consulting to tech startups. Full disclosure: She is a frequent contributor to Forbes on the topic of mobile marketing, engagement and apps. Her work also regularly appears in a range of publications from Venture Beat to Harvard Business Review. Peggy is a top 30 Mobile Marketing influencer and a nine-time author based in Europe. Follow her @peggyanne.
When you think of The Washington Post, you probably think newspapers, not software company. But the reality is that the company operates a lot more like the latter. Under the influence of owner Jeff Bezos, The Post has been trying innovative approaches to everything it does and is experimenting with new ways of doing business.
That includes running an ad tech startup inside the company, one whose job is to use The Post as a sandbox of sorts to come up with new ways to deliver ads and then market the technology they produce to other publications. It’s not the kind of project you expect to find inside a publication like The Post, but it’s one of the qualities that attracted VP of commercial product and innovation, Jarrod Dicker several years ago.
Dicker says he originally reached out to The Post in 2015 about a job because he was seeing the continuous trend of media companies’ reliance on third-party companies for things core to the business, such as ad technology.
Seeing RED
After he came on board, Dicker helped form the RED team, which stands for research, experimentation and development. The group, which consists of software developers and product managers, began to look at the ways the company did ad tech.
As with any attempt to change the way you do business, Dicker ran into the “that’s just the way the industry works” attitude. His idea was to look at it fresh. What if you didn’t have any preconceived notions about how ad tech was supposed to work, how would you build it from scratch?
What he knew for sure was that users didn’t like the way ads were being delivered to them. So the first thing he decided to do was focus on improving the user experience. When consumers ignored ads—or worse, blocked them—Dicker recognized that the approach the industry had been taking needed to change if publishing was going to survive and thrive moving forward.
Thinking Like a Startup
“My pitch to The Post early on was—and it was me coming in as an individual contributor at the time—how do we take a startup mentality and really think about our focus as a media company and figure out how to differentiate ourselves,” he said. The problem as he saw it was that most media companies were focusing so much on building the content side of the business, they were forgetting about innovating on the revenue side.
So, he said they took the approach: “What if we actually applied an effort to build products that we think would be perfect for user experience, knowing how our consumers engage on The Washington Post and apply those to what we know brands and marketers want.” And that may just have been the key that unlocked the strategy. Dicker and the team he helped form wanted to create products that worked for marketers and brands as well as users who were fed up with online ads.
Getting talent to come in and work on ad tech proved to be a challenge at first precisely because it had such a bad reputation. “People didn’t want to work on ad problems because of the association with fraud, blocking and bad user experience. And the people who could apply [for these positions] and make the change didn’t want to be a part of it. They assumed that things couldn’t change or be better,” he said.
Those were precisely the people Dicker wanted however. Solving these issues requires people who could look at ad tech problems with fresh eyes. One of the problems they found was related to ad load time, so speed became a priority. The result was aproductcalledZeus that has the fastest ad load times in the industry, faster even than Google, according to Dicker.
Revenue Revisited
The RED team developed Zeus and other ad tech products at the Post including PostPulse, FlexPlay, Re–Engage, Fuse, InContext, and PostCards, and then began licensing them to other media companies, such as the Los Angeles Times, Toronto Globe and Mail, and Chicago Tribune. He found that providing a way to potentially improve ad technology across the industry, while producing another revenue source, was a happy side effect.
Dicker isn’t under any illusions that the tools his team has created are going to supplant the content/ad/subscription revenue model. However, he does see it as a viable additional form of revenue for the company, and he finds it exciting that his team is helping the core business grow and thrive.
“We now also have a Software as a Service model where the Washington Post is no longer solely reliant on advertising or subscriptions. We are actually becoming the technology vendor for other publications.” And that not only helps them diversify revenue, but has created an internal culture of innovation, which should help drive long-term success.
You’re half-way through a gaming session and the world is breaking apart around you as you run from attacking aliens. Firing as you go, you turn a corner and suddenly your view is filled with the sight of a brand new sedan. You see a cute dog at your local coffee shop. When you lean down to pet the dog an ad pops up next to your hand inviting you to buy puppy food. Sounds dystopian? No, it’s just the latest in advertising technology guidance from the Interactive Advertising Bureau.
Augmented Reality (AR) and Virtual Reality (VR) are exciting technologies, but they are far from mature. Early adopters have paid a lot of money for expensive devices but the future of both the hardware and software for AR and VR is still uncertain.
New Advertising Opportunities
This murky future hasn’t stopped the IAB from pushing out guidance in its latest “#IABNewAdPortfolio” on advertising formats for both platforms. The enthusiasm for new advertising opportunities is understandable. However, these new ad formats could easily kill off these infant platforms.
Worse, it is unlikely that early AR and VR advertisers will strictly adhere to the IAB’s guidelines. The reality is most ads have a tendency to step over the already permissive restrictions laid out in IAB documents. It seems likely that will also be the case with AR and VR.
The IAB has specified ad formats that could turn their hosting technologies into a wasteland. Advertisers could display any ad format onto a virtual wall or billboard. Considering the current state of display ads, that alone is a troubling concept. The IAB offers almost no restrictions on interactive objects, only recommending that a branded can of soda shouldn’t take up the whole view. One innovator in VR advertising provided their own horrifying example of a virtual landscape infested by Despicable Me’s Minions.
This image was proudly supplied to MIT’s Technology Review by MediaSpike as an example of just how great VR ads can be.MediaSpike’s website provides the view from inside the Minion blimp, complete with three Minion ad placements and one Pepsi can.
Disruptive, And Not in a Good Way
According to Crunchbase, this mission to create a world where every flat surface and vehicle stares at you through the dead goggled eyes of a Minion garnered over 5 million dollars in funding, surely a sign of the future to come.
The IAB guidance specifies an opportunity for interstitials as well:
360-degree video placed as an interstitial ad between different VR scenes. 360-degree video MUST completely fill the VR scene with video ad.
It is hard to imagine a more disruptive experience than being in one world and turning around into a 360 ad embodying an entirely different one. Such an ad format would be easy for less ethical content providers to exploit, with every virtual head turn or gaze providing a chance to fall into an ad.
I’m Looking at You, AR
Then comes the horror that is the IAB’s ad guidance on Augmented Reality experiences: AI that watches everything you glance at and triggers ads accordingly. Here’s the guidance on what happens when Orwell meets Ad Executive:
For example, a brand may choose to associate a product or service with dogs. When the AI system on a device “sees” a dog using the device lens, the AI system can associate the familiar concept with the previously known concept of a “dog.” The unknown visual of a dog that the AI system scans may be either an image of a dog or the three-dimensional animal. Once recognized, the system can trigger the display of brand content.
This is a terrible concept. First, eager marketers would likely train AI to trigger on even vaguely associated objects. Second, the guidance allows for display ads to be either attached to physical objects or stuck to your viewport until… I don’t know, you go crazy? The concept is so obviously terrible that it was satirized 17 years before the IAB even came up with it.
Tracking the Trackers
This doesn’t even touch on consumers increasing opposition to the tracking currently deployed in display and video ads on the web. Ads run by AIs that track every gaze would only compound that invasion of privacy.
Considering the low-quality technical performance of ad tech and the heavy battery use of AR devices, the platforms themselves would probably not be capable of supporting the ad space effectively. Endless popups assaulting an Augmented Reality user’s view is sure to destroy any chance the technology has to make it into the general consumer market. While current ad tech may have damaged the viability of publishers on the web, this may be the first time ad tech destroys a whole technology category with its urgency to monetize.
Slow Down and Get it Right
If AR and VR are to bring advertising dollars, it isn’t by replaying the mistakes of the last decade on new formats. The first step will be severely limiting the possible locations where—and amount of time when—advertising can appear. The next, in any guideline or best practice we must recommend against the invasive tracking of ‘Advertising Intelligences’. This is not the world we want to build and we cannot open the door for this type of tracking tied to these platforms.
This does not mean that there aren’t opportunities. Product placement is, without a doubt, a clear trade-off that most consumers have already accepted. Another option is that sponsors of VR and AR experiences could provide opening areas before users encounter the content, a more appropriate type of pre-roll. If the technology is given the opportunity to mature, many other opportunities will certainly emerge.
Whatever the future brings, if we wish for it to include AR and VR in our everyday lives—and in the lives of the consumers whose trust is essential to our success—we can’t allow these types of proposals to go unchallenged. If we need ads to fund these platforms, we will have to find more creative options, ones appropriate to the technology and user experience. No matter what business model supports AR and VR, we don’t want to create an untenable experience before these emerging formats have had a chance to develop and capture audiences.
Aram Zucker-Scharff is the Director for Ad Engineering in The Washington Post’s Research, Experimentation and Development group. He is also the lead developer for the open-source tool PressForward and a consultant on content strategy and newsroom workflows. He was one of Folio Magazine’s 15 under 30 in the magazine media industry. He previously worked as Salon.com’s full stack developer. His work has been covered multiple times in journalism.co.uk and he has appeared in The Atlantic, Digiday, Poynter, and Columbia Journalism Review. He has also worked as a journalist, a community manager and a journalism educator.
Some have dismissed VR as yet another overhyped technology category that will never achieve those prized hockey-stick sales projections. And let’s face it: Many consumers ignore it completely as solely for gamers. HPs recent entry into what it calls “commercial VR” may signal a new class of applications that could convince consumers to give VR another look. It should also inspire a raft of experimentation from a wide range of industries. At HP’s announcement at SIGGRAPH, HP’s partners used VR for applications as varied as creating immersive consumer and marketing experiences, to training and simulation, to curing PTSD.
HP’s announcement had three key elements. Most significant is the introduction of the HP Z VR Backpack, which is a battery powered, 10.25-pound backpack that’s driven by an Intel Core i7-7820HQ CPU, with an NVIDIA Quadro P5200 graphics card. Obviously, the main benefit of the wearable solution is the ability to move in a VR world untethered and without tripping over wires. Significantly, the unit features a dock, which allows developers to quickly transition back and forth between their desktop and wearable VR PC for virtual reality content design.
Beyond the backpack, HP is selling the HTC Vive Business Edition head mounted display (HMD). HP also plans to open 13 immersion centers around the globe to help companies experience HP VR technology and learn how to best develop and deploy VR.
Pole Position
An Audi prospect checking out the tires close-up in VR.
One early adopter of HP VR is Audi, which has developed two types of showroom-based systems. One allows potential buyers to walk around the car and peer inside all the nooks and crannies.
The other is a chair-based system that allows potential buyers to use a controller to navigate around and into the car. As they approach doors, trunks, or engine compartments in the VR world, hot spots appear to open and view inside, or sit. Audi plans to rollout the chair-based system to all dealers in the third quarter of 2017.
Magdalena Maczkowski is the Product Owner of Audi’s VR Experience/Immersion. As she explained, most prospects come to the dealership knowing which car they want to buy. Working with a sales consultant, they can configure and visualize the car on a traditional large screen display. When it comes to choosing colors and final options, they may don the VR headset to get a feel for how the panoramic sunroof looks, or the high-end 18” rims, or how the colors look at night under a streetlight. And, since Audi sells more than 50 vehicles, prospects can experience a car that isn’t on the lot.
Training and Entertainment Applications
Another early HP VR partner is Motion Reality, Inc, which develops real-time human motion capture and simulation technologies for the military, law enforcement, entertainment, and sports markets. The interface allows users of Motion Reality products to move within a virtual environment and interact with their fellow actors and surroundings by physically moving around a defined real-world environment equipped with motion capture technology.
Training and entertainment courtesy of VR.
VR for Pain Relief and Therapy
Using VR to help overcome PTSD.
A third company experimenting with HP’s technology is Firsthand Technologies, which uses VR for medical applications ranging from pain relief to helping reduce the symptoms of Post Traumatic Stress Disorder (PTSD) or phobias. Regarding PTSD, VR can provide controllable exposure to a fearful experience, allowing patient to process and ultimately overcome its impact. “People get stuck,” Firsthand CEO Howard Rose commented. “VR unsticks them with gradual, low stress challenges.” Rose also shared that Firsthand started using HP workstations in hospitals, in part, because of their whisper quiet operation.
Over the last 12-18 months, VR has evolved from a technology focused on a small number of use cases to a tool that can be used by any company that needs to market and sell its products, train its workers, or perform any number of other functions—including, of course, delivering information and entertainment. HP’s commitment to VR adds an exclamation point to that pivot. While VR has not yet captured widespread consumer use, the addition of more options and commercial implementations can only help build interest in virtual reality experiences as a whole.
John: Ad fraud is a persistent problem that, according to the IAB, costs the industry $8.2 billion a year in the U.S. While ad fraud is found in various forms, from a publisher’s vantage there are two main problems: One is fraudulent copies of sites that are created, and whose advertising inventory is then presented on programmatic platforms as coming from the original publisher sites. To add insult to injury, most of the traffic on these fraudulent sites is from bots. The other is non-human traffic on legitimate publisher sites from bots scraping the sites, attempting to insert comment links, or coming through content recommendation systems in an attempt to defraud them.
