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Advertising | Innovation | Perspectives | Revenue

Programmatic: Both the Villain and the Hero

Nothing makes a narrative more compelling than a villain: evil that must be overcome so the hero can prevail. Maybe that’s why every few years a new nefarious buzzword arises that both energizes the digital media industry and rattles the cages of the establishment. But the business of digital media is just not as tidy as a formulaic series. The real problems are complex. And the bad actors aren’t parading their final 15 minutes of fame on Dancing with the Stars, they are lurking in the shadows, profiting from marketers’ best intentions and the great content created by others. While the story of programmatic is barely a few years old, the plot lines are deep and we’re clearly still early in the first season.

It wasn’t too long ago that programmatic was referred to as the latest chapter in digital media’s “race to the bottom.” The word was associated with everything bad in the digital advertising supply chain because it started off as a murky pool of third parties offering marketers an easy way to reach massive (if dubious) audiences and for publishers to offload “remnant” inventory at bargain basement prices. Unsold inventory from great brands mixed with a whole lot of garbage—the old ad network model. This (thankfully brief) period in the story of programmatic did little for anyone besides intermediaries—though it did help draw attention to the fact that digital advertising processes were ripe for change.

The reality is that programmatic emerged as a response to the complexity of the digital ad buy and has evolved into a way to automate as much as possible, making digital media easier for marketers to buy and potentially more profitable for publishers. Our research shows that forward thinking media companies have wisely jumped into the programmatic fray in order to address marketers’ desire for efficiency while also leveraging their first party audience data to deliver highly targeted, efficient and impactful campaigns.

Yes,  a whole lot of programmatic inventory is still remnant but that is starting to change as more premium inventory becomes available for programmatic buys. In fact, a growing number of our members are starting to see programmatic guaranteed and preferred deals that rival direct deals in terms of CPMs. The big difference is that the programmatic deals—those that have pre-agreed prices and guaranteed high-quality inventory—offer automation of the back-end processes.

As representatives for the digital content brands that marketers trust, it is our responsibility to shine a light on any “trust parasites” in programmatic and to work with advertising and agency partners to maximize their confidence in the value they will receive when they put money into programmatic. The rise of programmatic direct and private marketplaces offer an example of how this is taking shape. And right now, buying direct from a trusted premium publisher is the best way to execute a programmatic campaign without risk.

Villain’s and heroes aren’t what we need to focus on in the story of digital media. However we do need to recognize that there’s a lot at stake here if all of the players don’t work together to educate the market, given the predictions that programmatic will dominate digital advertising within a few years. If you are one of the few still debating whether or not to embrace programmatic: Stop now. Automating the bidding, buying, securing and execution of an ad campaign in real-time using machines rather than paper and humans is a no-brainer.

If you put on your marketer cap, it’s fairly obvious.  Do you want your ads to be viewable meaning actually show up in the active window? Absolutely.  Do you want your ads to be in front of humans rather than bots? Um, of course. Do you want your ads to run in a clean, well-lit brand-safe environment? Yes, please. Do you want all of the above as easily as possible? Bring it on.

With every change, every challenge comes an opportunity to step up and “save the day.” And there are few better examples of the opportunity for digital innovation than programmatic. Get on board and let’s drive this narrative forward.

 

Image credit: kosmolaut.

Perspectives | Research | Revenue

comScore Versus the Bots: New Booklet Tackles Non-Human Traffic

As the digital ad spend rises, so does the amount of non-human traffic online. That is no surprise to Brian Pugh, comScore’s SVP of Audience, who has been tracking the issue for about 15 years. In those early days, says Pugh, no one wanted to talk about it; non-human traffic was one of the internet’s dirty little secrets. The bad news is that has grown a lot since then. The good news is that today people are discussing it openly and solutions are emerging to address the problem.

To fuel on-going discussion around these issues comScore recently released a booklet on Non-Human Traffic, which provides a clear overview of the issue as well as how a failure to address the problem causes inaccurate audience measurement, which negatively impacts the entire value chain. “Over the last 18 months, the issue has been talked about much more openly,” says Pugh, “because brands are becoming more sophisticated and aware.” And while viewability has been in the spotlight for a while, Pugh sees issues of fraud moving to the fore “because before you can judge if an ad is really viewable, you need to know if the viewer is human.”

comScore has been working to address the issue of fraud since the launch of its Media Metrix product in 2001, and the company’s acquisition of MdotLabs last summer signaled a significant push to weed out fraudulent traffic in order to accurately measure and report on audiences. MdotLabs co-founder Timur Yarnall joined comScore as SVP and anti-fraud evangelist, to help educate the industry and marketers, many of whom still think viewability is all they have to worry about.

The reality is that non-human traffic undermines the integrity of every performance and effectiveness metric. And this is not just a buy-side issue, at least in part because the growth of the digital advertising industry must be predicated on trust. Yarnall points to comScore’s recent launch of Industry Trust as another effort to increase transparency around problems in digital advertising, but also “to highlight the good things happening in the industry and not just provide fodder for the next shocking story.”

PercentNHTcomScoreIndustry Trust is intended to enable trustworthy programmatic transactions by providing a rating of ad inventory quality. Pugh says that the popularity of programmatic ad buying has further escalated fraud with bad actors delivering non-premium inventory by “claiming to be another site.” Low-quality sites impersonating a high quality publisher in order to steal ad sales is known as Domain Laundering and is one of the issues covered in the new comScore booklet. “This sort of thing is much too easy right now,” according to Pugh, who believes that more transparency and accountability are essential to strengthen the ecosystem. “Content is still king,” says Pugh. “The best audiences are going to be around great content so of course there are going to be fraudsters out there trying to impersonate the best publishers.”

The Non-Human Traffic booklet doesn’t touch upon the issue of third-party traffic sourcing, an area of much concern to publishers that was raised in the ANA White Ops report “The Bot Baseline: Fraud in Digital Advertising, which found that sourced traffic display inventory was almost five times more likely to be fraudulent.  While Pugh says he has seen cases of publishers trying to hide that sort of traffic in the past, these days they are becoming increasingly aware of the negative effects and are working hard to ensure that third-party traffic comes from reputable sources, thanks in part to vocal industry leaders such as AdWeek’s Mike Shields. Ultimately, he encourages publishers to continue to place a premium on building quality audiences, “If you are a publisher, you have to get traffic to your site. No, all sourced traffic isn’t bad, but the old saying you get what you pay for applies here.”

While both Yarnall and Pugh note that scammers continue to change their tactics in order to counteract the anti-fraud measures put in place by publishers, they also highlight the creativity coming from the media, marketing and measurement side of the equation in addressing these issues.  What’s key to staying ahead of what’s sure to be an on-going issue is the sharing of information and continued efforts by leaders in the industry to shine a light on the problems as well as the victories in combatting fraud and non-human traffic. And while fraud will never be entirely eliminated, Yarnall’s goal is to make it much harder and more expensive for fraudsters to exist.

Perspectives | Revenue

Inside DCN’s Next Conversation: Revenue Diversification

Revenue diversification is the final topic in the three-part series taken from our invite-only dinner The Next Conversation—an event we hosted inside the Digiday Publishers Summit in Vail, CO on March 26th. It’s a topic we think and talk a lot about with our members—from podcasting to events to eCommerce and subscriptions – digital content companies are well aware that advertising won’t fully pay for the great content of the future. And one clear take-away is that all forays into new streams of revenue must align with and complement one’s brand. Context matters.

Some highlights:

“You have to diverse your portfolio in terms of revenue. Whether it’s through subscription, events…you cannot have 70% of your revenue coming from advertising and only 30% of your revenue coming from elsewhere. It has to be more balanced”

—Steve Suthiana, Global Head, Digital and Media Operations, Mansueto Ventures

 

“You’re really looking for a path that allows your users to demonstrate loyalty and that grows your revenue separate and apart from ad dollars”

—Paul Marcum, Head of Global Digital Video, Bloomberg

“I think what Vice has done really well is bring equity back to the brand.”

—Lindsay Nelson, VP, Vox Creative, Vox Media

“Content is king.”

—Brian Danza, CTO, Daily Caller

 

Innovation | Perspectives | Revenue

The Potential Payoff for Podcasts

A certain buzz has been building in the media industry lately. It started getting louder with the ascent of the smash public radio podcast, “Serial,” and it’s since grown into a full-on craze: Podcasts are making a major comeback.

Recent research from Edison found that around 46 million Americans listen to podcasts every month, nearly twice as many listeners as compared to 2008. Subscriptions of podcasts through iTunes reached one billion in 2013, according Apple. And NPR doubled its podcasting revenue in 2014 and is set to double that revenue again this year. NPR’s vice president of programming told Poynter last month that monthly downloads for its portfolio of podcasts have also increased, “from 37.5 million in October 2013 to more than 90 million in March 2015.”

But the bigger question has less to do with content and quality and more to do with sustainability: How economically viable are podcasts?

Achieving Lift-Off

The barriers to entry for podcasting are fairly low, but financing podcasting is another story. Crowdfunding has worked in some cases, such as with the podcast 99% Invisible, which became the most successful Kickstarter in journalism when it launched its campaign in 2012. And that podcast even had a fantastic follow-up crowdfunding campaign to create Radiotopia, a podcasting network that has since become the Kickstarter’s most funded campaign for radio.

But crowdfunding doesn’t work for every publisher. Take Invisibilia, a new NPR podcast launched in the beginning of this year. Its staffers set aside about $1,500 to purchase Facebook ads to promote the show ahead of its release. They also promoted previews of the show on two of the most well-known radio shows, “This American Life” and “Radiolab.” That promotion worked so well that its staffers cancelled the Facebook ads after spending around $400.

Most popular podcasts have cashed in with a very personal form of advertising — hosts speaking about brands in conversational mode just as in the early days of radio. That has been “the dominant advertising model for podcasts,” according to Andy Bowers, the executive producer of Slate’s podcasts. Listeners generally feel a certain intimacy with the host, and to hear that personality speak an ad therefore has an effect that’s specific to the medium. You could call it an audio version of a native ad, and they bring in a higher CPM in the $20 to $45 range.

Trying to Scale

The downside to this form of advertising, however, is that it’s very difficult to scale and remain personal.

Slate, a longtime podcast hub, also recently launched Panoply, a “podcast network for media brands, authors, personalities, and premier organizations” that currently includes podcasts from New York Times Magazine, HBO Documentary Films, the Huffington Post and Popular Science. The network not only helps audiences to discover new podcasts, but it’s also out to assist with the advertising and revenue side of podcasting as well. Slate general manager and Panoply co-creator Brendan Monaghan told DCN’s Michelle Manafy that “acquiring programs that can fit into “audience- and advertiser-friendly categories such as news and politics, culture and lifestyle, sports, and women’s issues”—categories he says are currently underserved.

Unfortunately podcasting has its own “viewability” issue, similar to the problem where humans don’t see web ads. In this case, it’s difficult to tell if people who downloaded a podcast actually listened to it, and for how long. But that varies depending on the app, as some of the apps such as Stitcher and SoundCloud can give more depth, and are readying their own ad networks.

Another possible podcasting revenue model is subscription based or pay-per-listen. This tactic debuted with Ricky Gervais in the first round of the podcasting boom and these days, Marc Maron and Fox News are charging for some of their content. Given the desire for revenue diversification among media companies, we may see more experiments with subscription models around podcasting.

One thing is certain with podcasting, though: Technology is helping to drive this boom, with easier synching and updates to in-car apps. Podcasting remains a very personal medium for listeners on the go, so expect more and more publishers to add audio as another platform to conquer, while incrementally increasing revenues and experimenting with monetization methods.

Innovation | Perspectives | Revenue

Collective Patents its Cross-platform Targeting Technology

Collective, Inc. has been granted a patent for its technology that targets online advertisements to consumers based on their TV viewing habits by anonymously linking linear television data to digital across multiple screens. They filed for the patent in 2011 when they launched TV Accelerator, and CEO Joe Apprendi describes the four years since as “pretty interesting” given the industry’s increasing desire for cross-platform measurement in that time.

While Collective has been successful deploying its own solution, Apprendi says “now that we’ve got the patent, we’re excited about trying to make this as the standard in the market and establishing a licensing model around it.” Their U.S. Patent 8,949,890 protects the company’s offering and reinforces Collective’s expertise in multiscreen advertising.

Certainly, as audiences increasingly consume content across multiple devices, media companies and marketers are interested in understanding their behavior and, of course, the impact of advertising in various contexts. Interestingly, Apprendi says the origins of Collective’s TV Accelerator solution can be traced to Nielsen research that showed the remarkable lift in ad recall when consumers were exposed to a television commercial and online video. With the Nielsen process, however, this could only be measured when it “randomly happened.” Apprendi says his team realized that “Collective was in a unique position to make this happen intentionally.”

Nielsen’s recent acquisition of Exelate, a company that connects identities across all channels and devices, signals that others would also like to be in that position. Apprendi notes that Nielsen was in the “ad effectiveness and audience measurement business, which they are good at. Now it looks like they are moving into targeting, using data to target, not just measure.”

Collective, says Apprendi, has a head start given that they’ve been doing this for a decade already and have core capabilities focused on data-driven programmatic advertising and on providing audience contextual data to deliver targeted ads across platforms.

Apprendi believes that most marketers are buying publishers’ channels as a proxy to reach a target audience but they should actually flip that thinking in order to make better decisions about where to make big direct investments. “Let’s not make those decisions until I buy programmatically across platforms, screens and media brands to see which avenues and media brands perform the best.” Then, he says, marketers can make better decisions about where to make a significant direct investment.

And, while he sees signs of progress with more and more agencies having a unified video buying practice across screens, he says that “The Holy Grail is that eventually, we’ll see marketers start with audience first, rather than ‘this is what I did on TV now what should I do to support that.’”

At a minimum, Apprendi encourages marketers to use data and analytics to determine which media outlets make the most sense for their objectives. And on the publisher side, that data can help them respond or optimize their content strategy. “Data makes everyone smarter at the end of the day.”

The long term goal, however, is “full transparency,” says Apprendi. This is not just cost transparency, but includes issues of inventory quality and viewability. “We need transparent relationships if we want to help marketers make smarter media decisions.”

Innovation | Revenue

Podcasting Sounds Like a Big Opportunity to Slate

For a while there, it looked like Podcasting was fated to be little more than a format road-fork in the ever-expanding digital media landscape. Though a slew of individuals and media brands initially jumped on board, many just as quickly abandoned podcasting in favor of other digital formats. Slate, however, stayed the course. The company continued to invest in podcasting over the years and just announced the launch of Panoply, its new podcast network for media brands, authors, personalities, and premier organizations.

When Andy Bowers, Chief Content Officer and co-founder of Panoply left NPR to join Slate more than a decade ago, podcasting was in its infancy. A little over a year later, podcasting was named the 2005 word of the year by the editors of the Oxford American Dictionary. However that same year, Bowers recalls that YouTube entered the scene. “And then all eyes turned to video,” Bowers observed. Well, not all eyes. Slate was among those that continued to invest in the format and, says Bowers, witnessed podcasting’s quiet but a steady audience growth—an audience that, for Slate, currently generates about 6.5 million downloads a month.

That growth isn’t so quiet anymore. With the much lauded success of This American Life’s record-setting Serial podcast, the format has re-entered the spotlight. And while the success of Serial is certainly a boon for the launch of Panoply, Bowers said that even a year before its release, “the buzz was coming back and many of us in the podcasting space felt it.” According to Matt Turk, Slate’s former publisher who now serves as Chief Revenue officer of Panoply, “Yes, Serial was a game changer, but technology and changing consumer behavior are also playing a massive role here.” He cites Slate research that finds two thirds of its podcast listeners using mobile devices to listen to programming of interest whenever and wherever it suits them. And, as it becomes increasingly easy to listen to podcasts in cars, Bowers and Turk predict an even steeper audience growth trajectory.

It also seems that once someone discovers podcasts, they develop a robust appetite for them. Bowers says that the average podcast listener regularly consumes seven or more. Given the potential audience, the Slate team felt there was an opportunity to improve content discovery mechanisms and to foster the growth of the overall podcasting market with the launch of a new network. While there are a number of podcasting networks already in the market, Bowers says that “each has its own specialty and we fit an important niche. We’re a place for premium brands, thinkers and authors. These are brand-safe environments and that is an important point of differentiation.”

At launch, Panoply holds commitments for programming from: The New York Times Magazine; HBO Documentary Films, Inc.; New York magazine/Vulture; The Huffington Post; WBUR radio; Real Simple; Popular Science; Gretchen Rubin, author of the No. 1 New York Times best-seller The Happiness Project; Food52; FX’s The Americans; and the National Constitution Center.

In addition to focusing on fueling podcast discovery for media brands, Panoply will also distinguish itself from existing networks by offering “a compelling combination of production, audience-building and sales,” according to Brendan Monaghan, Slate General Manager of Slate and Panoply co-creator. He says that Panoply has plans to create and acquire programs in audience- and advertiser-friendly categories such as news and politics, culture and lifestyle, sports, and women’s issues—an area he describes as underserved within podcasting to date. “We’re starting out with brands and publications in a similar space to us, those we knew were interested in podcasting, but that also represented categories that are ripe to grow,” says Monaghan.

Audiences aren’t the only ones increasingly attracted to podcasts. According to Turk, advertiser receptivity to podcasts is markedly on the rise and he reports that “year to date we already have more ad revenue in podcasts than in all of 2014.” These podcast advertisers include Prudential, Delta, Acura and Nissan.

In Monaghan’s role as GM, he is charged with incubating and launching new opportunities. Given the way the stars—or market forces—are aligning for podcasting, and the company’s track record of podcast performance, he is confident that Panoply provides an opportunity for growth for his organization and for podcasting as a whole.

Industry-Research | Research | Revenue | Video

FreeWheel Q4 2014 Video Monetization Report

FreeWheel, a Comcast-owned ad serving platform servicing many major TV and cable networks and online video services, including A&E Networks, Discovery Communications, ESPN, NBC Universal and Univision, has released its Q4 2014 Video Monetization Report.

The report found that 2014 digital video growth was driven by ultra-premium content – new seasons of shows and live streaming. This was closely related to growth in TV Everywhere authenticated viewing.

Key findings include:

  • Live viewing grew 297% year-over-year, driven by strong growth in Sports streaming and News simulcasts.
  • First-run broadcast shows attracted far more viewers this quarter than the year prior, as seen by a 67% increase in digital video ad views.
  • Over-the top (OTT) streaming devices, overwhelmingly used for long-form and live viewing, overtook tablets, accounting for 8% of all video ad views.
  • Authenticated viewing grew 591% year-over-year, as 56% of all video ad views on long-form and live content now come from behind authentication walls.
Innovation | Revenue

The AP and PodcastOne Partner to Offer Dynamic News Via Podcasts

Podcasting is definitely making a comeback. But like so many things digital, podcasting isn’t a one-size-fits-all opportunity. While many individuals and organizations are posting podcasts on their own sites, others opt to participate in podcast networks. The Associated Press is taking the latter route,  getting into the resurgent podcasting game while remaining true to its brand: a trusted source of independent news and information licensed by media outlets of all kinds.

When Norm Pattiz, founder and CEO of PodcastOne, approached the AP about licensing their content for podcasts, they were interested. According to Ebony Reed, AP’s director of business development for local markets, the AP is often approached by those who are looking to fill an information need and they are always excited to figure out ways to ways to creatively meet those needs. “We want to grow and continue to be at the forefront of providing information to the world,” said Reed. “When Norm came to us, we were interested to hear what he was doing and how we could work together.”

Pattiz who has a long and storied history in radio syndication (notably as the founder of Westwood One) admits that he’s always been a big believer in news and knows that advertisers are too.  He founded his latest venture in February, 2013 when he noticed that news had been in decline on broadcast radio and wanted to find a way to incorporate it into his content mix (PodcastOne hosts approximately 200 podcasts, including those by Adam Carolla, Steve Austin and Jillian Michaels.) The trick, of course, was that podcasting is an on-demand medium, while news is up-to-the-minute content. Pattiz decided to leverage PodcastOne’s dynamic ad insertion technology to solve this problem. “With dynamic insertion, you can insert the ad regardless of when a podcast is downloaded. So I thought, ‘why couldn’t we do the same thing to provide the most up-to- date newscast for consumers?’” Problem solved. (And an opportunity created.)

While this model presents a content-licensing deal (with revenue sharing) for the AP, Reed said that it was also appealing to be a part of the PodcastOne effort particularly because of Norm’s involvement and his innovative broadcast approaches. ”We are always looking for ways to help with new digital products and this is a great way to reinforce the brand by being affiliated with this new and exciting venture.”

Pattiz licenses the AP’s audio clips service which offers hundreds of cuts each day, including sound bites, correspondent reports, news headlines, wraps and more. The AP’s 60-second news headlines are featured at the end of PodcastOne’s diverse podcasts as “AP Up-To-The-Minute Newscasts.” The goal is to integrate news into the PodCast one content, while also creating additional advertising inventory to sell in the post roll and extending listener engagement beyond the formal end of the podcast episodes.

While Reed says the AP didn’t set out to be in the podcast business, she emphasizes that “The AP tries to stay on the cutting edge of digital and we are exploring a wide range of different initiatives. We are open to experimentation and pushing to be a part of new ventures and opportunities.” Ultimately, though, while the digital team at AP is focused on finding new channels for its content and creative ways to increase its footprint, the AP isn’t looking to build its own podcast network. “You read us in newspapers, you hear us on TV but we don’t own a newspaper and we don’t own a television network.” With the PodcastOne partnership, the AP continues its long tradition of offering its information through a wide range of outlets and meeting the information needs of its partners and consumers alike.

Advertising | Revenue

Edmunds Signals Advertising Shift With Programmatic

Edmunds.com had an enviable problem: A wide range of brands wanted to advertise on the site but were being crowded out by big-pocketed automakers who love to spend on their highly-contextual pages. It’s no surprise that car makers wanted access to the Edmunds audience; according to Datalogix, 59% of U.S. car shoppers use Edmunds.com, and more than half of visits to its website result in a purchase. To increase opportunities for non-endemic brands to reach its desirable audience, Edmunds began to experiment with programmatic last year via private exchanges. And 2015 has brought a partnership with Krux – a data management platform (DMP) – to help them deliver across all digital screens and sources  and continue to expand Edmunds’ advertising and content capabilities.

According to CEO Avi Steinlauf “Edmunds has embraced audience-based marketing by redefining our entire premium ad product offering.” This includes everything from page-based placements to audience-based placements for all of the company’s directly-sold, guaranteed onsite ad inventory. A key aspect of its new offering is the ability to reach the Edmunds audience offsite on other websites.

To establish this “audience-based advertising platform,” Edmunds.com turned to Krux to enable real-time tracking and audience segmentation of its audience. Krux also provides a platform to safeguard against the unauthorized use of audience data including strict adherence to industry standard consumer privacy policies.

Consumer protection is an essential component of this initiative. As Krux CEO Tom Chavez put it, “Like any publisher with valuable people data, Edmunds doesn’t want their data cast into the winds or transacted in dark rooms by frenemies who take liberties.” As such, Krux focuses on providing fine-grained controls that allow Edmunds to provision its data only to named players on times, terms, and conditions of their choosing. According to Chavez, “This requires an end-to-end approach that first detects and monitors if and where their data is leaking, and second enables them to point and send it to trusted partners in a friction-free, policy-managed fashion.”

The shift in its ad strategy is in response to what Steinlauf describes as “the ad industry’s increasing need to reach relevant audiences and provide more effective, tighter messaging to consumers.” This is achieved by offering marketers who directly buy ad inventory on Edmunds, a license to retarget those same audiences by activating them for retargeting on their programmatic buying platforms (DSPs).

As a second-party data provider for automotive OEM clients, Edmunds is able to work more collaboratively with these OEMs as well as with agencies to develop new types of ad campaigns or to increase the ROI of current ones. And, for dealership clients, Steinlauf says using these audience segments overlaid with geo-targeting data “provides an exciting opportunity to serve as a key component in their cross-channel digital marketing efforts.”

Innovation | Perspectives | Revenue

The Big Four: Challenges We Must Face as an Industry

I could not be more thrilled at the enthusiasm for great content across the media industry— whether in the advertising, press, investment or journalism communities. That enthusiasm was never more apparent than at the 13th Annual Digital Content Next Summit last week, which gathered senior executives from across our membership to explore opportunities and innovation. We also came together to tackle challenges. And, in my opening remarks for the Summit, I captured four common themes that challenge content companies as they strive to reach their full potential in the digital transformation:

1. Pressures on display advertising.
The flat to declining ad prices, which have resulted from abundant supply, have triggered a downward spiral that can only be slowed by the quality dimension. The transition to viewability will help, but the viewability conversation is mired in a malaise of too many inconsistent ad solutions and buyers taking advantage of the transition.

Fraud in the digital display chain is also massive problem: It tops the list of marketer concerns. And let’s not forget about the shift to mobile, which continues to accelerate. This shift is a good thing because it provides opportunities for personalized, useful content experiences. But we need to keep in mind that ad pricing on mobile is 30% of that on tablets and desktop.

The result, which I wrote about in The Trust Principle, is a marketplace that is mostly bought and sold on direct response without value for environments and brands. Google, Facebook and countless intermediaries have swallowed up the roughly 65% growth in digital advertising that has taken place in the past three years, while content companies’ revenues have remained flat overall.

2. The Attention Economy.
It’s in full swing. We now have the opportunity to consume media 24/7 on countless devices, unleashing significant opportunities for content companies.

Here’s the rub: Anyone can be a media company. Individuals now compete with century-old institutions. Non-profits go head to head with for-profits. The competition is fierce whether the company is pre-revenue, or raking in billions.

I would argue the goal of capturing a consumer with 30 minutes of entertainment once a week is dead. Capturing 30 minutes each more morning with a newspaper is dead. Now we’re all trying to get a consumer to come by for a few minutes each day. We must provide a service to them—whether it is entertaining or informing and make sure to use their time well.

3. Business model innovation.
The days of brainstorming non-advertising revenues as an opportunity are gone. It’s now a requirement to innovate your business model. Companies can’t simply compete by attracting mass audiences and serving ads against them. Being a great media brand is not enough. Today, organizations of any size or longevity need to think like start-ups and continuously experiment and innovate.

Yes, brands must own the relationship with individuals and monetize that relationship through advertising, but also in countless other ways to bring value back to their business—by delivering value to their user.

4. Protect our art.
Data is all the rage, but it is art that defines us. Whether it be the journalism and free speech we fight so hard to protect, or copyright and content piracy, this so-called “content” is precious stuff. It is why consumers rely on us, and trust us and it is how we get to know them in the process. So yes, protecting our first party data (which comes out of customer relationships, as well as those with marketers) is also essential. But we build our businesses on this art and we need to protect it to make sure we can continue to fund and pay for it in the future.

Big challenges: Hell yes. But we are facing them as an industry, together.

Hit me up on Twitter (@jason_kint) if you want to dive deeper into any of these challenges or if there are others that you think we need to focus on.

Perspectives | Revenue

An Insider’s Guide to Native Ad Sales

If you are a top tier media company in this day and age, chance are you have a native advertising strategy in place. You’ve done your research, read the success stories and concluded that native ads can drive incremental revenue. However, the question remains: Are you taking advantage of your greatest asset?

I’m not talking about your editorial staff (not to in any way undervalue them); I’m talking about the folks that bring in the checks. Take a closer look at your ad sales team and ask if you are giving them the ability to sell native as a part of their online solutions? If the answer is no, start making changes today.

Most publishers I’ve talked to have a native strategy, but oddly, that strategy often doesn’t include having their sales teams offer native as a part of the sales pitch. Native has become somewhat of a monetization commodity that is being sold by others (ad networks, exchanges) instead of being sold directly by your sales teams. That’s because a $5.00 guarantee on impressions will be enticing to many. (Check out our earlier post on Guarantees for Native Inventory.) Besides, it’s easy to slap some code on the page and add that revenue to your bottom line. But this approach fails to capitalize on the serious revenue that brands are anteing up for great native advertising presented in high-value contexts.

Any guarantee you may get from a third party is really just a floor, remnant if you will. The real value comes when you have at the ability to create and run native placements on your Owned and Operated properties–at scale and for big dollars. Sales teams already connect with brands on a daily basis. They are out there pitching your sites’ audience and all the wonderful media placements you have to offer. Why not give them the ability to sell native to those same brands?  It’s actually much easier than you think.

Here’s three ways you can integrate native advertising into your current ad sales strategy:

1. Build on your advertisers’ current campaigns by offering to create native ads as an extension of their marketing efforts. Creating native ads couldn’t be easier, all you need are readily available assets like a YouTube link, Tumblr post, or Instagram photo and some simple ad copy tied to a destination URL. Plug those pieces into a native ad network’s ad creation studio and out pops a native ad.  There’s no need to hire extra designers or copywriters. With the right ad serving tools, native display campaigns can be set up to run in under two minutes flat.

2. Redistribute branded content the advertiser is already running (i.e. videos, long-from articles, etc.). Everyone is telling marketers to start acting more like publishers, and they are. Countless brands have developed in-house content marketing teams that crank out content on a regular basis. Help brands ensure that their efforts are worthwhile by re-posting their content on your site with clearly labeled modifiers like “Sponsored By Brand X” or “Presented By Brand Y” (DCN has done some research on these best practices among its members).

3. Create your own form of sponsored content or advertorial (here are a few tips on that), and drive the value of your native advertising campaigns up even higher. Remember how I said that you need tap into your available assets to better monetize with native advertising?  Now, I want you to take a look at your editorial staff. Evaluate your writers and pick (or hire) one or two that would be able to create content that can both align with your current editorial offering and your advertisers’ campaign goals. The best native content does both.

Again, you must clearly label the content to indicate that it was paid for by an advertiser. (It’s important to be above board at all times, so as not to mislead your readers and risk losing their trust.) The best part is that this form of native allows you to charge a premium for your editorial services, while ensuring that your readers will still be engaged. After all, who knows your audience better than you do?

Hopefully your convinced that you need to start selling native direct. If you need another nudge, consider this: Brands are projected to spend over $4.3 billion on native advertising in 2015. With a pie that huge, it’s time for you to start taking a bigger piece. Now go schedule a meeting with your head of sales, and start making more money with native today.

Kevin Van Lenten is SVP of Partnerships at AdsNative. Previously he was CRO and GM of Uvidi.com and held various senior sales positions at Vertical Search Works, Touchstorm, Adknowledge, and LearnVest.

 

Innovation | Revenue

Purch Acquires AnandTech in Continued Push to Connect Content and Commerce

With its acquisition of AnandTech, Purch continues to put its money where its mission is. Since it rebranded from TechMedia to Purch last April, the company has steadily continued to build up the ways in which it can “ease complex buying decisions for shoppers.” Fitting neatly into the buying funnel, AnandTech further enhances the reviews component of the ever-growing Purch stable of sites, joining its Top 10 Reviews, the Tom’s brand of tech media sites (purchased last year) and BuyerZone (purchased in June).

Anandtech.com is known for its computing and IT analysis and reviews, with an emphasis on mobile, which the company feels will round out Tom’s Hardware coverage. “AnandTech will be complementary, more than competitive, to Tom’s” says Purch COO, Doug Llewellyn. “The world is going more mobile. These guys got there early and do it better than anyone else.”

However he emphasizes the importance of what the two brands have in common: loyal, engaged audiences of tech enthusiasts. “With acquisitions, we always look at the user community and the people driving that community,” according to Llewellyn, pointing out that Purch focuses on the connection of content, community and commerce. He also says that the feeling across Purch is one of admiration and respect for AnandTech’s rigorous reviews process as well as its writers and editorial team, who will be staying on as part of the acquisition.

AnandTech Editor-in-Chief Ryan Smith–who took the role after the site’s founder Anand Lal Shimpi’s retired from journalism to join Apple in August–wrote a lengthy post about the search for a buyer. In it, he says Shimpi spent almost a year meeting with potential buyers to find one that had a sustainable business model (particularly given that AnandTech has been profitable since inception) and could improve the site’s reach. They also sought a buyer that had values that aligned with theirs. Smith found the process hearting, noting recent investments from traditional and new media, as well as VCs in the business of creating high quality content.

Smith writes that, “In meeting with the Purch business and editorial teams, there was a clear interest in further developing AnandTech’s strengths as well as feeding back AnandTech’s learnings into the rest of the Purch family.” Llewellyn echoes this, pointing out that through the Tom’s acquisition, “we learned a ton from how they do things and you can see the effect across our entire portfolio.” He feels confident that Purch “can bring enormous expertise on how to scale a brand, given that Tom’s was a third, or maybe only a quarter the size it is today when we acquired them last year.”

And scale, as well as advertising sales and marketing acumen are things that Smith clearly looks forward to increasing under Purch: “While we had no issues competing with larger corporate owned sites on the content front, when it came to advertising we were at a disadvantage…larger corporate owned sites could show up with a network of traffic, substantially larger than what AnandTech could deliver, and land more lucrative advertising deals than we were able to.”

Given that Purch boasts the number one position in ComScore’s Tech-News category, a global readership of more than 100 million monthly unique visitors, and the ability to drive more than a billion dollars in commerce transactions every year, increasing scale for the AnandTech brand should not be a problem. “We are really attuned to how marketers want to reach and speak to readers,” says Llewellyn. “But as we tie this great brand to the portfolio of brands under Purch, we definitely want to be sure that the readers know are excited to support the best of breed content that AnandTech is known for.”

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