This article was originally published on Don Marti’s blog on 16 August 2017
As far as I know, there are three ways to match an ad to a user.
User intent: Show an ad based on what the user is searching for. Old-school version: the Yellow Pages.
Context: Show an ad based on where the user is, or what the user is interested in. Old-school versions: highway billboards (geographic context), specialized magazines (interest context).
User identity: Show an ad based on who the user is. Old-school version: direct mail.
Most online advertising is matched to the user based on a mix of all three. And different players have different pieces of the action for each one. For user intent, search engines are the gatekeepers. The other winners from matching ads to users by intent are browsers and mobile platforms, who get paid to set their default search engine. Advertising based on context rewards the owners of reputations for producing high-quality news, information, and cultural works. Finally, user identitynow has a whole Lumascape of vendors in a variety of categories, all offering to help identify users in some way. (the Lumascape is rapidly consolidating, but that’s another story.)
Few of the web ads that you might see today are matched to you purely based on one of the three methods. Investments in all three tend to shift as the available technology, and the prevailing norms and laws, change.
The basic functionality of the internet, which is built on data exchanges between a user’s computer and publishers’ servers, can no longer be used for the delivery of advertising unless the consumer agrees to receive the ads – but the publisher must deliver content to that consumer regardless.
This doesn’t look accurate. I don’t know of any proposal that would require publishers to serve users who block ads entirely. What Rothenberg is really complaining about is that the proposed regulation would limit the ability of sites and ad intermediaries to match ads to users based on user identity, forcing them to rely on user intent and context. If users choose to block ads delivered from ad servers that use their personal data without permission, then sites won’t be able to refuse to serve them the content, but will be able to run ads that are relevant to the content of the site. As far as I can tell, sites would still be able to pop a “turn off your ad blocker” message in place of a news story if the user was blocking an ad placed purely by context, magazine style.
Privacy regulation is not so much an attack on the basic functionality of the Internet, as it is a shift that lowers the return on investment on knowing who the user is, and drives up the return on investment on providing search results and content. That’s a big change in who gets paid: more money for search and for trustworthy content brands, and less for adtech intermediaries that depend on user tracking.
Advertising: a fair deal for the user?
That depends. Search advertising is clearly the result of a user choice. The user chooses to view ads that come with search results, as part of choosing to do a search. As long as the ads are marked as ads, it’s pretty obvious what is happening.
The same goes for ads placed in context. The advertiser trades economic signal, in the form of costly support of an ad-supported resource, for the user’s attention. This is common in magazine and broadcast advertising, and when you use a site with one of the (rare) pure in-context ad platforms such as Project Wonderful, it works about the same way.
The place where things start to get problematic is ads based on user identity, placed by tracking users from site to site. The more that users learn how their data is used, the less tracking they tend to want. In one survey, 66% of adult Americans said they do not want marketers to tailor advertisements to their interests, and when the researchers explained how ad targeting works, the percentage went up.
If users, on average, dislike tracking enough that sites choose to conceal it, then that’s pretty good evidence that sites should probably ask for permission to do it. Whether this opt-in should be enforced by law, technology, or both is left as an exercise for the reader.
So what happens if, thanks to new regulations, technical improvements in browsers, or both, cross-site tracking becomes harder? Rothenberg insists that this transformation would end ad-supported sites, but the real effects would be more complex. Ad-supported sites are already getting a remarkably lousy share of ad budgets. “The supply chain’s complexity and opacity net digital advertisers as little as 30 cents to 40 cents of working media for every dollar spent,” ANA CEO Bob Liodice said.
Advertising on high-reputation sites tends to be a better investment than using highly intermediated, fraud-prone, stacks of user tracking to try to chase good users to cheap sites. But crap ad inventory, including fraudulent and brand-unsafe stuff, persists. The crap only has market value because of user tracking, and it drives down the value of legit ads. If browser improvements or regulation make knowledge of user identity rarer, the crap tends to leave the market and the value of user intent and context go up.
Rothenberg speaks for today’s adtech, which despite all its acronyms and Big Data jive, is based on a pretty boring business model: find a user on a legit site, covertly follow the user to a crappy site where the ads are cheaper, sell an ad impression there, profit. Of course he’s entitled to make the case for enabling IAB members to continue to collect their “adtech tax.” But moving ad budgets from one set of players to another doesn’t end ad-supported sites, because marketers adjust. That’s what they do. There’s always something new in marketing, and budgets move around. What happens when privacy regulations shift the incentives, and make more of advertising have to depend on trustworthy content? That’s the real question here.
Video has become an obsession for many publishers as a method to garner deeper engagement with their audiences. So why not post them on Facebook, YouTube and Snapchat and see if you can wring a few more ad dollars from those platforms? It always gets down to time and money: Which platform is really worth it?
Lately Facebook has been front and center with video, pushing live-streaming last year by subsidizing publishers who created recurring original content. And now comes Watch, a new tab for video with mini-shows from publishers that look more like YouTube than Netflix, funded by Facebook. And that’s after many publishers such as Hearst, Bustle and TechCrunch have prioritized Facebook’s Instagram over Snapchat.
In the end, Facebook has its eye on the bigger prize: getting a piece of the TV advertising action.
So where will that leave Snapchat? It’s reputation as a millennial digital darling has now matured into that of a sluggish teenager seemingly in need of a parental (read: profitable) business model after another poor earnings report with big losses and slowing user growth. Perhaps Snap will try harder to play nice with publishers since it remains a relatively “safe space” within Discover.
Watching ‘Watch’
Facebook has long said their future is in video, and a dedicated section to keep you sucked into the app is part of that strategy. The Watch tab also features a “Watchlist” of episodes created around your personalized algorithms, and is meant to capitalize on community viewership for the maximum Facebook experience. Seeing what your friends are reacting to and being able to watch videos within groups is how Facebook’s video platform differentiates from the likes of YouTube, Netflix and Hulu.
While Facebook eventually hopes for “thousands of shows,” so far only a few are available. And like its effort with Facebook Live, Facebook is paying a select group of publishers, including BuzzFeed, A&E, Major League Baseball and National Geographic, to create and offer content specifically for Watch. Publishers can make money either by splitting advertising revenues with Facebook (the social giant gets a 45% cut), or by creating branded content with advertisers from the start.
Facebook is anticipated to take in about 20 percent of the $83 billion in online advertising dollars this year, according to eMarketer, but it’s still unclear how much will eventually stem from Watch, even if it does have potential (and the backing of the all-powerful News Feed algorithm).
Watch vs. Discover
Even though Facebook has put a lot of energy into cloning Snapchat’s best features, it didn’t copy Snapchat’s strategy of only allowing a select group of publishers onto Discover. The result of Snapchat’s control is that it only has about one short original video show per day. When Facebook eventually opens Watch to whoever wants to create video for it — which is part of the plan — the YouTube-like experience, without YouTube’s powerful search function, might make discoverability hard for most people. In fact, as others have reported, Facebook’s Watch stands to increase the effect of the filter bubble.
When it comes to business, given the less than stellar performance of resource-heavy Facebook Live — not to mention the difficulty of making money with Instant Articles — it’s safe to say publishers should proceed with caution about putting all their eggs in Facebook’s video basket. Facebook is already on top of growth as one part of the two-part online ad duopoly, but it has yet to make itself a safe space for publishers to profit as well.
And Facebook will have to also deal with extremist content that has put YouTube in hot water. Facebook has already come under fire for violent content in some of its livestreams, and brand safety and offensive issues have been huge sources of contention for YouTube. It seems it’s only a matter of time for conflict to arise in that department as well for Facebook. Facebook hasn’t done a great job with humans or algorithms on handling fake news or extremist content, so it still has a lot to learn in editorial oversight.
Can Snapchat Snap Out of It?
Meanwhile, with slow user growth and poor earnings performance, Snapchat has a lot to catch up on if it wants to keep pace with competition. Its growth rate this quarter was about half of what it was in the first quarter. When it comes to daily users, Snapchat also only added 15 million new daily users in the first half of this year — whereas Instagram Stories added 100 million, more than six times as much.
Snapchat could try to subsidize more content, but the question is how. And the truth is that Facebook’s better ad targeting and measurement makes it that much more difficult for Snap to grab advertisers onto its platform over Instagram. Snapchat may have an automated ad-selling platform, but some publishers are grumbling that they have no way of knowing their performance on the “dying” platform.
To top it off, Google is planning to launch its own answer to Snapchat’s Discover, “Stamp.” Built around its AMP mobile web pages that load faster, it’ll allow publishers to create visual-oriented content that — unlike both Facebook and Snapchat — they can also host on their own sites. Another boon for publishers is that Google-backed publisher stories would be available in Google search results.
With all this in mind, publishers would do their best to diversify their video efforts and distribution. They’ve tried complaining and teaming up against the tech giants, but maybe this is a better idea: pitting the platforms against each other. If they all want to dominate in video, why not hold out for better terms, subsidies and promotion in the feed? Snap is in a real bind, and this would be a good time to ask them for a better deal. Facebook wants Watch to catch on? Maybe they can offer producers a better deal for good content.
If platforms want to divide and conquer, then publishers should do the same back at them.
The Privacy Act of 1974 emphasizes the need for both “notice and choice” to protect consumer privacy online. “Notice” gives consumers the information about data collection and use, and “choice” allows consumers to determine whether their data is collected and shared. But do the checks and balances of “notice and choice” really help to protect consumer privacy?
The Digital Privacy Paradox: Small Money, Small Costs, Small Talk Report by Susan Athey, Christian Catalini and Catherine Tucker from the National Bureau of Economic Research, offers insight on the privacy paradox and the inconsistencies between privacy preferences and actual consumer privacy choices. The research examined how more than 3,000 undergraduates engaged in privacy preferences while choosing an online wallet to store and manage digital bitcoin currency.
Different wallets, different incentives and encryption offerings were proposed to evaluate privacy offerings of different dimensions. Students could choose between four wallets: Blockchain, a hybrid web/self-managed wallet, Circle or Coinbase, both web wallet services or Electrum, a self-managed wallet. Participants were also asked about their preferences in privacy features (privacy from peers, intermediaries and government) and their degree of trust in financial institutions, startups and government to ensure a balanced and randomized sample.
Findings showed that regardless of their privacy preference, students shared their friends’ data when given a small incentive. Surprisingly, even the more privacy-sensitive students responded to the incentive offering.
One incentive gave students a pizza in exchange for three friends’ email addresses. Interestingly, a clear majority of the students chose pizza. Neither gender or levels of privacy sensitivities had any effect on choices. Six percent of the students appeared torn in the decision process and provided invalid emails.
In addition, when privacy required additional effort — such as encryption technology — students often went with without it in their transactions. In total, 55% of participants tried adding encryption and only 49% of those who tried succeeded. The remaining participants transacted without encryption.
Small incentives can misdirect people. To ensure privacy practices, current policies should be reviewed to determine how people can be protected from their willingness to discard privacy practices. Consumers need to make meaningful choices when it comes to privacy and incentives often cloud the decision-making process.
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.
With the introduction of new advertising formats, ad types, and methods of buying and selling inventory, consumer publishing is undergoing some big changes. To get a closer look at what’s working, MediaRadar conducted the “2016 Consumer Advertising Report,” using our data science-powered platform to review these trends for 2016 and Q1 2017.
Here’s a look at some of the most notable findings.
Native advertisers up 74 percent.
High CPM ad placements are surging. Native ad buyers, in particular, are up, rising three-quarters (74%) from Q1 2016 to Q1 2017. This represents the largest growth in buyers for any ad format. Looking back further, we found that demand for native has nearly tripled since January 2015, which had less than 1,000 buyers (981). In January 2017, there were almost 3,000 (2,882). Consumer advertising is shifting as audience consumption patterns evolve. We foresee advertisers will keep spending more on native because it often outperforms traditional ad units.
Print ad spend declined 6 percent.
The number of print ad pages in Q1 2016 was 117,551. Compared to Q1 2017, the number of print ad pages has decreased 8 percent year-over-year to 107,698. Similarly, estimated print ad spend has declined 6 percent from Q1 2016 to Q1 2017. However, even with this decline, there are still a considerable amount of pages being bought. We notice niche and enthusiast titles are on the rise, with some regional titles flourishing.
Programmatic buyers down 12 percent.
According to our data, 45,008 advertisers purchased ads programmatically in Q1 2016. In Q1 2017, however, the number of programmatic advertisers dropped substantially, falling 12 percent year-over-year. On the quarter, more than 5,000 fewer advertisers (39,415) bought programmatically.
After years of growth, the decline in programmatic buyers is likely attributed to concerns around brand safety – especially given the recent problems for companies like YouTube. This form of advertising continues to evolve as brands seek more control over where their ads are running. We expect to see programmatic rise as more brands move to programmatic direct models.
Our report showed that native is surging, and buyers are investing accordingly. Print ad spend is declining as a whole, but is buoyed by vertical subject matter and titles. Publishers can also expect to see programmatic rise as more brands shift to programmatic direct models. It will be interesting to see how these developments play out in the second half of 2017.
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.
A good website redesign challenges the status-quo. It questions a site’s navigation, layout, and plan and demands efficiencies without sacrificing user experience. Accordingly, a well-planned and researched design proposal will achieve improved user engagement, page views and time spent. The Engaging News Project, an initiative of the Moody College of Communication at the University of Texas, investigated the impact of design testing to provide news organizations with necessary audience feedback before going live with redesign.
To do this, the Engaging News Project partnered with a major Canadian news site and a major U.S. news site to conduct two experiments. The first experiment, the online test, showed consumers the old sites and the redesigned sites. They were then asked questions about their perceptions of the site. In the second experiment, the live test, the redesigned homepage was shown to a random audience (approximately 8,000 persons) in real-time. Key usage metrics were collected on these users to measure engagement.
The Findings
The Canadian sites redesign focused primarily on the number of photos and the amount of text featured on the homepage. The new site included more photos and less text compared to the existing version. The U.S. sites differed most notably in page width, emphasis on photos, and the amount of content. The new site featured a wider design and more vertical content. The new site had fewer photos at the top of the page, but larger photos after scrolling, compared to the old site.
Live site tests consistent with experimental online test for most metrics The redesigned Canadian site in both the online experiment and live test, was favored. More page views per visitor, a lower bounce rate, and higher average time per visit were generated. Consumers appeared more engaged and spent more time on the site when they went to the site on their own (live experiment) versus those being direct to the site (experimental design).
Interestingly, findings for the U.S. website, both online experiment and live test, favored the old site. The new site registered a higher bounce rate, lower time on page, and shorter scroll depth in comparison to the old site.
Article recall differs Article recall for some articles was better on the new site and for others on the old site. Differences in overall recall corresponded with the presence of images and where the articles were placed on the page. For the Canadian website, those using the new site recalled more articles than those using the old site and for the U.S. website, there were no differences between overall recall on the old or new site. Importantly, overall recall did not differ based on people’s age or based on previous experience with the websites.The Engaging News Project further identified which specific articles on the sites were recalled and what might account for these differences. For the Canadian website, three articles were recalled more on the old site more than the new and six were recalled more on the new site than the old. For the U.S. two of the top 10 articles had better recall on the new site than old and six articles had better recall on the old site than new.
Placement in the first column may also affect article recall
The amount of scrolling to reach an article may impact recall and
They found no differences in recall when articles are of equal focus in either old or new site.
When undertaking a website redesign, clear objectives and metrics must be defined and tested. Online site design testing ensures consumer feedback and quality assurance prior to going live. It should be included in all news site redesign plans.
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.
If 2016 was the year of the platform, 2017 is the year of the subscriber.
Amid a backdrop of political change, wavering trust in government and media, and the rise of fake news, subscriptions are up among the largest U.S. publishers, proving that consumers value high quality journalism. According to Pew Research, the numbers show that in 2016, The New York Times added more than 500,000 digital subscriptions – a 47% year-over-year rise, and The Wall Street Journal added more than 150,000 digital subscriptions, a 23% rise. Even Facebook recently announced that it’s building a feature that would encourage readers to subscribe to news publications, in response to publisher interest.
And this trend isn’t going away. According to WAN-IFRA’s 2017 World Press Trends report, understanding paying commercial models is the number one priority of publishers this year, particularly as audience revenues surpass advertising revenues among global newspapers.
While the industry rightfully focuses on growing new subscribers and experimenting with business models, the discussion should not end there. What we’re not talking enough about is that subscribers are a distinct audience. They engage with your content in a different way and are loyalists in a different way. Understanding these differences is where publishers will build their revenue strategies to take their businesses to the next level.
Subscribers are Unique
No one will pay for content that doesn’t repeatedly engage them.
Loyal readers, which on average account for the majority of pageviews across all channels, have time and time again proven to be your most valuable as they consume more of your content.
And what is that link between loyalty and subscriptions? Active engagement. A recent report by the MIT School of Management, Turning Content Viewers Into Subscribers, presented the Subscriber Ladder of Participation as an illustration of reader lifecycle. Rather than thinking of your reader journey in a passive way, it encourages you to build your strategy around action: moving readers from Anonymous to Subscriber by encouraging them to act.
MIT School of Management’s Subscriber Ladder of Participation
And this active participation is central to Chartbeat as well – our research has shown that analyzing and optimizing the reader experience around engagement patterns as opposed to just empty pageviews drives returning visitors, motivating users to proverbially ascend the ladder towards subscriptions. Subscribers are loyalists who engage with your content in a unique way, and understanding that engagement is key to driving more loyalty.
As Kritsanarat Khunkham from Die Welt put it, “Our whole subscription model is based on returning visitors—they’re essential. You can only turn users to subscribers when they’re returning. I’d rather have 500 returning visitors than 5,000 one-time users. They’re [the ones] who appreciate my work, who trust my brand.”
Besides the simple fact that returning visitors increase ad impressions, they also represent a crucial point in a publisher’s subscription funnel. Every new visitor is a potential subscriber, but — to put it bluntly — no one will pay for content that doesn’t engage them.
Subscribers are Ideal
Once you’ve engaged your subscribing audience, you need to focus on keeping them and getting more. To do this, you need to study how they engage and drive like-behaviors in your loyal/returning audience to turn them into subscribers.
Khunkham notes that often, their consistent eye on data uncovers what topics their audience is truly interested in. This justifies expanding coverage in those areas, often areas they might not have expected. “Sometimes [our audience is] more interested in political news than we expected, and we have such potential for [an audience] who reads seriously,” he says. “When we can prove to [journalists] that readers engage with their meaningful work, it motivates them.”
In other words, publishers need to start thinking about taking their data past the point of conversion. Once a reader has subscribed, are you continuing to dig deeper into their behaviors and deliver the content that they have demonstrated a complex interest in? Discover not only what content your subscriber communities engage with, but think of subscription status as another lens to evaluate all of your editorial strategies — from social media channels and platforms, to devices and portals, and even relationship-building campaigns.
At the end of the day, understanding new visitors and their journey to return is important, but garnering deeper insights around how subscribers engage with your content differently can unlock durable retention and growth strategies for publishers across the board.
Terri Walter, the Chief Marketing Officer of Chartbeat, works every day to ensure that publishers and newsrooms have the tools and insights they need for quality content to thrive. A digital marketing veteran of 20 years, Terri has worked over the course of her career to position high potential brands and spearhead thought leadership in media and analytics at companies including DoubleClick, Razorfish and Microsoft Advertising.
/ An inside look at the business of digital content
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