Tag: sponsored content

All Hail the Rise of Native Advertising
Native advertising, sponsored content or branded news (all the same) is booming and with some online publishers it’s now their main source of revenue.

It’s important to note that native advertising is not content marketing. Content marketing is a content strategy by brands where typically, they own the content, such as their blogs or content on a product website. Native advertising is sponsored content, more typically created by the publisher to be in alignment with an audience that the advertiser wants to reach. I think where the confusion happens is when an advertiser creates biased and conversion oriented content that is placed on websites for a fee. To me, that’s content marketing more than native advertising because content marketing has evolved to be measured by conversions, while native advertising looks at other metrics.

Fractl and Moz conducted a survey of more than 30 content marketing agencies and obtained cost data from more than 600 digital publishers and determined that “content marketing has a better overall return on investment.”

“Readers are necessarily less engaged with advertising vs. editorial content, and metrics show lower share rates, lower engagement rates, lower view counts, etc. in most cases,” said Kelsey Libert, partner and vp of marketing at Fractl. “You can’t simply push through a mediocre, thinly veiled advertorial. Content marketing puts the brand and the consumer on equal footing, and in the process necessitates the brand elevate the content they are creating. When done correctly, the result is a true match between brand and content consumer, where the content created has true value, and spreads based on the merit of the content. Through this, content can enjoy true virality in a way that is nearly impossible with Native ads.”

“The fact that people find it necessary to pit one form against the other is a little bemusing,” said Cas McCullough, Founder at Writally PTY LTD, in a comment on Adweek. “When used together, good content and native ads are very powerful. On their own they don’t get the same ROI. Our case studies prove this consistently, so we’ll stick with an integrated approach.”

Sites such a Buzzfeed and Vice have built their entire business model around native advertising. Slate says that it now relies on native advertising for nearly 50% of its revenue. According to Digiday Slate trained its 10-person sales team on a its new native ad product called Slate Custom, and also hired Jim Lehnhoff, the former head of Gawker Media’s native advertising strategy. The goal with Slate Custom is to make native ads that are aligned to Slate’s “edtorial DNA.”

“The differences between five years ago and now, in client expectations, are enormous,” said Keith Hernandez, the president of Slate, in a New York Times article on native. “Creating something that’s delightful and that’ll make someone stop and click and share…that’s really hard. But doing the easy thing is not fun.”

The Atlantic’s Hayley Romer, their Publisher, expects “native campaigns to drive 70 percent of its ad revenue this year, up from 60 percent in 2015.”

“We know that our audience is engaging really deeply with our native content on our site,” she was quoted as saying in a NiemanLab article.

The 2016 Reuters Institute’s Digital News Report, the largest study of its kind, based on more than 50,000 people in 26 countries, was released recently (PDF) and shows the rise of sponsored content. Here’s a chart from the Report:

The report noted that with existing models of online advertising increasingly broken, publishers have been trying alternatives such as “branded and sponsored content.” Sponsored content still has numerous legal and political obstacles, with labeling “sponsored” still an area of confusion. Geographically, the US and Canada are most accepting, while Germany and Korea branded content faces tremendous consumer confusion and resistance.

The New York Times has created a 100-person native ad unit, T Brand Studio, in a huge push for native advertising revenue. The Times is openly declaring “sponsored content to be an important part of their strategy.”.

The motivation for publishers in looking for a new monetization model for their digital properties is the continued weakness of online display advertising.

“Display still has a place, but we believe that the digital advertising of the future will be dominated by stories conceived by advertisers, clearly labelled so they can be distinguished from newsroom journalism, but consumed alongside that journalism on their own merits,” said New York Times CEO Mark Thompson in a commentary in the above report. “This is a more compelling and creative vision of digital advertising than conventional digital display, and it requires new skills, talents, and technologies, and substantial fresh investment. Audience scale and global reach will still count, but the audience which publishers will need to find will not be super-light users, the one-and-dones who spend a few seconds on many different sites, but truly engaged readers and viewers who are prepared to devote real time to content of real quality and relevance.”

Thompson is adamant that the editorial and commercial sides must work as one. “Editorial and commercial leaders need to work together on integrated strategies which combine editorial mission and standards, user experience, innovations in data, technology and creative design, and radically new approaches to monetization,” he said. “Not five different strategies, not even ‘aligned’ editorial and commercial strategies, but a single shared way forward.”

Sponsored content does not have to be biased content, but instead can be content that is paid for by an advertiser, because that advertiser wants to reach the type of people that read a particular content subject area.

Interestingly, a study (PDF) by the Internet Advertising Bureau (IAB) and Edelman in June 2015 uncovered that consumer perceptions of sponsored content isn’t all negative.

Roughly 45% of those seeing sponsored content related to business or entertainment recognized the value-add.

The IAB study says that brand relevance, authority, and trust are the most important factors to driving consumer interest in sponsored content across all media. “Make the ads and product more on target… also give info [on] how to enhance the experience with the latest and best products,” commented one consumer interviewed in the study.

The value (or lack of value) for the advertiser is that the credibility of the site hosting the sponsored content is largely transferred to the advertiser.

Sherrill Mane, formerly of the IAB and currently Head of MAdTech Strategy, and Steve Rubel, Chief Content Strategist for Edelman recommend these steps for publishers that intend to incorporated sponsored content:
- Control the experience and be prepared to walk away from advertisers who aren’t relevant/trusted
- Encourage aligned brand marketers to work together in a more authoritative manner
- Go the distance when it comes to transparency/disclosures
July 25, 2016
Should The Government Regulate Paid Content?

Online advertising has changed. It used to be that Web sites would have a few banner ads or side bar ads to bring in revenue. Then consumers started to use adblockers and other methods to ignore these ads. That’s when sites turned to native advertising, and it’s caught the FTC’s attention.

The Federal Trade Commission announced on Monday that it would be hosting a “native ad” workshop later this year. The Commission says that the workshop will serve to continue its quest of helping consumers “identify advertisements as advertising wherever they appear.”

Should the FTC regulate native advertising on the Web? Do sites already do a good enough job of labeling sponsored content? Let us know in the comments.

So, what’s the big deal with native advertising? Well, as you may know, another name for native advertising is sponsored content. These are the ads that parade around as regular content. A good example would be BuzzFeed as a lot of its famous lists are sponsored content.

Here’s what the FTC has to say on the matter:

Increasingly, advertisements that more closely resemble the content in which they are embedded are replacing banner advertisements – graphical images that typically are rectangular in shape – on publishers’ websites and mobile applications.

The big question now then is whether or not this is a problem. That’s actually what the FTC wants to figure out in its workshop. The Commission wants to educate consumers on the difference between regular content and native ads, but it wants to first figure out the best way to do so. That’s why the Commission is hosting a workshop that “will bring together publishing and advertising industry representatives, consumer advocates, academics, and government regulators to explore changes in how paid messages are presented to consumers and consumers’ recognition and understanding of these messages.”

Now advertisers who are increasingly relying on native advertising and sponsored content shouldn’t be getting scared just yet. The workshop is merely an opportunity for the FTC to collaborate with advertisers and publishers to inform its own decisions on the matter. That’s why it’s inviting everybody to take part in said workshop so it can best address the needs of both advertisers, publishers and consumers in any potential future regulation.

In fact, the FTC published a list of topics that it will be examining at the workshop so that advertisers can prepare themselves for the kinds of questions the Commission will be asking:
What is the origin and purpose of the wall between regular content and advertising, and what challenges do publishers face in maintaining that wall in digital media, including in the mobile environment?
In what ways are paid messages integrated into, or presented as, regular content and in what contexts does this integration occur? How does it differ when paid messages are displayed within mobile apps and on smart phones and other mobile devices?
What business models support and facilitate the monetization and display of native or integrated advertisements? What entities control how these advertisements are presented to consumers?
How can ads effectively be differentiated from regular content, such as through the use of labels and visual cues? How can methods used to differentiate content as advertising be retained when paid messages are aggregated (for example, in search results) or re-transmitted through social media?
What does research show about how consumers notice and understand paid messages that are integrated into, or presented as, news, entertainment, or regular content? What does research show about whether the ways that consumers seek out, receive, and view content online influences their capacity to notice and understand these messages as paid content?

Do you think the FTC will welcome a healthy debate on the issue of native advertising? Or does the Commission’s questions worry you that it will unfairly target advertisers? Let us know in the comments.

Of course, it should be noted that the FTC isn’t the only entity that’s concerned about native advertising. For years now, Google has penalized sites that use paid links, and it just recently started setting its sights on sponsored content that’s not been fully disclosed.

Back in May, Matt Cutts said that Google would be “looking at some efforts to be a bit stronger on our enforcement” of native advertising. He later clarified this by saying that native advertising falls within its longstanding rules regarding paid content:

“We’ve seen a little bit of problems where there’s been advertorial or native advertising content or paid content, that hasn’t really been disclosed adequately, so that people realize that what they’re looking at was paid. So that’s a problem. We’ve had longstanding guidance since at least 2005 I think that says, ‘Look, if you pay for links, those links should not pass PageRank,’ and the reason is that Google, for a very long time, in fact, everywhere on the web, people have mostly treated links as editorial votes.”

Cutts also provided a real world example of how native advertising that’s not been fully disclosed can impact consumers:

“So we’ve seen, for example, in the United Kingdom, a few sites that have been taking money, and writing articles that were paid, and including keyword-rich anchor text in those articles that flowed PageRank, and then not telling anybody that those were paid articles. And that’s the sort of thing where if a regular user happened to be reading your website, and didn’t know that it was paid, they’d really be pretty frustrated and pretty angry when they found out that it was paid.”

The FTC may not be regulating native advertising just yet, but Google is clearly on the warpath. The Commission’s desire to better identify and possibly regulate sponsored content will probably net Google a pretty influential role in the FTC’s workshop and future decision making down the road.

That being said, it’s not sounding like the FTC wants to outright ban sponsored content. Doing so would be an absolutely asinine response to something that hasn’t even presented itself as a wide spread problem just yet. Most sites that utilize sponsored content mark it as such already. Instead, it will probably just expand upon its current report on native advertising – Dotcom Disclosures.

Even then, publishers and advertisers wanting to stay on the good side of Google are probably already following any potential new regulations that may come out of this.

Do you think Google’s rules on native advertising should influence the FTC’s decision making? Let us know in the comments.

[Image: Wikimedia Commons]

September 17, 2013

LinkedIn is finally following the path of other social sites like Facebook and Twitter as the professional network has just launched Sponsored Updates for your activity feed.

LinkedIn has been testing Sponsored Updates for about six months nows, but today they’re finally pulling back the veil on the new advertising venture.

“We know that getting relevant information at the right time can help inform the many business decisions you make throughout your day. Through Sponsored Updates, businesses aim to engage select communities of LinkedIn members with useful information. This can come in the form of an article, blog post, video or presentation that is rooted in relevant content,” says LinkedIn’s Gyanda Sachdeva.

Sponsored Updates will appear in your activity feed and will be clearly marked as “Sponsored.” Users will have the ability to like, comment, and share the updates. They’ll also be given the option to follow the company responsible for the update.

And if you’re not happy with any particular piece of sponsored content you find in your feed, you can always hide it.

“We are focused on delivering posts that will be relevant to you. Just like other content in your feed, we will gauge your engagement with Sponsored Updates and aim to surface posts that will be useful to you. In the event a piece of content isn’t relevant to you, we offer the option to hide it from your feed. You can see this option on the top right by hovering on any Sponsored Update,” says Sachdeva.

At launch, some high-profile companies have already signed on as partners to the new Sponsored Update initiative, including Allstate Insurance, Box Inc., Domo, Inc., Charles Schwab & Co., General Electric, Mercedes-Benz, Nissan Motor Company, The Weinstein Company, Wall Street Journal, and Xerox.

“Marketers are increasingly leveraging content to inform, educate, and inspire their current and prospective customers. But the high quality content they’ve produced – slideshows, articles, videos, and whitepapers – does not always achieve enough reach and engagement on their own channels. With Sponsored Updates, marketers will be able to distribute this content directly to relevant professionals in a place their customers and prospects are already consuming professionally relevant content. Marketers can target Sponsored Updates to any segment of our premium audience based on professional profile data across more than 225 million members,” says LinkedIn’s David Hahn.

Tag: sponsored content

All Hail the Rise of Native Advertising

Should The Government Regulate Paid Content?

LinkedIn Sponsored Updates Now Available To All Advertisers

LinkedIn Launches Sponsored Updates in Your Feed