Failure of ads leading to sponsored articles

Sponsors Now Pay for Online Articles, Not Just Ads:

Advertisers and publishers have many names for this new form of marketing — including branded content, sponsored content and native advertising. Regardless of the name, the strategy of having advertisers sponsor or create content that looks like traditional editorial content has become increasingly common as publishers try to create more sources of revenue.

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Publishers are largely being driven to support the use of sponsored content because of fewer people clicking on banner ads, the abundance of advertising space and other factors make it more difficult to make money from traditional online advertising. As advertising technology becomes more sophisticated, ads can be bought and sold at cheaper rates across the Web. Often they are ignored by the very customers advertisers are trying to reach.

It’s a pretty great deal for both advertisers and publishers. By having their advertisements appear to be regular content, people are willing to share the articles with their social networks. As opposed to banner ads, which people have learned to automatically ignore, this content actually has people telling their friends that they should give it a look:

An article on Google Glass technology was shared almost 2,000 times on social media, indicating that readers may not have cared, or known, if it was journalism or sponsored content, although the series was identified as such.

For publishers, it means less of a reliance on banner ads while still being able to offer content for free (though Forbes and the Washington Post are using both sponsored content and paywalls).

There hasn’t been any major backlash from readers against this rise in sponsored content, so perhaps they don’t care as long as the posts aren’t outright ads.

The big media monopoly on scoops is over

Big News Forges Its Own Path:

Traditional news organizations used to be free to break news — or not — in their backyard and on their chosen beats. Now they have to be looking over their shoulder — at everyone. And in virtually every aspect of culture, from business to technology to fashion, the big guys now compete with a range of Web sites that break their share of news through obsessiveness and hyperfocus.

The big news that Rupert Murdoch was getting a divorce after a 14-year marriage to Wendi Murdoch did not come from tabloid newspapers, gossip magazines or E!, but from Deadline Hollywood, the business entertainment site run by Nikki Finke.

The business disruption in the media world caused by the Internet has been well documented. But a monopoly on scoops, long a cherished franchise for established and muscular news organizations, is disappearing. Big news will now carve its own route to the ocean, and no one feels the need to work with the traditional power players to make it happen.

Being a big organization with sources at all the major players in every industry isn’t so valuable when other sites can take your big scoop and get as many or more page views by giving a more eye-catching headline and some photos or extra context.

For instance, yesterday the Wall Street Journal broke the story that Google is making an Android-powered game console. Here’s a Google search for “Google game console”.

80,500,000 results and the WSJ article doesn’t even get the top spot.

The New York Times is struggling to sell all of its ad space

The New York Times is making ads for the future — but where’s the money right now?:

According to Haskell, the New York Times‘ digital story-telling machinery is appealing to companies as a way to convey heritage and complicated brand stories. He adds that clients like Prudential say they have had tremendous response to their campaigns, including huge lifts from social media.

But despite the promise of such ad tools — and clever platform tools like Ricochet and Sparking Stories – the Times’ overall ad performance is limping. Recent earnings results show that digital ad sales are not just flat but actually declining — a troubling development at a time when digital revenue is supposed to stabilize the company as it faces a permanent decline in its print business.

Haskell says the company has been unable to pre-sell all its inventory, and attributes the overall ad challenges to two factors — “an explosion of inventory from social channels” (read Facebook) and the rise of automated or “programmatic” buying which lets advertisers purchase digital ads on real time exchanges.

Why isn’t The New York Times using programmatic ad buying? Haskell, the company’s VP of advertising, thinks that their reader data and performance metrics can woo companies over from more automatic ad placement options. Why not give advertisers access to those metrics as part of a programmatic buying toolset?

News media needs to become more like Hollywood

How the New York Times can fight BuzzFeed & reinvent its future:

However, that is only part of the story. The trick is not to get married to just the oohs-and-aahs of the Snow Fall, but to think of it as a business opportunity, much like the way Hollywood studios creatively monetize their blockbusters. My question is why can’t newspapers and magazine companies take the same approach and build a business model that actually factors in various opportunities that something like Snow Fall can offer?

So instead of starting with a newspaper story and adapting it to different formats, the Times should start with the Snow Fall. If you look at Snow Fall closely, you can see a cohesive approach to content, one that adapts and morphs to not only the medium of access, but to diverse business models — much like the movies.

Om’s argument is that traditional news media has failed – with a few exceptions, like Paul Krugman and David Carr – to properly adopt the blog format on their sites. Instead, they have simply tried to post traditional news articles as blog posts.

As he notes, blogging is about tying together all kinds of media and sharing it through the lens of an individual’s take on the world:

Blogging is a way of editing the world and presenting it to my community, and that means everything from photos, links, tweets and videos, in addition to sharing my raw thoughts and fully packaged features, scoops and even basic news. Every act of sharing tells you what I am interested in and what I am willing to learn and talk about.

Rather than trying to shoot for tens of thousands of hits per short blog on their site, Om thinks that The New York Times should drop $25 million on making dozens of pieces like Snow Fall – long-form pieces with huge budgets that pack in tons of media and use fancy scrolling in the hopes that the spectacle will lead to millions of page views.

I think Malik is being a bit too optimistic here.

There’s a reason most blockbusters come out in summer – they’re a way to escape from the heat, relax, and keep the kids busy while they’re out of school. They have a reputation for being big dumb explosion fests because that’s what people want.

A long piece of excellent reporting like Snow Fall, however, is the opposite of that for most people: it’s thousands of words to read through with multiple pages and no indicator of how far into the story you’ve read. It’s work.

Now, I’m not saying  that making more pieces like Snow Fall would be a mistake in and of itself. It did get millions of page views. But to shift such a massive portion of the Times budget to making such pieces – even with the lower costs from already having the technology ready – would overestimate the demand for long-form journalism.

There’s a reason The New York Times has so many more readers than The New Yorker: people want news. Big stories are awesome, but NYTimes.com gets 35 million monthly page views is because people trust it to have the best reporting on the most important news happening right now around the world. Articles with word counts in the tens of thousands simply don’t meet that need.

Instead, the best thing the Times could do is to let the technology that came out of Snow Fall trickle down to average news stories. Just as CGI has become prevalent enough in Hollywood that even the lowest budget films don’t completely break the fourth wall whenever an explosion happens on-screen, The New York Times can move on from the shitty image galleries that most sites have for image-heavy articles and integrate videos more fluidly with text than the simple embeds used today.

As for Om’s point about using better native advertising (like including a Land Rover ad with Snow Fall)  – there’s no reason that doesn’t have to apply to almost every piece of news. The Times just need to put its sales and technology teams to work at making better software on the backend to let advertisers more accurately target individual articles related to their products.

Twitter Looks for a Head of News and Journalism

The official Jobs at Twitter site:

Twitter is playing an integral role in the evolution of the news industry — both as a tool for reporters and newsrooms and as a way for consumers to find news in real-time. Twitter has already changed the way news breaks and provided journalists new ways to connect with their readers. We are looking for a seasoned leader to shape and drive the next growth phase of Twitter’s partnership with the news industry.

The obvious assumption to make here is that Twitter has decided to act in the wake of the Boston bombings, during which the social media site was bombarded with a load “information” (rumors) regarding suspects and police events. Telling what was truth from the noise was impossible and Twitter as a platform was criticised after the events for the some of the irresponsible reporting that took place after the tragic events.

The job posting is affirms the idea that Twitter sees breaking news as a key part of its strategy: the posting says the incoming head of department should create a plan that increases “volume and quality of professional news content on Twitter, especially in breaking news”.

Is the posting of the job after a time when some sort of spotlight was on Twitter and its news strategy a coincidence? Probably. But it’ll be interesting to see what the new recruit will do to develop news strategy in the longer term.

Politico hits 1,000 subscribers for ridiculously expensive Pro service

Politico hits 1,000 Pro subscriptions and plans to launch a magazine — paidContent:

Politico launched Politico Pro in February 2011; while it was originally aimed at individual subscribers, Pro quickly switched its focus to the group subscriptions that now make up the vast majority of its base. Pro offers some subscriber-only articles, early access to morning newsletters, customizable instant alerts and other perks. Pro started out covering energy, health care and technology and added more coverage areas — defense, financial services, tax and transportation — last year. Starting this month, Pro subscribers can also receive an afternoon policy newsletter called Pro Report.

In an attempt to drive more Pro subscriptions, Politico is launching a free quarterly print magazine that will feature past Pro coverage. On March 22, it will be delivered to “every member of Congress, the White House and all federal agencies as well as to 160 newspaper boxes and 100 Washington-area Starbucks.”

Politico is tight-lipped on what a subscription to Pro actually costs. Subscription fees vary based on the type of organization (government, nonprofit and so on) and how many employees it has, as well as the number of coverage areas an organization wants. Nieman Journalism Lab reported last year that an individual subscription starts at $3,295 a year, with group memberships starting at $8,000 for five people and one coverage area.

I cannot believe that people are willing to spend that much for the features they mention. That makes a digital subscription to The New York Times look like pocket change.

The New York Times has a rough few years in front of it

The newsonomics of zero and The New York Times » Nieman Journalism Lab:

Without these kinds of new revenue products, expect circulation revenue growth to slow, perhaps dramatically. One reason is the legacy side of the business. While the Times has impressively priced up print subs, it’s losing about 6 percent of subscribers a year. In the short term, the money is good enough to make those economics work. Over a three-year period, it’s trouble. A potential loss of another 20 percent of print subscribers would result in both reduced high-dollar subscription revenue and a markedly reduced rate base for print advertising. Over time, it will get harder and harder to make up lost revenue by charging a smaller and smaller set of print subscribers more money. 

The paywall seems to be helping to make up for their falling revenue, but the collapse of the print subscription base is a problem that will only hurt revenue more over time. Denise Warren (in charge of advertising and digital at the New York Times) needs to figure out how to charge more for online ads and how to reach 1,000,000 digital subscribers. She has less than three years to do it.

Research In Motion rebrands itself as BlackBerry

Research In Motion rebrands itself as BlackBerry | The Verge:

“At today’s BlackBerry 10 event, CEO Thorsten Heins announced that his company will no longer be known as Research In Motion. As of today, RIM is being rebranded as BlackBerry. ‘We have reinvented the company, and we want to represent this in our brand,’ Heins said. ‘One brand. One promise. Our customers use a BlackBerry, our employees work for BlackBerry, and our shareholders are owners of BlackBerry.'”

 About time. No average person had any idea that Research in Motion was the company that made BlackBerries. I’d be willing to bet that most people already thought the company was called BlackBerry.