Advertising technology supplies millions of ad impressions and targeting tools, but they leave the fundamental goals of an advertising campaign, notably success, to the advertiser. Is there anyone who truly cares about a small business advertiser, the primary client of local newspapers and magazines, at the scale of Facebook or Google?

Any small publisher who survives on direct advertising sales has to consider the weaknesses in the model of their Silicon Valley competitors if they intend to continue to rely on an ad sales model. We hear every day that the “duopoly” is dominating in digital advertising revenue. This is true, but Google and Facebook are definitely not invincible, and recently eMarketer predicted their market share would drop this year.

Small, niche publishers, like hyper-local news, regional magazines, and trade journals, have powerful advantages which cannot be replicated at scale, and they should use them.

Motivations for Advertisers

Before outlining these advantages, we need to ask ourselves something more fundamental which will highlight why they are so powerful.

Why do advertisers advertise? It’s obvious: to generate business.

Now, let’s take a more sincere and empathetic approach. Think of yourself as the business owner.

Businesses are created for a lot of different reasons. For some people, it’s a potential path to freedom or independence. Some love what they do and want to try and make money with it. For others, like the owner of a local franchise, it’s a way to make a living. These people all have something in common: they need the phone to ring, emails to stack up in the inbox, or people to walk in the door. Without it, they don’t have much of a business.

But they’re just average people with a lot of other things on their mind. When it comes to “marketing” they’re often clueless, apathetic, or too bogged down by their daily routine to even think about it. And when they have thought about it, they’re generally skeptical about anyone who promises to do it for them. If getting people in the door reliably (and profitably) was so easy, they’d be on a beach somewhere instead of talking to you.

Success in direct ad sales begins with the understanding of why customers spend money on advertising: they want to gain recognition and attract customers.

So the question for anyone trying to sell an ad is, “how can I help this person gain more recognition and hopefully, more business?”

The question is not, as many people think, “how can I get this person to buy an ad?”

When you approach an ad sales discussion from the perspective of helping someone achieve what they actually want, the conversation flows in a much more productive and positive direction than, “here’s my media kit, are you interested in supporting us?”

Importantly, the way you think of advertising also changes. It becomes your duty to make sure that whatever you’re offering is working. If not, sales and renewals are going to dry up. After all, you’re really selling your assistance in helping your customer meet a goal — not ads.

10 Advantages for Small Publishers

These are the 10 advantages that small publishers have over the big tech companies. They are outlined more fully in a new book available at Broadstreet.

1. You Have Community Support and Affinity

One of our customers, and one of the many innovative voices in the Local Independent Online News Publishers (LION) group, Jay Senter of Shawnee Mission Post told us this: “People really value the fact that we’re providing reliable coverage of their communities. And they recognize that all of our sponsors are local, too. So when someone signs up for an ad or sponsorship package with us, they’re attracted not just to the price for the exposure, but to the ability to be associated with a well-regarded local brand.”

When you walk into an ad sales appointment, you are recognized as a bullhorn to a town that’s listening. You are starting from first base while everyone else waits in the on-deck circle.

Sources of advertiser dissatisfaction with paid search and other local marketing services. Source: LSA-Thrive Analytics, January 2015

2. You’ve Got a Direct Relationship

Wendy Cohen of Berkeleyside gave her personal insight into the true value of someone selling local advertising: “A direct salesperson makes the process seamless, works on the client’s behalf and is the person who provides trust and comfort to what can be a daunting experience, particularly for a small business person.“

As a local publisher, it’s your duty to understand and help fulfill the client’s needs. Start the sales conversation by asking the potential customer what it is they would hope to promote or achieve.

Listen closely and take notes. You might find it beneficial to develop a proposal that outlines how you can help your prospect reach their goals and define what success would look like.

3. You Have Flexibility When It Comes to What You Offer

Our current idea of “digital advertising” is a standard box ad or leaderboards — in other words, banner ads sized at 300×250 and 728×90. Yes, you should support those sizes, but you should also be thinking about what you can offer beyond that.

What do you, as the publisher or salesperson, think would actually get your readers’ attention and aid your client? As an autonomous and independent publisher, you have the ability to offer whatever you want to and call it “advertising.” In other words, don’t let the IAB strictly define what you can and can’t sell.

A benefit of changing and innovating, when it comes to your offerings, is that different products work well in different use cases. On top of that, someone who passed on an old offering months ago might be interested in trying a new offering. Old leads and prospects don’t have to be forgotten if you’ve always got something new to show.

A section sponsorship, displaying only one advertiser at a time visible on Nooga.com

4. Sponsorship Models

In 2017, the most common question among our customers was “how can I set up section sponsoring?”

Many small publishers have their sites broken out into different sections which just happen map to different segments of their potential advertiser base. For example, Food and Dining, Arts and Entertainment, Events, Crime and Arrests, Schools, Kids, etc.

Many publishers don’t know this, but they can easily give an advertiser “ownership” of a section of their site, meaning that all ads — sidebar, leaderboard, in-story and others — are from the same advertiser on every page load. The brand impact is undeniable.

Some advertisers (attorneys and high-end real estate agents, for example) love this sort of thing. At even $2000 per month, a few clients over the course of a year would likely pay off the campaign and generate real return on investment.

And no, Facebook, Google or ad networks could never offer that.

5. You Can Write Sponsored Content Like Nobody Else Can

If you truly take time to talk with a business owner and understand what they’re hoping to communicate, sponsored content is also an excellent option for informing and engaging the community.

Very few publishers will take the time to write in-depth content on an advertiser’s behalf. Many publishers will simple say “send us your content and a check, and we’ll run it.”

Owners love reading about and sharing stories about their business, especially when someone else wrote it. It’s an effective tool in working with an advertiser who might not be interested in traditional display advertising.

6. Your Pricing Can Be Flexible and Understandable

The current mode of pricing internet advertising is cost-per-thousand ad impressions, or “CPM.” It’s not complicated, but it’s not straightforward either. If you ever have to explain how the pricing works to a potential customer more than once, you’re wasting time and probably losing your chance to work with them.

A flat rate of $x per month is more understandable. It also isn’t reliant on your site traffic or the social media networks that control it, like CPM.

With a flat pricing model, there aren’t any other questions apart from “where would my ad appear?” which is covered next.

7. You Can Guarantee Positioning

Most of a small publisher’s competitors can’t promise when or where a client’s ad will appear on the site. For a small business owner, that sounds like trickery.

Small publishers, by contrast, can guarantee that a campaign will always appear in some position with some level of frequency. Many local advertisers will actually refresh a page and look for their ad once it goes live.

An automated, sophisticated newsletter for Homepage Media Group advertising setup with daily rotation and stat reporting.

8. You Can Put Your Customers in Inboxes Around Your Community

The newsletter may be the most underrated tool in a small publisher’s toolbox. It can be used to reliably drive traffic, unlike social media, and it can also be used as valuable advertising space.

Many advertisers love being present in a newsletter, especially when they’re readers of the newsletter themselves. The tangible feel of a newsletter and limited ad space creates a perceived potency that some are attracted to.

9. You’re Transparent

Ad-tech’s biggest problem, currently, is rooted in fraud and issues of transparency. It’s difficult for advertisers to understand whether they effectively targeted their intended audience, whether their campaign truly performed well, or if their ad was even seen by a human.

Here are a few recent headlines:

CNBC: Businesses Could Lose $16.4 Billion to Advertising Fraud in 2017
CNBC: Online ad fraud is a ‘widespread’ problem, Google and other big ad platforms admit
AdExchanger: Google Offers Refunds For Fraud, But Only On Its Own Terms

The straightforward approach and style of guaranteed positioning and flat pricing makes for a more transparent and understandable value proposition.

10. You Can Deliver Better Performance and Value

In two years of studying value-oriented digital advertising, Broadstreet has noticed that smaller publishers tend to yield higher engagement rates for ad campaigns than larger publishers. When good placement and a large, dynamic or informational creative is used, the engagement rates increase even more.

High clickthrough and engagement rates are important. That means that given a set number of impressions, you can deliver more impact than an ad network can. So even if your publication isn’t one of “scale,” if you deliver three to five times higher performance than an ad network, you have the effect of delivering three to five times more impressions that you actually do.

Conclusion

To win in any competitive process, you have to stand out and differentiate your ability. The outlined advantages are a simple but effective guide for achieving that. Remember them when asking yourself these questions prior to a sales meeting:

What can I do to show my prospect that I am legitimately interested in helping them?

Once they choose to work with me, how can I guarantee that choice was a good one?

How can I ensure that this experience was so positive, end to end, that they’ll work with me again in the future — and possibly even recommend me to someone else?

Basically, spin Google’s philosophy: “focus on the advertiser and all else will follow.”

Kenny Katzgrau is the founder of Broadstreet, an ad-serving company that focuses on small and niche news and magazine customers. Broadstreet is a long-running supporter of LION and the Center for Cooperative Media in New Jersey. He recently published a book titled “Ten Advantages: How Magazine and Hyperlocal News Publishers Will Win In the Era of Google and Facebook.”

The post 10 Advantages That Small Publishers Have Over Tech Giants in Selling Ads appeared first on MediaShift.

In the U.S., digital ad spend reached $72 billion in 2016, and with roughly nine out of ten American adults now connected to the internet, the typical U.S. internet user is worth around $250 per year to digital advertisers.

Yes, you read that correctly.

Digital advertisers are making approximately $250 annually – roughly twice the cost of a Netflix subscription – off you and your browsing data. This might be surprising to internet users, not only because it’s a lot of money (more than is spent on TV advertising), but also because digital advertisers make this money in large part by harvesting and selling your valuable personal information. In fact, personal data is taken from you each time you visit a website in order to target you with ads in exchange for what appears to be “free” content, a lopsided transaction that puts your privacy and security at risk.

Below is a fuller explanation of the free internet’s real costs and how users can protect themselves — although national data protection laws will never be able to fully protect individuals from this type of for-profit data collection. This is especially true as companies get more sophisticated in how they use your information. For example, in May 2017, Google announced that it would begin to tie billions of credit card transactions to the online behavior of its users, which it already tracks with data from Google-owned applications like YouTube, Gmail, Google Maps and more. The program, which is indicative of what companies are incentivized to do, puts users’ privacy at risk and is the subject of a complaint against the Federal Trade Commission filed by the Electronic Privacy Information Center in late July.

Websites are Tracking Your Online Behavior

From online shopping to reading the news, many Americans use the internet every day to facilitate nearly every aspect of their lives. But even just browsing the internet leaves consumers vulnerable to attacks against their privacy. Trackers that collect data on internet users’ online behavior are present on at least 79 percent of websites, according to a study by my company, Ghostery, which provides free software for safer browsing. Many of these trackers collect data to create detailed user profiles that can be bought, sold, and used by advertisers to target individuals with a never-ending stream of ads.

In collecting user data, trackers can gain access to highly personal information, not only about an individual’s browsing and shopping habits but also about her financial situation, sexual orientation, health status, political views, and religious beliefs. In fact, web tracking has become so pervasive that approximately ten percent of websites send the data they’ve collected to ten or more different companies, and 15 percent of all page loads on the internet are monitored by ten or more trackers.

And adults are not the only people whose privacy is at risk – Viacom, Mattel, JumpStart and Hasbro have recently been in hot water for contracting with advertising vendors that performed some type of persistent monitoring for targeted ads on children. They were forced to pay a combined total of $835,000 in fines.

Another alarming example: The Mayo Clinic, which provides information about HIV tests to site visitors, has many different trackers on its page. If you click on a button to arrange for an appointment with the organization, third-party companies are able to access this information – now knowing if you are taking an HIV test or being treated for the disease. And this is not an aberration; in fact, it’s quite common. Facebook was recently under fire for tracking users’ activity on health sites like the American Cancer Society.

According to a study by the Media Insight Project, a collaboration of the American Press Institute and the Associated Press-NORC Center for Public Affairs Research, 53 percent of adults pay for the news – meaning that a majority of consumers believe that publishers should be compensated for the content they are creating, and they are willing to pay for content that helps them to better understand the topics they care most about. However, in many cases, individuals are paying a much steeper price that can far exceed what they’re paying out of their wallet.

A girl playing with Hasbro’s Littlest Pet Shop. Hasbro has recently been in trouble for digital ads targeting children. (Photo by Shawn Ehlers/WireImage)

The Hidden Online Ecosystem

Even when content is available for free, there is an unseen cost associated with nearly every website a user visits. Ads are a good example of this; while most internet users understand that certain ads will interrupt their browsing experience and slow page load times, they may be willing to accept this inconvenience to obtain the content they care about.

But the full extent of this hidden ecosystem is harder to see. When websites place a piece of code on the pages of their website, they not only track which pages consumers have visited but also what specific actions they took, on this website and others.

Some trackers even use password managers like LastPass to further fingerprint a user. They do this by creating hidden or false login fields on websites that the password manager automatically fills in with email addresses and passwords. These trackers can take that information and get a more in-depth profile of an internet user.

One reason this is troubling is that the advertiser isn’t always the one doing the behind-the-scenes tracking – they often invite other third-party companies to add their own code on the website to track you as you browse the internet and retarget you accordingly. Just look at Bose, which was recently hit with a lawsuit for this practice, which creates a continuous cycle of monitoring and collection that distorts the cost of consuming content. It also imposes a significant burden on CPU and network resources to load scripts from all these different parties.

Ultimately, websites need to be more transparent about the true cost of their online content and allow individuals to determine if they are receiving enough value in this transaction.

So, What’s a Website to Do?

The most important thing that websites can do is to acknowledge the real cost of their supposedly free content. While the scales of this transaction have traditionally favored the publishers and advertisers, ad-blockers and privacy tools have provided consumers with a valuable bargaining tool.

In particular, privacy tools help users determine how much value they’re giving away when they visit a website, empowering them to decide whether or not the content is worth the cost. This opens up a possible negotiation of sorts between a website and a user.

The Future of the “Free” Internet

Some websites are already thinking about how they can empower users while also remaining financially solvent, whether it be through a tracker-free or ad-lite experiences. Through those mechanisms, we can eliminate the knowledge asymmetry that is so common today, leveling the playing field between internet users and websites. Websites must think carefully about how to reduce the asking price for users without profoundly impacting their experience.

Jeremy Tillman is Director of Product at Ghostery, which provides free software for safer browsing.

The post The Real Cost of the ‘Free’ Internet appeared first on MediaShift.

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It’s time to ignore the warning that past results are no guarantee of future success, stick a wet finger into the cold winter wind and make some 2018 predictions. (Here my predictions for 2017, if you’d like to evaluate my previous performance.)

This year, I’m predicting more uptake of AI and the blockchain for media, some business turmoil, and more battles with the duopoly (need we say who that is?).

AI Gets Real-er

In late 2017, it seemed that every media conference had a session about artificial intelligence, how it would boost media’s revenues, trustworthiness, curation and maybe even editorial capabilities.

Ad-tech companies are leading the way already, they say, employing artificial intelligence and machine learning, neural networks, deep learning, natural language processing and other related technologies.

In 2017, Google acquired at least two AI startups. Amazon and Microsoft, too, revealed major AI initiatives. Meanwhile, Facebook’s head of AI Research, Sarah Bird, lectured a NY Tech Meetup gathering last fall on ways her team was making AI easier for the platform’s less technically inclined “customers” to employ.

AI, she said, was being used to help advertisers earn more revenue, to place more relevant ads, and to improve people’s news feeds by better serving them the content they want. Facebook, she said, is working with “algorithms that can sense the world and automatically adapt.”

Others are experimenting with AI to help curate media, predict upcoming hot topics, inspect video and photos for objectionable content.

Some are using AI to help mimic human interaction in chatbots and apps, including Betaworks, according to CEO John Borthwick.

“A startup we’ve backed called Hugging Face is an app designed for kids and teens who want to have an experience with pet AI,” Borthwick said at a NYC Media Lab gathering. “People know they’re talking to a machine but they’re having a social companion-like experience.”

Artificial intelligence: a pupil attends a lesson in robotics at the IT Lyceum in Kazan, Russia (Photo by Yegor AleyevTASS via Getty Images)

Blockchain Moves Into Media

The number of explanatory articles on blockchain — such as “Four Ways Blockchain Will Transform Marketing and Advertising” (Forbes) or “27 Ways Marketers Can Use Blockchain” (AdAge, by my friend David Berkowitz) — that appeared last year are a sure sign we’ll be seeing more of it.

Blockchain can be used to increase the level of trust in an advertising supply chain currently rife with fraud. A secure, blockchain-generated code exchanged between ad buyer and publisher can give assurance that an ad is appearing as promised on the page said to be receiving it. It can also be used to help confirm users’ identities, share data with them and help verify that reported metrics bear a semblance to reality.

“Initial areas of scope are fraud, measurement, discrepancy reconciliation for billing purposes, financial transactions, and validation of advertising resources and assets,” Richard Bush, Chief Product & Technology Officer of NYIAX, a media contract exchange system being developed in partnership with NASDAQ, wrote for the IAB, an industry trade group.

“By 2019, I think that at least 20 percent of payments by [advertising] agencies are going to be stored in some sort of encrypted ledger, a.k.a. blockchain,” says Kyle Csik, managing partner at GroupM, the world’s largest media buying company (and, full disclosure, a Teeming Media client).

Blockchain can be used for micropayments, to verify subscriptions, to help verify identities (you listening Twitter, Facebook, WeChat, et al?) — anything that requires verification that relies on an unbreakable, encrypted network.

A caveat: when it comes to blockchain and AI, it’s important to remember that the hype machines will be in full swing. Some folks will walk the walk, but others will be just talking. Keep your thinking cap on.

Business Realignments

2017 saw some important business realignments, and in 2018 we’ll see more of the same, with media hunting for revenue models that can sustain their operations, and mergers and acquisitions as the more solvent players look to pick up skills and capabilities.

In the hunt for revenue, media companies will continue to try subscription models. They’ll play with new ad models, too. Vox and Buzzfeed took on programmatic advertising in 2017, after eschewing the technology for years. Buzzfeed also moved away from sponsored content, laying off about 100 people who helped produce it.

Layoffs also came to a “handful” of people at Complex and still more at mic.com, MTV, Fox Sports and Mashable. Former Gawker Media employees are taking a stab at buying their former flagship, gawker.com, but with 11 days to go, the crowdfunding initiative had raised less than $85,000 of the $500,000 goal.

We can expect more acquisitions. Lower tax rates will mean more cash for companies — including the duopoly, Apple, Amazon and Microsoft — that will have the funds to grow, and gain technologies and expertise through acquisition, as did Verizon, Capitol Broadcasting, Time Warner and Tribune Media in 2017.

Less “Pivoting to Video”

Many of the companies who laid off staff cited a “pivot to video” as a key reason. They want to capture the almighty video advertising dollar, which is many multiples above what display ads in typical text-based web pages can command.

But with Buzzfeed reconfiguring, Mashable acquired by Ziff Davis at a price well below previously reported valuations, and more video from more publishers coming on line (hence driving down prices), what had been a gold rush should return to a more rational effort to give audiences more of what they want, rather that what advertisers demand.

Ford CEO Mark Fields (R) and Greg Hart, Ford’s vice president for Amazon Echo and Alexa Voice Services, speak at a press conference on January 5, 2016. (ROBYN BECK/AFP/Getty Images)

More Voice Applications

It’s been a big year for Amazon’s Echo and the Google Home lines of voice-activated devices. Amazon — which controls more than 70 percent of the market — claimed that “tens of millions” of devices were sold over Christmas, and Amazon Alexa was reported as the most downloaded app on Christmas Day.

Media companies have been incorporating their programing into both devices. Say “Play NPR,” for example, and either device will play a nearby public radio station, or “Play The Daily Show” to hear a clip of host Trevor Noah.

EMarketer predicts 35.6 million Americans will have used voice activated devices in 2017, up 129 percent over the previous year.

The Duopoly

Google and Facebook control the digital advertising landscape.

They will continue to do so. Efforts to make a dent will continue.

(I explored the issue at some length in last year’s column.)

The Rich and Powerful Affecting Freedom of Speech

As a former editor, reporter and foreign correspondent with friends and colleagues who have literally died on the job, I’m afraid we’ll see further attacks on reporting that those in power don’t like.

Gawker was brought to bankruptcy by Silicon Valley investor Peter Thiel’s support of a Hulk Hogan lawsuit against them.

Shiva Ayyadurai promised to appeal a judge’s ruling that he couldn’t sue TechDirt for saying he didn’t invent email.

Keeper Security filed a suit against Ars Technica and its reporter Dan Goodin, who wrote about a reported security flaw in Keeper’s software.

Expect more such SLAPP actions.

I am afraid we might also see the Trump administration or its supporters move to punish journalists who create what the president terms “fake news” — not just continued Twitter attacks and moves against leakers, but rather legal actions, either civil or criminal.

Let’s hope it doesn’t happen. Don’t hold your breath.

An award-winning former managing editor at ABC News Digital and an MBA, Dorian Benkoil handled marketing and sales strategies for MediaShift, and is the business columnist for the site. He is COO at Teeming Media, a strategic media consultancy focused on media-tech, ad-tech and finance. He tweets at @dbenk and you can find him on LinkedIn.

The post What’s Ahead for Media in 2018: AI, Blockchain and Billionaires vs. Journalism appeared first on MediaShift.

According to a recent study conducted by Storyzy which looked at 1,800 fake news sites representing 1.7 billion visits per month, an average of 22 new fake news sites per month were created in the U.S. since the beginning of 2017. These numbers are staggering, and difficult to track by hand. Robots are the most effective way to detect these new sites and eventually stop the increase and spreading of fake news, a trend which began accelerating in 2016 during the U.S. presidential campaign. Furthermore, brands might be advertising on these sites without even knowing they are doing so.

Currently, manual lists fail to catch up with the pace of new fake news sites. The well-known public lists of fake news sites, such as Politifact, Open Source (updated recently on April 2017) or FactCheck.org, are no longer online. The challenge in creating a manual list is that in order to be usable, updates must be made very frequently. However, users may not know how often the list is updated nor whether a recently-emerged site has been added to the list or not. Updating these manual lists is difficult because they are made and maintained by humans. It is beyond the reach of one human being to scan the entire web and keep up with the pace of fake news sites being created regularly. For a robot, though, this doesn’t present as much of a challenge.

However, a robot must be able to recognize whether a site contains fake news site or not. At Storyzy, we have developed a robot that is able to automatically identify every new fake news site. For example, last August when the neo-nazi website “The Daily Stormer” became active again after having been shut down, our robot was able to detect the newly active site.

24 new fake news sites per month in 2016

Through an analysis based on the creation dates of the 1800+ fake news sites on our list, we noticed that 24 new sites on average per month were created in 2016 and 22 new sites on average per month in 2017.

We also found that the number of fake news sites that emerged in 2016-2017 is equal to the total number of fake news sites that emerged in 2011-2015. This inflation is probably due to the societal and political atmosphere created by the U.S. presidential campaign, but since the election the rate of newly-created fake news sites is still high.

There are several different brand safety solutions to avoid fake news content, but our experience shows that these solutions are far from perfect. The recent Uber case illustrates this: after they decided to remove their advertising from Breitbart, Uber found that their ads remained despite efforts to take them off. Uber blamed its media agency and decided to sue them.

If you are an advertiser and you want to avoid displaying your ads on sites like Breitbart, the only way to ensure this happens is to use an updated list of fake news sites created by a robot. Considering the volume of sites on the internet, using a manual analysis won’t be sufficient.

(Peter Dazeley/Getty Images)

What you don’t know can hurt your brand

Since August, we have found more than 1,000 brands displaying their ads on fake news sites–and most of these brands have no idea this is happening. That list of brands is growing every day. We assume that some of these brands don’t care about funding or appearing on these kinds of sites, but many do. Brands often purchase their programmatic campaigns through media agencies and, like Uber, they request a brand safety solution, but these are only somewhat effective. Referring to an exhaustive blacklist, updated dynamically, is the only way for brands to ensure that their ads will not run on fake news sites.

We also found out that most of the sites identified by our system as fake news are using content recommendation widgets, more than two-thirds of 2,000 sites. Outbrain, Taboola, Revcontent, Content Ad, Zergnet and Adblade are the main providers of content recommendation widgets. In these widgets, you can find content that often leads to clickbait sites with a lot of display advertising. Brands that advertise on these websites are indirectly funding fake news sites.

In order for brands to completely avoid a presence on fake news sites, automated solutions offer wider protection than manual solutions.

Stan Motte is the co-founder and CEO of the tech start-up Storyzy, which was founded in 2012 with the goal of fighting misinformation on the web, first with an automated fact-checking tool, and today with an automated way to detect fake news sites.

Pierre-Albert Ruquier has 18 years of experience in digital information and news distribution. He is the CMO of Storyzy.

The post How Fake News Sites Can Hurt Your Brand appeared first on MediaShift.

Almost all the content and advertising on the internet is customized to each viewer. The impact of this kind of content distribution on the 2016 election is still being explored. But, we can certainly say that the campaigns used this to say different things to different people without having to worry about accuracy.

Addressing this problem by having people screen ads is impractical and legally questionable. A more straightforward solution based on current disclosure laws is being discussed in Congress: Increase transparency by having digital media platforms post all ads on a web page that everyone can view.

Before the web, big data and machine learning, political groups and campaigns reached their target audiences through mass media – newspapers, radio and television. Most everyone saw the same news reports and advertisements at the same times. As a result, the public shared a common base of knowledge about what political candidates were saying. No longer.

Today, digital media platforms track what users look at, search for, post, like and share to micro-target their users with ads they are likely to want to see. Compared to the scattershot approach taken on TV and other mass media, micro-targeted ads are amazingly effective. This is great for the media platforms, who get to make money from advertisers. It is great for consumers, who can trade their time viewing ads they are likely to want to see in exchange for “free” use of the internet. And, it is great for businesses that get to reach their target audiences for less money.

Recent news makes it clear, however, that micro-targeting is not so great for democracy. Micro-targeted advertisements, which are at the heart of the most successful internet business model, allow political groups and others – including foreign countries – to tell Americans tens of thousands of different stories. Each of these messages is customized for people who are predisposed to agree with it, and unavailable for anyone else to check or verify. The net result is to increase divisiveness and disputes about “fake news” as the public’s common set of knowledge is divided into increasingly smaller pieces.

A look to the 19th century

The problem of politicians telling different stories to different people is not new. In 1840, William Henry Harrison’s presidential candidacy essentially invented the modern campaign. He was the first to hold mass rallies, make personal appearances and introduce catchy slogans. He realized that he could tailor his messages to different audiences, and even provide different segments of the population with different sets of facts. The people on the receiving end of his speeches would never know their counterparts in a different region were being told something different.

The solution: the traveling press corps made sure that everyone had access to all of a candidate’s speeches. Harrison and other candidates could, of course, still say whatever they want to any audience, but the press coverage made self-contradiction a political liability. Today’s solution is the same: Increase transparency. In the age of micro-targeted internet ads we need to make all ads available to all the people.

During the 2004 presidential election, transparency was essential to eliminating fake news. An ad campaign by a group called “Swift Boat Veterans for Truth” was created to discredit Democratic candidate John Kerry. In part because the public at large saw the ads, the effort was unmasked as inaccurate propaganda about Kerry’s service in the Vietnam War. By increasing the transparency around online ads, we the people can hold all politicians, parties and interest groups accountable, and return to reasonable debates based on a common set of facts.

Current solutions aren’t enough

The recent news that Russia tried to manipulate the election with micro-targeted ads on Facebook, Google and Twitter, and that advertisers can micro-target ads based on racist keywords, has led to calls for online media platforms to be more socially responsible and accountable.

The tech companies’ planned response involves hiring more people to review ads and keywords – a form of censorship. Even if each ad and its related targeting keywords could be vetted by the media companies, there are free speech issues involved in rejecting ads. Furthermore, motivated and clever advertisers are likely to find ways to reach their intended demographics.

Taking the lesson from history

As in 1840, Americans need help restoring the transparency that has been lost with changes in how campaigns reach the electorate. If media platforms were required to post all advertisements in an online archive on their websites for at least one year, then consumer groups, political watchdogs, the press and in fact any citizen would be able to monitor the ads being run.

In addition, at least for political ads, the keywords used to target the audience and the group paying for it could be included along with the ad itself. Keeping all ads on a known and publicly available page would make the ads available for all to see for a reasonable amount of time. Advertisers would be held accountable because everyone would be able to see the ad and it would not go away quickly. If we, as citizens, don’t take it upon ourselves to check the archive page, then shame on us.

It won’t solve all of the problems of micro-targeting. Advertisers and campaigns will doubtless try to circumvent whatever rules are in place. The goal is not perfect accountability, but a step toward it. Just as campaign laws require paid political ads on mass media to identify their funding sources, there should be a trail of accountability for advertisements on digital media platforms. This system is technically feasible and could be set up immediately. It is likely to reduce misinformation and curtail foreign manipulation at the same time, and could help the internet live up to its hope of improving – not hindering – democracy.

Seth Copen Goldstein is an Associate Professor of Computer Science at Carnegie Mellon University.

The post Solving the Political Ad Problem With Transparency appeared first on MediaShift.

Native advertising, which Forbes defines as “ads…designed to fit so closely with a publication’s content that they appear to be part of a publication,” is often described as a tool news organizations need to maintain a steady revenue stream. While the practice is lucrative, it also jeopardizes the editorial independence of newsrooms as journalists become aware of what advertisers want them to discuss. Today, brands are able to work with journalists in unprecedented ways that are difficult to regulate, because very few people know how such partnerships between advertiser and publisher are negotiated.

I worked at the New York Times’ branded content studio, T Brand Studio, for two years. During this time, I found that native ads felt hackneyed to the people creating them. When the practice first started, its focus was on crafting branded articles that gave readers a compelling narrative behind a company’s new product or service. Today publishers are increasingly finding ways to partner with advertisers on custom content without being transparent to readers about these deals.

As media critics, academics, and news consumers debate the ethics of native advertising, I fear they’re missing the larger story of how publishers are evolving their business model to secure revenue. Advertisers are asking the New York Times and other news publishers for more. They want to work with the newsroom in deeper and more complex ways. To combat this breakdown of the editorial and advertising wall, media watchdogs need to fight for regulation that demands news publishers disclose which brands they are working with and what they have been asked to produce.

Advertisers want novelty

As a Creative Strategist in T Brand Studio, I was tasked with crafting proposals that showed marketers how the Times could create bespoke advertising opportunities that would capture an engaged audience. In practice, this means working closely with the sales staff across specific categories such as finance, live entertainment, and luxury, and to respond to RFPs (requests for proposal). A common theme in these RFPs was a request for something that “has never been done before.” This wasn’t a surprise, because it is not always enough to offer a brand digital ad space: rather, content studios need to deliver creative ideas to clients.

When I worked in the finance category, this often meant communicating how a bank could provide readers with helpful information while also highlighting the benefits of their services. This involved sharing a headline for a branded article, or paid post, as well as a high-level outline of what the article would discuss. It quickly became obvious that pitching branded articles was not nearly enough: After a financial client runs one native ad outlining how they enable people to invest in the things they care about, the revenue stream is dead. This means that the advertising department needs to create additional opportunities for clients.

Publishers invest in staff that sit between advertising and editorial

You don’t have to look further than LinkedIn or NYT’s public job portal to see that the paper is actively developing new ad formats that further blur the line between news and advertising. For example, Michael Villasenor is currently the creative director of Ad Marketing and Innovation. His responsibilities, as he describes them, are to “work alongside the publisher and newsroom team to ensure that we properly support all of their marketing needs. This also includes developing original digital and print ad materials in order to secure never-been-done-before treatments within the marketplace.” Today, publishers must create advertising opportunities that enable brands to champion content series editors may want to work on.

This development actually outstrips concerns over the labeling of native ads. When the newsroom wants to work on special series of stories, they may reach out to T Brand to see if it will be easy to underwrite the editorial initiative with advertising dollars. When T Brand gives editors feedback on what clients want (articles on 401k, retirement, etc.), the editors may decide to pay more attention to such topics than they would have initially. Now, this isn’t something that will ever be explicitly stated. Rather, it will be baked into the larger partnership between advertiser and publisher.

Samsung shows us where native is going

The demands advertisers have placed on publishers have evolved quite ominously from T Brand’s inception in 2014. Debate over the clear labeling of branded articles seems like child’s play today. Now many regulators — and even people in the industry — have a hard time defining what should be labeled as native content. It is no longer as easy as spotting a branded article and asking a publisher to put a disclaimer on it. NYT’s partnership with Samsung is a prime example of this.

The Times was a perfect partner to deliver 360-degree content for the promotion of Samsung’s technology, because the paper had established a strong reputation in the VR space. Last year, staff at T Brand Studio and my co-workers on the Creative Strategy team were asked to create a custom advertising opportunity for Samsung that involved the newsroom. This campaign was called The Daily 360.

Money changed hands and yet the PR and headlines around the campaign never called it a native ad or sponsorship. Instead the Times press release included a small footnote reading: “Times journalists have been provided with Samsung Gear 360 cameras and equipment to use while reporting out in the field.” Neiman Lab’s report mentioned the deal as a “partnership” with Samsung, with an exchange of technology, and noted that Samsung could publish the videos on their own platforms.

Samsung’s own press release on the partnership probably came closest to explaining just how much the tech giant was supporting the Times. In the release there’s this telling quote from Meredith Kopit Levien, executive vice president and chief revenue officer of the Times: “It’s because of Samsung’s support and filming technology that we’re able to give global audiences a true sense of what it means when the New York Times is covering the breadth of what’s happening in the world.”

This example is not meant to highlight only the blurred lines between advertising and editorial. There are enough articles across the internet on how journalism is doomed, but offer neither solutions nor sympathy for the plight of newsrooms across the nation. The New York Times is still committed to protecting the unadulterated vision and agenda of its newsroom: this has not changed.

What has changed is the level of transparency, across publishing, that is provided to readers and media watchdogs. Rather, the Samsung example shows the pace at which publishers are forced to generate novel advertising opportunities in an effort to secure much needed revenue. While my first-hand experience has been with the Times, the RFPs and negotiations between publisher and advertiser to blur the line is an industry-wide trend. It is nearly impossible for people to know what to regulate if they can’t even spot the advertising execution after it has gone live.

The solution demands disclosure

Currently, no rule or policy exists that require news outlets to disclose that they have received x dollars from y client to produce z advertising placement(s). It’s important to note here that disclosing what is and is not funded by an advertiser would not slow down the production of such campaigns, partnerships, native ads — whatever the news outlet wants to call it. Publishers should disclose the terms of their deals with advertisers in quarterly reports and on their website. This is the mandate we should require all publishers to adhere to. It will secure the separation of church and state, editorial and advertising. It will provide people with the level of transparency journalists should always offer for readers.

Often, when writers discuss the ethical implications of native advertising, and how the newsroom feels about the practice, they seem to forget that editors know it helps the paper. Editors are aware that if they can work with advertisers without sacrificing their vision and mission, the extra dollars help secure the newsrooms’ survival. Editors and reporters in the newsroom know the revenue generated by T Brand helps secure their job. We should stop painting advertisers as the problem and start realizing that journalists are also responsible and need to stand up to editorial interference.

Ava Sirrah is a Ph.D. candidate at Columbia University, where she studies how native ads impact newsroom decision making. She is interested in regulating the industry, spreading media literacy, and exploring new revenue streams for publishers. She worked at The New York Times for two years as a Creative Strategist. 

The post The Blurring Line Between Editorial and Native Ads at the New York Times appeared first on MediaShift.

Google’s official response is unsurprisingly vague, and while ad rotation (the way Google rotates your Google AdWords ads) may seem like a minor consideration, it can have a big impact if not effectively managed.

Judgement Day: the Rise of the Machines began September 25, 2017

Sci-fi references aside, Google has made it very clear that the future of many of its algorithms are and have been relying on deeper implantation of machine learning. The same style of statistics and patterns that feed your GPS and tell you traffic problems are at play in the AdWords platform.

The machines are learning, and fast. But the truth is that while powerful, machine logic is still in its infancy and needs some guidance by human hands. We recently found a perfect example of this when we noticed ads using the abbreviation for horsepower (hp) were limited on possible trademark violation for Hewlett Packard (HP). Ironic, but it shows that if that fantasy war between man and machine ever does happen, we do have a chance at survival.

Google claims that previous ad rotation did not provide enough data into the decision making process. Off the record, we do find that often these types of changes do have a direct impact on financial gain by Google, and advertisers may see an increases in costs per click, that if not kept in check could damage the return you get on investment you made to buy ads from Google.

The official word – and what it really means

According to Google’s official email:

“There will only be two ad rotation settings

• “Optimize” will use Google’s machine learning technology to deliver ads that are expected to perform better than other ads in your ad group.
• “Rotate indefinitely” will deliver your ads more evenly for an indefinite amount of time.”

But this leaves us with some questions. What are you optimizing for? Clicks, cost, conversions, conversion rate, ROAS (Return on Ad Spend)? – all of these have a different impact on ad placement, performance and return.

After a phone conversation with reps from Google, we learned that “optimize” means different things in different networks. For search, unfortunately it appears to be optimized for clicks. However, for display the optimize is geared towards conversions.

Admittedly, this feels a little backwards. Traditionally the search network, advertising in search engine pages, has been highly successful at driving leads. Here, optimizing for clicks has usually meant an increase in traffic, along with a potential increase in cost. On the other hand, a more conversional display network (advertising on someone else’s website using Google’s platform) may be a game changer for many advertisers. Display has traditionally been far more beneficial as a branding play with limited conversions and it has been far too easy to spend excessively without return. The idea of a more profitable display network is certainly intriguing, but time will tell, and expectations on this changing should probably stay low.

How to prepare for and manage these changes

The biggest thing to keep in mind with any change is that if you have a good foundation you can minimize the damage. Here are a few specifics that can make a proactive difference in your account rather than waiting out the storm.

Smart bidding: If you are not already employing Google’s automated bidding tactics like Target CPA (Cost-Per-Acquisition), Target ROAS (Return On Ad Spend), maximize conversions, or enhanced CPC (Cost-Per-Click), you should start. Google’s machine learning is taking stronger signals from bidding strategies and seeing more success when they are in play.

Manual efforts: Simple and regular manual review of the ads in your account has been a best practice for a long time. Check which ads have the best click through rates, the lowest cost per conversion and the best return on ad spend. Pause the poor performers, but also spend the time trying to figure out the messaging that chimes the best with your users. What words, features or benefit is making the difference in performance – test new ads regularly, but try to keep to three good performers and 2-3 test ads.

Regular review: Check it, then check it again. Schedule a review if you need to. Problems creep up in an account when you aren’t looking, so do it frequently. Platform changes are less frequent and there is usually a warning, but competition moves, and regional and local factors can also make an unforeseen impact on your account. As an example, I’m pretty sure ad engagement in Houston, TX dropped off during the floods. Sure that’s obvious, but what other outside factors could be affecting your account?

Overall, you should be cautious of Google’s statement, “You do not need to take any action at this time.” Be proactive. Your agency may have already reached out to you regarding the changes and effective action plans. If not, get a new agency. For most advertisers there shouldn’t be a negative impact of this change, but it never hurts to be prepared.

Chad Crowe joined Techwood Consulting in 2016 as part of a merger. Currently, he manages Techwood’s implementation and account management operations. He holds a bachelor degree from Reinhardt University and a Master’s Degree from Troy University in Communications. Over the years, Chad has managed over $25 million dollars in paid search advertising.

The post Google’s New Ad Rotation Settings and What They Mean appeared first on MediaShift.

Google is funding extremist and fake news sites through AdSense, its platform dedicated to publishers, despite its own policies. This is because it only removes ads at the page level. Analyzing the 700+ fake news sites* on its automated blacklist, Storyzy found that 90% of those using programmatic ads are affiliated with Google AdSense.

One of the main reasons for the presence of ads on extremist and fake news sites is the fact that Google removes ads only from certain pages, not from a whole site. In a post from May 2017, Google announced that from then on, it would remove ads from pages that violate its policies. They were explicit that this would be carried out at the page level and not at the site level. Scott Spencer, Google’s sustainable ads director, explained:

“As we roll out page-level policy action as the new default for content violations, we’ll be able to stop showing ads on select pages, while leaving ads up on the rest of a site’s good content.”

In concrete terms, a given brand’s ads may have been removed from pages with racist content on an extremist site but still appear in its weather forecast section, meaning that Google and the brand are providing revenue to such sites. So it is not a surprise that, in September 2017, 90% of fake news sites which are monetizing their audience through programmatic advertising are using Google AdSense (according to Storyzy statistics). Their audience represents 120 million monthly visits.

Since July 2017, Storyzy spotted on these fake news sites more than 600 different brands’ ads, including big names such as McDonald’s, Walmart, AT&T, Adobe, Visa, Nespresso, American Express, Verizon, Hertz, Volkswagen, Goodyear, Microsoft, Dell, Toyota, and others.

Google AdSense Content Policies Are Clear

Google AdSense policies about “dangerous or derogatory content” are clear and they are applicable at the page level:

“We believe strongly in freedom of expression, but we don’t permit monetization of dangerous or derogatory content.”

However, when a brand’s ads appear on specific “safe” pages of an extremist site because those specific pages do not violate Google policies, the brand is still funding both the extremist site and Google.

Are Google’s Rules Wrong At Page Level?

It is public knowledge that Breitbart.com has been blacklisted by nearly 2,600 brands since November 2016 (that applies to the entire site, not only specific pages). Not all content on the site is extremist, racist, or contains false information. These brands removed their ads despite the fact they could appear alongside articles from respectable agencies like the Associated Press. For example, in the screen shot below you can see an AP article on Breitbart that has been blacklisted by these brands.

So what is the best approach for a brand? Removing ads from the entire site, or just from certain pages? Nearly 2,600 brands chose the first option, probably because they do not want to fund Breitbart. So if you are a brand and you do not want to create revenue for extremist and fake news sites, perhaps the only solution is to blacklist the whole site and not only its pages that violate Google AdSense policies.

To be fair, Google says it can sometimes remove an entire site. However, we have noticed that 90% of extremist and fake news sites are running programmatic display ads, including Breitbart, which are still affiliated with Adsense.

Conclusion

If brands want to control their ad placement, they cannot rely only on Google. They should additionally use a real-time dynamic blacklist of sites where they do not want their ads to appear. This will provide a real-time update, which is necessary because sites are emerging, changing their domain name, disappearing and coming live again all the time. For example, thanks to our algorithms at Storyzy, we detected this week that the neo-Nazi site The Daily Stormer has become live again under another domain name. In addition, an automated blacklist is run by algorithms that are politically neutral.

*The Storyzy fake news sites dynamic blacklist includes 9 categories: false information, extreme right, extreme left, conspiracy, propaganda, hate, pseudoscience, satire and clickbait.

Stan Motte is the co-founder and CEO of the tech start-up Storyzy, which was founded in 2012 with the goal of fighting misinformation on the web, first with an automated fact-checking tool, and today with an automated way to detect fake news sites.

The post How Google AdSense and Brands Continue to Fund Extremist Websites appeared first on MediaShift.

Compare Amazon with Netflix, for example. Based purely on success from its programming, Netflix is far ahead. Its subscribers account for a huge share of internet traffic in North America. It continues to increase viewership and membership, piling on hit shows and movies, generating great press and acquiring others’ popular movies and shows. Its original productions such as “House of Cards,” “Stranger Things,” “Orange is the New Black,” “Chelsea Lately,” and the documentary “Thirteen” have received far more accolades and awards than Amazon has. The conundrum for Netflix, though, is that its core business is media. It pays a hefty amount to produce and license movies and shows, and rely on that content to attract and hold members, generate revenue and fund operations. It owes lenders more than $20 billion and has borrowed to produce and acquire shows and movies, and is not generating enough cash to cover that debt.

By contrast, for Amazon the media business is a sideline. As an e-commerce and web services powerhouse, Amazon can subsidize its media operations. Amazon Prime members, who gain access to Amazon’s selection of movies and shows, also spend thousands of dollars per year through Amazon, averaging more than two times as much commerce as non-Prime members. Amazon makes still more cash by selling its own devices (Kindle readers and tablets, the voice-activated Echo line, among them) and multiple private-label fashion, food, health and electronics products that compete with vendors who sell through Amazon.

Amazon offers Prime membership at roughly the same price Netflix charges for equivalent access while also including free two-day shipping, a huge music library, special eCommerce deals, eBook lending and other enticements. As a bookseller, of course, Amazon is king.

Meanwhile, let’s not forget Amazon’s real 800-pound gorilla: Amazon Web Services (AWS). The division last year lifted Amazon’s profit to a record, accounting for more than 71 percent of the company’s total operating income while bringing in only eight percent of revenue. Web services are eminently scalable and thus can increase profit margins by adding servers and bandwidth; there’s no need for all those costly writers, actors, directors and producers required to make every movie and show.

With AWS, Amazon can pretty much predict profit margins before turning on whatever lights the humans working in their server farms might need. Not even the most creative Hollywood accountant can tell you how much a TV show or movie will make. “Amazon has come to depend on AWS to fuel the rest of its sprawling business and feed its global ambitions,” Geekwire’s Taylor Soper wrote earlier this year. Which means Amazon probably can afford to hire the likes of “Transparent” star Jeffrey Tambor because of all the cash it has on hand thanks to AWS. You could say the same for how it can afford the rights to so much music, so many TV shows and the millions it’s spending for rights to stream elite sports. All that cash also helps Amazon Prime gain headway with its own blockbusters and also through judicious licensing of shows such as “Veep,” “The Sopranos” and “Orphan Black” from producers and distributors such as Showtime, HBO and BBC.

Netflix and subscription streaming video competitors such as Sling TV, YouTube Red and Hulu are media businesses. Amazon is a platform. Beyond streamed media, it also sells shows and movies on demand, much as Apple does. Its offers subscriptions to services like Showtime, HBO and Sling, which consumers can then watch through Amazon not only on computers and smartphones but also on TVs made “smart” via the inexpensive Amazon Firestick. Amazon offers still more video — everything from exercise and recipe videos to clips from older PBS shows — through its Video Direct program, which lures publishers by offering them a cut of revenue earned from subscriptions, sales or advertising.

Amazon Serves Ads, Too!

Amazon is also fast-rising as an advertising technology and services vendor. It generated $1.4 billion in ad revenue last year, according to Barclays, and eMarketer predicts Amazon will be the third-largest digital advertising provider by 2019, after Google and Facebook. It also has a robust advertising exchange, is offering a “header bidding” programmatic advertising optimization solution to publishers, and provides search advertising through its A9 division. It can place ads on publishers’ pages and also have tons of advertising inventory on Amazon.com. Amazon is likely looking into advertising for various Alexa audio apps on the category-leading Echo line, as well.

The Amazon Echo is the market leader in voice-activated assistants.

Then there’s the data. Even when Amazon isn’t technically “advertising,” its algorithms are predicting and proffering items it knows we might want. Facebook and Google dwarf Amazon in ad dollars, but Amazon can continually make its ads more perfectly targeted by knowing not just what interests consumers have shown but also what they actually buy, watch, read and listen to. That’s a wealth of data whose worth builds over time as more of it is collected, compiled and cross-referenced. The Washington Post, owned by Amazon CEO Jeff Bezos (and not Amazon), is yet one more high-impact playground in which to create content, gather data, show ads, get information and create influence — commercial and otherwise.

The Long Media Game

Put it all together and you can picture a budding powerhouse against which few media companies could hope to compete. Unless, of course, those companies are Google and Facebook, which claim they’re not media companies even as they take the vast majority of all new digital advertising dollars.

There, perhaps is what may be a saving grace. While the behemoths battle for market and mindshare, they also run up against each other and thereby help keep each other in check. The traditional media companies — those mortals bringing in only single-digit billions, or less, each year — play the giants and their would-be competitors for ad dollars (Apple, Snap, Twitter, et. al.) against each other to eke out better terms for the media they distribute on each of their platforms. And, yet, nearly all those platforms rely on advertising to sustain themselves while Amazon can use the cash it generates in other ways to increase its capacity and competitiveness in media and advertising. Amazon recently even launched a social network, Spark, with a special e-commerce twist.

Amazon is expected to account for more than half of online retail sales by 2021.  Sen. Corey Booker is among those who have voiced antitrust concerns about Amazon’s impending $13.4 billion purchase of Whole Foods. In the foreseeable future, media and advertising companies could be raising similar objections to Amazon’s market influence in their spheres. If there’s one thing Bezos has shown us since he launched Amazon more than two decades ago as a seller of printed books, it’s that his company looks for areas it can dominate and it plays the long game to get there.

An award-winning former managing editor at ABC News Digital and an MBA, Dorian Benkoil and is the business columnist for the site. He is COO at Teeming Media, a strategic media consultancy focused on media-tech, ad-tech and finance. He tweets at @dbenk.

The post Why Amazon is Poised to Kick the Media Industry’s Ass appeared first on MediaShift.

Advertisers are concerned by an opaque supply chain, low viewability and high levels of fraud. Publishers are stuck competing with Facebook and Google in an ad economy based on selling impressions, which by definition rewards scale over quality. Professionals on both sides of the equation are looking for better ways to buy and sell ads.

Brent Merritt

One intriguing alternative to the status quo is selling display ads based on time. In this approach, publishers use attention currencies such as cost-per-hour to sell big blocks of users’ time (measured by active engaged time metrics), instead of selling bundles of impressions.

In the course of researching a new white paper about attention analytics, I got to talk to smart practitioners about this trend, and some key insights from the report are below. The most important takeaway is that while time-based ad sales may not reshape the entire ad economy, they hold real potential for certain publishers as they fight for the ad dollars the duopoly leaves behind.

Read the Full Whitepaper

Where the demand comes from

The idea behind time-based ad sales started circulating in 2013 when an advertising director at the Financial Times proposed that time could be used as a currency to trade. Over the intervening years, awareness of the concept has spread and a small group of publishers, including the FT and the Economist, has actually begun selling ads this way.

The appeal for higher-end publishers is clear. Selling ads based on impressions rewards a high volume of visitors (even if they’re bots), but selling based on time assigns higher value to a more engaged audience. By extension, this rewards higher-quality content, and it provides a foothold to compete for ad dollars on the basis of content quality and audience engagement rather than fighting a losing battle for massive scale.

From the advertiser perspective, purchasing based on time can help address concerns about the efficacy of ad buys. The attention currencies used for time-based sales guarantee greater viewability than the Media Rating Council’s viewable impression standard, and because they’re based on real-time monitoring of user actions, they can help reduce fraud. And while more empirical research is needed, reports from the FT indicate that more time in view does increase a display ad’s impact.

Asked about the growing interest in time-based ad sales, Brendan Spain, FT vice president of advertising for the Americas reported, “The MRC viewability mandate has made publishers think about attention metrics and has resulted in a lot of questions around optimization for and selling on attention. We’re hearing other pubs talk about getting their ducks in a row to sell on time.”

Sounds great. What’s the holdup?

So if time-based sales hold such potential, what accounts for their relatively limited adoption thus far? One of the key points I heard repeatedly in my research is that significant barriers remain.

Stephanie Layser, director of advertising technology at News Corp, pointed out that a major hurdle is simply inertia. She observed that it would be difficult for an attention currency to spread because “the industry as a whole and the technology that it takes to achieve these goals are so deeply ingrained in the CPM model.”

Another roadblock is the current lack of demand for time-based sales from advertising agencies. Since their business models and technology are built around trading on impressions, introducing an entirely new currency is not a simple proposition. Similarly, mixing and matching currencies could create headaches for publishers. Layser explained that introducing a time-based currency would require significant changes to the ways that publishers’ ad servers function.

In assessing how likely time-based attention currencies are to spread more broadly despite these barriers, the people I spoke with offered a broad range of opinions. Some believe it’s improbable while others think it’s likely.

Jill Nicholson, head of product education at the analytics firm Chartbeat observed that the industry would have to reach “a tipping point where the early successes are so attractive to publishers, and the monetary benefits, the revenue benefits, of selling a new way are so attractive to publishers that it will overcome the difficulties. … I think the industry is really hoping for a new way to transact, it’s just a scary change to make.”

via Chartbeat

Who wins in an attention economy

If trading on time spreads more broadly, as some predict, it would stand to reward premium publishers above all. Their quality content and highly engaged audiences made up of desirable advertising demographics make them prime candidates to benefit from this approach.

On the other hand, publishers who chase scale without regard for engagement, especially those who do so using clickbait and misleading headlines are likely to lose out since they generate a lot more clicks than engaged time.

How much impact could time-based sales actually have for the winners? The FT’s Spain predicted, “I think what we’ll see is a much more sustainable business model for pubs who aren’t top ten or top five sites. You take Facebook, Google and a few others out of the top, and I think you start to see a sustainable business model for the top 1000 publishers instead of the top 100 publishers.”

In a marketplace where many publishers are fighting for survival, a shift of that magnitude would be an important step toward sustaining top-tier digital publishing and journalism. It remains to be seen how big the “attention economy” of time-based ad sales grows, but any tool that can help publishers compete certainly warrants ongoing attention and further exploration.

Brent Merritt recently completed a graduate fellowship at the George Washington University’s School of Media and Public Affairs. His work there focused on how digital technologies are changing the future of news media and strategic communications. He’s now an independent communications consultant at Metric Communications, where he helps organizations develop smart messaging and analytics. Follow him on Twitter, @brentmerritt.

The post Sell Ads On Engaged Time Metrics? Publishers Still Weighing Promise And Risk appeared first on MediaShift.