Nieman Foundation at Harvard
Many publishers’ digital revenues have been on an upward swing in recent years — but it’s not enough to fill the gaps left by print. According to eMarketer, global digital ad spending in 2015 is expected to reach $170.17 billion. Global mobile ad spending globally should hit $69 billion this year.
That sounds like good news. But there are plenty of caveats for publishers: In 2014, Google, Facebook, AOL, Microsoft, and Yahoo accounted for 61 percent of total digital ad revenue in the U.S., according to Pew’s annual State of the Media report.
Factor in platforms like Apple, Facebook, and Snapchat hosting news — and offering to sell ads, minus their own cut — and it can feel as if publishers are trying to thread an increasingly smaller needle.
I asked several publishers what’s working for them in digital advertising in this uncertain environment. What types of formats are performing well? How is that a change from recent history? Do they have any plans to counteract ad blockers?
Now that many companies are creating branded/sponsored/native offerings, the hunt for America’s Next Top Advertising Model has moved to formats like video, podcasts, and newsletters. For many, mobile remains an elusive goal — and, as Mary Meeker’s annual slide deck shows, a tantalizing opportunity.
I spoke with executives from Slate, The New York Times, Vox Media, The Atlantic, Mashable, The Seattle Times, Newsweek, and Wired. Their thoughts on digital advertising are below, slightly edited for length and clarity.
Matt Turck, interim publisher/chief revenue officer, Panoply:
There are several examples of that — our parallax units, for example, where the images animate as the user scrolls over. They tend to be very large; on our site, they’re 1440 x 700. Those seem to be very effective.
We work with a third party, Velocity Made Good. They have a unit called the “avalanche unit,” that sits at the top of the page, a 970 x 200 unit. It pulls content from Slate and/or Slate podcasts and/or video into the unit. It also showcases the advertiser’s message. That’s a scrollable unit as well.
There’s several different things we do there. The host read is very valuable. That’s the midroll unit, and it will go 30 to 60 seconds, sometimes longer. The hosts are given talking points and make it feel like it’s part of the program.
Four years ago we launched “Slate Custom,” which is basically an in-house creative studio that helps our advertisers communicate with Slate readers.
It’s another area where we’re having some success. We use the natural editorial positions on the site to drive the user to that content. It is clearly demarcated that it is sponsored content; it’s actually a different color. But we still bring the reader to that content the same way we bring them to high-quality content in Slate.
Our goal is to make sure we’re not confusing the reader, obviously, and that advertising does not influence the content of Slate, and finally to produce the best quality content for our advertiser.
We’re doing a series right now with Umpqua Bank. We’ve done a series with HBO. And we’re also doing something even more unique with GE. If you look at the iTunes chart, you’ll see a podcast called “The Message,” which is a fictional podcast, basically a sci-fi cliffhanger. We co-produce that with General Electric.
It’s just gotten more competitive. We’re still winning a great deal of business that’s tied to custom. But an advertiser can only work with one, two, or three partners. They might be able to go a little deeper occasionally, but it just makes it more competitive to win those battles.
We’re talking about a lot of things as far as ad blocking is concerned. It’s a concern for us and a concern for the industry, but we have made no decisions on what we plan to do there.
If it’s not one thing, it’s anothe, especially for an industry where we’re not charging our customers to enjoy world-class content. We gotta pay for it some way. I beg and plead with people to not use ad blockers so we won’t have to charge you for content.
Michael Zimbalist, senior vice president of advertising products and research and development:
Additionally, our new mobile creative package called Mobile Moments is striking a chord with pretty much every advertising sector, from fashion to automotive to tech. Mobile Moments uses a unique native in-stream unit we call the Flex Frame that fills three-quarters of the screen on any mobile device.
Advertisers want to reach our audience, who are among the most curious, intelligent and influential people in the world. Who knows better how to reach our audience than us? Our best ad products build on the same techniques and insights that help inform our news presentation. In the case of Mobile Moments, for example, we used the insight that our audience’s news needs change throughout the day, and using that insight, we designed an advertising program with dynamic creative that can be [scheduled by time of day] in harmony with the news presentation.
Five years ago, it was pretty much all standard units adjacent to content, with limited storytelling capabilities. Today, we offer advertisers the ability to tell stories with the same depth and breadth of our news report.
Right now, our plans for ad blocking are to be vigilant — closely monitor the situation to understand what impact, if any, it is having on our business — and to strategically focus our ad product development on innovations that are additive to the user experience. Mobile Moments is a prime example of that. It’s non-interruptive and respects the user experience. That’s super important to all we do.
Thomas Hammer, senior vice president of sales, IBT Media:
I think we’re at an inflection point, in terms of digital advertising and mobile advertising, where the brands really want to get closer to the core audience and core consumer. We’re using our editorial staff and our content curation to build experiences that pull in the brands themselves.
Whether that be an automotive brand, or a [consumer packaged good], or confections or whatever, they’re really focused on getting back to that core audience through branded experiences and native content across our different channels, whether that be desktop, mobile or print.
There is somewhat of an inflection point in digital advertising. It’s changing. I’ve just spent seven and a half years in a pioneering mobile video platform and mobile video advertising, which didn’t really own any of its content.
I think what you’re seeing in a lot of the ad tech companies out there is that, if you don’t own your content, it’s going to be very, very hard to win brands over in this new age of branded advertising, because you don’t control it. That’s where you’re going to see a big push from media companies to really start winning back the brands, and owning their content and curating it, and putting brands in that experience.
The one thing that has been difficult for marketers, and it’s a fault of everyone in the industry, is mobile. I’ve worked in mobile since 2007. I was at the pioneering mobile video company since 2008. During that period of time, there were very few companies that were talking about mobile advertising, the audience, the engagement that was there, whether that was video or rich media, full-screen experiences.
Only in the last three years has it been this dominant feature. You had maybe a handful of companies that were doing it prior to 2012, and now everyone says they can do it. But desktop has standards — there’s the IAB and the MRC. In mobile, there’s really no standardization. Everyone says they can do video, but they’re not defining what video is.
I think where things are trending is the mobile platform. But I think desktop is still that much more powerful. And when you’re talking about targeting and reaching that unique viewer from desktop to mobile and then, perhaps, in the future, over the top and connected TV? The media companies will have that first-party data. That’s where the power lends itself.
We’re about to release the new International Business Times newsletter. We’ve redesigned it, it’s going to be called “Pulse.” We’re very bullish on that and getting into a great discussion with the editorial team and my side of the house in terms of revenue.
Video’s the same way. We’re really building out our coverage. So in the next year we’re going to have boots on the ground in Davos for the World Economic Forum. At CES, SXSW, Mobile World Congress, the red carpets of the Golden Globes and the Academy Awards.
Internally and externally, we’re being very proactive in discussions about ad blocking.
It’s a difficult circumstance, but it’s something, again, when it’s great content — and content, unfortunately, in that idiomatic phrase, is king — we have to be very upfront in terms of ad blocking and understanding what is the true audience that is coming through.
Hayley Romer, vice president and publisher:
We attribute it to a number of different things. First and foremost, our commitment to quality is unwavering. People engage with quality content, and by now, our readers are accustomed to getting great value through content created by Atlantic Re:Think. To underscore that point, we continue to invest in talent across the board, and specifically on our content and design teams for Atlantic Re:Think.
We also completely re-imagined TheAtlantic.com this year, and have evolved the way in which our readers discover custom content on our site. Organic traffic to our custom content has increased by more than 480 percent.
Everything is different from five years ago. Five years ago, we primarily ran standard IAB units on the site, and perhaps some of the (at the time) newer rising star and rich media units. But about four years ago, we began to see a clear need to create more engaging, higher-impact ads, which were more interactive than traditional ads. At the same time, we began really creating custom work for our partners.
For us, the demand for big ideas that drive engagement for brands is overwhelming. The ways in which those ideas ultimately manifest themselves on our site in terms of advertising vary. That said, it feels like at the moment there is not a marketer on the planet who is not looking for more opportunity to run their video ads.
Ad blocking is something we are obviously watching very closely, both in terms of our audience and the industry as a whole. We have not yet made specific, long-term plans to counter it. I suspect we will have more on this in the near future.
Joe Alicata, vice president of revenue, product, and operations:
What makes them special is they are beautifully designed by our teams deeply integrated in our sites for our audience and they maximize effectiveness for our partners.
Telling stories has always been key to our growth here at Vox Media. The biggest difference between now and five years ago is we are now taking our platform, Chorus, and the insights learned from years of edit, product, design, and revenue working together, and now helping brands tell compelling stories with great success via branded content.
We are seeing a huge demand for both our premium units on desktop and especially mobile, as well as branded content. A great example of branded content is our Fantasy Online College with Lenovo.
Our goal and mission is to make advertising that is good for audiences and advertisers alike. Our approach is paying off for both, through Vox Creative making better, more integrated campaigns and an ad product suite built by our team that is increasingly focusing on performance.
Seth Rogin, chief revenue officer:
One thing that we do, which engages our community not only on Mashable but on social networks, are community challenges. We’ve done some great Instagram challenges with brands like Olympus and Hilton that allow our community to submit their photos not only for a chance to be featured on Mashable but sometimes in order to win some prizes like an Olympus camera.
We live in an environment that is full of distractions and never-ending options for readers. Because of that, it’s more important than ever to speak to consumers in the spaces that they themselves choose and trust for a connection to what’s next.
Like most digital publishers, five years ago, our advertising was limited to basic ad units and the occasional creative execution. Today, the options are myriad and the science is real, making it more important than ever that brands and agencies work closely with the media outlets that readers trust. Five years ago, data was focused highly around demography. Now it’s much more predictive and precise.
Brands want to connect with readers in a deeper, more meaningful way. Today, they’re able to connect with our growing audience across a wide range of touch points — Snapchat, live events, video, branded content in all formats, and much more. The types of campaigns that we see demand for are deeply integrated with our brand. Smart marketers trust that we know our audience better than anyone.
One great example of this is MasterCard’s support of the 2015 Social Good Summit, which we host every year with the UN Foundation, 92Y and the UN Development Program. MasterCard was not only looking to reach our community online, but in real life as well. They brought their “Priceless Elevator Pitch” to the Summit so that attendees could record their idea of what a better world in 2030 would like. They got a chance to build new connections that help the center’s goal of ending poverty. Each pitch will lead to a donation of up to $50,000 to DataKind to help end poverty.
We don’t have [ad blocking] plans today. The challenge to all advertisers and brands is to continue to evolve the user experience so that the ads are less of an intrusion and more of a value-add. When I open the September issue of a fashion magazine, I’m as excited to see the ads as I am to read some of the content. The fact that readers want to block digital ads is a reflection that we all just haven’t gotten this right yet.
Charles Kolsky, director of digital sales:
Our growth this year has come from introducing new products, training, and an increased emphasis on competing for digital products.
We have many more products to sell than we had two years ago, let alone five. Our ability to sell targeted advertising is a big piece of our growth. In addition, we have lots of demand for our premium positions, takeovers, and wallpapers on SeattleTimes.com
We are proceeding with plans to identify folks with ad blocking software and to serve them a message. More to come on that front.
Robbie Sauerberg, general manager, advertising, said that “premium and custom large-scale ad executions” are the advertising areas that are growing the fastest for Wired. One reason for that growth? Bringing together more resources for performance and design.
“We’ve embedded our editorial UX team into the design process in order to create elegant templates for large-scale ads that live and breathe with the site’s responsive content experience,” Sauerberg said. “By doing this, we’ve driven ad performance beyond anything we’ve seen before.”
In looking at the difference between what ad products are available today compared to the recent past, Sauerberg pointed to the “polarization shift from IAB to entirely-custom ad experiences.”
“Advertisers are much more comfortable with completely new executions, ranging from custom native content programs to proprietary ad templates,” he said.
Companies now expect better metrics around ads, and as a result products that perform well consistently. “Wired’s natural strength is delivering brand awareness in new ways for advertisers — while tailoring each experience to keep readers interested,” Sauerberg said.
Finally, Sauerberg said the magazine is exploring options to counter ad blocking: “We have a series of tests running to convert ad blockers to white-list our site.”
