By Jacqueline Koch
Take a peek at recent headlines describing the state of the media today. Most likely you’ll find scant good news amid the reports buzzing of radical change, job cuts and that 60 per cent of US newspaper jobs have vanished in 26 years. It’s feels a little like staring into a dark abyss. On the heels of these grim updates, the appeal of native advertising intensifies, a shiny object glittering in a mucky pool of disorienting uncertainty…
So the recent newsflash from The Associated Press should have been of no surprise: The global news network is taking the plunge, jumping into the deep sea filled with agencies and marketers, and will begin offering a full range of digital advertising services. In offering digital advertising services, the AP becomes a full-service agency called AP Content Services. This new business will provide subscribers with an inventory of sponsored written, video, photo and interactive content to integrate alongside its news service.
This latest development from the hallowed halls of global newsgathering adds to an ongoing conversation—and questions—around the promise and peril of native advertising, which has vociferous supporters and detractors. One key question is how best to wield this double edge sword that has the potential to carve out new revenue streams for publishers, yet threatens to whittle away at their journalistic credibility and risk their readers’ trust? And what other opportunities are emerging in this new epoch of publishing.
A confused customer amid rapid growth
According to a study released late last year by Adyoulike, worldwide spending on native advertising will soar to over $59 billion in 2018. This terrific growth rises in tandem with a threefold increase of IP traffic predicted over the next five years. This signals an anticipated surge in content demand, sponsored content included. Yet many industry analysts maintain that native advertising remains in its infancy and the technological tools to truly monetize it have yet to be fully developed.
These growing pains are afflicting publishers and their audience alike. A 2015 Contently study found that 62 per cent of readers believe a news site loses credibility if it runs articles sponsored by a brand. On the flip side, while publishers may wrestle with the consequences of merging church and state—the unholy union between editorial with advertising— the same Contently study found that even when an article is labeled as sponsored content, readers remain confused. “Consumers often have a difficult time identifying the brand associated with a piece of native advertising, but it varies greatly, from as low as 63 per cent [on The Onion] to as high as 88 per cent [on Forbes],” the study noted.
And what about the little guy?
As readers remain clearly perplexed and suspicious of the blurring of the line between news and advertising, brands and publishers should take note. As native advertising evolves and blazes a path forward, it prompts other questions: Does this weigh in favour of those with big budgets only or can this scale for the smaller businesses?
According to Purch president Antoine Boulin in a recent Digiday article, for native to deliver performance, “the publisher must put forward an enormous amount of front-end efforts to produce high quality content that meets marketer requests and drives traffic to it, and still, the direct link to ROI can remain murky.”
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