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Issue for September 2018

Is Display Revenue Becoming Passé?

Posted on Saturday, September 29, 2018 at 9:23 PM

Text-based advertising is gaining in popularity. But is it a sound strategy?

By William Dunkerley

Are you struggling to hold on to traditional display ad revenue? Or looking for new ways to capture a better share of digital? If so, did you ever consider that you may be barking up the wrong tree for revenue?

Survey Says

A respondent raised that surprising question in a recent survey by our sister publication, Editors Only. The survey sought to gather insights from editors on the roles they might legitimately play in their publications' advertising sales efforts.

Here's what one respondent had to say:

"Candidly, I think talking about 'advertising' is a little out of date. Advertisers have fled print and, in terms of digital, look to Google and Facebook. As an editor I see our revenue opportunities in paid subscriptions and native content.

"The greater opportunity lies in native content. Here I believe editors have a strong role."

At the same time I came across a survey conducted by Target Marketing magazine. It asked a cross section of marketers from around the country about the directions they are taking for their 2019 marketing budgets.

Of particular interest to me was how respondents indicated how they would be realigning their expenditures across different marketing channels. This part of the survey looked at the multitude of available alternatives, from TV to billboards to direct mail.

The survey wasn't asking how much money they would reallocate; instead it just questioned each marketer as to whether they would be increasing or decreasing their budgets in each area or maintaining the status quo.

So, for example, for online marketing (excluding social networks and search) the survey showed that 95 percent of the companies would be maintaining or increasing their budgets. Only 5 percent envision a budget cut.

That's good for online magazine publishers.

On the print side, the picture is not as rosy. Twenty-five percent of companies anticipate reducing expenditures for print advertising. While poor in comparison to online, this is not as bad as some soothsayers have been predicting. After all, 75 percent are either holding the line or increasing their budgets for print. In fact, it's practically a wash. The number of companies reducing print expenditures roughly equals the number that are increasing them.

Search Engine Marketing, Social Media Advertising, and Content Marketing

Three other advertising channels would seem to be our direct competitors for ad dollars: search engine marketing, social media advertising, and content marketing. That's generally consistent with what the Editors Only survey commenter had to say.

Only 5 percent of marketers using search engine marketing expect a decrease in that budget item. Ninety-five percent of budgets are staying the same or increasing. For social media advertising 7 percent are planning a cutback; 93 percent are staying the same or increasing. Facebook is the largest player in that category. The cutbacks may be related to the large amount of negative publicity Facebook has been getting lately.

The flight from content marketing is the lowest of all. Only 2 percent are cutting back. That leaves a commanding 98 percent of marketers that are either maintaining or increasing budgets in that area.

I view companies spending more and more of their budgets on content marketing as the greatest competitive force for magazine publishers to address. The two other competitive categories, social media and search, each have problems of their own. With social media there are growing privacy concerns and distrust on the part of users. With search there are troubling, unanswered questions about click fraud. And the jury is still out on the long-term value of the clicks.

Content Marketing: A Text-Based Advertising Modality

So we face off against content marketing. That hearkens back to the EO survey respondent's comment about native advertising. Roughly speaking, they are both variants of the same thing: advertising that is basically text based.

It's worth asking why text-based advertising has arisen as a significant modality. Social media and search are based on technological developments that were not available to publishers in earlier times. But what's really new about text advertising?

The next question to ask is whether it is really efficacious. Text has been around for a long time. If it were such a great way of advertising, why was it not discovered and exploited before now?

I've worked with many publishers who have from time to time produced supplements that contain mostly advertiser-furnished content. Often those supplements are theme or event oriented. But I've never seen them produce really outstanding results for the advertisers. In many cases the pitch for selling that kind of advertising appeals more to the vanity of the advertiser than to any expectation of a concrete result.

Maybe I'm wrong, and I invite readers to correct me if I am, but I see no time-tested evidence to support the newfound enthusiasm for text-based advertising.

If that's the case, it leads to the final question here: Why are advertisers moving in the direction of text-based advertising, whether it be content that they develop and distribute on their own or native advertising that appears in the pages of our magazines?

I'll suggest an answer to that question in a future issue.

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Text-to-Audio for User Engagement

Posted on Saturday, September 29, 2018 at 9:20 PM

In the news: How some publishers are using text-to-audio formats to engage app users and appeal to younger audiences.

In an effort to keep its app users engaged, publishers such as Bloomberg Media and the Financial Times are employing text-to-audio technology. Bloomberg in particular is capitalizing on the surging popularity of podcasts, particularly among younger people. Citing statistics from the UKs Radio Joint Audience Research, Lucinda Southern of Digiday.com writes, "Two-thirds of new podcast listeners are aged between 16 and 35. And new users are growing: 21 percent of podcast listeners have started listening in the last six months."

Elsewhere, the Financial Times has been using text-to-audio articles for a year now. Southern reports that the initiative has been successful and that "people are coming back regularly to listen."

Read more about Bloomberg and FT's text-to-audio initiatives here and here.

Also Notable

Marc and Lynne Benioff Acquire Time Magazine

Billionaire couple Marc and Lynne Benioff purchased Time magazine earlier this month for $190 million, reported AdAge.com on September 16. Marc Benioff will run the magazine independently of Salesforce, the tech company he founded and continues to run. Read more about the acquisition here.

Print vs. Instagram Ad Disclosures

Katie Notopoulos examines the rules of print magazine versus Instagram advertising disclosure rules in a recent Columbia Journalism Review piece. Summing up the stricter FTC disclosure rules for celebrities who post photos of free or donated products on social media apps such as Instagram, she writes: "Use clear language like #sponsored instead of #sp. Don't use squirrelly industry terms like #partnership. Don't hide your disclosure at the end of a bunch of tags or after a long caption that cuts off when viewed in the feed. Don't simply tag the brand. You must disclose any 'material relationship' with the brand or product you're posting about. That includes if you were paid to post about it, were given a free product to review, or received a free products, services, or accommodations. The same applies if you're a celebrity who has a multi-year endorsement deal with a brand, or even owns part or a whole of a company." Read more here.

Emergent Models in B2B Publishing

Tim Hartman, CEO of Government Executive Media Group, sat down with Kayleigh Barber of Folio: magazine earlier this month to discuss what's happening in B2B publishing. In the interview, he identifies lead generation, digital products, and data/technology investments as his company's key emerging business models. He also encourages companies interested in exploring content marketing to develop relationships with key partners and agencies. Read the full interview here.

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