Native advertising: Another false messiah?

I’ve been waiting for this: the leak in the native advertising balloon.

Tablets were going to save the news business. Not so much. Paywalls were our salvation, damnit. Nope. Native advertising is our future. Think again.

Digiday reports on the latest problem with the native advertising strategy:

Digital ad sales intelligence platform MediaRadar said the average renewal rate for sponsor content this year is 21 percent. Meanwhile, native ad tech company Polar recently described renewal rates as “weak,” with 40 percent of the publishers it surveyed showing renewal rates below 50 percent.

Native advertising isn’t going to cure all our problems because:

1. The ROI is debatable. Says Digiday: “Behind the low renewal rates is the fact that advertisers are uncertain about the return they’re getting on native advertising.” This has been my worst fear. We give the advertisers what our standards and ethics forever forbade — confusing our readers about the source of content — and then the advertisers wake up and say, ‘Well, that was fun. But we’re bored with that. What can you sell us next?’ Except with badly done native advertising, we’ve already sold our brands, our souls, our seed corn. We have nothing left. Jack, you gave away our only means of support for what? Magic beans?

I have long wondered whether native advertising would do what advertising is supposed to do: drive sales. What is the efficacy of replacing five-word banners with 500-word stories? Perhaps we are beginning to find out.

2. Competition is rushing in. Digiday: “Three years ago, there were about 15 companies helping brands produce sponsored content, according to MediaRadar CEO Todd Krizelman. Today, there are more than 600, and the number is growing.” I have long said that in media need to compete with creative agencies but we can’t imagine that they won’t fight back. Content is a commodity. Anybody can make it. That is the key lesson of the internet for media. So we surely couldn’t believe we’d hold onto the business of “telling brand’s stories” for long.

3. It’s expensive. It takes a lot of resources to make content for finicky advertisers.

4. It’s no longer enough to write a “brand’s story” and put in in our editorial space (barely camouflaging it as an ad). Media’s audience is insufficient. So media has to spend money (a) placing ads elsewhere to drive traffic to our native ads, (b) placing the native ads we make at other media sites, and (c) trying to buy social traffic. That, too, is expensive.

So what is the profit margin on native advertising after we are left marketing our services to replace the clients who churn out, after spending a fortune on making native advertising, and after spending another fortune advertising the advertising? Native ad distributor Polar says it’s a high-margin business still and that’s good. But where do those trend-lines fall given the news above?

This is the moment where you say, “Goddamnit, Jarvis, you shoot down tablets, paywalls, and native advertising, not to mention programmatic advertising (because it commodifies media) so what do you expect us to do?”

Mind you, I am not against doing native advertising well. See Quartz, for example. I am in favor of media companies competing with ad agencies for both creative and media business. What I object to is the idea that this could have been our sole salvation, any more than our earlier magic beans, without embarking on the much harder work of reinventing ourselves.

Our only salvation will be to question *everything* about our mass-media business models as we enter a new reality, starting with the value of reach in an age of abundance and endless competition. Yes, reach matters but only if we have something of value to convert all those folks to. We have to shift from reach to relevance, volume to value. We have to rethink the essence of what news and media are. That’s why I wrote this: to begin questioning and exploring.

That’s also what I said to our incoming students at CUNY’s J-school last week. At the end of our week together, the students listened to voters about their needs in this election and their proposed solutions didn’t look like content-based mass media at all. They’re all journalists but they are learning to question their assumptions. We need to do the same with business people and reinvent what they do. Instead, we’re grabbing the deck chairs on the Titanic hoping they will act as flotation devices.

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Content.ly — a reputable native advertising company (with whom we are doing at study at CUNY) just released some further data on media’s behavior. 68% of publishers have editorial staff make native advertising. Nooooo! 45% think the biggest threat to native advertising is the lack of separation between church and state. Jeesh.

From Media to Memes: Lessons from Occupy Democrats

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I want you in the news business — and politics and brands — to learn from two media and political geniuses for the social age you’ve probably never heard of. They are Rafael and Omar Rivero, 29-year-old twin brothers and the founders of Occupy Democrats, a Facebook page that specializes in the creation of memes like those above and below: a gif with text and photos or a video (the “veme”), containing information, opinion, and a call to action. Thus they feed conversations all over the net. Their Facebook page has 3.5 million likes, adding 100,000 a week. The average meme reaches 1 million people. In total, Rafael Rivero says, they reach between 100 and 300 million impressions a week.

Oh, they also have a web site with posts and articles, like a media company, but that’s frankly “an afterthought” — even though it’s the web site that has the advertising that brings in high five-figures of income a month, which enabled the brothers to quit their work and hire help: “five of us in a living room.” The point of their enterprise is not making content or building a destination, in media terms. It is “affecting the national conversation.”

“We want to give people the ammunition to engage in meme warfare,” Rafael told me, “giving people the fodder to win the battles and ultimately the war. The battles are fought and won or lost on social media.” The battles are also informed or uninformed there and that is why news media should pay attention.

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The reason I called Rafael is because I believe Occupy Democrats demonstrates a vital skill we must learn in media: feeding others’ conversations with information and arguments, adding journalistic value to the flow of information the internet enables. When I attended Vidcon, I saw that for YouTube fans, content is not a destination but a social token — something that speaks for them or informs and provides fodder for their conversations. We in media need to learn how to do that: how to take what we make to the people we serve, how to do that in a manner that is native to the platform and use case where these people are, and how to add value to their conversations and thus be valued for our contribution. Occupy Democrats does that. Sure, it’s partisan at its core. It’s not journalistic. But it has lessons to teach journalist.

The brothers launched Occupy Democrats a month before the 2012 election in response to the success of the Tea Party and to make up for what they saw as the weaknesses of the Occupy Wall Street movement — “outside the system, aggressively leaderless.” They started “just as a hobby, to be honest.” But it took off and started bringing in enough money that Omar, a Cornell graduate, could quit his job in finance and Rafael, a Swarthmore graduate, could give up his work running a vacation rental company and a furniture assembly business. “I always had an inclination to use the internet to fund my life,” Rafael said. “Ever since I was little, launching online businesses and online websites.” That’s the other thing media has to learn from them: entrepreneurship.

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Rafael says the hardest part of their job is selecting what to make into a meme. “When I look back at the first memes I made on Facebook, damn, I sucked. Media companies: they suck, too.”

Define “suck.”

“The meme must tell the full story. You can’t assume people know anything. You have to be able to tell the entire story in as few words as possible. You have to plug into the zeitgeist. The text has to pop and be 100 percent readable from 30 feet away. The image has to be compelling. The arrangement — it’s very hard to describe. It’s very intuitive. The statue is already in the block of marble and the sculptor just uncovers it. The meme is already there. You just have to find it….”

You might make fun of making GIFs as a media artform, just as I made fun of one of my CUNY colleagues some years ago when he said he wanted to teach the making of animated GIFs. I was wrong, dead wrong. These little media nuggets are portable and carry value. Rafael thinks hard about what people will do with them. “There’s something very personal about sharing a graphic on Facebook,” he said. “You’re not sharing with one person, with five people. You’re sharing with pretty much everyone you’ve met through your entire life. It says, ‘This speaks for me. This is how I feel on this issue,’ often a very controversial issue. People in the past were hesitant to discuss politics in person…. People have become much more willing to engage in political discussion because of Facebook. We give them the tools to do that.”

Yeah, I know, sometimes you wish people didn’t discuss politics online. But they do. We in journalism have an opportunity and an obligation to inform that discussion. And we in media have clearly done a bad job of that. So when you hear uninformed discussion, think about blaming us first.

Facebook et al give us new tools to do our job. Sadly, we keep thinking they exist to distribute our content, to drive traffic back to our sites, to generate page views and reach. When Facebook tweaked its God Algorithm a few weeks ago and announced the principles behind it, it was really trying to teach us in media that — though Instant Articles are nice — the real way to succeed on the platform is to give people things *they* will use in *their* way.

Occupy Democrats teaches us to do that. It also teaches us new ways to reach more people. Their claimed 100–300 million weekly impressions “puts some of the old media horses to shame, leaves them in the dust. It’s just insane,” Rafael said.

But reach isn’t everything. Damnit. Relationships matter. Impact matters.

I asked Rafael what he knows about the impact they’re having. So far, he sees it in terms of who’s copying him. “I created so much viral Bernie Sanders material when no one had any idea who Bernie Sanders was,” he said. “Someone in the Bernie Sanders campaign woke up and thought, ‘we can make our own memes.’ It can’t be coincidence that they copied our style. Sometimes when I get drunk I tell people I created Bernie Sanders as a political force.” He’s joking. In any case, Rafael is right when he says: “Bernie Sanders was basically the meme candidate.”

(By the way, the brothers were split politically: Rafael for Clinton, Omar for Sanders; now they’re both #withher. And by the way, the brothers are dual citizens of the U.S. and Mexico and so fighting Trump is extra delicious: “He fucked with the wrong pair of Mexican twins.” )

I was curious whether the campaigns have come to Occupy Democrats for help. Someone high in Sanders campaign wanted them to share Bernie’s memes. Rafael is not complimentary of the memeing in the Clinton campaign but he says they are talking with someone there. The campaign runs weekly calls for folks like these, sharing their messaging — that is, giving guidance rather than asking for it. The DNC? Nope. If they were right-wing, Rafael believes, the RNC would fund them.

What interests me more is whether media companies have come to the brothers to learn at their feet. One innovative company — Fusion — did because of the data they saw on social-media tracking service CrowdTangle: “Who the fuck is Occupy Democrats and they’re eating everyone’s lunch.” There was talk of a TV show but remember that the brothers are less impressed with big media than they are with Facebook. “We already are pretty busy. We didn’t see that it would add that much value to us…. The old-media landscape was what was said on Meet the Press. Now you’ve got to control the media narrative on Facebook.” In any case, points to Fusion and Univision.

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So how should news organizations incorporate these skills? Should The Washington Post have a meme desk? Sure, it should. The Post is hiring two full-time producers for Facebook Live alone. Others are hiring devoted Snapchat producers. Lots of media properties have email newsletter authors. More and more, I see calls for platform-native content creation (and that is making us ask questions about how we teach skills in a journalism school).

The problem with much of that so-called social-media work is that the goal is still to drive traffic back to the media site and that will be the case so long as we try to prolong the life of the volume-based mass-media business model and depend on volume. If we instead judge our value on how well we inform people and how much we help them solve their problems and meet their goals, then we will go to wherever they are and use the tools at hand to deliver value the best way we can.

Thus the meme desk would not create promotions for articles on web sites. It would not be an arm of the audience development department. It would not identify trending stories and jump on them by copying those stories. No, the meme desk would start by seeing what people need to know: what are they curious about or wrong about, what information do they need to know, what are they already talking about and how can we improve the quality of those conversations journalistically, with information, fact-checking, explanation, evidence, news? Then the meme desk would teach every journalist to do this and put itself out of business.

I was talking about all this today with tech journalist Charles Arthur, whom I’ve worked with at The Guardian. When I said that the newspaper front page and home page are dying because hardly anyone is going to them — demonstrating a lack of demand for our vaunted “news judgment” (for they exist to promote more than to summarize and inform), I also said the only exciting page 1’s I see these days are from New York Daily News editor-in-chief Jim Rich, who has reinvigoratec the form. Right, Charles said. That’s because they’re memes. Right.

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Dear Morning Joe,

I watch or listen to you every morning and over the years have enjoyed it. But during the rise of Trump, you infuriated me. You took pride in seeing Trump’s potential to capture the nomination while everyone else did not. But you could not see then what so many others of us could see: that your friend (your word) Donald is uninformed, demagogic, bigoted, mean, unstable, possibly insane, and certainly unfit to serve in the highest office in the land.

I am glad, very glad that on this morning’s show, you recognized all this about Trump and said so — and that you all went further, trying to get Republican leaders, including at least one at your table, to repudiate their candidate for president.

But what if you had seen Trump’s potential not just for votes but also for danger from the beginning? Would the Republican Party and the United States be in this precarious position today? This isn’t funny anymore. It’s not show biz anymore. It never was. You said as much this morning when you questioned Ret. Gen. Michael Hayden about how easy it would be for President Trump to launch a nuclear missile out of pique — hearing only answers that gave no comfort. Worse, you revealed that in a one-hour briefing with a foreign affairs expert (when was that, Joe?), Trump asked three times why we (he) can’t use nuclear weapons. This is serious. It always has been.

When it mattered most, journalism failed utterly to inform the public about the clear and present danger of a demagogue and an unstable, unfit candidate getting to within a step of the White House.

Now I’m not trying to blame you for Trump and his rise. But because I watch you in the morning over the other guys, I need to use you to spark a discussion about what we must rethink in political coverage in American journalism and media.

For years, media natterers like me have lamented the horserace coverage of elections — particularly presidential elections — with journalists taking pride in predicting winners. This year, I’ve been frustrated to hear journalists (often on Morning Joe) taking it upon themselves to tell candidates what they need to do to win — that is, acting more as campaign consultants than correspondents. In both cases, this is a matter of journalists wanting to appear savvy, a syndrome NYU Prof. Jay Rosen diagnosed two presidential races ago. But that is the least of our problems now.

When it mattered most, journalism failed utterly to inform the public about the clear and present danger of a demagogue and an unstable, unfit candidate getting to within a step of the White House. Friend Rosen has argued that we in news media must bring new worldviews to this new situation. Yes, and new tools.

I often hear complaints about the ignorance and bile that characterize the public discourse in politics today. We blame the public for that. OK. But the fault for an uninformed public also lies at the feet of those whose job it is to inform the public. We in news and media are doing a terrible job.

Rather than predicting who will win — and calling the day done — journalists must concentrate on revealing the qualifications, experience, policies, assets, and deficits of those running so the public can judge: the profound job interview. In any rational equation, it should have been easy to question every such aspect of Donald Trump’s candidacy. Back to you, Morning Joe: Trump called in constantly. How often did you demand full and cogent answers about his policies: How will you do everything you promise to do. “How?” was the most under-asked question of this campaign. You say you know him. Surely you could have revealed his obvious narcissism if not his instability to the nation. That you did not — and that media as a whole did not — can only be a measure of our failure. Yes, sure, you’ll put Hillary Clinton through a job interview as well. But don’t even think of trying to talk balance: a few minutes on Khan and a few minutes on email. There is no such thing as balanced coverage of an unbalanced candidate. Because you know Trump so well, Morning Joe, you could have led our field in asking him the toughest and most revealing questions. That is our job.

Falling to these frightening depths — and remembering that we’re not saved from it yet — is an opportunity to rethink how we do journalism, conduct elections, run political parties, and govern. Let us get at least that much out of this fiasco.

Facebookmageddon? Not so soon

Only time, experience, and data will tell, but I wouldn’t be throwing out Facebook strategies for news quite yet.

Two things happened today: (1) Facebook for the first time outlined the principles that govern its decisions — that is, its News Feed algorithm — about what to select and show you. (2) At the same time, Facebook tweaked — we don’t know how much — that algorithm to emphasize friends and family more and news less.

But Facebook has *always* favored friends and family over news content. It is a *social* site. That should come as no surprise to anyone. The only question is how much weight each has.

Indeed, when Facebook’s execs told me their priorities in the past, they were (1) connections with people, (2) entertaining people, and (3) informing people. Its document today reversed the order of 2 and 3 in the narrative; I have no idea what the order is in the algorithm.

The shock at this news is, I suspect, a bit overdone. Says Farhad Manjoo in The Times:

Though it is couched in the anodyne language of a corporate news release, the document’s message should come as a shock to everyone in the media business. According to these values, Facebook has a single overriding purpose, and it isn’t news. Facebook is mainly for telling you what’s up with your friends and family.

Who the hell *ever* thought that Facebook’s single overriding purpose was news? No one. Ever.

So this is a matter of degree. It’s more transparent than it has been — which is what we have been asking for. It emphasizes that people want to talk to people on Facebook and if people want to talk about your news, you’re in luck. If they don’t, you’re shit out of luck. Always have been. Still are.

Let’s wait and see what the real data look like. And let’s follow Facebook’s example to serve people rather than merely serving content.

Getting Google and Publishers to Share Love — and Data

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This last week, in three high-level publisher summits in Europe, I saw tangible progress toward realizing what I think is the most important single opportunity that publishers and platforms have together: sharing data to benefit first our users and then our businesses.

For years, I have been arguing to publishers — including those warring with Silicon Valley — that what they should seek from the platforms is not cash (that isn’t “our money” the platforms are earning) or raw traffic (look at how the pursuit of reach über alles has ruined journalism) or throttling technology companies through government intervention (new copyright laws and antitrust investigations are not investable business strategies).

Instead, we should seek data: information about people — their interests and behaviors — that helps us build relationships of relevance of value with them.

When I said this to publishers, they either didn’t understand or they argued that the platforms would never give data to us. To which I answered: “Have you asked?”

When I said this to the platforms, they would kvetch — rightly — that our demands were too vague to deal with. And besides, they’d finally say after a few beers: “Your guys wouldn’t know what to do with the data if we gave it to them.” True that. But then I’d reply: “So educate us.”
Well, over the last week, I have seen real progress in having publishers get specific about their requests and I have seen a willingness from — so far — Google to engage.

My trip began at a Distributed Content Summit in Berlin convened by Axel Springer — which has led the war against Google in Europe — with 25 media companies from around Europe. I was the only American representative, assigned to provoke discussion with American bluntness. I told the group that it was time to shift from war footing to business footing and that the responsibility lay with us to get specific with our requests: What data are we asking for? How will we use it to benefit our users? What will we do with it? How will it benefit us? How will it benefit the platforms? Springer’s executives smartly turned this charge into an assignment: that every workshop led by the brands should come back with a project or test to propose to the platforms.

Some of us took the fruits of this work to the next event: the second annual Newsgeist in Bilbao, at which Google brought together about 150 news leaders for an unconference on the future of news. At last year’s Newsgeist some of us arrived asking for something specific: an open-source version of what Facebook had just announced, Instant Articles. We got AMP (accelerated mobile pages) as a result. Great precedent; high bar.

In Bilbao, we convened one session on what Google could do for news (and vice versa) and on the final morning we had another, getting far more specific and useful, on what collaborative A/B tests we could imagine, building on the discussion from Berlin. Here’s what the group came up with:

* How could Google use its knowledge about our users and our content to help us improve the recommendations we make to our users and thus their experience on our pages? We could also test how such data could improve conversion to subscription or membership, ad performance, and (when are we going to explore this opportunity?) commerce.

* If publishers passed their subscription/membership data to Google and Facebook, how could the platforms improve users’ experience (and our business prospects) there? That is, if Google knew I were a subscriber to Springer’s Bild, then when I come to Google Search or News asking for Formula 1 news, shouldn’t Google give some priority to Bild’s coverage, which I’ve paid for? That answers a constant request from pay-walled publishers to recognize their disadvantage in SEO.

* Obviously and especially in Europe, these ideas raise privacy concerns. The platforms could not pass over personally identifiable information. But they could pass over categorization of users: this is a user who belongs to a group that watches a lot of video or reads a lot of politics or tends to read long stories or looks at lots of short things in the morning, and so on. What that leads to is the need to build a framework for such categorization of users and content. If we build that together, it means that publishers could also share this data. And that answers Google’s plea that we not look only to Mountain View for help but also look to each other. (Coincidentally, German publishers just announced their own consortium to share what appears to be ad data to compete with Google and Facebook.)

bad ad* Collaboratively improving recommendations for content begins to look similar to the function of the recirculation engines Taboola and Outbrain, which send our users off our sites to the most irritating clickbait imaginable (example: left), getting the benefit of publishers’ data along the way. Every publisher I know hates the companies but loves the checks they send. It’s reach crack. Well, hmmm. Should publishers and platforms consider building their own, not-evil recirculation engine? Just asking. For some friends.

* Just to round this out, I also renewed someone’s idea from last year’s Newsgeist Europe for an API to Google News, which would enable publishers to curate news (somebody once said: do what you do best and link to the rest) and also to see where their own news fits in clusters of others’. The problem is that we don’t fully understand our content (once getting data about a user’s habits or interests, we will have trouble finding the right content to match it).

Then came the next event on the European Future-of-News Love Tour (t-shirts coming): a news publishers day convened by Google Play in London, where we continued the discussion and where I saw that Google executives are serious about responding to publishers’ now-more-specific proposals. The answers may not always be yes because of practicality or competition (the platforms are companies). And as the discussion widens, better ideas may emerge. Great. The discussion is launched.

I’ve been spending a lot of my time lately — in writing here and in meetings and discussions anywhere I can — to bring peace to the kingdom between publishers and platforms, from the U.S. to Europe to Latin America. As a result, individual publishers or groups are coming to me suggesting they want their own war or manifesto or list of demands. I have been arguing in return that it would be far more productive to find areas of mutual benefit to have strategic impact on our businesses. It helps me in that argument when I can point to real signs of progress such as what I’ve witnessed this week.

It is also important to note that the discussion with platforms is — and can only — move forward when product is involved, not just marketing, PR, or business development. In Silicon Valley, product is everything. Some top engineers at Google are beginning to get involved in news products and I was delighted to meet one at the London Play event (I wish I’d seen more such representation in Bilbao, not just to show respect but to foster mutual understanding and collaboration). Google’s response to the war in Europe was to establish a Digital News Initiative, and much progress has followed: AMP, a new YouTube player and deal, Newsgeist, the Google News Lab. I’ve quibbled that these are marketing and comms initiatives. But on this trip, a Google exec set me straight and said that status changed when Google CEO Sundar Pichai made news a priority. (I learned elsewhere that the cool-kid way to say this is that news became a Google OKR.)

Meanwhile, down the road at the Facebook ranch…. News has long been a product priority there. Some of their best product-development talent has been working on things that have news at the core: Instant Articles and Facebook Live, to name two. So in product, Facebook has been ahead of Google but Google is catching up. In the arena of building relationships with publishers through events like those in Bilboa and London and groups like the Digital News Initiative, I’d say Facebook needs to catch up. (There was at least one session just about Facebook at Newsgeist.) There is much that Facebook can do to share data in similar ways and improve the experience and relationship of news brands and users on Facebook and off. Publishers can also make better use of Facebook to develop relationships, serve communities, and generate interest data there. I have more ideas about this that I’ll leave for another day.

In the end, this effort is not about warring are even about negotiation. This is about collaborating on the reinvention of news. What gives me the greatest hope after this European tour is that I saw the carcasses of many a sacred cow lining the road from Berlin to Bilbao.
I heard a surprising consensus that media’s reach strategy is a loser, or at least that we’ve lost it. Seeking audience and page views for their own sake does not build real value; it’s highly competitive; it rewards our worst instincts as editors and readers.

To replace it, many publishers are, of course, seeking consumer revenue through subscriptions and (I hope to see more of this) membership and commerce. As a result, they seek to build more valuable products that drive engagement. That’s a step in the right direction.

I was most impressed at Springer’s event in Berlin when most of the participants did not drag their heels in the hopes that they could fight content distribution and count on always driving audience back to content on their websites as destinations (is each italicized word becoming outmoded?). The Springer meeting was invaluable in getting publishers to share information about their goals and experience with distributed content. No one had blinders on about it.

In all these places, I heard editors and publishers enter the confessional to admit that distributed content tells us our sites are bad and ad blockers tell us our experiences are awful. Confession is good for the soul and strategic development.

This is all positive. News won’t survive and succeed by ignoring the platforms or trying to trip them. The platforms need the authority and originality that news organizations can bring. Together, we can finally start to challenge our assumptions about news and each other and set about the more critical task of reinventing news for this new age — that is, serving the public better. To peace in the kingdom.

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Disclosures: I do not accept pay from Google, Facebook, or any platform. Being a poor prof, I do take travel expenses when I could not otherwise attend some of these events. For this trip, Google and Springer each paid a share of my flights and hotels as will the Tow-Knight Center, which I direct. That center is in part funded by the Knight Foundation, which is also a partner in the U.S. versions of Newsgeist. I have consulted with and spoken at some of the news organizations at these events.