Advertising

Kill the Backfill (with Native)

Kunal_GuptaIt’s established; native advertising is a viable revenue opportunity for publishers and one of the best content tools for marketers looking to create brand awareness and engage with audiences. What isn’t established? How to scale this revenue opportunity without devaluing it out of relevance (like we did with the banner). We are seeing increased chatter and industry buzz about programmatic native advertising networks and exchanges. This picture looks all too familiar though and as I’ve written before, it’s quality which will continue to drive the value of native advertising.
Here is a controversial idea: If you don’t sell it, turn it off and kill the backfill (with native).
I can tell your muscles are tensing up, so let me explain. I’m not suggesting to eliminate remnant or unsold inventory. Real-time bidding and programmatic ad platforms are a growing part of any modern publishers business, and it would be naive to think you can simply turn off a consistent revenue source on a whim. What I propose is you turn off the mindset when it comes to your native ads business.
Native advertising inventory is high-value and needs to only be available to a marketer by calling a publisher sales rep directly. The moment this highly valued in-stream inventory is made available through a third-party network or exchange is the moment the inventory will be devalued (and it’s then a race to the bottom).
I asked a few of our customers what they think of this idea to “kill the backfill” with native advertising, here’s what they told me:
Andrew Saunders, Chief Revenue Officer at the Globe & Mail: “It’s all about quality for the Globe & Mail’s audience, and our approach has worked really well to maintain a high-level of content being promoted through native inventory. We would not want to lose sight of that by allowing third-parties access to this premium inventory across desktop and mobile reserved for our valued clients.”
Nigel Leigh, Head of Commercial Platforms at the Telegraph: “Our creative solutions team have been selling award-winning bespoke content solutions to clients for over a decade in digital. We pride ourselves in offering clients a premium service that attracts a quality audience to their content. This means we utilize our native placements to our best abilities and don’t dilute the placements with non relevant advertising.”
Lindsay Nelson, VP Integrated Programs at the Slate: “Our clients see tremendous value in working closely with our team to execute high-impact content programs, which native promotion of content is a key component of. The value proposition for any premium publisher would break down pretty fast if they thought of native as yet another type of inventory that needed to be filled 100% of the time.”
Building a native ads program with the end purpose of creating a reservoir of empty placements which need to be simply “filled” with content is squandering the potential a premium publisher holds. Instead, every sponsored content execution should retain value and add more premium selling points instead of boiling the concept down to it’s lowest common denominator and selling it to the first bidder.
Why am I so adamant about this issue? Because I fear a product with an exciting future could become obsolete if a traditional digital mindset creates a price war between publishers racing for the lowest rates. Eric Picard, CEO of Rare Crowds, writes about publishers getting addicted to “bad” revenue, becoming dependent on a quick monetization method without thinking about how it may affect future value.
We are afforded the opportunity to see how this played out with display advertising and can thus make a sober decision on native advertising’s future for premium publishers. Avoid temptation and kill the backfill before it begins.
Kunal Gupta is the CEO of Polar (formerly Polar Mobile), a computer software firm based in Toronto. Polar originally focused on mobile, but has rebranded to expand its mission, now specializing in native ads. He has been recognized as a Top 30 Under 30, a United Nations Global Citizen and Ernst & Young’s Entrepreneur of the Year. Look for his post on The Makegood the third Wednesday of each month.
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