As the Sunday People launches a seven-day website funded entirely by native advertising, Angela Haggerty asks whether the online news industry may have finally found a sustainable financial model.
A brand new seven-day website from Trinity Mirror piloting native advertising as a sole stream of ad revenue
is not insignificant, and the struggling industry clearly thinks there may be something in this concept. The Sunday People website has been dubbed by some as ‘Buzzfeed for adults’, and as that website passes the 80 million unique users mark the comparisons are far from unflattering. But the very definition of native advertising has proven tricky to nail down, indicating how the concept is in a period of evolution. A recent report from AOL UK managed to find some consensus on a definition and concluded that native advertising was “sponsored content, which is relevant to the consumer experience, which is not interruptive, and which looks and feels similar to its editorial environment”. And with that evolving definition the Sunday People appears to be joining the ranks of the likes of the Huffington Post in buying into native advertising as a possible saviour of online journalism
. Sue Douglas, head of Sunday brands at Trinity Mirror, says that if the journalism industry is realistic about funding a future that provides a quality output for readers, publishers must begin trialling new financial models. “I think that we do have to reinvent the wheel here and look at how we can have a different relationship with our prospective advertisers,” Douglas explains. “It’s more of a partnership – partnership with business is the essence of native advertising. “This isn’t advertorial at all; it’s about collecting and curating the stories that you want on your site, and then within a story is some kind of serendipitous news element that lends itself to a product or some other priority that you know a business you have a relationship with has and you can utilise that. “You might be doing a story about appalling weather, and so right down at the bottom you can have a link for Hunter’s wellies, providing people with the means to buy a relevant product if they want to.” A recent survey from Hexagram found 62 per cent of publishers are offering native advertising
, which currently represents an average of 20 per cent of revenues and is expected to increase to 30 per cent within a year. The report showed that 84 per cent of publishers believe that native advertising adds value for customers, and the concept is proving an unsurprising hit with brands (78 per cent) and agencies (81 per cent) too. However, native advertising’s natural predecessor, sponsored content, was viewed less positively, by only 56 per cent of brands and 50 per cent of agencies. The Huffington Post, the Guardian and the Wall Street Journal are all already hosting native advertising, and it is flagged as such in a number of different ways by each title. The Huffington Post uses the tag ‘sponsor generated content’, while the Guardian goes for ‘in association with’. While the People website has been likened to Buzzfeed, which has been put on a pedestal as an exemplar of native advertising done well, the popular news and entertainment website sees a clear difference between its offering and other publishers, and Will Hayward, Buzzfeed’s European VP of advertising, is far more reserved about the new wave of native advertising. “Native advertising is a slightly loaded term,” he says. “I think the textbook definition is ‘advertising that matches the format of the surrounding content’. True, Buzzfeed’s partner posts don’t jar against the rest of the content, but we only see this as a small part of our value proposition to brands. “The real value is in creating really awesome content that simultaneously brings to life a brand’s product, core values or marketing strategy, and is good enough that our audience might voluntarily recommend it to their friend. That is where we stand out against other operators in the market, and that’s why so many brands are rushing to be part of what we do.” The native advertising proposition from Buzzfeed and the People differs in a crucial way, and in a way that Hayward is keen to point out. According to Sue Douglas, native advertising can be built into editorial content – which will always be chosen entirely on its own merit, she insists – when it’s relevant, rather than being completely separate, specifically created standalone content. “We’ve been talking to a number of partners, looking at packaging with existing news and stories that we’re doing and how they can benefit from our users’ interest in a story. It’s really about contextualising. It’s not even advertising. It’s contextualising business propositions, products and services within a story that you’ve presented.” But that approach carries with it a risk that the editorial integrity of a publication becomes compromised in the eyes of readers, and that questions will inevitably arise over how independent of commercial motives editorial selection can really be when a website’s financial model depends on content that can be commercialised. Hayward says that while Buzzfeed has been a leader in native advertising, there has always been a clear line between editorial and advertising, and, despite Buzzfeed being held up as the native advertising success story in action, he warns against taking the concept too far. “If you think that the core proposition is going to be blurring the lines between editorial and advertising, you’re going to annoy your audience, who are then going to feel badly about your brand partners and the net result is an irritated audience and brand damage,” he says. “I think what is happening is that companies who are pretty well established and really struggling with the shift to digital think that if they blur the line they can maintain their audience but advertisers will like them more, but I think that will cause issues. “I find it incredible that any credible media company can think that blurring the lines between the two is the solution. If you put emphasis on blurring the line between editorial and advertising you have no future in this market space. You might have a future for six months or a year while there’s a buzz about it, but if you think the solution is the word native you’re on the road to disappointment.” Hayward says that not only is the line between editorial and advertising made clear on screen at Buzzfeed, the line is clearly marked within the company. The editorial and advertising teams sit at opposite ends of the office, he says, and there is no possibility of that relationship becoming any closer. It’s a contrast to the People’s approach. Douglas believes that journalists are capable of “thinking in quite a lot of different contexts” in relation to a single story and she says that while, as a woman from a journalism background, she understands the uneasiness that changing the traditional model of opposed editorial and advertising departments may initially create, the journalism industry has no choice but to explore different revenue streams. “There’s no point in us thinking that without a paywall – and I don’t think a paywall works – that we can have the best teams of journalists with the best content, great investigative stories and really entertaining copy. How are we going to afford to do any of that without charging the consumer? “We have to work out a new revenue model. It applies as much to music, art and books; how do you price tag ideas and intellectual property? You can’t, because people don’t pay for it. But you can by association, by creating revenue from people just being interested in the content.” Douglas isn’t the only one thinking along these lines. At the recent Society of Editors conference in London, former CEO of Local World Steve Auckland said it was time for editors and journalists to take a more active role in helping their publications sell advertising. The launch of The People website is yet another reminder that the online journalism industry is struggling to carve a way forward. Bringing editorial and advertising closer together within content will be viewed by some as the desperation of the industry revealing itself by indulging in what would once have been the unthinkable, particularly in news content. For others, altering the traditional relationship will be seen as the kind of bold step away from a traditional journalism that is needed, and a sacrifice worth making to ensure a future for the industry.This article first appeared in the 13 December issue of The Drum. Click here to order your copy