Can the rise in in-app video and native save publishing?
GlobalWebIndex reports that a typical internet user dedicates over 50 minutes a day to online press/news — 12 minutes longer than they do with printed media. But it’s not just digital natives driving this growth. 67% of diehard 65+ year-old print readers are now accessing news on their smartphones. That’s up 24% in just one year!
Mobile is where it’s at, but, surprisingly, it’s not the mobile web. According to eMarketer, US adults spend close to three hours a day using smartphone apps compared with only 34 minutes on mobile websites.
It also forecasts that US adults will devote 20 minutes daily viewing in-app video as opposed to 11 minutes on the mobile web — concurring with the Interactive Advertising Bureau (IAB) that found apps overtaking browsers as the access point for mobile video across all regions.
What about news apps?
Despite the rise of app abandonment, Reuters reports that news apps are steadily growing in popularity and use around the world.
I found that particularly puzzling given that Adobe’s 2017 study stated that social media is the primary outlet for news.
How can both studies be true? With between 15-20% of publishers’ traffic coming from social media, I would suggest that social is the news discovery mechanism for most readers who eventually end up on publishers’ websites or apps — apps that retain the interest of users much longer than the mobile web.
Perhaps that’s why, even the stalwart web app advocate, Financial Times, which walked away from Apple’s app store six years ago, has recently done an about-face on the issue. In August 2017, it launched a new iOS app they cite as “a key way to drive engagement” and something their customers were specifically asking for.
What news apps are popular with news consumers?
News apps come in multiple forms from individual branded editions, to newsstands, to pay-as-you-go, to all-you-can-read, and social media platforms. But not all news apps are created equal.
The most popular news apps, aggregators, are those that enable today’s promiscuous audiences to:
• Explore content from a multitude of trusted sources (including in-app video) • Provide the ability to engage content creators and other users
• Offer personalized, algorithmically-generated newsfeeds which unlock engaging content that might otherwise go unnoticed — the curation method preferred by the majority of today’s news readers.
With these news aggregation apps, quality news discovery goes from being highly chaotic to being highly personal, which in turn, is highly convenient.
Now check out what most newspaper and magazine publishers’ apps look like. With a few exceptions, most branded apps typically:
• Include only a single source that locks a user into a monogamous relationship, confining access to a limited amount of content (many without in-app video)
• Are curated solely by an editor, not an algorithm
• Block a user’s ability to communicate with journalists or editors through commenting
How do publishers reconcile their belief that they can own the relationship with a reader with the realities of what today’s news consumers really want? They can’t.
A Nielsen study commissioned by the Knight Foundation provided insights into this publisherreader disconnect when it compared the top mobile news apps by audience. News aggregator, Flipboard, is the only one in the top 10 (e.g. USA Today, BuzzFeed, Fox News, reddit, CNN, Google News & Weather, SmartNews, etc.) that steadily increased audience over four years, while audiences for the other top apps flattened.
So apps are important, but where’s the money?
With only 13% of people on average paying for online news worldwide, the chance of making money on subscriptions alone for most publishers is slim.
But all is not lost. Market researcher, IHS Markit reported that 2016 in-app ad spending was 90% of the total mobile advertising spend in North America and Europe combined. Within that, what is, or should be, very interesting to publishers is the growth in “native” in-app advertising.
This rise in native in-app ad spending is a huge opportunity for mainstream media. Unfortunately, according to IHS, despite the data that supports that argument that people spend more time in apps and that the usage of apps is increasing, publishers are still largely dependent on small revenues from the mobile web, with up to 90% coming from that source.
This is a massive lost opportunity that publishers must address quickly if they expect to compete for future mobile ad dollars that are poised to enter the pockets of the digital ad duopoly. In 2017, Facebook and Snapchat spun off mobile incubators and Google added native ads to AdSense.
Now some publishers may see entering the “dark side” of sponsored content as an affront to their journalistic integrity, but diversifying a business to include advertising doesn’t mean corrupting one’s core competencies. If a native ad tells a story, is of high quality, useful to the reader, clearly labeled as sponsored content, and within a trusted publisher’s environment, consumers will accept it.
Native ads result in higher lift and engagement than other ad formats — a win-win-win for the consumer, publisher, and advertiser. So it’s no wonder, Forbes Media launched its first native ads in 2010 and today its BrandVoice content marketing arm accounts for 30% of the company’s revenues.
Other top-tier publishers are also snapping up marketing agencies at an unprecedented rate. The Financial Times bought content marketing studio, Alpha Grid, The New York Times acquired HelloSociety and Fake Love. Vice, looking to reinvent itself, purchased Carrot Creative; Time Inc. and Viant picked up Adelphic.
But far too many other media executives don’t seem to be prepared to take money from their web and print budgets (short-term revenue streams) and invest it in the long-tail potential of in-app native. To all of you who belong in that group, I highly recommend you read this article; it may make you think twice about that decision.
The road to riches is paved with in-app native
Over the past decade, there probably hasn’t been a better opportunity for publishers to unlock new advertising revenue streams than what mobile apps and in-app native advertising offers today. Done right, mobile apps can be very lucrative — last year iOS and Android app publishers made over US$89 billion.
But just building individual branded apps and adding video and native advertising to them isn’t going to guarantee success.
Author and futurist, Ross Dawson said in his keynote address at INMA World Congress in 2015 that the future of news = trusted aggregation + community + commerce.
He was right then and still is.
Today, people want choice, the ability to connect with others (including editors and journalists), and to contribute to the rest of the community — all within an engaging and algorithmically-driven content discovery app. If you give them that, commerce will follow.
So what’s holding you back? Maybe we can help. Let’s talk!