Can the rise in in-app video and na­tive save pub­lish­ing?

The Insider - - CONTENTS -

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!

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