For new media, the time of reckoning is now

Social media, fake news and digital advertising all have at least a couple of things in common, and they are not flattering.

Firstly, they are not credible, according to the German government which has just presented a draft law that would impose fines of up to €50 million on social media channels that fail to delete fake news.

They are also under scrutiny from the world’s biggest advertisers who argue that CTR, an acronym for click through rates, and viewability, a non-word coined by Silicon Valley’s golden boys to describe the extent to which digital ads can actually be seen by consumers, are, well, not credible enough. Not anymore, at least.

P&G and Unilever lead the pack of the newfound antipathy towards social and were recently joined by the supremo of WPP, the world’s biggest advertising network, who, in a recent LinkedIn post sided with advertisers’ concerns about the diminishing impact of their digital spend, quoting a study that revealed that newspapers can increase the overall effectiveness of an ad campaign by 300 per cent.

This is quite a statement, given that WPP had informed shareholders that it had set a target of 40-45 per cent of revenues to be derived from digital in the next five years. And all that in a year predicted to see absolute global parity between internet and traditional media ad spending.

For the digital advertising industry the irony here is as obvious as a twist in a Greek tragedy, the timing as accurate as a Swiss watch, and the warning signs as ominous as the thunder of an electric storm.

Headwinds

They can’t claim they didn’t see the headwinds coming though. A brief online search typing the right keywords is enough to reveal a wealth of information about the pitfalls — factual or fictional we may never know — of internet advertising and online news validity.

As early as in 2013, Facebook estimated that between 5.5 per cent and 11.2 per cent of its 1.23 billion accounts were fake. When extrapolated and projected to today’s 1.86 billion users, the higher-end estimate would put the total number of Facebook fake accounts in 2017 at over 208 million. The rate of engagement among a brand’s fans with a Facebook post is 7 in 10,000. For Twitter it is 3 in 10,000.

According to other sources, only 44 per cent of traffic on the web is human, less than one person in a thousand clicks on a standard banner ad and over half the display ads paid for by marketers remain unviewed. Yahoo itself admits that one bot-net can generate 1 billion fraudulent digital ad impressions a day.

Social media platforms have been riding on waves from where they seemed unsinkable given the perfect shape of their businesses. But they have suddenly found themselves in a low tide exposing blemishes that they would rather keep in the shade.

They must now try and regain confidence in their previously unchallenged promises by convincing advertisers that their measurement tools and benchmarks are credible. They can only do that by having them validated through independent, third-party bodies comprising regulators, industry watchdogs and stakeholders with an interest in their business models and based on a widely accepted industry standard.

At the same time they must combat the proliferation of fake news and hatred-inciting content to convince news consumers that they can still be regarded as decent alternate news distribution channels. Failing to listen, learn and lead by example by practicing what they preach would alienate them and ultimately render them irrelevant, even obsolete.

In the virtual tag-of-war between digital publishers and advertisers we may end up having an unlikely winner — newspapers and traditional media at large ...

In spite of the viral vitriol it has suffered on Donald Trump’s Twitter account, the fourth estate still remains a credible beacon for news reporting and advocate of politically correct freedom of speech. And it would only be a matter of time before advertisers decided to reverse the tide of their marketing budgets back to the product people trust.

The writer is Head of PR and Social Media at Al-Futtaim and author of “Back to the Future of Marketing — PRovolve or Perish”. Follow him on Twitter @georgekotsolios