Ad-Supported Content Is The Only Viable Option For Publishers

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As a publisher, your business model is probably focused on ad-supported content. The good news is that consumers want more content. Specifically, they want high quality, reliable content. Reuters conducted a poll of 1,230 of its members in April 2016 which was covered by Digiday’s article titled “Reuters finds readers want quality news, but aren’t willing to pay for it”:

Although 81 percent of respondents said that a news brand is synonymous with trusted content, with nine out of 10 of them turning to a particular news brand to verify breaking news, two-thirds of them said they wouldn’t be willing to pay for any online content, regardless of quality.

Finding solutions for consumers unwilling to pay for “trusted content”

Despite the good news that consumers see real value in “trusted content”, they remain unwilling to pay for it. Growing ad blocker usage has highlighted dissatisfaction with poor user experiences and privacy concerns. It has also placed increasing pressure on most publishers’ revenue models.

Publishers are exploring various strategies to help mitigate the effect of ad blocking; as a key threat to revenue. Some of these strategies are proven to curb (or even reverse) ad blocker adoption with the consequence of an increase in ad revenue. They include –

  • options for consumers to pay directly for the content they read in the form of micro-payments; and
  • paid subscriptions which publications like the New York Times are experimenting with (more recently: ad-free, subscription models).

These options have not, generally, received much support from consumers.

Many major publishers have adopted a more direct approach and have tackled ad blocking head on. Publishers leading this charge include Der Spiegel, Forbes and Epicurious which have reported noticeable reductions in ad blocker usage on their sites after offering consumers a stark choice: whitelist the site and allow ads or go find content elsewhere.

Other successful strategies including focusing on more effective ad placements; dramatically improving consumers’ user experience of publishers’ sites and engaging more effectively with visitors to those sites. These steps address the major incentives for ad blocker usage in the first place.

Equally important are the ad solutions publishers choose as vehicles for ads. The challenge is identifying which ad products offer more relevant and engaging experiences for consumers, on one hand, and higher viewability for advertisers, on the other hand. Ad solutions such as native ads and in-image ads are often used in tandem with more conventional display ad products and address many UX and relevance concerns about online advertising while delivering more sustainable revenue for publishers.


Ad revenue remains essential

The industry faces a number of challenges:

  1. Consumers want, expect even, high quality content from publishers.
  2. Producing high quality content and expanding audiences is a costly business and requires scalable and sustainable revenue sources.
  3. Consumers are increasingly dissatisfied with the experiences they have with ads which traditionally fund the content they want. As a consequence, ad blocker adoption has risen dramatically in recent years because consumers’ solution is to block the ads publishers use to generate revenue.
  4. Consumers are not willing to pay more directly for the content they want so this means alternatives to ad-supported media are presently not feasible.

When it comes down to it, ad revenue remains the only viable revenue strategy for the time being, at least for large publishers with massive audiences. Certainly there are examples of publishers that have adopted membership or subscription models which are successful in varying degrees. Those success stories tend to be outliers and work with fairly narrow audiences.

Jonathan Hellmann photoI spoke to Jonathan Hellmann, our Publisher Development Team Leader, about the central importance of the ad-supported content business model and he had these insights:

As a publisher, one of your goals is to deliver high quality content, through remarkable user experiences, to your audiences. Advertising empowers publishers with the financial capability to do this by providing the revenue necessary to fund continued innovation. The goal is to enhance the user experience, not disrupt it.

A strategy for a sustainable ad-supported content model

The challenge now is how to implement a sustainable and scalable ad-supported content strategy and, at the same time, sufficiently address consumers concerns about ad blocking?

Meeting this challenge requires a multi-faceted approach and results may vary from publisher to publisher but I’ve noticed a few clear trends. To begin with, you need to address the underlying incentives for consumers to use ad blockers. This largely comes down to improving the user experience and communicating more effectively with consumers about their concerns.

Another tactic is to optimize existing ad solutions and focus on the ad solutions that generate incremental revenue while delivering higher viewability. I’ve already mentioned in-image and native solutions. Our in-image solution has, for example, been proven to deliver superior revenues for our publishers.

Ultimately, ad-supported content is the only option for most publishers and consumers at the moment. Fortunately, there are solutions available.

We have written about these strategies in more detail in other articles. Read these articles for deep dives into strategies that work and solutions for the prickly challenges you face:

  1. Behind Ars Technica’s Winning User Experience
  2. How 2 Premium Publishers Nail Engagement
  3. A Smart Strategy for Engaging Readers

Featured image credit: Pixabay

What do you think?