Pubs Need to Get the Performance $ignal

There is growing debate about the future
of journalism and to a greater extent publishing in the digital age. The axis
of the conversation is revenue generation or lack thereof. The problem in this space
is one that frustrates me enormously because the answers are there. We know how
to make money on the web but old mindsets continue to impede progress and have
consistently over the past decade allowed upstarts to control both the delivery
and revenue generation associated with digital publishing of news and
information.

One core issue I continue to witness is the fundamental
misalignment between the advertising publishers want and the advertising that works in a news and information medium, be it digital
or analog. To this end the OPA (Online Publishers Association) and the IAB have
been vehement that it is lack of creativity preventing brand money bags from
flowing into the space. I couldn’t disagree more.

The fact of the matter is that when prime-time television CPM is $12,
your audience is 12 million and your ad runs for 30 seconds this offers more ad
value (and will continue to) for demand gen than online. Also, despite grasping at straws for excuses (clicks don't matter, we're not using the right attribution metrics, etc. etc.) branded display ads don’t work. The facts are:

1. Unit performance sucks for everyone
2. Any demand gen created goes right to Google

Look at AM Radio – maybe the most comparative medium in user
behavior to web publishing. Commercial AM is primarily focused on news, information,
gossip & opinion. It is programmed for shorter bursts of attention due to
the nature of how people interact with the medium (weather on the 1’s, Traffic
on the 8’s, etc.). The web is quick twitch just like AM. Our click behavior
online closely mirrors our switching radio stations trying to get the
information we desire.

AM is not an immersive medium like its high fidelity sister FM.
Rather, AM tailors its content and it’s
advertising to audience behavior. As any listener of AM radio knows, direct
response (DR) dominates the medium. DR radio ads often play off the trust factor
with the station and/or host – both great ways to leverage ad performance non-existent
in display advertising (but interestingly present it social media and search).

Direct response radio is a huge business and one dominated
with much the same offers that people on the web respond to. The optimization
methodologies also closely mirror each other. Interestingly direct response ads
are also the ones growing to dominate online. More interesting is this growth
is based on performance. Publishers ignore this audience response at their own
peril.

This begs the question will there be two webs — The AM web
and the FM web? The answer is yes and it already exists. The FM web is where we
go to for rich media experiences – videos, gaming – where we go to have fun. Because these
experiences immerse us, the type of marketing should be different. The AM consumption
behavior to ‘get what we need and move on’ lends itself much better to DR where
in more immersive digital experiences brand messages should wash over so we
recall them as we walk through the supermarket.

This brings us back to the misalignment. Revenue starved publishers
and budget hungry advertisers have been infatuated with demand gen dollars for
display and have gone so far as to rip DR a new one (while gladly
taking their ad network backed money). This desire for more media budget has
also manifested a false and unaccountable sense that DR ads diminish the publishers
own brand value. It’s all a bunch of crap both from a user sentiment perspective and
performance perspective.

The lesson is that understanding the way people consume
media is paramount to optimizing it for revenue generation both with your
original content and your advertiser content. There is much we can learn from
Amplitude Modulation.

The solution is a major paradigm shift. DR needs to be
embraced, it needs to be “legitimized” and the revenue captured with the
publisher’s audience, content and data needs to be distributed in a more equitable
manner. The problem is not one of revenue generation. The dollars are there, they
just need to be shifted.