The Future of Sponsored Content: 3 Scenarios for Success

The Future of Sponsored Content: 3 Scenarios for Success image native advertsThe Future of Sponsored Content: 3 Scenarios for Success

According to this study, audiences are as likely to read sponsored content as they are to read editorial content.

Sponsored content appears to be undergoing a renaissance. Called native advertising, brand journalism, or whatever, it is back in the conversation for marketers and PR professionals.

Sponsored content is decades old, it’s just the tactics that are changing. In the past, sponsored content may have taken the form of advertising sections in newspapers, infomercials on TV or custom publishing. But with new names, new advocates and new tactics, we are going to see and hear a lot more about sponsored content in the near future. Will it stick? Will it become an increasingly important part of marketing? Or will it go the way of banner ads, a bandwagon everyone jumped on then decided it didn’t work?

At the heart of the issue is how marketing and advertising transitions from traditional outlets to digital outlets. While that migration, from print and broadcast to the Web happened, it didn’t happen at the revenue level the media wanted and it didn’t produce the response the advertiser wanted. Though one may question whether the widespread perception that the value of traditional forms of marketing and advertising has declined is a really a function of better measurement tools. Has the value declined or has it been meager all along and we just needed better visibility to realize it?

The Future of Sponsored Content: 3 Scenarios for Success image Screen Shot 2013 10 30 at 2.08.48 PMThe Future of Sponsored Content: 3 Scenarios for SuccessNative advertising is the latest handshake agreement between publishers, who need money, and content providers, who need visibility. The publisher offers access to its audience, the content provider pays for it and they both agree that the stuff won’t look too bad, won’t be blatantly commercial and will somehow fit with the other content. The party that is not privy to this handshake, though, is the reader and it is the audience that eventually will decide whether the sponsored content is welcome, whether they want to see it, or whether it is too blatantly commercial.

Publishers pursuing this path tend to be a little queasy about it. So you see pronouncements about how vigilant they are going to be in labeling sponsored content as just that. But in fact there is a prevailing air of deception about many forms of sponsored content. Ask for a definition of native advertising and you’ll usually hear something about how it is commercial content that looks like the “native” content of the outlet where it is published. What really matters though is not the look but whether the sponsored content is of the same level of interest to the outlet’s reader as its own originated content.

What sponsored content and display have in common is that they are both dependent on what I referred to in a previous blog post as “diverted eyeballs.” The reader isn’t looking for your content, he or she is looking for something else and by placing your content (or display ad) next to that something else, you are hoping that the readers’ eyeball get diverted to your content. I think this is an approach which is on the decline as most media properties are seeing their traffic coming more from search or social referrals rather than visitors browsing their site as a destination.

So who will be successful with the new wave of sponsored content and how do you put yourself among the winners? The simple answer, oft repeated as it is, is to create great content and put it on great sites. Sounds good but, sorry Google, the Web is full of great content on great sites that nobody ever sees.

Here are the three scenarios which I see as potentially successful for sponsored content.

  1. As with all communications activity there will be an elite group that produces excellent content and buys space for it on premium properties. They will be the role models that all the advocates for sponsored content will point to. But as role models they will be deceptive because they will most likely represent a brand whose status and visibility is well beyond that of most and they will also likely have made an investment in the production and placement of content that is beyond the means of the average brand. If Apple for example could achieve success by placing content on the Wall Street Journal that’s all well and nice but doesn’t mean a thing for the rest of us.
  2. I think there is a real opportunity for sponsored content to be successful on niche media properties that have cultivated a very specialized audience. For example, you are likely to find a much, much larger audience on a consumer travel site than you are on a trade site about utilities. But how many travel sites are there? Tens of thousands? The utility news site might be lightly trafficked but it also might be the go to resource for the very limited audience that is interested. That audience will likely include individuals at utilities who make buying decisions so if you happen to be in that business, that’s your customers. Good content about changing technology in energy generation or the impact of government regulation is going to play really well on the site.
  3. Content providers who are experts at marketing their content, using search, social, distribution and media to drive traffic to the content. These folks may not really need to buy placement to drive an audience to their content but there are some advantages to the third party placement that will supplement the content providers own promotion efforts. For one thing, the media site that the content is placed on may have a better search ranking than the provider’s owned media properties, thus may bring in more search traffic. The domain name of the publication may be an advantage since it is likely to be perceived as a more authoritative source. And the media property may supplement your content marketing with its own efforts to drive traffic to its site. (Related reading: Driving Content Discovery)

Sponsored content is not going to be the savior of media outlets trying to recover lost revenue. Nor will it to any large extent retire more traditional marketing and advertising activities. But under the right circumstances, it can be a pretty successful tactic.

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