With BuzzFeed and Upworthy reporting eye-popping traffic growth and planning to hire teams of reporters, many people are wondering whether sharing is the new currency of media success.

The idea is that if you give readers enough top-ten lists and animated GIFs they’ll do all your marketing for you. You don’t even have to worry about search engine optimization because nothing ever went viral on search. This philosophy has even given birth to a new style of headline writing that’s intended to stimulate sharing (“Why’s This Kid Throwing Coins? The Reason May Or May Not Blow Your Mind, But Something Does Blow Up,” reads one recent Upworthy example).

Henry Blodget

But maybe sharing isn’t all it’s cracked up to be. In a recent case study on USA Today, Michael Wolff looks at Business Insider, the hyper-caffeinated new-media brainchild of exiled Wall Street bad boy Henry Blodget. Business Insider is notorious for its fixation on being first and for driving its reporters to exhaustion. It’s a content mill – albeit with higher quality than many of its peers – that churns out large volumes of information in the quest to earn shares on Facebook and Twitter.

And it’s generating traffic: 25.4 million unique visitors in January, says Wolff. The problem is that Business Insider has low reader loyalty:

Only a small percentage of Business Insider’s traffic actually seeks it out and regards it as a worthy destination and a source with particular brand authority. Most other readers land on a Business Insider article because of search-engine results, or because of an engaging — tabloid-style — headline in a Facebook feed and other social-media promotions, which generate 30% of Business Insider’s traffic.

Wolff asserts that this drive-by traffic has little value because readers don’t identify with the brand. Worse is that the drive for big numbers becomes a race to the bottom.  As advertising rates continue to drift lower, publishers must seek ever-higher traffic volumes to stay in the same place. This means resorting to gimmicks like contests, cheesecake photos and celebrity gossip. That attracts poor-quality traffic which has low brand affinity and little value to advertisers. It’s a vicious cycle.

Digital Dimes

Blodget disagrees. In a response on Business Insider he says that the very problems Wolff cites are actually opportunities. New media companies don’t have legacy businesses to protect and so are free to disrupt mainstream competitors and steal revenue, he says. “We are better at serving digital readers than many traditional news organizations, so we can thrive on these ‘digital dimes,’” writes Blodget. His post displays a photo of what are presumably a group of happy young reporters in the company’s New York offices (Wolff says Business insider has hired 70 full-time journalists at a cost of more than $15 million a year. Do the math).

We think Wolff is on to something. Take a look at the chart below from the Pew Research Journalism Project. It depicts traffic to the 26 most popular U.S. news sites over a three-month period. It shows conclusively that visitors who reach a site directly (via a bookmark or typing the address into a browser) stay much longer, read much more and visit more often.

This isn’t surprising when you think about it. Typing “nyt.com” into a browser is an act of brand affinity, whereas headline-clickers on Facebook don’t really care where the headline comes from. The BuzzFeeds and Upworthys of the world must compete headline by headline. Is that a problem?

Attracting readers with gimmicks is nothing new. One of the myths of the news business is that people read newspapers primarily for the news. The reality is that they read for all kinds of reasons. Any veteran of the pre-digital publishing days will tell you that an embarrassingly large number of traditional newspaper readers bought copies for the coupons, Ann Landers, comics, the Jumble and the daily horoscope.

But at least in those days readers knew what brand to buy. Today’s audience has more affinity to the content than to the publisher, and aggregators like Flipboard are constantly looking for ways to supersede publishers’ brands with their own. Brand still matters. A click is not the same as a reader.

 

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Final print edition of The Onion

Final print edition of The Onion

It is neither major, metro nor daily, but we would be remiss in not marking the passage from the world of the printed page of The Onion, which has long borne the self-effacing tagline of “America’s Finest News Source.”

Founded by two juniors at the University of Wisconsin–Madison in 1988, the satirical journal has thrived online with its diet of satirical news stories written with such deadpan earnestness that The Onion’s entry on Wikipedia lists more than 15 prominent cases of third-party sources citing it as a legitimate news outlet, usually to their embarrassment

Unlike many newspapers that have left the print world, The Onion is merely following its overwhelmingly young and Web-savvy audience. The paper became international phenomenon when it hit the web in 1996 and traffic to theonion.com reportedly now averages 7.5 million unique visitors per month. Its YouTube channel has 670,000 subscribers and The Onion has been liked on Facebook 3.2 million times.

The Onion has been gradually withdrawing from the print market for years. Its last remaining print editions – which were in Chicago, Providence, and Milwaukee – published their final copies last week. Not surprisingly, they were a tribute to the durability of print. Headlines included: “‘ONION’ PRINT REVENUES UP 5,000%,” “Nation Just Prefers Feel Of Newsprint In Hands” and “Experts: Digital Media Revolution Still Another 70 Or 80 Years Away.”

We were subscribers to the print edition of The Onion for several years and keep its RSS feed in our carefully curated list of media sources. We still have trouble reading it without the milk coming out our nose.

 

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Brian Stelter“There is no longer a defined final destination for talented journalists,” writes Emily Bell in The Guardian. “The New York Times is surprised to find itself a stepping stone.”

Bell is writing about the sudden and surprise defections of a number of top Times journalists to other media outlets, often for substantial amounts of money. The Times lost three prominent editorial staffers in one day last week: Brian Stelter (right) quit to go to CNN, Sunday editor Hugo Lindgren is off to places unknown and chief political correspondent Matt Bai will join Yahoo News. Last month, gadget specialist David Pogue left to go to an unnamed Yahoo startup. In an unrelated move, Jay Rosen has also joined an unnamed startup founded by Pierre Omidyar of eBay fame.

All of a sudden media is cool again, or at least some media. While traditional publishers continue to struggle with declining revenue, money is flowing into new media companies. Buzzfeed has raised $46 million. AOL is investing in a big overhaul and expansion of Engadget. Snapchat just turned down a $3 billion offer from Facebook, indicating how frothy the social networking market has become. B2B community Spiceworks has raised more than $50 million for its novel media model that uses software and a community as delivery vehicles. Even the Washington Post is expected to get an infusion of cash from its new owner, Jeff Bezos.

This is translating into career opportunities for some accomplished journalists whose brands now arguably transcend the publications they work for. Bell suggests that the star-making apparatus of the media world is shifting in their favor. Not long ago a job at The New York Times was considered the ultimate career plum for news journalists, but belt-tightening has hit the Old Gray Lady just as it has everywhere else (although not as hard). With all-digital operations suddenly flush with cash, the appeal of working for publishers whose survival strategy is to wall off content from non-paying visitors is diminishing.

In many ways, traditional media companies dug themselves into this hole. In their rush to produce more content and add more advertising inventory, they turned some of their best reporters into rock stars. Thanks to blogs, video podcasts and branded talk shows, journalists now get unprecedented visibility. That makes them prime targets for new media firms who want to trade on their personal brands.

Turnover may also be an unplanned consequence of paywalls, which will soon be in place at 41% of US newspapers. The problem with paywalls is that they shut readers out, and readership is what journalists live for. The Times‘ famous Times Select paywall was abandoned six years ago in large part because the paper’s signature columnists complained that their readership had evaporated. The models have improved since then, but no paid-access plan comes without some loss of audience.

So while newspapers  erect barriers to readership, new media entities like Buzzfeed figure out novel ways to get people to share their sponsored content. Is it any wonder that ambitious journalists with growing personal brands are seeking opportunities to spread their work to wider audiences instead of hiding it behind credit card forms?


Even reporters who don’t have million-eyeball reach may have new ways to monetize their audiences. A startup called Beacon has launched a service that enables journalists to derive revenue from their most loyal fans and share a little bit of the spoils with fellow contributors. Mathew Ingram sums up the model succinctly:

Each of the site’s journalists (there are currently about 50) has a page where their content lives, and a discussion forum. When someone subscribes to them for $5 a month, Beacon takes a cut — the amount is in flux, but writers keep around 60 percent on average — and then the reader gets access to all of the site’s other writers. Some of the proceeds from each subscription also go into a pool that is shared by all of the journalists on the platform.

It doesn’t sound like anyone will get rich from this business, but at least there is a direct correlation between work and reward. And we suppose Beacon could be a launchpad for a few new superstar journalists who build their audiences there. Like the crowd funding site Kickstarter, Beacon builds and manages the community. It’s then up to the participants to give the audience something of value. May the best journos win.

 

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By Paul Gillin | October 1, 2013 - 7:44 am - Posted in Business News, Newspapers, OnlineMedia

Lloyds List 1741We usually focus news of comings and goings on this site solely on major metropolitan dailies, but we’ll make an exception for Lloyd’s List, which claims to be the world’s oldest daily newspaper and which is going out of print at the end of this year. The paper, which originated as a list of ship arrivals, departures and casualties that was posted on the wall of Edward Lloyd’s coffee shop in London in 1734, canvassed readers in June and discovered that fewer than 2% of them read the print edition any  more. Management sounds upbeat about the transition to all-digital, which has been in the works for several months. “The digital approach offers new avenues and opportunities to innovate an up-to-the-minute service that offers in-depth news and information on every aspect of shipping,” said editor Richard Meade in a quote in the Guardian. See the links below for additional coverage. Jolly good.

For you history buffs, Google has digitized about 85 years of Lloyd’s List, beginning in 1741.

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The World Association of Newspapers and News Publishers (WAN-IFRA) released an upbeat report on the state of newspapers worldwide, pointing to growing readership levels in emerging economies but cautioning that engagement levels are still low.

The report includes data from 70 countries that account for more than 90% of the industry’s value. It shows:

  • More than half the world’s adult population reads a daily newspaper, with 2.5 billion reading in print and more than 600 million consuming in digital form.
  • The newspaper industry generates more than US$200 billion of revenue worldwide each year. However, that figure is down 2% from last year and 22% since 2008. The numbers are dragged down by plummeting ad sales in the U.S., which has seen print advertising revenues fall 42% since 2008. The good news is that ad revenues are up 9.1% in Latin America, 3.6% in Asia and 2.3% in the Middle East and North Africa.
  • Newspaper circulation remains high, through stagnant, globally. Circulation declined only .9% worldwide in 2012 from a year earlier, primarily due to  rising circulations in Asia. Circulation is down 2.2% globally since 2008, with the steepest declines in Europe.
  • While newspapers are a vital information source, they aren’t engaging online audiences very effectively. Newspapers accounted for only 7% of visits, only 1.3% of time spent online and only .9% of total pages visited.
  • U.S. newspaper publishers now generate 27% of their revenues from non-traditional sources, such as digital advertising, services and ancillary products.

While the report can be seen as a glass-half-full scenario, we think it’s encouraging to see publishers diversifying their revenue sources. The industry’s historic dependence on print advertising in general – and classified advertising in particular – is at the root of its problems. The rapid decline of those revenue sources is prompting some publishers to get creative about finding new revenues. Those that succeed will be stronger for it.

 

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Paywalls continue to spring up across the news landscape while new-media enthusiasts warn that gated news is a throwback to a bygone age.

Britain’s Telegraph and Sun announced plans to erect paywalls almost simultaneously after successful tests. The Telegraph, which claims to have the largest circulation of any U.K. daily, will give away 20 articles free every month and charge £1.99/mo. thereafter for unlimited access to the website and smartphone apps. The Sun‘s move is timed to make the most of parent company News International’s £20M deal to show near-live clips of Premiership football highlights on its websites beginning in August.

In Canada, Postmedia Network will roll out paywalls across all 10 of its properties, including the National Post. The move completes an experiment that began two years ago and has been deployed in stages. Digital-only subscribers will have to ante up $9.99/mo. for reading more than 10 articles in any title within a month.

Perhaps most indicative of the surging popularity of paywalls, though, is Politico’s decision to experiment with the idea. The Washington, D.C.-focused news service, which was once personified the new breed of digital-only publishers, has given in to the reality that advertising rates continue to fall and subscriber revenues must become part of the business. “We believe that every successful media company will ultimately charge for its content” said a memo signed by several of the Politico’s top executives.

Circling the Wagons

We continue to be more interested in experiments that break new ground in publishing economics than efforts to resurrect old models. There’s plenty to report there, as well.

Ken Doctor kicks us  off with a fine analysis of where NewsRight went wrong. NewsRight was a consortium of 20 publishers that sprung out of the Associated Press in early 2012 with the mission of tracking down copyright violators while also creating a subscription model that would permit digital publishers to license quality content for redistribution.

“Publishers have seethed with rage as they’ve seen their substantial investment in newsrooms harvested — for nothing — by many aggregators…” writes Doctor on the Nieman Journalism Lab, “…but rage — whether seething or public — isn’t a business model.”

Bingo. Consortia are good for only two things: setting standards and raising awareness. They’re a terrible way to create new products. The idea of pursuing copyright violators individually is ludicrous, anyway. It’s like trying to stamp out ants. There are always more where the first batch came from.

The only anti-piracy tactic that works is a public awareness campaign, and the newspaper industry has shown little interest in that. NewsRight died because the members inevitably had conflicting priorities, and it was impossible for everyone to find common ground when everyone had something to lose.

Does BuzzFeed Have it Right?

Sponsored Post on BuzzFeedDoctor points to the work being done at NewsCred, BuzzFeed and Forbes, among others, as examples of new ideas worth developing. “In 2013, we’re seeing more innovative use of news content than we have in a long time,” he writes. We’re particularly interested in BuzzFeed, the viral content engine started by Jonah Peretti and others in 2006. At first glance it looks like any other new-age news site, with a bottomless home page stuffed with a jumble of seemingly unrelated content ranging from the profound to the ridiculous.

As New York magazine points out in a lengthy profile, though, there’s a lot more going on there than cat photos. BuzzFeed is tuned to create content that people want to share, and it could care less who the authors are. The home page blithely mixes contributions from staffers and advertisers with minimal labeling. Every element within every story can be shared on every social network you can imagine. Every page is designed to maximize audience interaction with the content.

BuzzFeed makes little effort to segregate advertiser contributions from the work of its own staff. A photo essay on “12 Tips to Have An Amazing Barbecue” from Grill Mates sits next to “Just The London Skyline, Made Out Of Sugar Cubes” by staffer Luke Lewis. Some of the branded stuff is actually pretty good, like, JetBlue’s “The 50 Most Beautiful Shots Taken Out Of Airplane Windows.”

Is this serious journalism? Well, no. We don’t think corporate brands will ever produce that. But if they want to run their grilling tips next to similarly lightweight content from professional editors, why not let them? The genie that goes by such names as “brand journalism” and “content marketing” isn’t going back in the bottle. A recent survey concluded that corporate marketers and agencies consider branded content to be among their most effective branding tactics, and that 69% plan to spend more money on it in the coming year.

The bigger issue is whether sustainable publishing business models can be found that don’t rely entirely upon display advertising or subscription revenue. BuzzFeed and NewsCred are making some progress there. We don’t believe they produce serious journalism, if sex, gossip and voyeurism can attract a large enough audience to support real journalism, then we’re in favor of it. The idea isn’t new. It’s worked in the U.K. for decades.

Content Marketing Effectiveness

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Police Roam MA Suburb In Search Of Boston Bombers

Police Roam MA Suburb In Search Of Boston Bombers (Photo: Talk Radio News Service)

Those who fear that crowdsourcing may soon make professional journalists obsolete should take a look at some of the links below related to an amateur sleuthing experiment on the popular Reddit social news site that went horribly awry last week.

The goal was commendable enough. A “subreddit” was set up to enlist the members of this massive community (14 million monthly visitors by one report) in the hunt for suspects in the Boston Marathon bombing. Participants were told not to name names and to focus their effort on combing through thousands of photos posted on the Internet in hopes of finding the origins of the backpacks that exploded, killing three people and injuring 282 others.

The rules quickly went by the wayside, though. Names began being tossed out more or less at random, photos of anyone carrying a backpack were flagged as suspicious and chatter from the Boston Police Scanner were posted as fact. Most damaging was a rumor that Sunil Tripathi, a Brown University student who has been missing for a month, was one of the bombers.

Twitter did its part both to spread misinformation and to serve professional journalists who sought to calm the hysteria.  Some mainstream media organizations picked up on the Tripathi rumors and amplified them, while other journalists tried to settle the crowd by pointing out, among other things, that police scanner reports are unconfirmed and often wrong.

The accusation that Tripathi was involved in the bombings was particularly damaging. When the popular @NewsBreaker Twitter account reported that the missing student had been confirmed as a suspect based upon police scanner chatter, “social media went crazy,” said Reddit General Manager Erik Martin in an interview on Atlantic Wire. “It was posted so many times in [Reddit subgroup] /r/FindBostonBombers that I had to stay up the entire night deleting them.”

Martin called the experiment “a disaster,” and issued an apology to the Tripathi family on behalf of Reddit, which is owned by Conde Nast. Media critics have been swarming in the wake of the incident, with Reddit getting nearly universal condemnation. About the only contribution the crowd made to the investigation was to identify one photo of the suspected bombers that the FBI hadn’t seen. However, the distraction the experiment caused as professional reporters tried to untangle the web of amateur accusations more than offset the small benefits. A chastened Reddit has since launched a new crowdsourced campaign to help locate Tripathi.

Questioning Crowdsourcing’s Value

Does this mean crowdsourcing is a bad idea? In certain situations, yes. Criminal investigations require specialized expertise that no group of amateurs can match. FBI and police investigators had access to intelligence that enabled them to evaluate and discard spurious information that the Reddit crowd didn’t. In a highly charged atmosphere like this, investigation is best done behind closed doors, with information revealed selectively when it can move the process along. The crowd is enlisted to help authorities but not to solve the case.

We can’t help but wonder what the public response would be if police officials conducted their investigation the way Reddit did. If every rumor and bit of speculation was held up to public comment, then our opinion of law enforcement might be quite different. Sometimes there’s good reason to withhold information from the public, as the irresponsible actions of the Reddit crowd made very clear.

However, we shouldn’t throw out the baby with the bath. Crowdsourcing can have great value when applied to analysis of very amounts of data or eyewitness accounts. Witness the comprehensive Wikipedia report on the Marathon bombings for an example of how many eyes can tell a story better than a few.

The incident also offered some shining examples of traditional media at its best. On Friday the Boston Globe, which has been a poster child of newspaper industry tumult, posted this marvelous account of the factors that set two likable young men on the road to terrorism. It was mainstream media at its best.

Update

Mathew Ingram has a different view. He believes Reddit, Twitter and other popular tools are capable of producing quality journalism, but not in the way we’ve traditionally defined it. Ingram believes that journalism is “atomizing” into component parts, and that the fact-checking and validation functions can be better handled by a crowd.

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Top areas of ad spending declines, 2013

Traditional media took it on the chin in marketing plans researched by Aquent and the American Marketing Association (AMA). One in three marketers plans to decrease spending on newspaper advertising, making newspapers the big loser in the study. They were joined in the cellar by consumer magazines, radio, trade magazines and television, all of which were cited by more than 20% of respondents as targets of budget cuts. The winners? Mobile media, social media and marketing automation. More than three in four marketers plan to increase spending in those areas.


Perhaps marketers are simply reflecting the interests of the audiences they want to reach. Alan Mutter gathers some statistics that point to ominous demographic trends:

  • Only 6% of people in their 20s and 16% of 40-year-olds regularly read newspapers, compared to 48% of people over 65.
  • Only 29% of the U.S. population regularly read a newspaper in 2012, down from 56% in 1991.
  • Three-quarters of the audience at the typical newspaper is 45 years of age or older. In comparison, over-45s comprise only 40% of the population.
  • Print advertising still generates between 80% and 90% of revenues at the typical major metro daily.

Mutter asserts that newspaper publishers will never pull out of their tailspin unless they can create products that appeal to the new generation of digital natives who can’t be bothered to drag around paper, CDs or books. For them, the phone and the tablet are their windows on the world, and that will change industries ranging from news to travel to banking.


Plans to increase or decrease Facebook time in 2013There are always ways to make statistics say what you want them to say, of course. More people read a newspaper than visited a social network in the past month, according to KPMG International. Traditional electronic channels fared even better: 88% of respondents to the survey said they’d watched TV in the previous month and 74% said they’d listened to the radio. That compares to just 57% who had tweeted or Facebooked. The survey measured habits of more than 9,000 people in nine countries. It did not ask how much time respondents spent with each media.

There’s some evidence that the novelty of Facebook is wearing off. A new Pew Research study finds that 28% of Facebook users say the site has become less important to them, and a third have cut back on the amount of time they spend on Facebook. Asked about their plans for allocating time to Facebook in the coming year, 38% of 18-to-29-year-olds said they’ll cut back, compared to only 1% who plan to spend more time.


And speaking of Pew, another recent study finds strong support for a bastion of the print world: libraries. More than half of Americans 16 or older visited a library during the past year, and of those who did, 26% plan to increase library usage during the next year while 22% plan to cut back. Asked if libraries should clear out some of their book stacks to make way for more technical resources, 36% said definitely not, compared to 20% who supported such a change. It would appear that while print may be on the decline, the role of the library as a community gathering place is still secure for now.

Miscellany

Writing in Scientific American blogs, Frank Swain tells of  a new initiative by the Royal Statistical Society’s BenchPress project to teach young journalists how to interpret statistics. The program sends volunteer working scientists into schools and newsrooms across Britain to help ensure that “journalists produce science news stories that are as robust and accurate as possible.” This seems like a great idea to us. Any yahoo with a SurveyMonkey account and a mailing list can field a survey these days, and publishing tools make the results look like they came from Gallup. Scientists complain of having to squeeze the conclusions of complex research studies into tweetable sound bites in order to get attention – and more funding. There’s so much bad research out there, and statistics isn’t a core part of the curriculum at many journalism schools. Maybe it should be.


The Washington Post has come up with a “Truth Teller” app that compares statements made by public officials and corporate spokespeople to databases of facts in near real time. The project, which was funded with a $50,000 grant from the Knight Foundation’s Prototype Fund, is said to be able to extract audio, convert it to text and then conduct searches based upon the content. We’re somewhat skeptical, given that our Google Voice app still converts all our voice-mail messages to Martian, but maybe the Post found better technology.

The video below tells more, and stresses that this is a prototype. The technology is ultimately intended to be used behind the scenes to help reporters more quickly scope out falsehoods. We see huge potential for politics and mischief with this technology. Imagine a CNN vs. Fox “Leaderboard of Lies” or a plug-in that tweets falsehoods in real time. That we would follow.

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Journalism traditionalists who suffer from high blood pressure probably shouldn’t read this piece by Forbes editor Lewis DVorkin. In it, he outlines the role of what he calls “brand journalism” in the evolution of Forbes.com, and even in Forbes magazine. He also scolds journalists for their objections to this increasingly popular concept, saying that their interest in keeping marketing content cordoned off from staff editorial is in part an instinct to minimize competition.

DVorkin has been a vocal critic of those who cling to the traditional Chinese wall principle of strict separation between advertising and editorial. In his view, the new economics of the profession demand radical new ideas, and journalists are standing in the way. “After five years of media turmoil, the profession I love clings to the belief…that the industry’s problems are for other people to solve. And when steps are taken to solve them, my colleagues will put up a fight if they can’t do exactly what they did before,” he wrote a couple of weeks ago in a summary of the changing advertising landscape and Forbes’ adaptation strategy.

Like it or not, DVorkin’s vision of increased integration between marketing and editorial content is gaining favor in traditional publishing circles. The trend is called “brand journalism,” “native advertising” or “content marketing,” but whatever the title, it’s breaking down some traditional walls.

Business Intelligence Solutions Boston Globe promotion

Boston.com, which is the online arm of the Boston Globe, recently launched “Insights,” a sponsored advertising feature that showcases blog posts from advertisers. Boston.com is a little more aggressive about labeling Insights material as advertising than some other brand journalism practitioners, but it’s the same basic idea. The publisher appears to have no problem with participants like Business Intelligence Solutions embedding the banner ad at right on its blog, saying nothing about the sponsorship arrangement.

Some other publishers have all but erased the lines between staff and brand content. BuzzFeed, which is one of the new breed of breathless, celebrity-stuffed news sites for the ADD set, expects to derive nearly all of its revenue from branded content and sponsored posts. So far, things are going pretty well. The site was a magnet for political advertising during the US presidential campaign and is expected to triple revenues this year. Branded features, like this one from JetBlue, look the same as BuzzFeed content and carry only lightweight advertiser labeling. The Atlantic is also in the pool with Quartz, a news site that blends branded and staff-written content more or less seamlessly.

Writing on emedia, Rob O’Regan has a good summary of this trend, which has been fueled by Twitter’s sponsored tweets and Facebook’s sponsored stories. Those companies, which have no preconceptions about ad/edit separation, say these new vehicles are a resounding success. Publishers are taking notice, but a news site is not a social network. News organizations trade on credibility, and “native” ads tread into new territory. Recent research by Mediabrix and Harris Interactive found that  readers often feel confused or misled by branded content.

Mediabrix/Harris Advertising Research

Compatible Content

The reason all this is happening, of course, is that the traditional print advertising model doesn’t work in the highly targeted online world. Display advertising is the fastest growing category of online advertising, and publishers have always known that display ads surrounded by compatible content perform best. Advertisers have traditionally bought space next to compatible content, but now they want to provide the content, too, because people are rejecting traditional messaging.

Businesses are quickly glomming onto this trend. Cisco relaunched its press room last year as a news stream, hiring laid-off journalists from major business publications to write thoughtful trend pieces. Intel is doing the same thing. Coca-Cola just overhauled its corporate site as a lifestyle news magazine under the “Coca-Cola Journey” brand. Expect many others to follow.

Sponsored content is nothing new. Mobil Oil bought space on The New York Times‘s op-ed page in the 1950s. What’s different today is that a severely weakened mainstream media is willing to be more the creative than ever in placement and labeling – even if that means potentially compromising their own brands.

Is this a horrifying development? The journalism purest in us says yes, but we’re inclined to keep an open mind. Lewis DVorkin has a point when he says journalists live in a bubble.  Social media have shown that good information can come from anywhere, even from people who aren’t journalists. As media organizations have learned to their chagrin in recent years, you can’t shove anything you want down people’s throats when they have infinite choice. The same applies to advertisers.

Regardless of who the author is, anyone who publishes content is at the mercy of readers. Marketers who publish the same dreck on branded media sites that they use to fill their purchased ad units won’t see much return on their investment. If people don’t want the content, it doesn’t matter how much you pay to publish it.

So the stakes are higher for marketers, too. The question is how many of them can successfully change their perspective to think like publishers. In our experience, precious few can. The natural instincts of people who have grown up in the traditional marketing world is to sell at every opportunity, not to serve the informational needs of the audience.

This will change over time as a new generation steps in, and publishers will play a key role in effecting that change. They will need to work with their clients to make sure the sponsored content they carry is worthy of their brand. It can be done. Admit it: If you clicked on the JetBlue link above, you scrolled down the entire page. It’s good stuff, even though it’s sponsored.

The silver lining is that if “native advertising” can become a major new revenue source, it can enable publishers to re-invest in quality journalism. In the end, that’s more important than labels or Chinese walls.

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New Orleans Times-Picayune May 24, 2012The New Orleans Times-Picayune, a fixture in the Big Easy since 1837, will slash its staff and production schedule, going from 7 to 3 days a week beginning this fall. The body count isn’t known yet, but estimates are that at least a third of the staff will be fired. Those who stay are expected to take pay cuts.

The Times-Picayune, which is owned by Newhouse Newspapers, is apparently taking a page from the Ann Arbor News, another Newhouse paper that cut its frequency to twice-weekly more than three years ago. The Detroit Media Partnership was the first to eliminate daily frequency in late 2008. Many smaller papers have since quietly cut money-losing Monday, Tuesday and Saturday editions.

The strategy is aimed at preserving the newspaper brand – and a viable business – by eliminating unprofitable editions. The newspaper will continue to be published on Wednesdays, Fridays and Sundays, which are typically the three most profitable days of the week.

The New York Times‘ David Carr was the first to break the story in an item published just before midnight last night. Ricky Mathews, who will become president of the newly created NOLA Media Group, confirmed the news in a statement this morning that contained the usual sugar-coating. “NOLA Media Group will significantly increase its online news-gathering efforts 24 hours a day, seven days a week, while offering enhanced printed newspapers on a schedule of three days a week,” he said. The only enhancements specified were to food and dining coverage.

All the spin-doctoring in the world doesn’t change the fact that New Orleans will soon become the second major U.S. city without a daily newspaper.

Publishers are struggling with strategies to preserve their brands while transitioning to a digital-mostly strategy, which typically requires between one-third and one-quarter the staff of a printed newspaper. U.S. newspaper revenues have plummeted to levels not seen since the Truman administration on an inflation-adjusted basis, and there’s no indication the trend is likely to turn around. The thinking in New Orleans is that frequency cutbacks can keep the brand in front of readers while enabling the cost reductions to take place and still preserving enough margin to invest in new digital products.

The Times-Picayune won two Pulitzer prizes in 1997 and two more in 2006 for its coverage of Hurricane Katrina. Former staff members include William Faulkner and O. Henry.


Update: As noted in the comments, The Birmingham News, Mobile Press-Register and Huntsville Times will also reduce frequency to three days a week. They’ll become part of a “new digitally focused media company” called the Alabama Media Group. Read more on Al.com.


Marketplace Radio’s Kai Ryssdal interviews Chris Rose, who worked at the paper for 25 years and helped it win two Pulitzers for its coverage of Hurricane Katrina.


We were interviewed on Marketplace as part of its coverage of this story.

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