Banner blindness is a real problem in the publishing industry. About 69% of US news media revenue comes from advertising. However, at the same time, the overall click-through-rate for banner ads has decreased from 44% on the first banner ad to less than .06% in 2013, a rather steep decline. The banner ad is dying a slow painful death, but what comes next?
Native has been hailed widely as the future of advertising and spend has shifted as predicted. Business Insider predicts native will drive 71% of all ad spend by 2021. News websites from CNN to Forbes have rolled out sponsored articles and paid content. Native ad exchanges like Sharethrough have launched, and Taboola and Outbrain widgets can be seen on every major news website.
The decline of print media
However, native hasn’t necessarily been a boon for everybody. While Google's paid search and Facebook’s content machine get stronger through true data network effects, native is a prohibitive cost center for a lot of publishers. Content is expensive to produce and targeting involves a lot more than just producing images and articles. Furthermore, native advertising has a real problem of eroding trust with the user. 61 percent of readers say sponsored content hurts the credibility of media outlets. The real question that few seem to be asking is that is a standalone website a good channel for a true news media organization?
Realistically, the Internet has not been good for everyone. Newspapers have been slow to adapt and have had to cut costs. However, I think there’s another myth that needs to go away. Jack Shafer sums it up quite well:
“What if, in the mad dash two decades ago to repurpose and extend editorial content onto the Web, editors and publishers made a colossal business blunder that wasted hundreds of millions of dollars? What if the industry should have stuck with its strengths—the print editions where the vast majority of their readers still reside and where the overwhelming majority of advertising and subscription revenue come from—instead of chasing the online chimera?"
Given that, there's a chance native advertising for most websites might not hold up as the savior as it’s supposed to be. What if it only delays the inevitable, rather than actually allowing them to compete in the new world order of content?
I’ll leave you, my readers, with a better question to ask: should newspapers have disrupted themselves a long time ago by making themselves a Buzzfeed or Huffingtonpost or better yet become a holding company?