Is sponsored content the way forward for newspapers advertising online?

Newspaper websites are facing a conundrum. They need to make money off their content without driving readers away, while at the same time boosting advertising revenue.

Some organisations like the Times and Telegraph have implemented a paywall. The simple method of monetarising online content has had limited success and is a black and white solution to a complex problem.

One advertising experiment undertaken recently is the use of “sponsored content”, like an advertorial, where a company may submit an article advertising their brand or product which is put up on the site amongst the editorial content.

The business model has been used by startups such as BuzzFeed but recently, Bloomberg reported that the New York Times has been meeting executives such as BuzzFeed CEO Jonah Peretti to discuss how to implement the new strateg on their website.

How could sponsored ads help newspaper websites?

The New York Times is hoping to reverse its poor financial performance after 10 straight quarters of declining newspaper ad sales.

An innovative advertising strategy is certainly needed. Sponsored ads are more likely to be clicked on with readers perhaps mistaking them for genuine editorial content. This could translate into more ad bucks for the publisher.

The so called “native ads” will allow advertisers to use the online platform differently. This is not just a banner ad that every other website has. This is an advertising format specific to news websites that can be utilised effectively by advertisers.

For example, on BuzzFeed, The Fox broadcast network, sponsored and article called “20 Hot And Steamy Pieces Of Pizza Porn”, a list of animated graphics of pizza. The item promoted a new series of animated shows premiering on the TV network in July.

What problems could sponsored ads cause?

Any newspaper website that uses this tactic must make sure that the native ads are distinguished from original editorial content, to protect the reputation of the organisation as well as the integrity of their stories.

Publications must also make sure that their editorial content is not written in order to attract advertisers. Not only would this affect the quality of journalism for that particular publication, but also if sponsored ads were used across news websites, this could have a profound effect on the journalism industry.

A way forward?

Sponsored ads are a way forward but if successful, they cannot reverse declining ad revenues on their own. They are certainly one form of innovative advertising but news websites need to offer more ways for advertisers to invest.

Video content seems to be one popular choice that is constantly growing. With more news websites using video with their stories, advertisers can latch on to the opportunity of using the format.

The conundrum is far from being solved, but a few steps in the right direction can be the kick start needed. The key is to make sure that journalistic content is not jeopardised.

What do you think newspaper publishers can do to improve ad revenues? Are newspaper websites in irreversible decline in terms of ad revenue? 

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