There are any number of predictions for media priorities in 2018 floating around. As with last year’s predictions some will be on point, some will miss the mark, and some will appear laughably naive by the time January 2019 arrives.
Almost certainly, all the predictions will be subject to Amara’s Law - that we overestimate the effect of a technology in the short-term and underestimate it in the long-term. As an example, we saw disappointment with early implementations of A.I. chatbots this year because of early hype around the technology, but the bots have been ubiquitous – and delivering significant revenue – since the middle of this year.
This year has also been the year of the ‘pivot to video’, a term that was used so widely and so often that it became a punchline, its use a tacit acknowledgement that publishers were dancing to the platforms’ tunes. Writing for Nieman Lab, editorial director of Gizmodo Media Group Susie Banikarim, sums up why so many publishers leaned so heavily into the ‘pivot’:
“As the content boom finally seemed to go bust (see: Mashable, Mic, and Vice) and platforms proved themselves increasingly unreliable (read: terrible) partners, focusing on video was a Hail Mary attempt to ease economic and investor pressure by pandering to ad buyer preferences. It sounds better to say you’re “shifting resources into short-form video” than that you desperately need to reduce your run rate.”
But if the ‘pivot’ was a flash-in-the-pan trend that had fizzled out within a year, it was in response to a long-term trend that isn’t going away any time soon – the struggle to make digital publishing pay for itself. Even BuzzFeed’s founder and CEO Jonah Peretti admitted the pureplay’s past year had been tough. But because that trend isn’t going away, and because an attempt to skirt around it with the pivot to video has backfired, there is at least one prediction for 2018 that is bound to come true…
Reinventing ‘quality’ in digital advertising
The underlying issue with online advertising is that digital content remains largely undifferentiated in terms of ‘quality’. The output of storied news publishers and brands is valued at practically the same as that of the lowest-rent website out there – which of course don’t have the high production costs that go along with producing genuinely valuable content.
At the same time – while the majority of growth in digital ad spend is going to the Duopoly – overall digital ad spend is continuing to grow, and naturally publishers want a piece of it. So in 2018, finding a means to value publisher content appropriately – and sell ads against it for more money – is going to be a huge priority for media companies.
And there are several ways of going about it, from finding ways to prove the ‘quality’ of a publisher’s inventory to advertisers, to changing how the ads themselves are sold. The New York Times, for instance, is beginning a campaign of ‘beating its chest’ about the quality of its inventory, using the huge growth in its subscribers over 2017 as proof. Speaking to Digiday, the NYT’s head of advertising Sebastian Tomich said: “Going into next year, we’re going to be much less modest. I want to be more vocal about how all inventory is not the same.”
“Content is something you put in the content bucket until there’s enough content. Journalism is something that adds value and is worth paying for.” — AG Sulzberger at the annual State of the Times pic.twitter.com/Gw8ZcQxCrV
— Sam Dolnick (@samdolnick) December 18, 2017
Similarly, attempts like the News Quality Score Project and Factmata are involved in finding ways to appropriately value publisher content using machine learning and specific sets of signals, including the reputation of the publisher. The News Quality Score Project, currently in development from Frederic Filloux and a team at Stanford, is especially optimistic about the potential ramifications of its success:
“There is currently no correlation between production costs associated with great content, and the content’s tangible value. A story that required months of work at a cost of hundreds of thousands of dollars, carries the same unitary value (a few dollars per thousand of page views) as a news wrap hastily put together by an intern. But the day is coming in the not-too-distant future, when advertisers/sponsors will be willing to pay premium rates to appear with quality journalism.”
At the same time, many publishers are banding together in advertising co-ops, with the express aim of offering access to ‘quality’ audiences. While efforts like Project Rio have stalled, plenty of other co-ops are still extant – and with the failure of the great pivot to video to turn around publishers’ digital fortunes, expect a number of them to come roaring back to life in 2018.
That’s not to say that digital advertising alone will be enough to turn media companies’ fortunes around this year. It won’t. But it will be a significant portion of revenue for publishers in 2018, even for ‘consumer businesses’ like the newly subscriptions-focused New York Times, as part of a multi-stream revenue model. And Amara’s Law might finally work in publishers’ favour, with the ever-more sophisticated ad tech and data tools allowing them to truly demonstrate the quality of their inventory.
Billboard image via Perriscope on Flickr, used under a Creative Commons license.
Martin Tripp Associates is a London-based executive search consultancy. While we are best-known for our work in the TMT (technology, media, and telecoms) space, we have also worked with some of the world’s biggest brands on challenging senior positions. Feel free to contact us to discuss any of the issues raised in this blog.