There’s an important number in his week’s first-of-its-kind Newspaper Association of America report — The American Newspaper Media Industry Revenue Profile 2012 — on the evolution of revenue sources. That number: 8 percent. Eight percent of 2012 newspaper revenues came from something other than advertising or circulation. It’s a squishy number at best, incorporating a grab bag of newer initiatives. But it’s directionally right (“NAA’s New Revenue Report: Been Down So Long Looks Like Up to Publishers”).
All-access circulation revenue is spinning upward, leading to a 5 percent gain in overall circulation revenue in 2012. Print advertising is whirling downward — 9 percent last year — in a seeming death spiral. Digital advertising is growing tepidly at 5 percent. Put those circulation and ad trends together and you end fairly flat on your back. So NAA’s number is that dailies lost 2 percent of revenue overall; I’ve made the point that their big goal, as nothingburger as it may sound, is to get back to zero revenue growth (“The newsonomics of zero”).
Which brings us back to that non-ad, non-circ number. If local news organizations are going to regain growth — and hire — they must find new revenue. They have plumbed marketing services, events, and print-insourcing. Now some are putting a new category on the board: content marketing.
No, not content marketing, you say! It’s already a hackneyed phrase, seemingly identical to “native advertising” and “sponsored content,” both now much-recognized and already much-maligned techniques that bigger brands are using to break through the digital clutter and get to potential customers. Yes, content marketing (and we’ll narrow some definitions below). As news companies rediscover the power of their own content, there is new revenue to be gained. How much, not whether to seek it, will be the major question.
Meredith Publishing, the old-timey Des Moines-based publisher of Ladies Home Journal and many other brands, practically invented the content marketing trade within magazines and among B2C advertisers. The ideas, first applied as part of Meredith Integrated Marketing, are simple:
So Meredith turned itself from being a magazine publisher to a high-end marketing agency. In its case, it works the markets that answer the commercial edge of the age-old question “what do women want?” It’s thriving, re-using Meredith content and creating tailored content for Kraft, Acura, Jeep, Coke, Bank of America, and the NFL Players Association. The recently re-named Meredith Xcelerated Marketing now makes up a good share of Meredith’s non-ad, non-circ revenue, producing about a quarter billion dollars a year.
Make no mistake: Though largely untalked about in the consumer news and feature world (outside Meredith) until recently, content marketing is a huge business. By one estimate, it’s a $40 billion business in the U.S., with about $24 billion of that spent on print. Within that huge number is content produced for brands’ own sites, their email marketing, webinars, and more. My sense is that as brands find the ability to license useful content, they’ll spend less on custom creation and more on cheaper-to-them, high-quality, branded licensed content. So it’s a big — and we’d think — sustainable market.
If Meredith built on lots of experience in the B2B trade — where publishers have long used content to lure new customers through targeted email and like methods — then its magazine peers and the newspaper industry are starting to learn from Meredith. Consider the emerging global-to-local breadth of content marketing initiatives, and as we do, let’s be sure to differentiate between two basic kinds of content marketing.
The first — and where most traditional news brands are playing — is about using content already published. That’s the repurposing of what has traditionally only had a second life on birdcage bottoms and as fish wrappers.
The second — now embraced by the leading edge of digital-only, or digital-mostly companies, and lately The Washington Post with Brand Connect — is about creating or customizing content for specific brands’ purpose. The former is easily understood: Use it whole, no changes, and with full attribution. The latter, custom content, then gets into the thorny questions of who produces the content and how it is presented to readers.
The movement in content marketing:
When it started out a few years ago, the venture-backed New York City-based company looked like just another aggregator, licensing top-branded news content and working the old syndication business, selling content in multiple forms to multiple clients. That’s been a web dream from the beginning. It never scaled that well for early players like Screaming Media and iSyndicate through Mochila and Voxant. The problem: Publishers thought they had all the content they needed. If they couldn’t sell out the ad inventory against their own content, why buy more? Those companies may have been looking in the wrong place for demand.
NewsCred’s big insight — recently supported by a next-round investment — is that while most traditional publishers won’t pay for content, brands like Pepsi, AIG, Johnson & Johnson, General Electric, and Overstock.com will. So now, more than 60 percent — and growing — of NewsCred’s revenues are coming from brands. Big brands have found great success at using social media to bring many more interested eyeballs to their sites. Their big problem: giving those eyeballs something to do when they get there. After all, we don’t click through to those sites to get a hard sales pitch. So Pepsi offers a Gawker article on ’60s advertising as Mad Men returned to the air. It’s the soft sell of the digital era — content experiences are the come-hither perfume.
The company licenses stuff from 2,500 content providers, ranging from AP to Bloomberg and The Economist to Gawker, Getty and Forbes. It recently added The New York Times. The Times’ addition illustrates how content marketing revenue can work, even in a paywalled world. Some might have seen channel conflict between paying readers and brand use of selective Times’ stories; the Times, and others, have decided that’s not worth worrying about.
Thirty-two-year-old CEO Shafqat Islam says that last year his company provided “six figure” annual sums to its top content providers, a range confirmed by several suppliers. “By the end of this year, our top 10 publishers should be entering the seven-figure range.” Those payments — largely on a flat fee, not just revenue share, basis — were fed by the company’s 2012 overall growth: an 11-fold increase in revenue and a 570 percent growth in new customers, he said. The new investment is intended to facilitate further growth, helping he and his co-founders (co-CTOs 29-year-old Iraj Islam and 31-year-old Asif Rahman) expand both in the US and internationally, adding non-English language content.
Technology — really nuanced categorization of content — enables the business. What makes it really click though is people. It’s that mating of great content and big brand need that is crucial to content marketing success. Ten of NewsCred’s 75 staffers do the matchmaking, and their editorial backgrounds include stints at The New York Times, The Atlantic, and Slate.
The work is figuring out what kind of audience experience a brand (say, Johnson & Johnson) wants for a new mother’s campaign and finding appropriate content, “just as any other editor would do,” says Stefan Deeran, NewsCred’s content sales director.
So let’s quickly tackle some of the basic questions here:
— Why can’t all publishers do content marketing themselves? NewsCred’s Shafqat Islam told me he thinks publishers themselves can — and should — on their own, in addition to working with his company for greater reach.
Local newspaper companies can do that, but it requires at least four well-tuned competencies that determine success in the marketplace: inventorying and categorizing content, identifying customer goals, creating custom news products or feeds, and checking in on how well the content is performing and adjusting campaigns. Publishers can make that investment (as the Morning News is doing), or they can work with a company like NewsCred, or both. Most will work with aggregators.
— Is this a business mainly for national and global brands? Yes and no. NewsCred licenses content from McClatchy and “several hundred” local sources, in addition to magazines. It’s the evergreen features content — think relationship, sports, arts, and health content — that may work well for a variety of brands. Clearly, the big marketing services push (“The newsonomics of selling Main Street”) provides a wide potential on-ramp for content marketing, as the Morning News is now testing out.
— So, what is content marketing exactly, and how does it relate to native advertising and sponsored content? So definitionally, what is and isn’t “content marketing”? Well, content marketing is simply using content — news, feature, or otherwise — to commercial advantage. “Providing content that people are actively interested in reading,” sums up NewsCred’s Deeran.
So, then, what’s “sponsored content?” Simply, it associates a brand with a piece of content, and it’s content that, by definition, goes beyond the simply pitching of a product or a service — what we commonly call advertising. The sponsored content can be created by the brand, or its agency, or conceivably could be licensed from a NewsCred. It can also be custom-created for the brand by a newspaper or magazine. Sponsorship is an old broadcast TV standby, also called share of voice. As The Atlantic’s Scientology debacle showed, it can be a minefield. It all depends in my view on who’s creating the content and how it is presented.
What’s native advertising? According to Mashable’s parsing of the term, native ad pioneer Dan Greenberg, the CEO of Sharethrough (which now calls itself a “native advertising platform”) defines it as “a form of media that’s built into the actual visual design and where the ads are part of the content.” So, that would say it look more editorial content, blending more seamlessly into the reader’s editorial take — with all the attendant problems journalists will intuitively point out.
There’s no shame in employing people to satisfy the needs of advertisers and brands, gigantic or otherwise. That’s not journalism, though. Journalists, especially in the tradition of newspaper journalism, write for the readers, operating in one form or another on the “without fear or favor,” in Adolph Ochs’ enduring words. We write to inform and not to pitch, openly or stealthily, goods or services. Especially in an age where publishers are asking readers to pay for more of the cost of news creation than ever before, integrity of content should become an even greater bedrock principle.
Good content marketing and integrity of news brands can go hand-in-hand, but it’s a courtship that demands the attention of both editors and marketers now. It’s easy to say that content marketing is just a new-fangled form of (hateful-to-journalists) advertorial. Alas, that’s too easy.
Content marketing can blur the lines between “without fear or favor” news and market pitches — and there will be heavy pressures to do so. It’s easy to maximize staff efficiency by having a staffer write for the readers on Monday, Wednesday, and Friday and for marketers on Tuesday and Thursday.
That won’t work.
Tapping the abilities of journalists, whether the stuff they’ve already produced or stuff they produce on demand, makes a lot of sense. It’s all in these details. Who’s producing it? What else are they doing for the company? How has it presented or labeled? The bedrock — integrity, trust, disclosure — must remain even if unforeseen new innovations, like content marketing, now arise from it.