Native Advertising Isn’t the Devil
There's too much at stake to be cavalier about custom content.
Years ago, one of my predecessors as chair of the Content Council remarked that he could happily foresee the day when all content would be branded content—not just such traditional vehicles as custom magazines, but even such hallowed bastions of journalistic independence as The New York Times.
I’ve been thinking about that prediction a lot lately, as I’ve found myself writing and speaking to various groups about the growth of such branded content vehicles as native advertising. This came to a head last week when I was watching, somewhat belatedly, a hysterically funny rant that HBO’s John Oliver recorded last August on branded content, in which he skewered the media—specifically attacking Time Inc. and The New York Times—for breaking down the traditional church-and-state divide through its embrace of native advertising. Oliver would say that my predecessor’s prediction is coming true much sooner than expected.
Well, yes and no.
Yes, such branded content vehicles as native advertising are increasingly the rage. Last year Yahoo said it was putting virtually all its eggs in the native advertising basket. Buzzfeed, according to its CEO, has done that as well—and with huge returns. The head of government affairs for the Online Publishers Association told me a year ago that 73 percent of his members were already producing native advertising—and the percentage has increased since then. Every fifth or sixth item in the news section on Bloomberg.com is now labeled “sponsor content.” Notices of seminars on how to create “brand newsrooms” and practice “brand journalism” keep landing in my email inbox. The New York Times, Time Inc., and, most recently Condé Nast have all launched their own content marketing “studios” to help their advertisers craft all the new branded content that will run on the publishers’ pages, both printed and digital.
Condé Nast’s studio is different—and has raised some hackles—because its branded content will be produced by the same people who produce regular non-branded content for the company’s magazines: the previously sacrosanct editorial staffs. “We will be smart and strategic about how we approach these business opportunities and, of course, we will work with the right editorial resources for the right assignment,” Chuck Townsend, Condé Nast’s CEO told the Wall Street Journal. This arrangement is “the thing that really sets their branded-content offering apart,” added Amy Stettler, general manager of global media and agency management at Microsoft, as she was deciding whether or not to jump in.
With raised eyebrows, Oliver ran a clip in which Time Inc.’s CEO, Joseph Ripp, said that he thought the company’s editors were actually happier to now be reporting to the business side since, as Ripp put it, “no longer are we asking ourselves if we’re violating church-and-state, whatever that was.”
At a Federal Trade Commission conference a year ago, the agency looked closely into whether the “blurred lines” created by the likes of native advertising needed regulation to ensure that publishers remain honest and consumers remain protected from what media pundit Ken Auletta has called ads “camouflaged to look like news stories.” But, though some journalists, academics and consumer advocates urged the FTC to take action and fortify the church-and-state wall, the FTC came away convinced that the situation was neither dire nor dangerous.
And here’s why: there’s a lot at stake for all parties involved. For publishers, no matter how much favor they want to curry with advertisers, it’s important to maintain their integrity with readers. Readers won’t turn to them for unbiased information if they don’t think that’s what they’re getting. At the same time, study after study has shown that readers are happy to receive content from brands so long as it’s informative and even entertaining—in ways that standard ads can never be. In fact, they say they’re grateful to the brands for supplying the information and are more likely, as a result, to purchase products and remain loyal. And that won’t happen if the brands don’t make it clear that they’re the forces behind the branded content; otherwise how will the consumers know where to direct their gratitude—and their purchases.
As native advertising and branded content become more common, will there be abuses of trust? Of course there will be. But I really believe that it won’t be enough to make it necessary for the FTC to step in, for John Oliver to wring his hands beyond last summer’s 11-minute rant, or for my predecessor to say, “I told you so.” The bar has been raised for all parties involved. Condé Nast’s content studio, for example, is not going to risk undermining Vogue’s credibility in the fashion world by turning it into a pay-for-play environment. But it will ensure that the branded content that appears in Condé Nast publications will be well labeled, well written, and well designed—and Condé Nast will be well paid for the service.
So everybody wins.