Financial Times is a staid publication for the people in the front part of airplanes, but the London-based newspaper is embracing -- and today making official -- a radical way of selling digital advertising: by time spent, not the decades-old model of impressions.
With this new approach, called cost-per-hour, or CPH, Financial Times seeks to charge some advertisers by the number of hours their ads appear in front of certain segments of readers. The vast majority of publishers charge advertisers a rate called the CPM, for the cost per thousand people that are served an ad.
Financial Times executives refer to their cost-per-hour units as "long-form ads," because advertisers are only charged when at least 50% of an ad appears on screen for more than five seconds of "active" time -- meaning they're engaged with the screen and have not, say, left their browsers open and gone for coffee. Chartbeat is working with Financial Times to measure all of this.
(Ad Age explored this notion in a feature story last September. You can read it here.)
This idea of time-based selling, referred to broadly as attention metrics, has gathered steam over the last year as publishers like The Wall Street Journal, Bloomberg, The Economist and Upworthy have flirted with the idea. In January, Twitter co-founder Ev Williams, who now runs the publishing platform Medium, threw his support behind the practice.
So far, however, Financial Times is the only major publisher to dive headlong into the market with this offer (although Mr. Williams told Ad Age that Medium has "never done any advertising deals based on CPM.")
Financial Times began testing CPH-based selling last fall. Since then, the paper has signed on 10 advertisers -- including BP, Microsoft and the BlackRock-owned iShares -- and run a dozen campaigns on its site worth $1 million in revenue, according to executives.
Dominic Good, the paper's advertising sales director, said he will announce at a London conference on Monday morning that the Financial Times is taking cost-per-hour out of the test phase. Microsoft and iShares have renewed their contracts and are currently running campaigns on FT.com, with 10 more brands -- which FT execs declined to name -- close to signing up.
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These so-called attention metrics come amid a broader conversation in the digital media and marketing world around so-called viewability standards. Advertisers and web publishers use viewability standards to determine whether ads that were served actually had a shot at being seen by consumers -- or only appeared, for example, well off-screen. Last year, the Media Rating Council, a standards organization, said the industry should abide by a standard requiring desktop ads to appear at least halfway in view for at least one second in order to count as a viewable impression.
That was the impetus behind cost per hour at the Financial Times, but Mr. Good says his company's metric goes well beyond any viewability standard. "It answers advertisers' need for viewability and performance and the performance of these campaigns are better than if they're sold on CPM," he said.
Publishers have also been looking for solutions to downward pressure on ad rates online, where impressions are in seemingly infinite supply. Selling a much more limited resource -- consumers' time -- seems like it could give publishers that hold readers' attention new leverage in pricing.
Since last year, the Financial Times has conducted tests to determine whether showing people an ad for more time boosted brand familiarity or recollection. "Adverts seen for five seconds or more on FT.com show up to 50% higher brand recall and familiarity than ads that are visible for a shorter period of time," Mr. Good explained.