Paid Posts are an increasingly important business strategy for
the Times Co. During the second quarter, native advertising
helped goose the company's digital-ad revenue, which climbed
3.4% compared with the previous year. But it wasn't enough to hold
up sagging print sales, as overall ad revenue declined 4.1% from
April through June.
Similar scenarios are playing out around the publishing
industry. Print ad sales are in long-term decline, and the display
ad business is suffering pressures like automated auctions that
drive down prices. Native ads, which can command higher rates than
standard ads, are considered a bulwark against this onslaught.
BuzzFeed, which draws all of its advertising revenue from
sponsored content, recast the labels on its native ads in June. It
replaced phrases such as "presented by" with "promoted by" and
"brand publisher." The site also dropped the yellow shading that
was wrapped around advertising content on its site. Now only the
"promoted by" label is yellow.
Among consumers, at least, the tolerance for native ads might be
on the decline. A recent
study from the Interactive Advertising Bureau and research firm
Edelman Berland, for instance, found that a
mere 38% of consumers believe sponsored content adds value to a
site that covers general news, entertainment or business. Just 17%
of respondents to the study said that sponsored content adds value
to news sites, with 48% saying it adds value to business sites and
44% saying the same about entertainment sites.
from Contently, a company that pairs brands with writers who can
produce native ads, said that two-thirds of readers surveyed felt
deceived after learning an article or video was sponsored by a
brand. More than half of readers don't trust sponsored content, the
And this week, comedian John Oliver dedicated 11 minutes of his
HBO talk show "Last Week Tonight" to skewering native advertising.
He even called out the Times advertising executive who has
championed Paid Posts, Meredith Kopit Levien, as well as Time Inc.
CEO Joe Ripp, who has reassigned editors to report to business-side
colleagues, and Jonah Peretti, founder-CEO of BuzzFeed.
It seems unlikely, however, that marketers' appetite for
sponsored content will be curbed any time soon. An eMarketer forecast said marketers will spend
$2.29 billion this year on sponsored content, including native ads.
That's a 20.5% increase over 2013. By 2017, it's expected to hit
Publishers, media buyers and marketers all agree -- publicly, at
least -- that native ads should be labeled as advertising. But the
precise language and style of those labels is up for debate. The
Interactive Advertising Bureau, which develops standards around
digital advertising, opts for common-sense advice in its Native
Advertising Playbook and does not provide specifics.
"Regardless of context, a reasonable consumer should be able to
distinguish between what is paid advertising vs. what is publisher
editorial content," the Native Advertising Playbook says.
The most common label is something akin to "sponsored content,"
which The Atlantic has adopted, or "sponsor
generated content," which The Wall Street Journal deploys. Several
fashion and beauty sites use more ambiguous language. For instance,
"Cosmopolitan + American Eagle Outfitters" appears near the top of
denim slideshow on Cosmopolitan.com. That pairing of magazine
title and retailer is the only indication that the post is, in
fact, an American Eagle promotion.
Marketers for the most part prefer an understated description.
"Some form of labeling is necessary to make sure no one feels
deceived, but beyond that I don't think they need to have blinking
lights," said Scott Donaton, chief content officer at UM.
"In general, if a client is going to create content, they don't
want the thing dressed up in way that pushes audiences away from
it," he added.
The topic of sponsored-content labeling
caught the attention of the Federal Trade Commission, which
held a workshop last December called "Blurred Lines: Advertising or
Content." It delved into whether advertisers and publishers are
doing enough to prevent consumers from mistaking native ads from
"Every time we go into a new space there is the issue of how do
you regulate it and how do you create standardized formats," said
Brent Poer, president at digital agency LiquidThread, a Publicis-owned agency that
focuses on branded entertainment and content marketing.
"It's an evolving space," he added. "You have to make sure that
the visual statement is out there, but you don't want it to be
something that's completely off from what the site it lives on