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Op-Ed: Godawful revenue models and dumb advertising don’t help digital news media

To paraphrase Moses – “Let my people read!” Either that or start a hot dog stand for some cash flow.

BuzzFeed to go public after raising less money than expected
BuzzFeed, known for its viral content and journalism, will go public - Copyright AFP/File NICHOLAS KAMM
BuzzFeed, known for its viral content and journalism, will go public - Copyright AFP/File NICHOLAS KAMM

The rather sad news that Buzzfeed and Vice are in a bad way isn’t all that surprising. Media companies are “discretionary spending”, and when people don’t have money, they cut back, like on entertainment. What’s surprising are the revenue models. Vice is apparently truly on the ropes and facing bankruptcy.

Buzzfeed’s business model has had a lot of stick for overextending the company. Getting too big too fast, too many players, and using up capital is the current flavor of the criticism. Wisdom after the event, and big players didn’t see it that way when they invested. That’s a pity, in too many ways.

Buzzfeed was a “novelty” news site for quite a while. Then it got genuine respect the hard way by breaking news and was often sourced by major media after a few years. They earned their sector recognition fair and square.

It’s impossible to pretend to like the fact that Buzzfeed is scrapping its news division. The news section was what made Buzzfeed interesting to me. I could easily ignore the cutesy stuff, but the news was worth reading.  

The much less impressive news that they were relying to such an extent on advertising revenue, however, doesn’t win any Brownie points at all. Expecting ad revenue to fill the holes in the budget can’t work.

These are news media. Their core audiences are looking for information. Even FOX media users are at least theoretically looking for information

You don’t watch the news for the ads.

You also don’t rush out after watching the news and buy an SUV. It’s about as counterintuitive as you can get. Even in the mysterious world of pay-per-click, the value of ad placements can only be so much. That doesn’t help your revenue much, either.

Please excuse a spelling-it-out exercise here to clarify the ad issues:

  • News is by nature broad spectrum. It doesn’t necessarily directly connect to advertising SEO and SEM values. Broad spectrum ads just can’t work on the same basis as specialty ads. “Do you wanna buy a famine in Sudan?” isn’t much of an advertising option.
  • Specialty pages are a lot easier. Your arts page can have targeted ads, for example, like exhibitions connecting directly to user interests. Those ads can be useful and valuable for users.
  • So many sites totally overlook the ancient online advertising maxim, “Who needs it?” If it’s irrelevant, an ad might as well not exist.
  • Tech sites and pages can advertise tech products and services. It’s one of the few cases where news and ads actually enhance the value of each other, a more honest form of infomercial.

This is all so basic! For some inexplicable reason, digital media’s idea of ad revenue and marketing is about as primitive and unproductive as you can get. Algorithms can follow you around the world, and try to sell you the same stuff on multiple news sites.

I see that every day. Can it possibly ever affect my spending as a consumer? No. Am I likely to click on the same ads on 20 different sites? Of course not. Does this sort of total lack of interest equate to ad revenue for those sites? How could it?

Does it increase my time on the sites? Obviously not. I definitely and definitively don’t read The New York Times or The Guardian for the ads, unless those ads are in lockstep with what I want to read about.

In effect, by any possible advertising or marketing metric, it doesn’t matter whether those ads are there or not if they have nothing whatsoever to do with even why I’m onsite.  

By comparison, the most utterly lousy and loathed by writers form of advertising, direct marketing, is sophisticated. DM is basically clickbait advertising, appealing to interests like getting rich quick or losing 200 pounds today, etc. It works. Whatever you think of the products or the ad quality, DM get views.

Intrusive, cluttered ads everywhere just don’t work, either. Obviously, the ad guys have sold their ads, but is anyone else buying this crud? Particularly the site users, who make it worth running the ads?

A truly hideous type of advertising on news sites is now common:

  • Half a page of news and the rest of the page is all ads.
  • Popups before you get a chance to read whatever you want to read.
  • “Subscribe!” popups when the page opens. Subscribe to what, for god’s sake”
  • Distracting videos, which literally distract from the site’s own products. You’re kidding. You better be kidding, because you’re using that much space you pay for on ads nobody looks at.
  • Nowhere will you see targeted advertising or marketing. It’s like a random word generator, and about as useful as SEO and SEM. If the meta contains any useful information, think yourself lucky.
  • Nobody uses those gigantic sidebars on web pages, which are completely wasted. YouTube is the worst offender, but other sites are pretty bad, too.   

There’s a bottom line here, and it’s a matter of opinion whether anyone knows it exists.

  • A bit of spelling-out is required here, too:
  • Advertising metrics are precision tools. The value of advertising is part of the audit trail for advertisers.
  • You can gauge the effectiveness of your ads and your pay-per-click payments on very unambiguous hard numbers. Even the most pitiful generic advertisers will eventually do that.

If your ads aren’t accurately targeted, you’re wasting a lot of money. You can expect to be an ex-advertising sales executive if that continues. It will stop, sooner or later, even in the most complacent advertising scenario. So you, the news site, don’t have the ad revenue, or even the ads as advertisers reconfigure to hit their real markets.

You can use a “deals for our users” ad model, which is actually a DM model, but it will generate some revenue due to interest. You don’t do that.

News sites are particularly vulnerable to these ad metrics. “We’re selling tractors. Why are we advertising on Home Beautiful or FOX News?”, for example. Expect advertisers to move on.  

Politicizing ads definitely won’t help. Polarized audiences may or may not generate views. They won’t, and can’t, do much but split ad revenues on both sides.

To paraphrase Moses – “Let my people read!” Either that or start a hot dog stand for some cash flow.

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Disclaimer
The opinions expressed in this Op-Ed are those of the author. They do not purport to reflect the opinions or views of the Digital Journal or its members.

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Written By

Editor-at-Large based in Sydney, Australia.

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