Pay For Content Or Watch Ads

AdvertorialAdvertorials – not everyone likes them. No. Not even if you call it branded content. But then are these “evil” and “misleading”? I don’t think so. As long as the intent is clearly mentioned in the header (the image alongside prominently shows that this is an “advertorial”) and the publication does not pass it off as journalism.

Yes it is an eye sore and maybe it treads on the thin line between editorial sanctity and commercialism, and one could argue that since the publication mentioned has a separate supplement for advertorials, why not place it there?

The reason is the tussle between revenue yield (that’s much, much higher on page 1), cost of publication and brand visibility.

But why do brands and publications do it? One is that mainstream newspapers are still growing in India and therefore the reach is unparalleled. Second, just like internet and radio you can target campaigns either for national dissemination or limit them to a geography Vs. television where there is a lot of leakage. Third, advertorials – the well-executed & well-written ones – work better than mere ads. This is because they are more informative and co-opt the readers mind rather than push a message. Fourth, if the space can be monetized, why not? After all, somebody’s got to pay the bills.

Let’s also take a look at some other factors. India is a very price sensitive market. Even now, most people would rather not pay for content (it’s been an uphill battle for TV & internet). So, if newspapers X or Y were to suddenly charge a realistic Rs 15 for the daily paper (leave alone the Sunday glossies), the elasticity would ensure that demand plummets overnight. In that scenario, the paper that prices lower would capture significant market share.

Hence, every publication is deeply discounted on subscription, and looks at selling ads all over to subsidise that cost. The same goes for TV news. When you are being armed with information that can help you execute trades worth millions, why should your TV news channel fees be a paltry Rs 11 or 12 per month? (check this TRAI pay channel a-la-carte rates)

So why shouldn’t a publication or channel not seek to monetize their inventory innovatively? After all, they are all for profit businesses – their business being to bring you information.

heatmapIn the online world, this transforms itself into what is called native ads, which nest in your regular feed, but are marked distinctively as being “advertorials” or “sponsored”. This is because however fantastic your banner ads or flash animations, reader studies have shown that eyeballs rarely register those ads. Look at the heat-map alongside showing banner blindness.

But why do fewer people raise a stink over these native ads? Maybe it is because they are more contextualised and individualised to a person’s taste and hence, one doesn’t deem it to be too much of interference. Also, creating multiple access parameters is easier online. Those who pay are not shown ads, those who don’t pay have to bear the ads.

But the bottomline is those who will not pay a fee for content will have to pay the content creators’ bills by watching ads.

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