How One Startup Is Taking On the Monstrous Task of Monetizing the Internet
Dan Greenberg believes he has cracked the code for monetizing the modern Internet.
"Advertising can't be built around stealing people's time," he says. "And if you can't steal people's time, it needs to be about delivering quality content."
The founder and CEO of San Francisco-based native advertising company Sharethrough believes the shift from static, unimpressive banner ads and the like to quality, branded content in the form of native advertisements is the key to brands' and publishers' making money on the Web.
Broadly, native advertising is a type of marketing that's intended to be less intrusive and more customized than traditional ads. The ads are often typified by "sponsored content" disclaimers and resemble advertorials. Think of a BuzzFeed article accompanied by a subtle sponsorship note, GE's recurring Fallonvention segment on The Tonight Show, or even The Lego Movie in its entirety.
"It's not about interruption," Greenberg, 28, says. "It's not about forcing people to do something; it is really about delivering something of value at the right time."
And although native advertising gets bandied about ad nauseam these days, when Greenberg co-founded the San Francisco-based company with Rob Fan, 33, back in 2008, it was hardly a household term. At the time, the company was dedicated to creating apps that went viral on Facebook, but when the company needed to monetize those apps, he turned to the still-burgeoning world of native advertising.
Since, the company has focused on the shift from obnoxious ads to meaningful content--and that's led to meaningful revenue, too. The company serves as a conduit for branded content and earns money from selling software to advertisers and publishers. Greenberg anticipates Sharethrough's revenues for 2014 will be up 300 percent since 2011--when the company reeled in more than $10 million.
Greenberg has ambitions for more, however. He's confident that publishers overall can witness Facebook- and Twitter-style success. The social giants are great examples of successful native advertisers--and they have made billions off the strategy, he says.
"The big goal is to make it so every publisher can monetize their websites as effectively as Facebook and Twitter," the co-founder says. Given that the company has just shy of $20 million in funding and 100 employees, that goal would appear on the horizon, if not closer.
But according to Greenberg, a major challenge facing Sharethrough--and any company, really--is keeping up with an ever-changing market online. The push into mobile can be tricky, he says, adding that the shift has introduced some unique challenges to the advertising space. Namely, companies (including Sharethrough) are rapidly trying to figure out how to monetize the user experience on mobile devices.
Jack Krawczyk, the director of product management for advertising at Pandora, seconds Greenberg in this regard. He stresses that it is not a one-to-one translation between native on a desktop and native on a mobile device, which invites a discussion of which metrics brands should use to measure return on mobile ads.
"The real true value is the attention that these ads can garner, because they really are allowing users to focus in on the message that a brand is creating," says Krawczyk. "I think that the challenge is really similar to the opportunity--which is, How do you measure the attention and focus that you are generating for a brand with these user experiences?"
Greenberg isn't quite sure how to answer this question. But he does have a hunch: "In a world where we are so distracted, it is about meaningful personal content."
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