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Managing the Increasingly Blurred Line Between Editorial and Advertising

How can publishers and advertisers survive in today's economy?

Only 6% of the 18-24 population read newspapers; the majority of newspaper readers in this country are in their fifties and sixties. Audiences for CNN, MSNBC, and Fox News pull in viewers with a median age of 60 or above, according to media research company Nielsen.

Websites like Yahoo News and Huffington Post pull more traffic than CNN.com or The New York Times website. In two years, Buzzfeed (designed to stimulate social media with listicles: "25 Crazy Things...") has nearly tripled its monthly unique visitors, from 4.3 million to 19.3 million.

Traditional news has lost young people, the gold standard for advertisers.

Some daily newspapers, weekly magazines, and prime time television news shows such as Rock Center have folded. One reason is that they are no longer attracting the young folks advertisers prize the most. The march of technology has 24/7 cable news pulling audiences away from newspapers and news magazines while the Internet and mobile web are offering hundreds of alternatives, especially for the new generation. Cutting-edge outfits like TouchVision, Fuse, and PivotTV are trying to reinvent new ways to attract millennials.

Years ago, when The Washington Post was a monopoly newspaper and minting money, Katharine Graham gave a speech in which she defended the importance of profitability to news organizations, saying that economic strength gave newspapers the ability to say NO to pressure applied by advertisers to compromise coverage (or at least slant it more favorably towards the folks writing the checks). When you consider that in 2012, AT&T alone spent nearly $1.6 billion on media advertising, we are talking about some considerable potential pressure to blur the lines.

Advertising and editorial are finally hooking up.

With subscription revenue for newspapers and magazines dwindling because millennials aren't buying and growing competition for ad dollars from dozens of digital media options, news organizations are starting to hold hands with advertisers.

As news organizations struggle to be profitable again, the line between editorial and advertising gets increasingly blurred. (How strong was it in the first place?) Just last week, Time Inc said that, "seeking to increase revenue by building a closer partnership between business and the newsroom," the editors of its individual magazines would now report directly to the company’s business side for the first time in its history, instead of to the editor in chief of Time Inc. "We believe effective collaboration across business and editorial lines is imperative if we are to succeed as an independent company," Time's CEO wrote in a memo.  

Advertisers now have a much louder voice than ever before in what gets reported and how. You see this reflected all over the web already with the rise of "native advertising" (also sometimes referred to as "sponsored content" or "branded content"). This is often advertising disguised to look as though the editors of the publication or website wrote it. Proponents say this gives audiences commercial messages in the "context" in which they are already viewing or reading something, but detractors claim it is a way to trick audiences into engaging with ads. The controversy seems to just be getting started.

What’s the danger?

Historically, the job of editors has been to pick the stories that are most important to an informed citizenry. You may not have liked that they think you should read foreign news and business news and all of that political news from gridlocked Washington, but at least many of you trusted that the news was relatively fair and impartial.

But, as news has become compromised, that trust has fallen. Only 44 percent of people say they have a great deal or fair amount of trust and confidence in the mass media, only 4 percentage points from the all-time low of 40 percent.

One danger is that the younger generation checking out the news won't take the time to realize that some "native" advertising may have a biased point of view being pushed by the "sponsor."

Let's look at how advertising works in editorial.

There are three types of native advertising, according to Deseret Digital Media President Chris Lee: 

  1. BuzzFeed example. "10 Scents With Secret Powers," which BuzzFeed’s writers produced on behalf of a brand.
  2. Verge example. For this type of native advertising, Lee mentions The Verge, where a brand may sponsor content of some sort, but has no say in how the content is written. Lee said advertisers sponsoring one series about technology helping cities "received a custom pre-roll ad in the style and voice of The Verge’s offerings."
  3. BrandVoice example. "Security That Keeps Medical Implants Safe from Hackers" is an example of Forbes’ BrandVoice, where an advertiser puts content it has produced on Forbes’ website.

On Dec. 4th, a Federal Trade Commission workshop will "explore the ways paid messages are integrated and presented as content and how ads can be effectively differentiated from regular content via labels and other visual cues" in order to possibly draw up guidelines to "prohibit unfair or deceptive advertising." This builds on the momentum of a recent summit led by the American Press Institute.

The Code of Ethics of the Society of Professional Journalists says that "Journalists should...distinguish news from advertising and shun hybrids that blur the lines between the two." But with tough economic times, new technologies, and fewer young people getting their news from more traditional sources, the lines between news and advertising is fuzzy. 

One way to deal with this is to simply be transparent.

At ChaCha, we’ve grappled with this issue often, sometimes swayed by the temptation of easy revenue in the past. But with the launch of our new iPhone Q&A app and recently launched website, we are fully committed to transparency for our users. By making clear the sources of content on our platform, users and advertisers can both enjoy candid, credible, and high-integrity interactions. From a business owner’s perspective, this feels much more congruent.

Unless we are all vigilant, thoughtful, and proactive regarding the "separation of church and state" of advertisers and publishers, Wikipedia might soon feel like the gold standard for truth.

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Last updated: Nov 4, 2013

SCOTT JONES | Columnist | CEO ChaCha

Scott A. Jones is a veteran entrepreneur, venture capitalist, and co-founder of ChaCha, a real-time Q&A service that has answered more than 2.5 billion questions from 45 million+ unique users per month. Jones co-founded Boston Technology and Gracenote, the planet?s largest music meta-data service. Jones has been featured in the Wall Street Journal, The New York Times, CNN, and Fortune Small Business.

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.



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