Advertising
2 mins read

How sponsored content is becoming king in a Facebook world

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With less ability to charge for distribution, on their own channels or others, and a growing dependence on margin-squeezing outside platforms, publishers may be left to compete with creative agencies on their turf.

Publishers becoming ad agencies, in other words, means competing not just with one another, but with the agencies that already exist. Accordingly, publishers’ pitches often focus on price: their ability to create more content for less.

Such a situation, in which publishers join a broader competition for advertising production dollars, would be a testament to how much and how quickly media distribution has changed. Publishers may get back in the running for advertising deals lost in recent years, but much like the editorial content they produce, their ads will succeed or fail in contexts over which they have less and less control.

For smaller publishers, or those without backing from venture capital, the situation is less heartening. “Running a full-scale sales, marketing and operations team requires tens of millions of dollars of annual expenses,” Mr. Goldberg said.

Facebook, for its part, has provided a preview of how such a system might mature. A program that the company calls Anthology is meant to help video publishers “lend brands their creativity, storytelling expertise and video production know-how.” It is being used by companies like Vox Media and Vice with advertising clients to produce videos that will then be promoted on Facebook.

Started last year, and quietly expanding to include more publishers, Anthology offers hints at what a platform marketplace managed from the top down might look like. It is tightly controlled, with a clear division of labour: The advertiser pays; the publisher creates; Facebook promotes.

For now, despite uncertainty, publishers will most likely keep pushing forward. “It’s kind of past the point of turning back. You kind of have to see if it can work,” said Joe Lazauskas, editor of Contently, a content marketing and editorial firm. “There’s not a lot of alternatives.”

Ms. Losee, who previously ran the sponsored content operation for Politico, the politics news website, suggested that publishers’ half-decade push into online native advertising will ultimately help them, but only up to a point.

“Sponsored content can’t replace the revenue from traditional advertising,” she said. “I think the future business model for publishers, in this disintermediation of the media era, is a work in progress.”

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