Sponsor content was supposed to be publishers’ ticket to digital sustainability. Turns out most of them are having a hard time getting advertisers to come back for seconds.
Digital ad sales intelligence platform MediaRadar said the average renewal rate for sponsor content this year is 21 percent. Meanwhile, native ad tech company Polar recently described renewal rates as “weak,” with 40 percent of the publishers it surveyed showing renewal rates below 50 percent.
Behind the low renewal rates is the fact that advertisers are uncertain about the return they’re getting on native advertising. There’s also increased competition as lots of publishers try to get a piece of the action, and only a few can offer the broad distribution that brands want.
“Eighty-five percent of the money goes to the top five [publishers],” said John Cobb, CEO of Giant Media, a company that distributes native video advertisements programmatically through a network of publishers. “The rest of these smaller publishers are going after 15 percent.”