Every Thing About Sponsored Content

sponsored content

Sponsored Content: Every Thing You Need To Know

When it comes to sponsored content, most traditional channels for online content discovery have high adoption rates and are very well understood. Readily accepted channels from social media broadcasting and email, to PPC and SEO, have the possibility to deliver the best in content to the right people and at the right time.

In recent times, the online experience has been characterized by what can be called a deluge of content, where many channels or mediums for content discovery are bloated. It is estimated that over 2.73 million blog posts get written and published daily. In multiple industries, there are reports of experiences of a content surplus, which makes it more difficult for marketers to get their content seen.

Platforms such as Facebook and Twitter, are making changes to their algorithms in order to ensure the lowest amount of organic visibility for brands as well. The effect of traditional paid media such as banner ads has drastically reduced over the years as due to the increasing effect of banner blindness. The media outlet, Solve Media opine that you have more chances of surviving a plane crash than clicking on a banner ad.

Sounds like a bit of an exaggeration until you look at the heat map from the Nielsen Norman Groups 2007 eye-tracking study (as seen below).

 

 

The red areas show where readers looked most; while the yellow areas show fewer views; blue coloured area shows the portion with the least views on the page; the grey areas attracted no views or actions; while the green boxes outlined are used to highlight advertisements.

To solve this problem, fresh tactics, tools and techniques are springing up and being employed by various marketers to ensure maximum visibility of their content. As a result, we now have a whole content promotion ecosystem. Be it native advertising to influencer marketing, marketers and brands are experimenting in model ways.

A lot of brands are sponsoring articles on online publications or blogs that have large already existing audiences. According to Moz, as published in their Content promotion Manifesto; brands spend on average 6.7 per cent of their content marketing budgets on sponsored content in 2013. This trend has experienced a spike as seen in examples from The New York Times to Forbes’ Brand Voice.

While brand advertorials have been with us for decades, sponsored articles can however be categorized as relatively new for a lot of content marketers. In recent times, questions have arisen about a range of issues regarding sponsored content; from pricing to scale and even strategy.

It is as a result of these that the Moz team took it upon themselves to reach out to 550 digital publications to get as much information as possible about their sponsored content programs, which is the main focus of this article. They intended to discover the following:

 

  • A universal definition for sponsored articles
  • The current state of sponsored articles as a channel
  • Examples of sponsored articles
  • Pricing of Sponsored Articles and their value
  • A media buying strategy for sponsored articles
  • Platforms and Tools for sponsored articles

They were able to quickly identify that sponsored content on online publications and blogs, when viewed, as a marketing channel could be quite crude. Also, there isn’t a universally aligned justification to pricing. However, after they had collected an interpreted data on 550 online properties, and carefully dissecting and analyzing numerous advertising studies, they were able to shed some light on the relatively little known content marketing channel.

Their results are discussed below:

 

Defining Sponsored Articles

 

With the high rates of content marketing adoption, a lot of brands are making use of native advertising to promote their content. The Interactive Advertising Bureau (IAB) defines native advertising as “paid ads that are so cohesive with the page content, assimilated into the design, and consistent with the platform behaviour that the viewer simply feels that they belong.” According to them, native ads are made up of six different types of ad units: in-feed, promoted listings, in-ad with the native element, paid search, recommendation widgets, and custom.

The Definition of Sponsored Articles

The Interactive Advertising Bureau (IAB) describes ‘native advertising’ as “paid ads that are so cohesive with the page content, assimilated into the design, and consistent with the platform behaviour that the viewer simply feels that they belong.” In addition, according to the IAB; native advertising comprises six different types of ad units: in-feed, in-ad with the native element, promoted listings, recommendation widgets, paid search, and custom.

Sponsored articles as the case may be, are classified into the in-feed subgroup. However, so does content promoted on Twitter, Facebook and LinkedIn. This is because they appear within the regular content feed of the publisher; whether the publisher is BuzzFeed or Facebook is not of importance.

What this means is that sponsored articles refer to advertising on a media outlet in the form of editorial content i.e. it looks like its ought to be there. This is highly valued by brands because affiliation or association with a publication and access to its audience can drive traffic, awareness, leads and even conversions for the brand in question.

The Current Situation of Sponsored Articles

A lot of interesting information about sponsored articles were uncovered in the course of the research. For those familiar with what marketers refer to as advertorials, which have been around for decades, we can agree that sponsored editorials are actually an evolved version of those. The major difference between them is their positioning in the customer-buying journey. Advertorials are positioned in the middle to bottom of the funnel.

 

An example of a magazine advertorial

However, sponsored articles are strictly positioned at the top of the funnel. They have the purpose to be entertaining, helpful or even both. Top-of-the-funnel content refers to content that doesn’t appear to be sales and brand-centric to the recipient of reader. The steady rise of content marketing played a critical role in moving advertorials up the funnel. This repositioned brands from being purveyors of goods and services, to be originators of ideas and concepts, sharers of knowledge and thought leaders.

Criticism

Sponsored articles have received some criticism from brands, publishers, government regulators and even consumers.  This concern or criticism drawn is mainly as a result of the articles being very identical to editorial content. This could be harmful to the editorial integrity of a publication and also damage a brands image.

Publishers and marketers alike have a common interest not appearing to mislead consumers. It is no doubt however many marketers and consumers generally misunderstand that native advertising. This is in part why there was a need to write this article.

It was discovered in Copyblogger’s 2014 State of Native Advertising Report which surveyed over 2,000 marketers that 73 per cent of these marketers were either hardly familiar or even completely unfamiliar with native advertising. 38% of the marketers could identify forms of native advertising from a checklist, and only three per cent claimed to be very knowledgeable.

In a survey of 542 Internet users conducted by contently in 2015 to determine what their thoughts were on sponsored articles; 48 per cent of respondents believed sponsored content, labelled as such was paid for by an advertiser that had influenced the content produced. Others thought the label implied something else.

Over 66 per cent of the respondents said they are not likely to click on an article sponsored by a brand, and 33 per cent reported that they’re just as likely to click on a sponsored article as they are to click on an ‘unsponsored’ editorial content.

There has also been some contradictory evidence surrounding the overall efficacy of sponsored articles. A research from Chartbeat reveals that just 24 per cent of visitors scroll past the fold when visiting a sponsored article—as compared with 71 per cent for editorial content.

Although, according to the New York Times, readers spend the same amount of time on sponsored articles as traditional news stories. This position is backed up by a study from Sharethrough and IPG Media Labs. They discovered that in actuality, consumers look at sponsored articles more than typical editorial articles (26 per cent vs. 24 per cent) and that they spend a similar amount of time on each (1 minute vs. 1.2 minutes).

It is important to note also that not all publishers offer sponsored article opportunities to marketers. During the research, some respondents informed that protecting their editorial integrity and preserving audience trust were much higher priorities. On the other hand, a lot of big-name publishers such as Forbes, Business Insider, The New York Times, Washington Post, The Atlantic, and The Wall Street Journal have all gleefully welcomed sponsored articles as a revenue source.

For BuzzFeed, their entire business model is built around what they call sponsored “listicles,” a.k.a. sponsored articles.  The point here is that, where some publishers are against adopting this native form of advertising, it clearly doesn’t seem to be causing any damage to the publishers who employ native ads in their business models.

Most Media related National regulatory bodies haven’t clearly figured out how to regulate native advertising. Until this happens, the management and display of native ads will remain solely at the discretion of publishers.

However, the IAB has put in place native advertising guidelines for its members. They report that clarity and prominence of paid native ad unit disclosure are critical, irrespective of native advertising type.

Their two criteria are pretty straightforward:

  1. Make use of language that communicates the advertising has been paid for, thus making it an advertising unit, even if that unit does not contain traditional promotional advertising messages.
  2. Be large and visible enough for a consumer to notice it in the context of a given page and/or relative to the device the ad is being viewed on.

In the case of sponsored articles, a reasonable consumer should be able to clearly distinguish between editorial content from the publisher and paid advertising.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Growth of Sponsored Content

A survey conducted in 2013 by Hexagram and Spada showed that 62% of publishers embraced sponsored articles, with another 16 per cent planning to explore this channel by the end of 2014. Another research from eMarketer revealed that only 10 per cent of digital publishers did not have and were not considering native advertising on their sites.

The 2014 Native Advertising Roundup showed that 73 per cent of media buyers employ native advertising, with 93 per cent expected to spend just the same or more in the future. In the US, spend Native advertising increased from $1.3 billion in 2013 to $9.4 billion in 2018.

When compared to traditional display ads, native ads have been found to be more effective. 25% more consumers viewed sponsored articles than display ad units. Native ads recorded an 18 per cent increase in buying intent and a 9 per cent lift for brand affinity purposes. A study was released by BIA/Kelsey showing that brands are increasingly planning to spend on native advertising, and publishers will stand to benefit so long as they can preserve the interest and trust of their audience.

 

 

Examples of Sponsored Articles

 

As the design, feel, look, language, and requirements of sponsored content are left to the discretion of publishers, the outlook of sponsored content on different sites varies widely. A lot of publications enable brands with what can be termed as a virtual microsite within the site itself. While others are more streamlined, making use of an article which appears as a piece of featured content but in this case labeled as ‘sponsored’.

6 Examples of Sponsored Articles & Native Advertising from Chad Pollitt

Pricing

There are no standard metrics for pricing in the digital world when it comes to sponsored content. Because of this, budgeting for the channel could be an uphill task. Also, this makes long-term strategic execution at scale and across multiple publication close to impossible

In terms of value, sponsored content is relatively understood by many brands, methods of execution and who to engage to get it done however, is generally unclear. From the study, reason is deduced and a pattern is drawn by exploring costs and measuring them alongside a broad spectrum of online publications and blogs.

The information here is valuable to marketers as well as media buyers wishing to negotiate with online publications. It could also be used by publications looking to offer sponsored content opportunities to establish fair pricing.

Publishers control completely their own standards and pricing, hence they also maintain their own criteria for validating costs related with sponsored articles. In the analytics driven marketing culture of today, where channels are often compared alongside each other and returns across channels measured, it is difficult to consolidate sponsored content across several different publications into a singular “sponsored content” channel  since each channel has its unique value proposition.

The research is an attempt to scientifically make a justification, quantify and even predict current going-rate costs of sponsored articles using explicit data points that can be employed in measuring each online publication. The goal was to create the foremost quantitatively supported pricing standard for sponsored articles.

The intention of this study is to put an end to the above challenges by empowering marketers with the ability to budget, negotiate and finally scale the distribution of sponsored articles   within their channel mix.

Research

The research for the study was conducted over a five-month period in total. It took into consideration manual outreach through email and phone to more than 1,000 media outlets and blogs. The results of the outreach were responses from a total of 550 publishers that sold sponsored article units.

The said study took an objective approach to data inclusion and included a representative sample set. It collated data on globally recognized publications, one-man blogs, and of course everything in between.

Publications were classed using the criteria below:

Content is created by over five writers/ columnists / contributors/, and:

The website already makes use of traditional display advertising (e.g., banner ads)

Everything that didn’t meet the above criteria was categorized as a blog.

Each price gathered in the study was lowest charge for getting a sponsored article published, irrespective of other pricing factors. In total, 17 factors were cited as rationalization for pricing schemes from the 550 publishers.

Word count: The amount of words in a sponsored article

User time on page: The amount of time a typical reader spends on a publisher’s web page

Links: Specifications regarding if links would be provided, and should this be the case, how many, where and whether or not they would be “nofollow” links

Lead capture: For publishers that provide links to gated assets, majority charge on a per-lead basis.

Impressions (CPM): Cost per thousand impressions based on historical data,

Time and effort required from the publication’s editorial staff.

Monthly website traffic

PageRank: Publishers to justify relative pricing when they run more than one media outlet often use this

Domain Authority: Publishers to justify relative pricing when they own more than one publication often use this

Page-level engagement: A metric, which is measured by how far readers scroll down the page and the amount of time, spent on a given article.

Social media promotion: This is often an optional add-on that would increase price (may come as part of a package deal).

Email promotion: This is usually an optional add-on that would increase price (may come as part of a package deal).

Display advertising: This is usually an optional add-on that would increase price (may come as part of a package deal).

Number of articles: The amount of sponsored articles you are buying at a time

Visibility time: The amount of time an article stays live on the web page

 

Verticals: This is for large publications that cover many verticals or subject areas; some verticals are typically more expensive than others

 

Pay-per-click: This is another engagement-level metric which is measured by the number of click-throughs to an intended landing page.

 

In order to conduct quantitative analysis, explicit data was gotten from all of the publications to determine predictor variables. The predictor variables included:

 

Domain Authority: A ranking score from Moz, on a 100-point scale, which uses more than 40 signals to determine how well a website will perform in the search engine results pages (SERPs). The higher the score, the more authoritative the website is viewed as being.

Page Authority: This is another ranking score from Moz, on a 100-point scale, that calculates how well a given webpage is likely to rank in the SERPs. For this study, the publication’s home pages were used.

PageRank: This is a ranking metric from Google, which calculates the relevance of a webpage. The page rank score analyzes the number of incoming links and the referring webpage quality to generate a measurement between 0 (low relevance) and 10 (high relevance).

 

AlexaRank: This is a ranking score from Alexa.com that is based on traffic data from users over a rolling three-month period. A site’s Alexa rank is decided on the basis of a combined measure of unique visitors and page views. The site, which possesses the highest combination of these, is ranked No. 1, and higher number rankings correlate with lower traffic data.

 

Facebook Following: The number of fans (or “likes”) a publication’s Facebook page has.

Twitter Following: The amount of followers a publication’s or a blogger’s Twitter account has. For a publication with multiple accounts and/or contributing authors, only the account with the largest following was considered.

Pinterest Following: The amount of followers a publication’s or a blogger’s Pinterest account has.

Assumptions

It was taken as an assumption that the data set in this study was a representative sample of the whole ecosystem of blogs and other online publications because the results closely mirrored Moz’s distribution of Page Authority that analyzed over 10,000 SERPs and 200,000 unique pages. This regression model had a mean (average) Page Authority of 40.8 and standard deviation of 15.1. The distribution can be seen below.

The regression model in this study had a mean of 47.1 and a standard deviation of 15.5. The sample set of the publications and blogs had a just a little bit higher Page Authority than the Moz study. This wasn’t a surprise as the study only considered root domains and not long-tail pages within those domains.

Except for the little disparity, the distribution curves are almost identical. For those readers who love their numbers, the descriptive statistics of the Page Authority data in the study are below.

Limitations

There were a number of limitations to the study which are highlighted below:

Variations in sponsored content offerings – The study considered the pricing baseline based on the cost of one sponsored article. Because some publications only offered long-term commitments to marketers which could include other such benefits (email, banners, social promotion, etc.), some publications’ unit pricing may, however, be inflated. As a result of this, the regression model may not be an accurate price predictor in all scenarios.

Social account data – Not all online publications have accounts on Facebook, Twitter and Pinterest. In these cases, the number zero was used to quantify followers. For publications that had multiple accounts on the same network also, the study considered the account with the most followers.

Alexa Rank Inaccuracies – Alexa admits publicly that there are limits to making judgments from its data. Sites with relatively low traffic may not be accurately measured by Alexa.

Analysis

The graph below seeks to show the exact methodology we used to conduct the sponsored content pricing study. It’s purpose is to give readers confidence in our pricing models so they feel comfortable in adapting the formulas.

When all prices are graphed, bloat appears on each end of the pricing spectrum. In order to reconcile the dense areas, the study broke down the pricing data and regression models for blogs and publications separately.

Price-Distribution-All-Data.jpg

Blog Pricing Analysis

The graph below represents the distribution of prices for all 474 blogs in the study.

Pricing-Distribution-Blogs.jpg

Because of the wide range and low frequency of prices recorded in the “more” area, we decided to label these data points as outliers. By removing the outliers (approximately 3.8 per cent of the sample) from the analysis, the variance decreased by 87 per cent, making for a more accurate predictive model. All descriptive statistics for the blog data sample before and after removing the outliers were laid out in the study.

With the remaining 456 cases, a multi-variable regression test for price against all of the predictor variables was run, after which the insignificant variables were removed to formulate the pricing regression model for blogs, as shown below.

Blog-Price-Regression-Significant-Variable

The end results confidently determined the fair market price formula for a sponsored article on a blog:

Sponsored-Article-Price-Formula-Blog.jpg

Publication Pricing Analysis

The graph below represents the distribution of pricing for all 76 publications recorded in the study.

Price-Distribution-All-Publications.jpg

The outliers were kept in this regression model because of the range in quality and size of online publications is large. The descriptive statistics are available in the actual study.

Following the same methods as the blog analysis, the study ran a multi-variable regression test to construct a predictive model for publication pricing. After removing the insignificant variables the output looks like this:

Publication-Price-Regresion-Significant-

The end result confidently determines the fair market price formula for a sponsored article on a publication:

Publication-Pricing-Formula.jpg

What All This Math Really Boils Down To

With the formulas below, marketers now have a way to assign a value when purchasing or negotiating for sponsored articles on blogs or publications.

 

Prior to this study marketers had no way of knowing if they were getting a fair deal or not using this emerging channel.

 

Blog Price Formula = -60.5 + 5.97(DA) + 0.978(thousand Fb fans) + 15.1(PR) – 0.000007(AR)

Publication Price Formua = -37000 + 314(DA) + 20.9(thousand Fb fans) + 5152(PR) – 46.6(thousand Pinterest followers)

That being said, media buyers also need to note that many top-tier publications and blogs package their sponsored content offering in different ways. Keep this in mind when using the formulas above. Below are examples of some variation in sponsored article packages.

Pricing-on-large-publications.jpg

Networks and Tools for Sponsored Articles

While conducting research, several tools and networks kept coming up. Some networks set up for the sole purpose of connecting marketers with publishers for sponsored content. Even HubSpot has built an informal ad hoc network for its partner agencies to connect with its publishing customers. Tools for content measurement, such as Nudge, which was developed to measure sponsored content, are starting to crop up, too.

A few other networks and tools worth noting:

Adproval: This is a media outlet marketplace where publishers and advertisers connect.

BlogHer: This is a blog and social media influencer community focused on social media coverage of women

Blogsvertise: This is a blog marketplace allowing publishers and advertisers connect.

Buysellads: This is a media outlet marketplace that helps in connecting publishers and advertisers

Cision: The brand’s Content Marketing Database includes a searchable database of over 2,000 sponsored opportunities with thousands of U.S. publications

GroupHigh: This is a blogger outreach marketing software, which helps companies locate bloggers, as well as to managing and tracking relationships, and measuring results

Izea: A sponsorship marketplace that connects social media influencers with brands

Markerly: This is a brand amplification platform that brings brands and bloggers together.

Sway Group: This connects brands with agencies to the largest network of female bloggers on the Web

The Syndicate: This is log sponsorship network and a brand storytelling partner.

As the popularity of online content continues to soar and show no sign of slowing, the importance and use of sponsored content as a marketing channel will undoubtedly continue to grow as well. Besides, it’s a proven revenue stream for publishers who have often struggled to make money on the Internet.

However, as the popularity of sponsored content grows, so does the likelihood of it being regulated by the government. Till that happens, take this article as your comprehensive guide to sponsored content. The study can be downloaded here.

 

 

 

 

 

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