/ 20 December 2013

When advertising goes native

But as native advertising takes hold
But as native advertising takes hold

It's early on a Friday morning in late 2014. As you usually do, you navigate to your favourite website to check out the news. True to form, as the home page loads you find a well-illustrated news story unfurling down the screen.

"President Jacob Zuma lauded as hero by business leaders and the poor alike," announces the headline.

In the body of the piece, the reporter describes visits Zuma recently made to a township and to an investors' forum, and the gushes of praise that followed both encounters. The township residents even followed his Mercedes-Benz to toss roses at it. You blink and rub your eyes. What?

The site's "real" stories appear interleaved with "sponsored" articles that look just like the regular stories, but subtly promote Jaguar, AngloGold Ashanti or Agang SA.

Sound dystopian? In fact, it's already happening. It's called "native advertising" and, during the past two years in the United States and Europe, it has rapidly become newspaper and magazine publishers' new favourite online advertising model – and it's on its way to South Africa.

Is it a form of advertorial? A very similar kind of ad appeared in print in the Mail & Guardian in June, and was posted online. It was an article lauding Tokyo Sexwale's achievements as human settlements minister with "advertorial supplement" printed in small text next to the dateline. In the online version there was no mention of the article's sponsor – Sexwale's department.

By stark contrast, a "real" article written by M&G journalists two months later lambasted the department and described the situation as a "post-apartheid housing failure".

Native ads look as similar to articles as possible, mimic a publication's editorial tone and are interleaved with regular content so that they do not interrupt the reader's engagement with the core media brand.

It might seem that these ads will pose dangers to editorial independence, as the example above suggests. But publications are rushing towards them.

Ninety percent of media websites affiliated to the Online Publishers' Association now post native ads. The New York Times recently announced that native ads will be its advertising focus for 2014 and venerable news outlets, including Forbes and the Wall Street Journal, rely on them. The tech magazine Wired has even established an entire new editorial branch staffed by serious writers and photojournalists to write native ads for corporations, the idea being to bring as serious an imprimatur as possible to pure promotion.

Why the shift? It's helpful to get a little history. Ads have been around since at least the age of Egyptian papyri, if not earlier (who knows whether those cave paintings advertised a butcher?). Billboards even existed in ancient Pompeii.

The golden age of advertising, though, was at the cusp of the late 19th and early 20th centuries. The Industrial Revolution and the emergence of mass-produced and mass-marketed products prompted the establishment of huge advertising firms in London and New York. The year 1893 marked the first shift from purely subscription-based revenue by an American magazine to a primarily advert-based model.

The invention of radio and television created a market for more flashy and inventive styles of advertising. People fell in love with advertising: the "ad men" of Madison Avenue were considered sexy beasts and David Ogilvy's memoir Confessions of an Advertising Man became a bestseller. The more distinctive the ad, the better. It was a good thing for an advert to pop out from the dry journalistic content surrounding it.

But by the end of the 20th century, the public's intrigue with eye-catching ads was burning out. On the internet, people quickly learned to tune out banner ads and reject websites littered with flashy, epilepsy-inducing promotions. The click-through rate for banner ads plummeted to a mere 0.5%.

The fact is that, in the United States, newspapers' ad revenue is down a whopping 55% since 2005 and, at the New York Times, digital ad revenue has begun falling faster than print revenue due to the collapse of interest in banner ads.

The situation is similar in South Africa. Gill Moodie, the head of media analysis website Grubstreet, said that every media house "is in the same bind, where the print advertising is falling drastically but online isn't nearly picking up enough".

There are concerns about the industry's existence – how can traditional journalism continue to survive financially? – which is why some in the media are embracing the shift wholeheartedly.

"Advertising … pays great journalists to find and tell the truth," the business writer Derek Thompson wrote in an article in the Atlantic.

Old publishing revenue models are broken.

Thompson encouraged journalists concerned about preserving the profession's ethical standards not to throw the baby out with the bath water. The only way to fund journalism going forward, he concluded, is to accept radical "experimentation".

Chris Roper, the editor-in-chief of the M&G, is another bullish voice.

The paper will "absolutely" move towards native advertising online, he said. Sponsored content that matches the paper's voice, he suggested, can be discussed and shared on social media, opening up a whole new level of potential engagement and audience-targeting for the advertiser.

But many in the industry are alarmed by the obvious pitfalls. "It would require very sophisticated management," Moodie warned. "You are blurring some boundaries."

Last year, the Atlantic showed how easy it can be to run afoul of the boundaries. In an episode that became notorious, the magazine published an article touting the great achievements of the controversial Church of Scientology.

The publication endured merciless criticism for an ad that looked like a story, with the Onion spoof website running a mock advertorial in response: "SPONSORED: The Taliban is a Vibrant and Thriving Political Movement."

Supporters of native advertising tout "transparency" as the key to maintaining journalistic integrity in the face of an increasing overlap between advertiser-sponsored and independent content.

I contacted the Atlantic and its spokesperson, Natalie Raabe, said the magazine has drafted a new native-ad policy that the head of the American Society of Magazine Editors has praised. It stipulates that "The Atlantic will not allow any relationship with an advertiser to compromise the Atlantic's integrity" and that they "will label an advertisement with the word 'advertisement'".

The core of the M&G's developing native-ad policy rests on the same two pillars: that "native advertising has to provide as much value to the reader as M&G content" and that it "must be fully transparent and must be clearly labelled".

In reality, though, it seems likely that even the Scientology ad could slip through the cracks under such a policy. Who judges whether an ad contradicts the magazine's views when another aspect of native-ad policy demands that the editorial and native-ad sides of a publication must be kept entirely separate?

And there is evidence the practice itself, like any habit, inures journalists to its dangers. Recently, several media critics fingered Playbook, a daily newsletter that's essential Washington reading and comes under the aegis of Politico, a well-respected online hard news publication, as a "native advertising pioneer", demonstrating how plugs for Politico's prominent advertisers have been seamlessly folded into Playbook's editorial content for years.

The criticism was devastating but Politico blew it off completely, claiming our faith in its journalists' hearts of gold ought to be enough to assure us of their best intentions in all circumstances.

"Mike Allen [a Playbook writer] is one of the best reporters that I have known in Washington," Politico's editor-in-chief breezily told a television interviewer. "So the product is rock-solid. It's silly to insinuate that – like, why would we do that?"

As for transparency, the true funder of the M&G's first major native-ad campaign, a section called "Stories of Help" featured on the thoughtleader.co.za online opinion site, was nowhere to be found. "First National Bank [the sponsor] didn't want branding," Roper explained. "The product is the stories of hope, not FNB. The point of native advertising is that the content is what your readers expect from a normal news story."

What is clear is that many, even in the industry, are confused about what exactly native advertising is.

Is it an online advertorial? A sponsored feature? Or is it something else entirely?

And will it even be possible to regulate native ads?

Earlier this month, the US Federal Trade Commission warned publishing associations to adopt "voluntary" guidelines or face regulation. Some experts have suggested two specific policies would help: naming the funder of sponsored content and linking to a native ad's relevant editorial content so readers can understand the publication's independent position.

But as native advertising takes hold, we may come back around to the early days of advertising, when editorial content and ads were often undifferentiated. Recently I looked up some ads from Harper's Weekly, an American political magazine published from 1857 to 1916 (not to be confused with Harper's, a different publication).

An ad for a sewing machine took the form of a poem that was indistinguishable – except for its corny content – from the magazine's literary poems. No "sponsored", no nothing. An ad for a Bahamas resort took the form of an article.

The era of ads being easily distinguishable from reporting may be a brief golden age we will soon look back on as a fond memory.