The Sun and the Toronto Star, both previously staunch advocates of subscription-based revenue models, said they would open up their paywalls. The Sun is aiming to boost its social media profile by making selected content free to access on its site, while the Toronto Star announced a wholesale shift to free access.
Does this mean the writing is on the wall for paywalls and ad-funded content is the future? The answer is no – at least in the short-to-medium term – but a change of approach is necessary because free, ad-funded content is not working for many publishers either.
Publishers can’t keep haemorrhaging money using these two traditional models if we are to have a healthy media. The figures speak for themselves. In the US (according to the Newspaper Association of America), newspaper revenue from print advertising fell from $46.6 billion in 2006 to $16.4 billion in 2014, while digital ad revenues barely changed – up from $2.7 billion in 2006 to $3.5 billion last year. In other words, the need for a new monetisation model is critical – and especially so with the rise of ad-blockers.
An important solution, which is being driven by developments in technology and proving popular with publishers, is the offering of a value exchange between the publisher and its audience. This means asking the audience to engage with a brand message or experience in return for access to an article or video. It’s an approach that guarantees 100 per cent viewability for advertisers, delivers insightful audience data and helps keep the internet free.
As the value exchange strategy starts to gain popularity, publishers, brands and agencies need to start talking about cost per engagement or cost per human and quantifying interactions with humans rather than relying on models based on cost per thousand or cost per click that are becoming increasingly problematic and outdated. In practice, this will demand more flexible ideas of what constitutes engagement from a marketer’s point of view and, by combining brands’ goals and the possibilities offered by new technology, these formats could bring new creativity to digital advertising.
As publishers become increasingly wary of the pitfalls of paywalls and audiences rail against the oversaturation of current display ads, this third method of monetising online content should provide the industry with a breath of fresh air.
Rowly Bourne is the founding director of Rezonence