Good Advertising Still Works

Joshua Topolsky, founder and CEO of “The Outline,” has decided to go against the prevailing trend of paywalls and subscriptions. Because many publications are afraid of what will happen to their advertising dollars as a result of GDPR and the trend toward ad blockers, they’ve all gone like sheep to the subscription model over the past year or so. But we’ve written before in these pages that there is an upper limit on the subscription model, which is bounded by the reader’s time and income. Even wealthy people do not want to spend all their money on subscriptions.

So Topolsky, who is also a co-founder of “The Verge” and previously worked at “Engadget” as editor, raised $5 million to launch an ad-supported site, but one that is very different than other publications in its space.  He wanted a site that people actually read, with ads that actually worked. It’s a little like Back to the Future. In exchange, he gave up an emphasis on scale. “To be big would be simple,” Topolsky told Peter Kafka on the Recode Media podcast, “it’s very easy to get traffic. I could write a bunch of Avengers Infinity War posts, and get all the traffic I want.”

His point is that most sites are optimized to go for clicks, so even a site like NorthJersey.com will have those Avengers stories, even though they have nothing to do with NorthJersey and attract the wrong traffic. Then advertisers on those sites are disappointed, because their ads don’t work. “Bad traffic is easy. “What is difficult is to get the right people to the right story. There’s a higher value to that.”

What happens when Topolsky goes to the advertising world and tells them “I don’t have big traffic, I have smart traffic” when the usual advertisers are looking for reach?

In his opinion, advertisers have realized that what has been sold to them as the magic solution –i.e. big audiences on Facebook and Google–bought programmatically, has now been exposed as less than ideal for a multitude of reasons. While there is still a scale play for people like Buzzfeed, “The Outline” strives to differentiate itself on engagement. As an example, Topolsky says his site gets more views on custom content than sites with four times the amount of traffic. He has also said in the past that his click through rates are 25% higher than the industry standard.

“Not every advertiser will advertise with us, but some good ones will. Smart brands who want to speak to audiences directly, like Cadillac and MacAllan like us.” The custom content gets seen and is engaged with partly because it is more visible (there are fewer ads) and because it’s smart. Also Topolsky targets his stories carefully to his audience, mostly urban, mostly Millennial, mostly well off.

MacAllan used “The Outline” to tell its brand story for a $300 a bottle scotch. There are only a few million people who will pay that much for a bottle of alcohol, and niche products work for niche sites.

“The Outline” has just closed an up round for its niche site, and that’s a signal that investors think things are going well. “What we’re doing is not normal for sure,” Topolsky admits.”But it’s working. People are interested in advertising with us. We’re the twelve seat cool restaurant, not the chain, and that’s the long term plan.”