Will Numbers and Scale Give Way to Value?

We’ve noticed a movement lately away from scale,  the high volume content strategy of major publishers. While they thought they needed to publish more stories to gain more readers, they’ve now overwhelmed those readers in a deluge of content, some of it not worth viewing. They then run ads against all that content, further inconveniencing visitors. This is the model of The Huffington Post, which recently modernized its platform to let anyone contribute without moderation. We predict this will be a strategic mistake for Huffpo. This is the old way: publish as many stories as you can, reblog as much as you can, aggregate the rest, and use Outbrain and Taboola.

Quite frankly, this “more is better” strategy has buried the good stories in the crap.

A few new publications have decided to do it differently. We’re written about Josh Topolsky’s new publication, The Outline, on the ZINC blog.  The Outline strives to run fewer, better ads against longer form content that is edgy, but not trivial. The new Bill Simmons site, The Ringer, publishers around two dozen stories a day, and The Information, Jessica Lessin’s subscription site, publishers just two.   The hope is that by publishing fewer, better stories, these publishers will draw more actual engagement. That certainly seems to be true in the case of The Information, which doesn’t accept ads and has about 10,000 subscribers paying $399 a year. It also has active commenters from among its subscribers, and a Slack backchannel on which readers can talk to reporters.

Of the ad-supported sites, fewer ads and deeper niches will win over time. This will be good for all ends of the ecosystem, because publishers who have scarce inventory that is actually desirable can charge more for it. And advertisers, even if they buy programmatically, will have a better understanding of the audience they’re buying.

Which brings us to a point we’ve made repeatedly. Scale was a bad strategy for digital advertising. From the first, the infinite supply of content drove ad prices down and made it impossible to price the premium sites, or the desirable content, higher than everything else. That in turn led to the emphasis on click bait and viral content. And to ads that generated poor ROI.

An exception to this has been video advertising, which provides a better return because it is more expensive to produce and therefore there’s less of it. It’s the good old law of supply and demand: when there is less of something, its price always goes up.

Now that publishers realize that more is not necessarily better, it is time to educate advertisers. What will help? The growing perception that fake news and non-brand safe sites should not be part of anyone’s marketing program.