Thursday, August 07, 2014

Newspapers: Sponsored content, advertorials and the shifting balance of power

Norm Farrell has a useful post about sponsored content, the new name for advertorials. And The Gazetteer wondered what I thought, as a former newspaper manager.
Farrell says sponsored content is bad. 

“How should readers react when business pages are presented by an industry lobby like the Canadian Association of Petroleum Producers? I don't care to pay a newspaper that presents promotional pieces of advertisers as news nor do I wish to pay a newspaper that hesitates to publish stories that affect reputations of its sponsors,” he asks.
“If the Vancouver Sun's business pages are presented by the fossil fuel industry, readers are not likely to read that shale gas is "The dotcom bubble of our times." Nor are they likely to read that British Columbia has earned almost nothing from natural gas royalties in recent years.”

The piece raises two separate questions. Are readers being misled by ads masquerading as news, and are newspapers failing to cover stories for fear of irritating big advertisers?
No one pushed Bogie around
Advertorials were always a source of conflict between ad salespeople and the newsroom. Advertorials offered businesses a chance to buy ads that looked sort-of-like a news story, supposedly gaining credibility for the message. They paid a premium for the privilege.
Ad departments wanted the result to look just like a news story. The newsroom wanted the opposite - a different type face, borders and a big label that said ADVERTISEMENT. And the editorial staff didn’t want to produce the material, believing that that could create the perception of conflict in covering related stories. (And because they thought it beneath them.)
Usually, the editorial side won the day. Readers could recognize the ads for what they were.
As long as that’s true, I don’t have a problem with sponsored content or advertorials. In at least two cases, that apparently hasn’t been true of the Postmedia advertorials. They have run on newspaper websites as if they were real content, generated by editorial staff based on their best judgment about what information readers needed or wanted.
There are broader problems. Organizations and individuals are getting slicker and more convincing in developing and distributing sponsored content, in all media. More and more content that looks like or pretends to be journalism is really advertising. (Or clickbait aimed solely at getting people to look at ads.) 
That content comes from people who can pay for it. People who can’t pay have a limited role in the public discourse.
Editors and reporters used to decide what would go in the paper each day. The process was haphazard and shaped by personal prejudices and limited resources, but it was mostly aimed at delivering something useful for readers.Now, people with money can buy sponsored content. They can train their spokespeople and manage the message. There are seven print journalists left in the legislative press gallery. The government has 278 employees in the communications and public engagement department. The spinners have a vast advantage in numbers and resources.
And newspapers, and news media generally, are in a different position in dealing with advertisers than they were in the past.
Newsrooms won the arguments about clearly labelling advertorials in part because the businesses were profitable and seen as essential by many advertisers. 
Today, newspapers are struggling to survive. The advertisers have the edge in negotiations, as companies are looking for any way to generate revenue. The risk is that advertisers will hold too much sway.
A few advertisers have always sought to influence content. My position, while managing newspapers, was that it was in the long-term best interests of advertisers to accept that they had no special sway. Readers bought newspapers because they believed the information was selected based on their needs. If that was no longer true, readership and credibility would fall and ads would be less effective.
It was easy to say no to an unreasonable request - nicely - because the newspaper could cope with some lost revenue and be reasonably confident that any boycott would be short-lived. 
That has changed. Struggling businesses are more easily pressured. That’s not a slam on the people who work there, simply an acknowledgement of reality. When shareholders and analysts are awaiting quarterly results, or hedge funds are looking to get their money back, it’s harder to make decisions, in grey areas, that risk revenue.
Newspapers were sometimes accused of arrogance in the past. But arrogance brought with it a certain independence. 
It’s interesting that we are having this discussion. Newspapers, for all their stunning faults, have at least established a code of ethics around their relationship with readers. If they hadn’t, there would be no possible breach to consider.