How to Secure the Future of Digital News Funding: Key Strategies for a Sustainable News Industry
The digital news landscape is under pressure. Recent revelations about the allocation of ad budgets and the challenges posed by brand safety concerns have highlighted a critical issue: the need for sustainable funding in digital news. In this feature, we explore how to ensure the future of digital news funding, with expert insights from John Williams of the BBC and research by Mat Broughton from ExchangeWire.
The Current State of Digital News Funding
The state of funding for digital news is alarming. Recent testimony from the US House Judiciary Committee revealed that only 1.28% of clients’ ad budgets are allocated to online news sites. In contrast, Unilever USA spends less than 1% of its US advertising budget on digital news but allocates 20% to social media platforms.
This disparity raises important questions:
- Why is so little ad spend directed towards trusted news platforms?
- What impact does this have on the quality and sustainability of news journalism?
The Brand Safety Dilemma
Brand safety remains a major concern for advertisers. Unilever highlighted issues with its ads appearing alongside inappropriate content on social media platforms, such as content glorifying domestic violence. Despite these concerns, the bulk of advertising spend continues to flow into social media rather than news sites.
- Low Allocation to News: Less than 1% of Unilever’s ad budget goes to digital news.
- High Risk in Social Media: Significant ad spend is directed towards platforms with frequent brand safety issues.
The Reach vs. Quality Debate
One of the reasons for the low ad spend on news sites is the perceived advantage of social media platforms in terms of reach. For instance, Instagram boasts over six billion visits, far surpassing CNN’s 710 million visits. However, reach alone doesn’t justify the higher ad spend. Here’s why:
- Quality Over Quantity: Advertising in high-quality news environments can enhance brand perception and trust.
- Consumer Trust: Ads placed alongside reputable news content, especially breaking news, tend to improve purchase intent and brand trust.
The Role of News Platforms in a Misinformation Era
John Williams from BBC Studios Global Media & Streaming points out that the rise of disinformation and generative AI presents a unique opportunity for credible news platforms:
- Opportunity for Trust: Amidst misinformation, there’s a growing demand for honest and accurate news.
- Elections as a Key Moment: With 2024 being an election year, there is a prime opportunity for news platforms to rebuild audience trust.
Adapting to a Cookieless Future
The impending decline of third-party cookies is reshaping digital advertising. News platforms are adapting by:
- Embracing Contextual Targeting: BBC has long used contextual targeting and is now enhancing its use of first-party data and contextual tools.
- Innovating with Data: Moving away from behavioural targeting to better understand the value of news as an advertising context.
Strategies to Boost Funding for Digital News
To secure more funding for digital news, we need to address several key areas:
1. Insights
Advertisers need robust data to see the value of news as an advertising medium. This includes:
- Qualitative and Quantitative Metrics: Demonstrating the effectiveness of news environments for brand visibility and trust.
- Content and Context: Emphasising the positive impact of ads placed in high-quality news settings.
2. Access
News publishers must be present wherever their audience engages. This means:
- Holistic Platforms: Providing seamless access across TV, digital, audio, and social media.
- Integrated Solutions: Offering advertisers integrated platforms that align with audience habits.
3. Courage
Advertisers and agencies need to be braver about placing ads in news contexts. This involves:
- Respecting the Audience: Acknowledging that premium news audiences are discerning and value integrity.
- Commitment to News Platforms: Maintaining ad presence on news platforms, especially during critical moments, to build long-term brand value.
Conclusion: A Call for Action
Securing the future of digital news funding requires a shift in how advertisers and agencies view news content. By prioritising quality over reach, embracing new data tools, and showing courage in ad placements, we can support a sustainable news industry.
With expert insights from John Williams and the urgent need highlighted by industry research, it’s clear that the future of digital news depends on our collective effort to invest in quality journalism.
Useful Resources and Relevant Links:
