How 'Content Shock' Has Led to the Rise of the Chief Revenue Officer at Financially Struggling Online Publications
Print might or might not be making a comeback, but in 2016, even many online publications are struggling with revenues. Can chief revenue officers (CROs) -- those senior executive leaders charged with owning long-term strategy for their monetization channels -- save the day?
The cash-flow bottleneck comes as a result of “content shock,” whereby audiences are constantly barraged with media, shortening our attention spans and raising our standards in terms of what captures and holds our focus.
Of course, there are monetization challenges to address with the rising share of content consumed via mobile devices. Today’s publishers need to figure out how to effectively contend with banner “viewability” issues, screen size limitations, fat fingers and the reign of “snackable” and “detachable” media formats.
Then there’s the rising prevalence of ad blockers, widespread banner blindness and the general lack of interest among the general public in shelling out for access to the other side of paywalls. Studies indicate that the average click through rate for display ads is 0.06 percent, and ad blocking has grown by 41 percent in the last year. It’s more likely you’ll climb Mt. Everest than click on a display ad.
No wonder online publications are left searching for ways to make a buck. Today’s CRO doesn’t have a particularly easy job.
Why it takes a CRO
Media consumers are sending a clear message that we want pleasant experiences that take place on our terms without pesky interruptions asking for handouts or touting sponsors’ products. If online publishers have any hope of making money by connecting with and cultivating loyal audiences, it’s going to be because they’ve successfully crafted and protected these experiences.
With more and more publishers turning to their newly recruited CROs for sustainable monetization solutions, these executives are charged with unearthing sellable media placements and products that don’t turn people off. It’s a tricky, shaky middle ground with precious little precedent. Sales and business development departments at publishers are responsible for meeting monthly quotas, moving units and filling inventories -- not to “fight for the user.”
That’s why at publishing companies, only the CRO is responsible for all aspects of a company’s revenue performance, identifying and monitoring the high-gain points and making sure that product, sales and marketing teams are all working towards the same goal. The CRO assesses the risks associated with various strategies, creates a plan for each revenue stream, monitors performance and then circles back around to implement strategies for faster revenue growth.
How publishers are monetizing creatively
BuzzFeed is a great example of using custom strategies for native advertising and sponsored content to generate revenue.
With business units dedicated to generating share-worthy sponsored content as a service and promoting it via a proprietary machine learning-powered recommendation engine, Buzzfeed is a monetization powerhouse. According to one source, the sophisticated publisher’s revenue has increased from $4 million in 2011 to $64 million in 2013 to $46 million over just the first half of 2014.
Not every media company has access to the resources to create a data-driven monetization machine like Buzzfeed’s, though. Somewhat smaller publishers are turning to integration-ready third-party platforms like CodeFuel and Imonomy to generate revenue with advertising in such a way that it becomes part of the user experience. This way, as the shrewd CRO will note, audience members can engage with native and sponsored content -- essentially next-generation ad units -- without being bombarded or interrupted by them.
Engagement and monetization suite CodeFuel offers publishers a solution to engage and monetize their audience with technology that taps into user intent signals and allows publishers to promote additional related content. Since the units are fully customizable and can be tweaked to maximize content relevance, this helps to keep the audience engaged and on the site longer for top attention performance.
This is the type of solution that speaks to CROs who are familiar with the landscape. Native ads are viewed 53 percent more than banner ads. Moreover, 32 percent of consumers say they’d share a native ad with friends and family compared to just 19 percent of people saying the same of banner ads. When native ads include rich media, conversion rates have been known to increase by up to 60 percent..
“If the evolution of our technology world dictates that we need to change course in order to innovate and maximize revenues,” says Eyal Ben-Ari, CodeFuel’s own CRO, “then the CRO needs to step forward, align teams and become the much-needed company pioneer.”
How CROs get everyone aligned
Since CROs take a holistic view, managing the entire process from assessment to optimization, they can work with product, sales and marketing to create plans that allow the teams to work in tandem towards the same goals.
When sales and marketing teams at publishing companies aren’t aligned, for example, you may run into issues with marketing making promises the sales team can’t keep up with, and thus creating relationship issues with external stakeholders like media agencies and buyers for brands. Marketing can send sales thousands of leads, but if sales can only get a tiny percentage of those leads to convert, the CRO needs to step in.
It might not be possible to get all of these departments to play nicely together for the sake of collaboration, but as Chicago consultancy Revenue Storm’s CRO LaVon Koerner will remind us, with a sound strategy in place, it’s far easier to make sure everyone in an organization at least aligns what they’re doing with the company’s documented goals.Publishers who fail to embrace the changing landscape of content monetization will continue to see nose-diving revenues. Doing so without a CRO is possible, of course, but embracing native advertising as part of a CRO-overseen business can help boost revenues to new heights for the long term.