The Ultimate Content Marketer’s Guide to Syndication and Licensed Content

By Shane Snow April 15th, 2015

In 1884, a 27-year-old kid named Samuel Sidney McClure launched a startup that would define the media industry for 130 years.

Previously the co-founder of his student newspaper at Knox College, young McClure had moved to New York City to make his way as a newsman. At the time, the burgeoning—and unregulated—advertising industry was beginning to make newspapers around the world more sensational.

It was a tumultuous atmosphere bearing remarkable similarities to today’s digital rat race that would launch news giants like Pulitzer and Hearst. But amidst the chaos, McClure began paying writers for what present-day pundits would call “slow journalism”: longform investigations, books, and deeply reported features. Instead of publishing the stories himself, he bought the rights and sold the stories to publishers around the world.

He called it “syndication.” His company, McClure Newspaper Syndicate, went on to represent some of the most influential writers of the day, from William Jennings Bryan to Teddy Roosevelt to Sir Arthur Conan Doyle. The company established a business model that traditional media companies would follow for more than a century, generating billions of dollars in revenue.

McClure and its successors gave publishers something they couldn’t get themselves: access to top content and talent from the world’s far corners—and for cheap. Because a syndicate could sell a book or article or comic strip to various buyers, it could charge less and make more profit. It became the paradigm for television (pilots and reruns), artists (musical and graphic alike), and printed works (whose books and stories could be resold in different languages and locales). This is not unlike the software business: Create something once, then sell copies of it ad infinitum.

A “syndicate,” by dictionary definition, is “a group of individuals or organizations combined to promote some common interest.” In media, this means legally publishing someone else’s content, typically in exchange for a fee or credit. The modern buzzword “licensed content” is often used interchangeably with “syndicated content.”

Today, syndication is still a big part of traditional media’s business model. But like everything else, it’s being tugged apart by technology. Recent shifts in the way people publish, access, and consume media—social media and content marketing being chief change agents—pose challenges for the syndication model, specifically for news content.

My personal interest in syndication stems in part from the my own company, where we help brands become publishers of education and entertainment in order to build loyal audiences. (We provide software tools and freelance talent to create original content, engage readers and viewers on the web, and optimize the process over time.) As our business has grown from three guys in coffee shops to 80 employees and the world’s largest network of freelance journalists, we’ve debated: Should we get into syndicated content, helping brands like Coca-Cola to license articles from traditional publishers like CNN? Or should we stick to helping brands just do original content?

The key questions in my mind as we’ve explored the syndication model are the following:

  1. Is licensing content effective for brand publishers, who have different business goals than traditional publishers? Is it worth paying for?
  2. Will syndication in general continue to work as the media landscape evolves?

After much research, the short answers are:

  1. No.
  2. In some cases.

If you don’t want to read the long answer below, feel feel to tweet this and close the tab:

Research shows: Licensed content doesn’t work in content marketing. For brands, original content always wins.

Syndication and traditional media

Originally, what made the syndication business work were access and options. Or, rather, a lack of them.

E.g., A local magazine in Kentucky couldn’t get Rudyard Kipling to write for it in 1920. But it might buy a reprint license for Kipling’s poems.

E.g., A newspaper in Oregon couldn’t ship a reporter to New York to cover an election in 1955, but it could buy a story about it from a news wire like the Associated Press.

E.g., A cable TV channel probably couldn’t afford to make something as popular Seinfeld in 1999, but it could buy the right to rerun it.

In each of these examples, the second publisher doesn’t need to create something new; it can buy a copy of the original and give its own audience access to it. Notably, there would be little point in a New York newspaper licensing content from another New York newspaper, if each could send its own reporters to cover the same stories. And a New York Post editor would rather swim naked in the Hudson than rerun a story by the Daily News. But a Kentucky paper and a New York paper aren’t competing for the same readers, so a syndication arrangement is a win-win.

Until the Internet, that is.

Today, licensing and syndication only really works for content that people are willing to pay for, or content under strict access control. This is why movie theaters are still open and Comcast and Hulu Plus rake in millions. Local print papers still license stories from news wires, but it’s a tough business, and one that doesn’t translate to the web. It no longer makes sense for a local paper to republish a national Reuters story on its website when online readers could get that story elsewhere.

Most of the time, syndication just doesn’t make sense for free content. The one place it does work, however, is when one publication has a loyal audience that doesn’t overlap with a smaller publication that produces specialized content.

People habitually visit only a handful of websites every day, most popularly search engines, portals, and social media sites. If a news site is lucky enough to have you as a loyal reader, it has an opportunity to show you content from other sites you might not frequent.

If you’re a small publication or an individual blogger, you likely want to be syndicated by one of those bigger sites. My own blogs are occasionally syndicated by publishers like Business Insider or Time, and this builds my audience. Those publishers can benefit from in-depth content (much like the kind that S.S. McClure brokered) that their audience hasn’t been exposed to, and I can reach more people with my brand.

However, I have little incentive to pay to republish a Business Insider story on my blog. My readers may as well go to directly.

As Moz’s Rand Fishkin explained in a recent interview with The Content Strategist:

“If you’re a small or mid-sized website and you’re licensing content from the AP and the Times, you’re probably sunk. That’s not going to do much for what you’re building. That’s not going to do much for your SEO…

On the other hand, I see folks like Slate and Salon and The Washington Post and this fantastic blog post that was written by this author in this smaller space. That can be awesome. They have a huge megaphone and they can amplify a great piece of work that maybe has only been seen by a very, very small niche community.”

It might be valuable for me to link out to interesting BI stories from my social accounts, but syndicating those stories to my blog in their entirety doesn’t do much, and it doesn’t make me look better to my readers than simply tweeting the link to the original story. In fact, my research indicates that a smaller publisher syndicating content from a bigger publisher might leave a weird taste in readers’ mouths.

Which brings me to…

Licensed content and brands

The typical licensed content sales pitch to commercial brands goes like this:

  • “It brings credibility to your content marketing campaigns.”
  • “It helps you scale content and publish quickly.”
  • “It fills coverage gaps.”
  • “It generates strong social media value.”
  • “It’s good for SEO.”
  • “You get more bang for your buck.”
  • “The ideal content mix is 1/3 licensed, 1/3 original, and 1/3 user-generated content.”

Unlike a media company, whose business aim is to show advertisements to the largest number of people possible, the overarching goal for most content marketers is to reach specific groups and build relationships with them. Brands anticipate that those relationships will eventually yield brand advocacy, trust, or sales. Traffic does not equal success.

In today’s media environment, most people arrive at content through social media, search, and email. Few media sites receive relatively large percentages of direct traffic.

With that in mind, let’s take a look at each of the above points:

  • “It brings credibility to your content marketing campaigns.”

This claim is overblown at best. At worst, the opposite is true.

Last year, I surveyed a panel of 378 Internet readers from ages 18 to 60 about what they thought when a brand published licensed content on its blog for thought leadership. Fifty-nine percent of respondents said it did nothing for their opinion of the brand, and 32.8 percent said licensed content made the brand look worse, even if the content came from a respected name.

More comprehensive research needs to be done in this area, but these survey results indicate that unoriginal content from brands can put a weird taste in people’s mouths. If licensed content is really good, it can make a commercial brand look good only if it appears that the brand created the content itself. Most licensing agreements, however, require a prominent citation of the original source. This puts content-licensing brands in a double bind: In the same survey, 32 percent also said that a hard-to-find disclosure of authorship would make a brand look worse. Yikes.

  • “It helps you scale content and publish quickly.”
  • “It fills coverage gaps.”

These are both true. However, for brands, the goal should not simply be to publish. So these points are moot. Filling coverage gaps makes sense if you’re the only game in town (e.g., a local paper back in the day, or a cable provider like Comcast today). It doesn’t make sense if you are a small publisher or a site that receives most of its traffic through search, social, and email. If someone logs on to your site directly every day, then yes, filling coverage gaps is a good idea. But for content marketers, this is putting the cart way before the horse. There isn’t a brand publisher on Earth with a significant portion of traffic coming directly every day.

  • “It generates strong social media value.”

There doesn’t seem to be much evidence to support this, compared to simply sharing external links to the original content via social media (which is much cheaper than licensing content and then sharing it). In fact, sharing links to others’ original content is generally viewed as good social media citizenship. I’d argue that sharing links to others’ content that you’ve republished on your own site doesn’t provide stronger value on social platforms than giving credit and linking to the publication where the article originally appeared.

  • “It’s good for SEO.”

This one is patently false. As we’ve written before, Google looks down on unoriginal content more than ever. Cyrus Shepard, SEO expert and head of content at Moz, recently told me, “Syndicated content is like giving popcorn to children. It will keep them busy for a while, but that’s it. All the value is having something original.” This is from the top SEO firm out there.

Once again, if you’re the bigger fish in the syndication equation, you’re generally not going to be hurt by this, according to the Moz crew. But there’s no value in it if you’re the smaller fish.

  • “You get more bang for your buck.”

The going rate for licensed online articles tends to be between $25 and 38 per story, which is 10–20x cheaper than a typical, well-researched original article. Unfortunately, as seen above, licensed content appears to provide little or no bang no matter how many bucks a brand spends. Producing 10x the amount of ineffective content is still, well, ineffective.

  • “The ideal content mix is 1/3 licensed, 1/3 original, and 1/3 user-generated content.”

This, it turns out, is an arbitrary suggestion recommended by only one company (see below) that sells licensed content. There’s no research to support that this has worked for any commercial brand, much less as sweeping advice for all brands. Experts in categories from social to SEO to creative agencies tend to disagree with this statement, universally saying that high-quality original content, including user-generated content, is far more effective than non-original content for brands.

Old dogs with old tricks

As of 2015, I could only find one remaining company actively touting licensed content as a strategy for brand publishers. According to data, this company’s own SEO authority has decreased in the last year, despite publishing over 600 pieces of content to its blog, many of them licensed from publishers like Business2Community and Forbes. (For comparison, we published a similar amount of original stories to our own blog and grew our SEO authority significantly. Our monthly unique readership is over 200,000 as of last month.) So it appears that what experts say about syndicated content is true: It’s hurting the company’s content marketing.

Heck, if this company is paying any attention to its own content performance, it likely knows that its licensed content is inferior. A year ago, I used social data to chart how the company’s own original content outperformed its licensed content by a factor of 10.

Other companies that broker licensed content for traditional publishers—folks like Bloomberg—have ramped up original content production studios for their brand clients that want to do content marketing. I’m yet to see a case study of a successful content licensing program for a brand that has resulted in real brand results (and not superficial metrics like “reach”). The big syndicates appear to be going all-in on original content for brands, and leaving licensed content for traditional media.

There’s plenty of evidence that original content works for building audiences and is good for getting licensed by bigger publishers, but that licensing content in the other direction does nothing for brands. If anything, a marketing strategy based on licensed content may be worse than one with no content.

The bottom line:

For content marketers, it’s far better to be syndicated than to syndicate.

Tellingly, when McClure Newspaper Syndicate wanted to build its own brand and sell its own services, it used original content to do it. Here’s the comic strip McClure sent to prospects in 1943:

Syndication will still have a place in the media ecosystem for some time. But we’d be amiss if we applied its old model to modern content marketing.

Image by Africa Studio
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