‘We’ve Gone All In’: Why The Daily Beast Wants to Save Journalism Through Content MarketingBy Joe Lazauskas April 22nd, 2015
Some in the media industry still view native advertising as the shapeshifting beast that will bring the downfall of journalism as we know it. But at The Daily Beast—where sponsored content now brings in the vast majority of the publisher’s revenue—the perspective is far sunnier.
“We have gone all in,” said Mike Dyer, The Daily Beast’s chief strategy officer. “We like our approach. We like how much we can handle. The last published [revenue] number was 55 percent. I can tell you it’s much higher than that. There is not a lot of room left to go.”
Dyer made a name for himself at marketing agency Hill Holiday, where he was far ahead of the curve when he launched the agency’s renowned content marketing services in 2008. Since arriving at The Daily Beast in December 2012, he’s been leveraging that experience to build an industry-leading sponsored content offering by developing a robust content marketing network—filled with hundreds of veteran editors, creative directors, journalists, and other content creators—to execute ambitious content marketing campaigns such as The New Alphas, a series of high-quality profiles of young leaders for Lenovo that ran over a seven-month period, and The Art of Now, a hub of summer-themed trend pieces sponsored by Lexus.
The Daily Beast’s sponsored content is of genuine interest to the Beast’s audience, a relative rarity in the publishing world. (This piece of sponsored content was shared over 14,000 times, for example.) And ensuring that those stories resonate with Beast readers is crucial. While other publishers pump traffic to their sponsored content through Outbrain and paid social distribution, the Beast organically drives readers to sponsored content through homepage and newsletter placements.
While there’s a strong church and state divide between the Beast’s editorial and advertising teams, there’s also an enthusiasm for sponsored content atop the masthead. To editor-in-chief Jon Avlon, creating a sponsored content model that flourishes while protecting the integrity of editorial is an immensely important challenge for journalism—and even democracy.
“Let me get on the soap box for a second about why financial independent matters,” Avlon said. “Journalism is the only profession that’s mentioned in the Constitution. We have the opportunity to reimagine how journalism monetizes, how the economics of it works. If we fail at that so all of a sudden it is simply a large ‘S’ flag, that ultimately is dangerous to democracy.”
If Avlon is passionate about finding a financial solution that will allow journalism to survive, he’s even more passionate about protecting the editorial integrity of his company from financial dilemmas related to sponsored content. “You need to keep that separation completely clear to preserve your integrity and your independence,” he added.
While Condé Nast is breaking down the wall between editorial and advertising by enlisting editors to manage branded work through its new ’23 Stories’ content studio, The Daily Beast remains committed to keeping that wall intact. None of the journalists who work on the Beast’s branded content write for the site’s editorial side, and there is almost always an editor and creative director, who has already worked with brands, managing the project.
“It’s a dangerous game,” Avlon said of letting edit staff work on sponsored content.
“A creative director and advertiser can no more take John’s place than John could take their place. They are different,” Dyer said. “Yes, it’s content, but they don’t do the same things.”
The Daily Beast’s branded content services extend past the content that shows up on the site. In the mode of a content marketing agency, they also help brands create content for their own websites as well. But in the short term, Dyer believes the majority of the content The Daily Beast creates for brands will run as sponsored content, simply because most brands aren’t yet ready to make the commitment to building an owned publication.
“You have to care and feed it,” Dyer said. “It’s like having a puppy. Are you ready for that?”
While Dyer believes more brands will build owned media properties—a trend on full display with the recent launches of Marriott and Starbucks‘ media companies—he also thinks native advertising is poised to explode across the industry as publishers continue to see more of their traffic come from mobile devices, which spells trouble considering that desktop ad units are worth four times as much as mobile display. Dyer sees sponsored content as the solution that can save publishers from financial catastrophe.
Simultaneously, however, he’s worried about publishers treating sponsored content like display advertising, using services like TripleLift to programmatically sell sponsored content spots to brands without any editorial oversight. “I don’t think most publishers are making smart decisions,” he explained. “That’s an insanely bad position, because that will do to content marketing CPMs what remnant advertising and programmatic buying did to display CPMs, which is wreck them.”
And if publisher sites are flooded with bad sponsored content, the entire practice will be in peril because readers will learn to avoid it like the plague.
So even as The Daily Beast works on more sponsored content, Avlon and Dyer are committed to setting an example for the industry. It’s not just an advertising issue—it’s about the future of the fourth estate.
“All journalists need to be engaging and thinking entrepreneurially, and I think it’s one of the challenges and opportunities of our time,” Avlon said. “We don’t have the luxury of simply saying that’s someone else’s problem.”Image by Deb Wenof, portraits and logo courtesy The Daily Beast