Online Sponsorship Trends To Watch: 2014 and Beyond

We often look to national sales trends to inform what may be coming down the pike for local sales, including online and digital revenue. PBS and NPR are actively engaged in selling and securing online sponsorships for their websites, and in recent years have made progress in monetizing specific digital content assets, including online and streaming video/audio, podcasts, mobile apps etc. That’s not to say that a clear revenue model for digital sponsorship in public broadcasting has emerged. The media landscape is constantly and rapid evolving, as is technology and consumption of that technology, all of which makes it challenging to identify best practices and proven strategies. The way in which we effectively define and measure audience engagement in the digital age is a work in progress, as the optimal local/national online revenue model. Adding to these considerations is the ongoing challenge of balancing the noncommericial values of public broadcasting with increasingly commercial digital advertising trends.  The following online sponsorship trends are being felt at the national level and can be used to inform local strategies in the next quarter and beyond: 

Decline in Banner Revenue
Native, Premium, and/or Custom Formats 
Programmatic or Real-Time Buying 
Separate Digital and On-Air Budgets 

Decline in Banner Revenue
The banner ad is still the best option for advertisers that are looking to reach large online audiences at scale most efficiently. However, display ad CPMs are either flat, falling, or under pressure, primarily due to an oversupply of inventory generated by social networks like Facebook as well as the practice of placing multiple banners on a single page. Thus, this combination of low CPMs, programmatic buying, and "banner blindness" means that publishers need to supplement banner revenue with other online marketing opportunities. ^top

Native, Premium, and/or Custom Formats
Native advertising occurs when marketers' content (i.e. ads) blends in with the overall user experience on a site, so that it doesn’t necessarily look like an ad.  Currently, while there is immense interest in opportunities such as sponsored articles, tweets (Twitter), stories (Facebook), AdWords (Google) and so on, advertisers and publishers are rapidly adopting this form of advertising, but are also hampered due to scale limitations and high production fees.  In media companies, this technique is best exemplified by Internet pure plays such as Quartz, Buzzfeed and Gawker Media, as well as traditional media entities such as Forbes, The Atlantic and more recently, The New York Times. ^top

Programmatic or Real-Time Buying
Real-Time Bidding (RTB) offers efficiency via automation for buyers and sellers of online inventory to connect seamlessly without insertion orders, phone calls, RFPs, reconciliation, analytics, and any of the other manual procedures involved in negotiating a media buy. Real-time bidding has enabled media buyers to find audiences at scale. It's one of the fastest growing segments in online advertising, and since there are both benefits and pitfalls associated with it, publishers must understand the phenomenon in order to be successful in an RTB-enabled ecosystem. ^top

Separate Digital and On-Air Budgets
There are separate buyers for digital and on-air, but there is also simultaneously a convergence of interests. The data, metrics, optimization, automation via machine-to-machine buying that are the currency of the web are increasingly sought by on-air buyers, while the reach, and ease of buying is highly desired by digital buyers. ^top

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