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Slack Chat: What's the Future of Sponsored Content?

Published: April 16, 2019       Updated: June 15, 2024

8 min read

Idea Grove Slack Chats-1

Jarrett (Jarrett Rush, director of content marketing): As the traditional media industry continues to struggle financially, companies are constantly experimenting with new monetization models. Some of these models are increasingly blurring the line between "earned" media coverage and paid advertising for brands.

The membership programs of the Community Company— including Forbes Councils, Business Journals Leadership Trust, Fast Company Executive Board and Newsweek Expert Forum -- are popular examples of this. For a cost of about $2,500 per year, members are provided exclusive opportunities to have bylined articles and other content published in their local business journal and high-profile national magazines.

I know that in my newspaper days we looked down our noses at anything on our news pages that was labeled sponsored content. I think the consensus was that someone was trying to pull something over on the readers, disguising their ad as legitimate content. I'm curious about your thoughts on sponsored content, both from a personal perspective and how you think your clients think about it.

Brittany (Brittany McLaughlin, account director): I think publicists used to feel the same way. If it's sponsored, does it carry the same weight as a feature article written by the editorial staff?

Katie (Katie Long, vice president of publication relations): Oh, I agree. Traditionally, if an outlet we weren’t familiar with proactively reached out about an opportunity, we investigated to find out if it was legitimate or pay-for-play. Pay-for-play generally meant it wasn’t credible or a good use of our “earned media” skills.

Liz (Liz Cies, vice president of public relations): I’ve always felt it was almost like cheating; anyone can buy a placement, but you have to have a killer idea to secure earned coverage.

Jacqueline (Jacqueline Wasem, account manager): My perspective has changed. Five years ago, I would have shied away from sponsored content as a reader, but we've seen news outlets strategically test how to maintain a high-level of trust and encourage engagement with sponsored content. Today, I'm much more likely to click on something sponsored if I know it’ll be worth my time.

Scott (Scott Baradell, president): What is called “sponsored content” or “native advertising” today used to be called “advertorial.” But that advertorial content, generally speaking, was pretty horrible. It was thinly veiled advertising and lacked the same quality standards of the editorial content -- so much so that it stood out like a sore thumb. Particularly since the emergence of Buzzfeed in 2013, it’s become far more sophisticated and, frankly, helpful, which has helped reduce the stigma.

Liz: I really appreciate the Forbes Councils model, where content is still vetted. I think it’s a happy medium and helps maintain the higher quality you see with pure editorial coverage.

Scott: The Forbes Council model, which is membership based, is also far more accessible to midsize and smaller businesses. Even in the early days, you couldn’t get in the door with Buzzfeed for less than a $50K investment. A Business Journals Leadership Trust membership costs you about $2,500 per year.

Jarrett: Are the terms sponsored content and pay-to-play interchangeable? Or are those different things? Pay-to-play feels a little more scammy to me, but that may be because of an evolution in the model.

Brittany: Pay-to-play implies that the company contributing the piece has the final say in the content, where sponsored content seems more collaborative.

Scott: What's traditionally been scammy about pay-to-play is their sales model. They try to lure you in to think it's an earned media opportunity when it isn’t. They will do things to suck you in, like set up an interview with your CEO, take up a half hour of their time asking questions, and then when you ask about the story, they’ll say ... “Oh! Well, if you actually want this interview to be published, it will cost you.”

Pay-to-play is also associated with organizations that overpromise the exposure you get. “You'll be on USA Network and TNT and BET and reach a potential audience of 50 billion people!" If they happen to be watching at 3 in morning, that is.

Jarrett: Do you think readers have ever understood or appreciated the differences in these models?

Liz: At the end of the day, I imagine there’s little distinction to the average reader. I even had someone tell me recently that they assumed all Business Journal content was sponsored.

Brittany: I think it depends on the audience. Some groups are more aware of the nuances, but the general public is probably not paying that much attention.

Liz: Ultimately, I think perception is positive when it’s done well. People want to be educated and entertained, no matter how. I would bet that most people don't care or notice unless it’s done poorly -- too salesy, lack of substance, etc.

Katie: I’m not sure that the general public pays any attention to sponsored vs. earned. Same with social media. The social media landscape has changed dramatically, and paid is required to get traction with growing followers, increasing engagement, etc. I don't think the average Joe is aware of that, though.

Jarrett: Has the fact that we see sponsored content almost everywhere online, including in SERPs and social media, softened the public's perception of this kind of content?

Brittany: Whether or not it has softened perceptions, it is certainly something our clients are picking up on. It makes the conversation easier to have with CMOs and VPs of Communication about all the ways to get the message out about their brand.

Liz: Brittany's point is key: our goal is to get the message out through the most effective channels. Sometimes that could include sponsored content, so there's no reason to avoid it simply because money is involved.

Jacqueline: I agree.  When sponsored content maintains a high-level of quality, both the outlet and the company maintains trust. Once it becomes click-baity or salesy, people will lose that trust.

Scott:  Right. Today, it's up to each media brand to decide what works best to balance its reputation with its profits. In the past, there were standards of ethics that dictated what publications could do and not do. In today's landscape, it’s a free for all. The FTC is not going to be getting involved. It's up to the reader to determine if a media site is of value and “legitimate.” As a publisher, if you can produce sponsored content that also attracts eyeballs, you're making money on both ends. That's every publishers' dream.

Jarrett: We’ve talked about this new hybrid model, championed by the Community Company, that involves editorial vetting and paying for the opportunity to get in front of whatever team does that vetting. Scott likes to call it "earned media plus." How sustainable is that model, and does it feel better to you than a traditional advertorial model?

Katie: If the expansion of the Community Company from Forbes Councils to Ad Age Collective and the Business Journals Leadership Trust is any indication, I’d say it’s going to rapidly grow

Brittany: I also like that in addition to the contributed pieces, Forbes Councils includes the opportunity to answer questions for roundup stories -- which they call "expert panels." That lets the editorial staff drive the focus of the content and have a vetted source to draw from.

Liz: I think it will be more sustainable long-term. It maintains value for the reader by being more selective about content, while conferring a sense of exclusivity on contributors. A win-win.

Brittany: It’s going to be hard for them to turn down the money, though. That might impact the selectivity in the long run.

Scott: Exactly. The model is attractive and feels sustainable at the moment, but ultimately the value will diminish once the channel is flooded. People always get greedy and then value is diluted. Buzzfeed had a model that was hailed as the future of journalism five years ago; now they are laying off folks like everybody else. Forbes has struggled mightily over the years to balance creating higher volumes of low-cost content with maintaining the value of its brand. I don’t believe there is such thing as a sustainable monetization strategy in today’s media industry; you just have to keep evolving and stay in front of things. That's true for both the media and PR industries.

Liz: Is there anything we can learn from the decline of the Huffington Post's reputation? They had bloggers for some time, until it became so crowded and noisy that the overall quality started to fade.

Jacqueline: My thought is that Huffington Post and Forbes of yesteryear had only figured out half of the puzzle. They didn't invest in the stricter editorial review process that Forbes is embracing today with the Forbes Councils program.

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