Native Ads Pay Off For NYT

While native advertising has been one of the big growth categories in digital marketing over the last few years, there’s surprisingly little benchmark data to indicate just how much money publishers are actually making from such ads. However, the performance of one leading publisher may serve as a bellwether for the category overall (with the caveat that it isn’t exactly representative).

On that note, New York Times Co. CEO Mark Thompson gave an inside look at the NYTCO’s native ad operations during a keynote interview with Harvard Business Review editor in chief Adi Ignatius at Business Insider’s Ignition Conference.

According to an edited transcript of the interview posted by BI, Thompson said: “There was zero revenue in 2013. In 2014, year one, $13 million in revenue. This year I think over $35 million of revenue. I expect it to do $50-$60 million of revenue next year. It's just a rapidly growing business.”

Of course, native is just one of a number of growth strategies being pursued by NYTCO, which is also aggressively expanding its content offerings and focusing on mobile distribution.

On these overlapping subjects, Thompson noted, “… in the 1980s we, The New York Times, broadened from being a news and opinion offering to all sorts of culture and lifestyle offerings in new sections. And in the transition to digital that slightly got lost in the wash. And so we're trying to get back to that sense of a broader engagement with our users' lives.”

Thompson said the newspaper also remain focused on cultivating the “sense of a must-have daily experience of a core of really engaged users who can't really function without it. So how do you create that kind of frequency of use and habituation in a smartphone context?” As an example here, Thompson pointed to the success of the paper’s food content, referring to its popular Cooking app, and said similar lifestyle apps are in the works -- for example, focused on health.

NYTCO is also working on finding the right balance between paid subscriptions and advertising -- but Thompson added that the two categories shouldn’t be seen as separate or mutually exclusive, as the mere fact that someone is willing to pay for content indicates a high level of engagement, making them a more attractive prospect for advertisers: “We believe there's a market for high-quality journalism and that people will pay for it. We also believe the people who are prepared to spend the money, time, and attention it takes to absorb high-quality journalism are also of preferential value to advertisers. That's the core of our model.”

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