How Rodale & LittleThings Balance the Risks & Rewards of Google AMP & Facebook Instant Articles
“I’m on the happy side of lukewarm about Instant Articles,” said Rodale’s head of digital partnerships Diego Sanchez, describing his level of enthusiasm for Facebook’s mobile format. The statement, shared at the FUSE Forum on Distributed Content on March 23rd, captured the ambivalence that Sanchez and Justin Festa, EVP of Digital at LittleThings, expressed about publishing on third-party platforms. Sanchez and Festa explained during the forum’s keynote panel that despite the new traffic and revenue opportunities Google AMP and Facebook Instant Articles can offer, there is inherent risk in publishing on platforms that they don’t control. Algorithm changes can easily shift the balance of costs and benefits out of publishers’ favor and advertising restrictions can limit monetization.
Sanchez and Festa said that, despite the risk of platforms intermediating their relationship with their audiences, they must be present on these platforms because readers are increasingly using them to discover content on mobile. The potential lift from AMP and Instant Articles is too great to ignore.
During the panel, Sanchez and Festa explained how they balance the rewards and risks that AMP and Instant Articles offer.
The Basics of Google AMP & Facebook Instant Articles
Google AMP and Facebook Instant Articles are mobile publishing formats that allow publishers to share stripped-down, faster-loading versions of their content on Facebook and Google. Google’s format is open source, meaning multiple developers — not just Google’s — helped develop and continue to refine the format, and anyone can integrate the AMP code into their products. Google features AMP-formatted articles in prominent carousels within search results and within the standard “blue link” search results. Instant Articles is a proprietary format. It allows publishers to serve full versions of mobile-optimized articles in the Facebook app. Both formats allow publishers to sell ads within the platforms, with respective limitations.
Creating a Winning Revenue Formula on Facebook
Rodale is focused on earning new revenue from Instant Articles, and it’s doing so in three ways: through direct-sold ads, sponsored content, and programmatic ads. Direct-sold ads make up the majority of revenue Rodale earns on Instant Articles, said Sanchez. Brands that have high ad sell-through like Men’s Health and Women’s Health are ideal for direct-sold ads on Instant Articles, said Sanchez. For these brands, Rodale builds Instant Articles into its run-of-site package. Rodale earns 100% of the revenue from these ad sales. The clickthrough rate (CTR) on Instant Articles is high, said Sanchez. Rodale is even considering selling Instant Article ads a la carte, at a more premium price so as not to cannibalize on site ad sales.
Rodale also earns revenue from selling sponsored content on Instant Articles. Facebook provides ways for publishers to attribute posts to certain sponsors, which means sponsors can use their own marketing budget to boost their posts on Instant Articles. “That’s been pretty successful for us,” said Sanchez. “In the past it was a little more difficult to drive traffic to branded content that was in the Instant Article format, but [being able to boost articles] allows us to do that and work with the client to make that happen.”
Programmatic ads drive a small portion of Rodale’s revenue from Instant Articles, because the CPMs for Facebook’s Audience Network ad exchange are much lower than programmatic ads sold on Rodale’s properties. In part, the low CPMs are due to the fact that Facebook does not allow header bidding, which enables multiple demand sources to bid on ad inventory before it goes to open exchanges. Only Facebook’s Audience Network serves programmatic ads on Instant Articles.
LittleThings earns the majority of its revenue, roughly 90%, from programmatic ads sold on its site, and it struggled with the low CPMs earned from programmatic on Instant Articles. “We were monetizing at 15% or 20% of what we could earn on our own site,” said Festa.
To solve this issue, LittleThings looked for content formats that drove greater engagement and provided more opportunities to display programmatic ads. The publisher found that image-heavy content is ideal for Instant Articles. Pieces that feature 15 to 30 images encourage readers to keep scrolling, and LittleThings can embed more programmatic ads into those articles to make the experience more profitable. “We got to a point where we were on par or close to what we could do on site,” said Festa. “That was the balance we could strike where we could still do 15% to 20% of our articles through Instant Articles, but we could do it in a way where we weren’t giving up the monetization and we were improving the user experience.”
A Path Toward Owning One’s Audience
Although Festa and Sanchez zeroed in on Instant Article revenue opportunities during the panel, they added that driving Facebook users to their sites and converting to owned audiences is also a major consideration in their distributed content strategy. Both brands link from Instant Articles to their sites and to move readers down the audience acquisition funnel.
Rodale is also converting new audience directly on Instant Article pages. It’s testing a beta version of a one-click email sign-up feature on Men’s Health content. The one-click email sign-up provides Rodale with a Facebook user’s verified email. That verified email address is especially valuable to Rodale because often the publisher receives fake emails when it gates content on site, said Sanchez. “With Facebook, it’s the real email address. We’re seeing a very high percentage of new-to-file from that submission experience,” said Sanchez. The ability to drive subscriptions is increasingly important, he added, because referral traffic could shrink with future algorithm tweaks.
Google AMP Makes a Big Impact on Search Traffic
Both Festa and Sanchez noted that Google AMP is not yet a major revenue driver for their brands. While they can sell direct and programmatic ads from a variety of networks and earn 100% of ad revenue on AMP, ad viewability and CTR is low. Festa chalks this up to the fact that content often loads before the ads themselves. Instead, both Festa and Sanchez view AMP primarily as a way to drive greater search traffic to their sites.
LittleThings in particular sees AMP as an opportunity to quickly rank its content on Google search, because Google tends to give AMP content preference in search results. Festa explained that readers typically discover LittleThings content via social sharing, rather than search, so in the past the women’s lifestyle site never earned much traffic from Google. But because LittleThings implemented the AMP markup on all of its articles, its content is displayed more prominently in search. “A path that might’ve taken months or years in the past [to rank on Google search results], now we can do it in weeks or a matter of months by supporting AMP,” said Festa. At the moment, the incremental traffic earned from AMP is a “nice-to-have,” said Festa, but he anticipates that a few months from now that traffic will be significant.
Sanchez added that AMP has driven sizable traffic for Rodale sites in a relatively short period of time. “For some sites, like Prevention, it’s become a substantial driver of traffic quickly. When I say substantial, it’s more than 5% of the site’s traffic,” said Sanchez. Other publishers, are seeing much higher surges in traffic. The Guardian, for example, reported that Google AMP is responsible for over 60% of its mobile traffic, and that percentage continues to grow.
Although AMP can significantly boost search traffic, LittleThings and Rodale aren’t seeing readers diving deeper into their content from AMP. The issue is that the AMP design encourages readers to back out of the article and return to Google search using the “X” icon, rather than explore the publisher’s website, said Sanchez. As a result, Rodale is experiencing lower pages-per-visit from AMP readers. Google has added new design features to encourage readers to recirculate to publisher sites, like displaying the publisher URL at the top of the article, rather than the AMP URL. Sanchez said that despite these improvements, recirculation remains one of the biggest issues of the AMP platform.
What’s the Future of AMP & Instant Articles?
Although Rodale and LittleThings find it more difficult to monetize Google AMP, the executives seemed to have a positive outlook on AMP’s future development. “I’m not terribly concerned about where it goes from here,” said Festa. “Google has been good about laying out their vision. . . and a lot of the heavy lifting for the AMP Initiative is done; it’s been adopted and now it’s a matter of how do you continue to improve the product. I think with things like the recirculation issue. . . there will be improvements. That’s going to happen because it will benefit publishers.”
“Facebook is a mystery sometimes,” added Sanchez. “Sometimes you get access to beta, which is great, but I feel less clear on the future of how they’re going to be developing that product than I do about AMP.”
The difference between the platforms’ future development, lies in the fact that Google AMP is open source, while Facebook Instant Articles is maintained and updated by Facebook alone. With AMP, developers can identify and track every change made to the format. And its open nature allows anyone, including ad exchanges and ecommerce platforms, to adopt the format. Greater adoption across providers should offer more monetization opportunities to publishers down the line. Instant Articles, on the other hand, live within Facebook’s walled garden. It has sole control over how the format evolves, giving publishers less opportunity to shape future development in their favor.
For now, however, both publishers have found the balance of risks and rewards on both platforms to be favorable to their overall business objectives.