If Ads Don't Work, Can Publishers Strike Subscription Gold?
Tony Haile spent seven years trying to save the internet from click-based hell. As CEO of Chartbeat, a software and data provider to publishers, he showed editors, in real time, which stories were “trending” on their sites. He hoped the information would convince media companies and advertisers that their primary way of doing business online—through banner ads, sold through split-second digital auctions for fractions of pennies—could not last. At industry conferences, he presented chart after chart showing the emerging duopoly of Facebook and Google, the commoditization of quality journalism, and the perils of clickbait content strategies.
It was hard to disagree. Analysts estimate that Google and Facebook captured all, or virtually all, of the growth in digital ads last year. Elsewhere, readers don’t look at display ads, let alone click on them. The average clickthrough rate is a measly 0.05 percent, so publishers covered their sites with increasingly obtrusive ads. In 2016, the use of ad blockers increased by 30 percent, according to PageFair, which tracks the data. Meanwhile, advertisers are increasingly concerned about paying for fraudulent clicks from bots or seeing their ads next to offensive content. Despite these challenges, Chartbeat’s solution—selling ads based on metrics like time spent and engagement—failed to catch on.