Publishers are at the core of the modern consumer journey. The content they create generates the majority of consumer interest and intention, yet they rarely capture a fair slice of the commercial value they produce in return. As such, publishers have always been on a quest to broaden revenue sources. But the continued uncertainty resulting from COVID-19 means diversification is more important than ever.
Advertising will always be a mainstay of publisher revenue, but they can’t rely on this income stream alone as illustrated by recent events – global ad budgets are now expected to be down 31% for the full year due to the pandemic. Moreover, publisher events were originally tipped to be a big earner for 2020 but, with countries around the world implementing lockdown measures, these were largely cancelled or postponed, leaving a key revenue source blocked.
Subscriptions present one alternative, and indeed we have seen publishers prioritize subscription volume over immediate revenue recently. This may prove successful while consumers continue to place more value on both informative and trustworthy information, but there is a limit to how much people will pay for content, as well as how many different channels they will subscribe to. Particularly considering the number of online, video, music, and gaming subscription services now available.
So, with ad spend down, brand safety concerns rife, and footfall to events still non-existent, what other options are there for publishers? One revenue opportunity that has taken off – and looks likely to remain viable, even in these unprecedented times – is native commerce, where publishers earn commission through referrals to ecommerce sites.
This is an area of business that has been thrown into the limelight by the pandemic, with US ecommerce forecast to rise 18% in 2020. Businesses like The New York Times’ Wirecutter noted an increase in traffic to commerce content very early on in the pandemic, and Hearst UK has seen 328% growth in its ecommerce arm since lockdown.
Consumer shopping habits have changed since COVID-19 with consumers now accustomed to buying items online. Household products, health and personal care products, board games, and video games were all among the top-selling items consumers bought online during lockdown. At-home fitness gear like weights and treadmills saw a 55% boost in sales once self-isolation was enforced in March. And what’s more, we’re likely to see consumer behavior permanently altered, with the online purchasing patterns established during lockdown expected to continue even as restrictions become more lenient in the future.
Native commerce allows publishers of all shapes and sizes to tap into the entire customer journey, rewarding them for the interest and purchase intent they’ve created. So, while other revenue streams are potentially less productive, commerce is one avenue publishers should be looking at, and there are a number of ways to make the most of the opportunity.
Keep Pace with the Changing Situation
Native commerce can provide publishers with valuable revenue as long as they are agile enough to keep up with a rapidly changing situation and shield themselves from market swings. Commission rates are continually increasing and decreasing due to atypical fluctuations in demand and product availability, and new native commerce programs are opening up while others are temporarily paused. In a quickly evolving commerce landscape, publishers need to ensure they stay on top of the situation, ideally using product links that update automatically in real time to generate the highest level of commission for a promoted product or service.
Balance Profitability with Authenticity
In times like these, it’s tempting for publishers to promote only those items that are topping the bestseller list, but if those products don’t fit with the content and values of the publication, this is unlikely to be an effective long-term strategy. Audiences will be able to tell instantly if the writer isn’t being authentic, and the subsequent loss of trust will adversely impact customer lifetime value. For success in native commerce, publishers should look for products that consumers need at the current time, but that also seamlessly complement the publication’s unique editorial content.
Write with Intention and Transparency
Whether they mean to or not, publishers inevitably influence consumer buying decisions whenever they write about brands, solutions, or products. But if they want to actively drive purchase behavior and real revenue through native commerce, publishers can’t rely on subtlety. They must be intentional with the content they create, while still ensuring it remains natural and engaging. Some publishers are concerned that blatant product endorsements may adversely impact the perceived value of their content, but as long as they are transparent about their promotional activities, engaging readers in a positive and informed discussion about what to buy, this should not be an issue.
Provide Valuable Advice and Assistance
Success with native commerce depends on providing valuable, in-depth information to help readers decide how to spend their hard-earned cash. For instance, many readers who had to suddenly start working remotely sought to make a considerable investment in kitting out their workspace with everything from laptops and printers, to desks and office chairs, so articles and reviews written by people who have genuine experience of the products discussed help readers decide what they need. If nothing else, the last few months have driven consumers to value honest, trustworthy advice more than ever, so helpful long-form content will help drive purchase behavior.
Revenue diversification was already high on publisher agendas, but the coronavirus fallout has pushed it to the top of the priority list. The increased volume, low operational overhead, and maximum inventory flexibility offered by native commerce means the net value to a publisher is much higher than other commerce options. With limitations on revenue streams such as advertising, subscriptions, and events, publishers can seize the opportunity of native commerce if they approach it with agility, authenticity, intention, and value in mind.
Related story: Your Events Are Canceled. Now What?