banner

Advertising Must Remain at the Heart of Media to Maintain Profitability

Advertising Must Remain at the Heart of Media to Maintain Profitability

June 04, 2014

 

 

An extensive new survey of consumer attitudes to online advertising and content carried out by international cloud technology company, CloudSense, underlines the continuing need for advertising to sustain the business model of online publications and websites. Overall, 74% of respondents to the survey currently do not pay to access any digital media sites or apps. Yet 46% (the most popular reply) said that seeing advertising around content was their preferred way of ‘paying for’ access to content, while 28% are happy to view advertising before reaching content, underlining their acceptance of it in the delivery of media.

In the 16 – 24 year-old age group, the number prepared to accept advertising around content rose to 54%, with 37% happy with up front advertising. This is a marker for the future as the survey detects that the younger generation is less inclined to spend money on online content, despite consuming more media platforms than older respondents. However, the figures for those accepting advertising decline gradually as respondents get older, suggesting that attitudes evolve with age and there is no dramatic generation gap.

In general, online advertising is accepted, with only a small number (12%) prepared to pay to have no ads. Paywall-protected media sites such as newspapers will need to improve this figure to make their business model viable, which is leading to a growth in innovation of commercial propositions. Privacy was also seen as more important than relevancy with 51% not wanting advertisers to know more about them to enable more personalised ads.

The survey, polled the views of 4,000 consumers across the UK and US revealing some interesting contrasts. “We wanted to develop some tangible proof points around media consumption across two of our largest markets and to provide publishers and media houses with insight on how consumers view online advertising,” explained Richard Britton, CloudSense CEO. In the UK, TV is still the preferred way (74%) to access content such as news, fashion, sports and business, 9% ahead of the online option. In the US the overall figures are exactly reversed with 9% more going online than watching TV.

“If the younger generation in particular aren’t paying for content, then it’s essential that publishers are able to profit from advertising,” commented Britton. “It is now more important than ever for publishers to attract advertisers relevant to the audience, provide a positive user experience and ultimately, this will give publishers the ammunition to sell more advertising.

“This may involve a radical transformation of purchasing models and the infrastructure surrounding billing and payment and a need to redefine the approach to ad-selling to meet consumer expectations. The days of inefficient siloed print and digital ad-selling need to be left behind to survive in today’s industry. In other words, these firms need to rebuild to achieve the flexibility required for the digital future.”