Media Forum: Is online advertising failing?

Are online newspapers letting down their ad clients, Alasdair Reid asks.

According to the IPA's Digital Media Owners Image Survey, published last week, media agencies appeared to be rather less than bowled over by the online sales efforts of newspapers.

True, this survey is not definitively comprehensive - because only four publishing companies (Telegraph Group, Financial Times, News International and Guardian News & Media) were deemed to be important enough to make the survey's media list, compiled from display advertising spend rankings submitted by 24 IPA-member media agencies.

For the publishers that did make the list, there are some serious questions to be addressed. The section, entitled "my overall experience of dealing with this supplier is a good one", was perhaps the most telling - especially when you look at these scores against the previous survey conducted in March.

The most improved performer was a web specialist, AOL, and of the cross-platform operations, the Telegraph turned in an admirable score, while a couple of broadcasters (Sky and Channel 4) were reasonably well placed too. But down at the bottom of the performance league were a couple of newspaper publishers (News International and the Guardian) whose showing had deteriorated markedly.

When asked about which sales teams tended to understand their objectives, the response from agencies was that none of the online efforts of newspaper publishers were to be regarded as particularly impressive.

And when asked which companies deliver innovative, creative solutions, at least two of the publishers (News International and the Guardian again) have been taking steps backwards. This, you could argue, is rather disappointing - especially when you remember that newspaper publishers are counting on digital revenue growth to pull them out of the mire.

Are newspaper websites failing in the advertising market? Failure is far too harsh a word, Oliver Newton, the head of emerging platforms at i-level, says - but it's undeniable, he adds, that newspaper publishers have problems.

He explains: "They're certainly missing a few tricks. One of our frustrations is that, on the editorial side, they're used to turning things around quickly. Newspapers are the story of the day. So why can't they offer more flexibility on the online advertising side? Often, we're looking to run advertising in editorial material relevant to a client - but we find it very difficult to achieve. That's frustrating."

Much of that is underscored by Matt Champion, the digital director of PHD. He comments: "The people I trip over regularly in the reception are the network people and the major portals - the AOLs and the MSNs. I'd struggle to tell you when I last saw someone from a newspaper. But then our spend is largely focused on the digital-play media owners - and the network people. With newspapers, they also tend to get hung up on the qualities of their audience but we're often more interested in the context and in the behaviour of the user."

But Jason Dormieux, the managing director of MEC Interaction, admits that he has some sympathies for the newspaper publishers, which tend to be big organisations. He says: "Their problem is that even if they've managed to innovate, there are pressures on resource. It's perhaps easier for more focused organisations such as AOL and Facebook to staff themselves appropriately. But the online newspapers have to focus too and start moving forwards."

Absolutely, Damien Hodge, the head of online investment at Media -Com, agrees. He concludes: "Much of the answer for their poor performance comes from two areas - natural movement in the industry towards more direct measures and a need for innovative technology. They cannot compete with portals and networks. They are also competing with technology companies that can impact change rapidly and create technical solutions to suit a client's needs."

MAYBE Jason Dormieux, managing director, MEC Interaction: "In terms of content there's no way you can describe (newspaper publishers' online efforts) as failing. However when it comes to their ability to work with agencies I think you could say they've perhaps been falling down - though it's no surprise to see the Telegraph standing out as the exception here."

NO Damien Hodge head of online investment, MediaCom: "It wasn't all bad news - newspapers rightly scored highly on cross media opportunities, they provide strong synergy and great content which advertisers want, and are undoubtedly becoming more open to new ideas and clever solutions. It is the pace of change that remains a difficult challenge for traditional offline media owners."

MAYBE - Oliver Newton, head of emerging platforms, i-level

"Publishers are expected to be natural leaders and, in user experience, the ones you'd expect to be way out in front seemed to have failed. Although, it's encouraging to see the Telegraph get good scores."

MAYBE - Matt Champion, digital director, PHD

"The newspaper publishers still have brand equity - there's no doubt about that. But the online operators getting spend are those coming in with cost-effective, innovative solutions, backed up by technology."

MAYBE - Jason Dormieux, managing director, MEC Interaction

"In terms of content, there's no way you can describe newspaper publishers' online efforts as failing. However, when it comes to working with agencies, you could say they've perhaps been falling down."

NO - Damien Hodge, head of online investment, MediaCom

"It wasn't all bad news - newspapers scored highly on cross-media opportunities, they provide strong synergy and great content which advertisers want, and are undoubtedly becoming more open to new ideas and clever solutions."

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