Is native advertising a threat to PR?

One of the rules of PR is that placements in major news outlets are never guaranteed. Native advertising may be changing that model.

I read some pretty surprising stats recently in a Content Strategist post which outlined the success The New York Times‘ brand studio is having with custom advertising content (referred to as “paid posts”).

The stats:

  • When measured against paid posts created by third-party advertisers, the studio-produced content was found to generate 361 percent more unique visitors and 526 percent more time spent with the post.
  • When evaluated against editorial content—articles with no advertiser affiliation at all—some brand studio posts incited as much engagement as high-performing articles that run on the Times‘ website.
  • BI Intelligence and the Interactive Advertising Bureau report that native advertising will generate $21 billion in ad spending by 2018—more than four times that of 2013.

That’s right: Sponsored content is being getting shared and read as well as some editorial content on nytimes.com, and native ad budgets will basically quadruple in the next few years.

It could be big trouble for PR. Here’s why.

Read through these “paid posts” the brand studio is putting together. They are fantastic (you can read the one titled “Grit and Grace” sponsored by Cole Haan here, and the one titled “Women Inmates: Why the Male Model Doesn’t Work” sponsored by Netflix here). No, they’re not written objectively, but they read very much like a news story you’d see in the paper.

These kinds of posts continue to gain traction with readers. We’ve seen differing stats on the “effectiveness” of native advertising. Plus, we’ve seen many different formats for native advertising. This level of native advertising is different, though. It’s sophisticated. It’s engaging. It’s using different media (note the videos in both pieces). It’s great storytelling written by professional, multimedia storytellers.

As consumer perceptions continue to evolve, the power of PR may evolve with it.

Here’s my thinking: If you’re a big company, your “PR goals” usually revolve around a few different things (generally speaking, of course)

  • Building awareness
  • Changing/maintaining tonality or share of voice
  • Driving leads

One PR strategy that gets at those goals revolves around media relations: getting placements, showing up in The New York Times, that sort of thing. PR agencies and consultants spend tens and thousands of dollars trying to capture just that: a placement in The New York Times. It’s the coup de grace of the PR world. It’s editorial coverage in one of the most respected publications in the world.

Of course, getting that article in The New York Times isn’t guaranteed. We all know that. If you work in PR, you know you can’t guarantee placements.

But what if you could? What if you could pay a fee and get an article that would essentially do the same thing as the editorial coverage you were chasing? How much would you pay for that? Would that be more or less than the PR agency you’re hiring?

If sponsored posts such as the ones by Netflix and Cole Haan continue to gain more trust, the line will blur. Those native stories created by content studios like the Times‘ brand studio may end up becoming more and more attractive to brands looking for that guarantee.

Think about it from the brand side: You have a big product launch coming up. A story in The New York Times would go an awfully long way to helping make that launch a success. Your PR shop tells you nothing is guaranteed.

However, if you hire an agency like T Brand Studios, it could be guaranteed (and maybe for a lower price point). You could have a story in The New York Times. Sure, it would be sponsored content, but audiences may not care about that as much as we once thought. Engagement rates are similar between sponsored content and editorial coverage anyway (according to their reports).

So you tell me. What would you do? Is the PR world in a little bit of trouble here?

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