Good news: Online advertising “bot” fraud is down 10%. Bad news: It still amounts to $6.5 billion annually.

Ad spending continues with quite-healthy growth, being forecast to increase by about 10% in 2017 according to a studied released this month by the Association of National Advertisers.

At the same time, there’s similarly positive news from digital advertising security firm White Ops on the ad fraud front. Its Bot Baseline Report, which analyzes the digital advertising activities of ANA members, is forecasting that economic losses due to bot fraud will decline by approximately 10% this year.

And yet … even with the expected decline, bot fraud is still expected to amount to a whopping $6.5 billion in economic losses.

The White Ops report found that traffic sourcing — that is, purchasing traffic from inorganic sources — remains the single biggest risk factor for fraud.

On the other hand, mobile fraud was considerably lower than expected.  Moreover, fraud in programmatic media buys is no longer particularly riskier than general market buys, thanks to improved filtration controls and procedures at media agencies.

Meanwhile, a new study conducted by Fraudlogix, and fraud detection company which monitors ad traffic for sell-side companies, finds that the majority of ad fraud is concentrated within a very small percentage of sources within the real-time bidding programmatic market.

The Fraudlogix study analyzed ~1.3 billion impressions from nearly 60,000 sources over a month-long period earlier this year. Interestingly, sites with more than 90% fraudulent impressions represented only about 1% of publishers, even while they contributed ~11% of the market’s impressions.

While Fraudlogix found nearly 19% of all impressions overall to be “fake,” its fraudulent behavior does not represent the industry as a whole. According to its analysis, just 3% of sources are causing more than two-thirds of the ad fraud.  [Fraudlogix defines a fake impression as one which generates ad traffic through means such as bots, scripts, click-farms or hijacked devices.]

As Fraudlogix CEO Hagai Schechter has remarked, “Our industry has a 3% fraud problem, and if we can clamp down on that, everyone but the criminals will be much better for it.”

That’s probably easier said than done, however. Many of the culprits are “ghost” newsfeed sites.  These sites are often used for nefarious purposes because they’re programmed to update automatically, making the sites seem “content-fresh” without publishers having to maintain them via human labor.

Characteristics of these “ghost sites” include cookie-cutter design templates … private domain registrations … and Alexa rankings way down in the doldrums. And yet they generate millions of impressions each day.

The bottom line is that the fraud problem remains huge.  Three percent of sources might be a small percentage figure, but that still means thousands of sources causing a ton of ad fraud.

What would be interesting to consider is having traffic providers submit to periodic random tests to determine the authenticity of their traffic. Such testing could then establish ratings – some sort of real/faux ranking.

And just like in the old print publications world, traffic providers that won’t consent to be audited would immediately become suspect in the eyes of those paying for the advertising.  Wouldn’t that development be a nice one …

The world of blogging: Just how does it operate?

wbMost people in business know at least one or two people who publish a blog. Chances are, they know people who blog on non-business topics as well.

Have you ever wondered what are the common practices followed by these bloggers? Speaking as someone who has published blog posts since 2009, I certainly have.

Now the “wondering” is over, because Chicago-based web design firm Orbit Media Studies has just published its 2016 Blogger Research Study, which presents the results of surveying ~1,050 bloggers about how they go about their blogging business.

Here are some of the most interesting highlights from the study:

Where do bloggers write their articles?

According to Orbit’s findings, the vast majority of bloggers are creating their content at home or at their home office:

  • At home/home office: ~81% of respondents cited
  • At the office: ~32%
  • Coffee shops or other foodservice establishments: ~19%
  • Co-working spaces: ~4%
  • Other locations: ~7% (primarily on trains or planes, or at a library)

What is the length of a typical blog post?

From the Orbit research findings, it’s pretty clear that the most popular blog post length is 500 to 1,000 words. (This one is, for instance.)  Anything longer than that quickly migrates into the “feature story” mode:

  • Less than 500 words: ~21% of respondents cited
  • 500 – 1,000 words: ~61%
  • 1,000 – 1,500 words: ~13%
  • 1,500 – 2,000 words: ~4%
  • More than 2,000 words: ~1%

Do bloggers use editors, or act as their own editor?

There’s little differentiation in behaviors here; the vast majority of bloggers report that they edit their own work. An even greater ~91% of the survey respondents either edit their own work or use an ad hoc review process.  Bottom line, most blog posts have never been seen by anyone other than the author before going live:

  • Edit own work: ~73% of respondents
  • Show it to one or two people: ~30%
  • Use a formal editor: ~12%
  • Use more than one editor: ~3%

How long does it take to write the typical blog post?

The responses ranged widely, but the most common length of time is between one and two hours:

  • Less than 1 hour: ~17% of respondents cited
  • 1-2 hours: ~37%
  • 2-3 hours: ~20%
  • 3-4 hours: 13%
  • More than 4 hours: ~13%

Are bloggers writing for other people besides themselves?

Generally speaking, bloggers are writing for their own publication, but there are many instances where bloggers are writing for clients as well.

  • 75% – 100% of blogger’s posts written for clients: ~9% of respondents cited
  • 50% – 75%: ~6%
  • 25% – 50%: ~9%
  • 5% – 25%: ~13%
  • 1% – 5%: ~18%
  • 0%: ~47%

How are bloggers driving traffic to their posts?

Two words: social media.  Direct e-mail marketing is also a common technique, as is search engine optimization:

  • Social media marketing:  ~94% of respondents cited
  • Search engine optimization: ~51%
  • E-mail marketing: ~35%
  • Influencer outreach: ~15%
  • Paid services (SEM/social media advertising): ~5%

The high SEO figure is hardly surprising, considering that bloggers are, by definition, focused on writing inherently interesting, newsworthy content.

More details from the Orbit survey can be accessed here.

Downsizing hits America’s most prestigious business media properties.

bwsjThis past week, the business media world was buzzing about the inadvertent release of information concerning pending layoffs at Barron’s magazine, thanks to editor-in-chief Ed Finn mistakenly hitting “reply all” on a message intended for just one person.

But the more interesting news is what’s happening right now with two of America’s most important national print publishing properties: Barron’s and The Wall Street Journal.

Up until now, it was thought that a select handful of America’s largest and most pervasive publications with national reach and reputation would be the ones least susceptible to problems befalling the industry regarding declining advertising revenues and changing news consumption habits.

At or near the top of the list of those rarefied properties were these two publications for sure.

But now we know a different reality — or at least a more complicated one. WSJ editor-in-chief Gerard Baker announced last week that the publication is seeking a “substantial number” of employee buyouts to limit the extent of involuntary layoffs that will need to happen otherwise.

The WSJ buyout offer been extended to all news employees worldwide – managerial and non-managerial – and includes a lucrative voluntary severance benefit that’s 1.5 times larger than the company’s standard buyout package.

WSJ employees will need to make up their minds quickly, as the buyout offer is good only until the end of October.

wsjbAs for Barron’s, its situation became public only after the Ed Finn memo was received in the New York City newsroom of The Wall Street Journal in error.  The Finn memo, which had been intended for Dow Jones Media Group publisher Almar Latour, speculates on how The Wall Street Journal’s announcement might affect an upcoming round of layoffs at Barron’s.

That bit was “new news” to pretty much everyone.

Aside from the “drama” of news scoops happening because of unintentional actions, the bigger question is this: What do these layoffs and buyouts portend?  Is it the end of the adjustments – or just the beginning?

Clues to that answer come in Gerard Baker’s memo, where he reveals that The Wall Street Journal has “begun an extensive review of operations as part of a broader transformation program.”

Let’s see what kind of “silver bullet” business strategy they end up devising – and whether it will have its intended effect.

The Gawker saga: Are there any good guys in this drama?

gmSome people I’ve spoken to about blog collective Gawker Media’s recent legal and corporate tribulations have expressed concerns about the chilling effect well-funded lawsuits may be having on a free and unfettered press.  But it’s hard to find any angels in the ongoing saga of Gawker Media and its many detractors.

The latest news is that Gawker is filing for Chapter 11 bankruptcy protection even as it entertains an acquisition bid from publishing firm Ziff Davis.

Reportedly, Ziff Davis is offering $90 million to purchase Gawker Media.  This compares to the $140 million judgment against Gawker handed down by the courts in March in the Hulk Hogan defamation lawsuit.

hhLooking at the sordid details, it’s hard to find sympathy for any of the major players.  In the choice words of journalist and writer Bob Garfield:

“[Gawker Media is a] snide, predatory gossip site that built a reputation cutting hypocritical big shots down to size, but soon ran out of big shots and turned its sneering animus on any anonymous medium-shot unfortunate enough to fall into its sights … Gawker.com is in the schadenfreude business.”

Professional wrestler and television personality Hulk Hogan (aka Terry Gene Bollea) isn’t a paradigm of virtue, either – what with his history of obnoxious statements and what we’ll call euphemistically “other activities” that fall pretty low on the class-meter.

ptTech industry billionaire Peter Thiel, who provided the financial backing for Hulk Hogan’s successful lawsuit, was once a victim of Gawker himself – being “outed” as gay by the media site.  But Thiel’s über-libertarian pronouncements appear churlish on the one hand, while his legal takedown of Gawker seems to be at cross-purposes with the “anything goes” free speech premises of libertarianism.

Nick Denton, Gawker founder and CEO, has remained defiant even in the wake of the latest turn of events:  “Even with his billions, Thiel will not silence our writers.  Our sites will thrive – under new ownership,” Denton has been quoted, adding that court appeals will continue.

Clearly, this drama isn’t ending anytime soon. But with no sympathetic characters in this drama — and that’s about the most positive thing one can say about it — who’s ready to take a shower right about now?

Magazine Profitability Strategies: Prevention Magazine Goes for a Radical Solution

pmWhen a business model becomes problematic, sometimes the only solution is to step outside the circle with some seriously radical thinking.

That seems to be what magazine publisher Rodale has done with its flagship media property, Prevention magazine.

As reported by Jeffrey Trachtenberg this past week in The Wall Street Journal, beginning with the July issue, Prevention will no longer accept print advertising.

It’s a major step for a publication as venerable as Prevention, in print since 1950 and an important player in the magazine segment focusing on nutrition, fitness and weight loss.

According to the Trachtenberg piece, Prevention magazine has actually seen an increase in ad pages – up over 8% to 700+ ad pages in 2015 over the year before.  But here’s the rub:  ad revenues were actually down because of circulation losses.

The magazine hasn’t turned a profit in a number of years, either, although other related Rodale titles have (Runner’s World and Men’s Health).

The radical surgery planned for the publication means that the number of pages of a typical magazine issue will decline dramatically. So the cost of printing and shipping will go down.  In order to make up for the loss in ad revenue, the magazine’s subscription price is set to more than double to nearly $50 per year.

Price-conscious as consumers are, that action is expected to drive circulation figures down even further – from around 1.5 million to roughly 500,000 if the company’s projections are correct.

Is this an ingenious idea that will preserve and strengthen a highly regarded publication? Or a desperate action that will end up simply driving this magazine into oblivion in a novel way?

Maria Rodale

Maria Rodale, CEO of the family-owned publication company, thinks the former. As she stated to reporter Trachtenberg:

“We’re walking away from revenue but we’re also walking away from a lot of expense. Let’s serve our readers and charge them for it.”

Rodale anticipates that Prevention magazine’s operating expenses will be reduced by more than 50%.

What are the implications of that?  Maria Rodale again:

“If you have to run the numbers out with an advertising model, it’s hard to see it ever getting to profitability. With a non-advertising model, it quickly becomes profitable.”

… But I’m not so sure. This radical departure from the traditional ad-supported publication model may pay short-term dividends.  But will it turn out to be merely a momentary respite before the next downward slide – this time into irrelevance?

With so much information being so easily accessible online (and free of charge) – particularly in the areas of preventive health – I can easily envision fewer and fewer people wishing to shell out $50+ per year for the benefit of receiving a monthly publication that may or not contain highly relevant and valuable information each and every issue.

What do you think? Is this a silver-bullet solution?  Or a zinc zeppelin?

Amazon turns the page on yet another publishing maxim.

The publishing industry’s “primary disruptor” will start paying authors based on pages read, not e-books purchased. 

AmazonBeginning next month, Amazon is ushering in its next big change in the world of publishing … and it’s a pretty fundamental shift.

Instead of paying royalties to authors based on how many e-books have been sold, Amazon will start paying authors based on how many pages of their books consumers have read.

For now, the program applies just to self-published authors who are on Amazon’s KDP Select Program — but you can bet that if the experiment plays out well, it’ll likely expand.

Currently, Amazon remunerates its native authors on a monthly bases based on the number of times their e-books are accessed through two Kindle service programs:

The new change will shift away from paying authors based on each book accessed, and instead pay based on each page that readers access (and that remains on the screen long enough to be parsed).

Who will be the winners and losers in this new approach to compensation?  Certainly, some people have criticized the current payment scheme for benefiting authors of smaller books more than those who write longer tomes.  The change may improve matters for the latter because of the additional pages that make up their e-books.

But is that really the case?  Many large volumes are reference-oriented book or fall into other non-fiction categories, such that a reader may be interested in accessing only a few pages within the books in any case.

But on the fiction side, authors may find themselves attracted to writing the kind of “cliffhanger” story lines that keep readers turning the pages.

However it shakes out, one thing seems destined to change.  The old saw that “it doesn’t matter how many people read a book — only how many purchase it” may well be on the way out.

What are your thoughts about Amazon’s new remuneration policy?  On balance, is it good for authors — or for the world of books in general?  Feel free to share your comments with other readers.

(Still) Too Much Irritating Online Advertising

online advertisingTime was, the online experience was blissfully free of annoying advertising.  (Of course, that was back in the very early days of the Internet.)

Then things got pretty bad pretty quickly, as publishers became forced to find ways to make up for lost advertising revenues from their print vehicles.

One of the most egregious examples of the explosion in online advertising were pop-up and pop-under ads.

So infamous, in fact, that an entire industry of ad blocking software sprang up, eventually providing the ability to eradicate most of them.

Not all of them, of course, but enough so that for those who use the programs, those ads are no longer quite as pernicious as before.

And yet … the arsenal of publisher’s revenue-generating ad tricks is still quite large — and pretty irritatingly effective, too.  Here are the most pervasive ones:

Slideshows – Some publishers use a picture slideshow format at every opportunity as a way of increasing page views and ad impressions.  Each click to view the next slide means more opportunities to collect revenue from serving up more display ads.  Using this scheme, publishers can end up with ten times the ad volume compared to if they had presented the information and images on a single page.

Pagination – Related to the slideshow scheme is the idea of publishing an online news story on two or three pages, whereas it could easily have been presented on just one.  If you ask people, most would be quite happy simply scrolling down the page to read the entire story.  On the other hand, publishers love this tactic because it enables them to double or triple their ad impressions.

Autoplay video – Even though most viewers hate autoplay videos, publishers think this tactic is great because they can gain revenue from video serves without having to wait until a user clicks on it to play.

Autopage refreshing – The obnoxious practice of refreshing and reloading a web page every 30 or 60 seconds has little to do with fresh new content being added to the page – unless that “fresh new content” is new advertising impressions.  And that’s precisely why it happens – so that publishers can get credit and revenues from significantly more ad impressions than they would otherwise.

Add to these techniques the age-old practice of attracting attention via “cheesecake” or other questionable images – no matter that they have nothing to do with the product or service being promoted – and you have a veritable rogues gallery of obnoxious “tips and tricks” – all designed to serve up as many ads as possible and generate Potemkin Village-like “engagement” along with the heightened ad revenues.

And who’s surprised?  After all, it’s only “mere money” we’re talking about …

If you find certain advertising practices particularly detrimental to your online experiences, I’m sure other readers would love to hear about them.  Please share your thoughts in the comment section below — and what you’ve done about it in response.