December 20, 2018

UGC & Sugar, and the Resurgence of Real Media

Written by Todd Tran

Don’t worry, this post is not going to make you feel bad about eating sugar. It’s not about sugar at all. It is about user-generated content (UGC),  but not about the consumer’s consumption of UGC. It is about the advertising industry’s reliance on UGC for media advertising and how our recent realization of the dangers of it has led to a resurgence of “real media”. The growth of user-generated content, on top of the rise of social media consumption and the promise of valuable data and low cost to advertisers, has led to a dramatic increase in media spend on these platforms. Social media will garner almost $20 billion in spend in 2018.

The parallel between UGC and social media is similar to sugar in that it has quickly penetrated the ad industry and has become addictive. Many advertisers are very reliant on this media but are now realizing that it’s not as perfect as it seems.

I am not against UGC. I consume it regularly and believe there should be a platform where everyone can contribute their own content. I believe advertisers should include UGC as part of their overall media budget, as it serves many purposes including mass reach, competitive prices, and in many cases provides robust data for targeting purposes. But like sugar, too much of a good thing can be detrimental.

The most obvious issue that has surfaced in the industry is brand safety. We see headlines daily regarding the danger of advertising on UGC with ads appearing next to inappropriate content. There’s no doubt some platforms have made strides to tighten this but frankly, there is no fail safe way to fully police billions of posts in real time.

Another challenge that the media industry is grappling with today is the prevalence of fake news on social platforms. Research done by Teads in 2018 shows that because they are concerned about contributing to a culture of “fake news,” over 75% of consumers are likely to seek out news sources they trust.

Attention is a struggle on social media, with users scrolling 50% faster on social media feeds than on editorial content. In fact, some brand CMOs have publicly stated that the average in-view time of a social media ad is 1.7 seconds. This is a particularly acute problem for video ads which require in-view time longer than display ads. You will get mass reach, potentially strong data for targeting, and low CPMs but the user doesn’t see the ad! It is critical to properly evaluate the ROI of such media placements.

The brand safety crisis, along with the realization of low attention and low brand impact, has led many marketers to seek inventory in safer and more effective media – professionally-produced content, or “real media”.  These are the media brands we grew up with and trust, like The Washington Post & Forbes.

However, there is one barrier to achieving success on real media. Large UGC platforms such as YouTube and Facebook have massive global reach and user data which makes it easy for media buyers to obtain the reach they need along with the targeting they need. Individual publishers are generally smaller scale and lack the volume of user data. Therefore, a media buyer would have to piece together many publishers (potentially hundreds) in order to obtain the reach needed.

This is the challenge that allows Teads to exist. For the past 7 years, we have been intensely focused on one goal –  to build a Global Media Platform that unites all the professionally-produced editorial “real” media that consumers love and brands trust. We believe that only when all these publishers are united on one platform that advertisers can access via a single touch point can these publishers compete with large-scale UGC platforms.

Our vision was to built a platform that provided the full stack solution for publishers to monetize their ad inventory and to provide a single access point for advertisers to access this inventory. This includes impactful ad formats, ad serving,  and SSP, creative studio, and data. We invented the outstream video format as a first step together with an ad server and SSP. We then added Teads Studio, our creative studio, which is available as a managed service and self-serve. We have also included creative consulting and content pre-testing to ensure the creatives and format deliver the intended results. We have added dynamic display formats and DCO. We built a DMP with massive data assets from 1st, 2nd and 3rd party. All of these key elements are boosted by advanced machine-learning algorithms to enhance their performance.

Of course, a platform is useless without publishers. Over the past 7 years, we have focused on partnerships with the best publishers in the world, including The Economist, Bloomberg, Forbes, The Atlantic, The Washington Post, and more.  We now work with ⅔ of the Comscore top 300 publishers in over 30 countries with a reach 1.4 billion worldwide. We can credibly say now that we have the largest collection of professionally-produced editorial publishers in the world.

As brands wean off of UGC and achieve a more balanced diet, it is critical that there is one platform that unites the world’s best publishers. We believe the future, like the past, is very bright for real media.

Share this post
Share on facebook
Share on twitter
Share on linkedin

More from Teads