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Creating Revenue from a 'Humble Link'

Oliver Roup, CEO at VigLink, contributed this article to BusinessNewsDaily's Expert Voices: Op-Ed & Insights.

Consumers are bombarded with more commercial messaging than ever before from countless sources, but it's also easier than ever to tune ads out. People fast-forward past multimillion-dollar commercials or subscribe to web-based, commercial-free TV platforms like Netflix. They view more content on the web than ever, but online ads have become virtually invisible to them. New advertising concepts like native monetization are revitalizing online advertising.

Native monetization is the idea that the revenue source for a site weaves seamlessly into the core experience of that site. Most publishers take it for granted that their site will simply run display ads. Nobody visits these sites because of the ads. They visit for the content, the experience, the community — that which makes a site unique and compelling. The ads are just tacked on. With native monetization, the revenue model isn't so irrelevant to the core site experience. This is what Google did with search ads and what Twitter and Facebook are trying with promoted tweets and posts. With native monetization, the revenue model actually has a hope of adding value to user experience.

Connections between brands and potential customers are more effectively fostered when they add value to the user experience, rather than distract or interrupt. Even the most targeted display ads are still not core the site experience. Even traditional contextual targeting — which aims to be relevant to the page — suffers from an increasingly noisy signal as pages become longer and longer. Native monetization should be relevant to the micro-context: the section, the paragraph, even the sentence. This is native monetization at its most effective — and often it's just a humble link.

At the level of micro-context, even the most jaded ad viewers tend to register the message. This means that as a content publisher, you have an incredible amount of influence — and it's growing daily. By publishing content people voluntarily access, you can create commercial intent, which is a highly valuable asset. So how can you monetize that value?

There are a number of approaches you could take. Some publishers develop direct relationships with e-commerce merchants or affiliate networks and negotiate a commission for clicks and sales. Others get more elaborate, creating full-blown partnerships with e-tailers or even acquiring e-commerce operations to jointly brand and market products in a model that combines the publishing and sales functions in a single venture.

This is a creative strategy, and the exploits of venerable publishing companies and trendy tastemakers as they graft complex e-commerce operations onto their businesses will probably be studied by MBA students for years to come. But is that really the best way to monetize the value of the commercial intent you generate as a content publisher?

Before making that leap, consider the potential downsides: One-off agreements with e-commerce partners must be individually negotiated and tracked. Partnering with an e-tailer or acquiring an e-commerce operation poses its own challenges, including the need to align the content with a single partner and take on the headaches of managing inventory and distribution. This approach can also compromise your editorial objectivity since it necessarily features close ties to a single product or service source.

For most publishers, the easiest solution is to focus on what they do best — generating strong content that creates commercial intent — and leave the monetization to a third party that specializes in delivering commissions from multiple retailers under a single agreement. With such an approach, publishers can leverage the humble hyperlink to convert commercial intent into sales and transform sales into commissions. This strategy eliminates the need to negotiate multiple agreements and deal with supply chains, warehouses and inventory. It also preserves the publisher's objectivity. Sometimes, the easiest approach really is the best.

The views expressed are those of the author and do not necessarily reflect the views of the publisher.

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