The four key benefits of content commerce

It’s no secret that in a post-digital world, it’s much tougher for publishers to make money. Globally, Google and Facebook gobble up somewhere between 80 to 90 percent of all digital advertising spend and within Southeast Asia they still command the lion’s share of ad spend, despite some stronger local players.

Equally, it’s no picnic on the brand side either with traditional advertising strategies becoming increasingly less effective. The modern consumer has lost trust in advertising, is wise to clickbait, scrolls right past blatant brand promotion and can spot a fake endorsement in seconds. And that’s before you factor in the demise of the cookie and the impact of IDFA when iOS 14 is introduced on digital advertising strategies. These trends have had a dramatic impact on customer acquisition, specifically for brands who’ve relied on publishers for CPM-based advertising. 

So, when squeezed publishers find a way to monetise their content in a way that’s cost-effective and transparent for brands it’s a welcome win-win.

Which is where content commerce comes in.

What is content commerce?

Put simply, it’s the digital equivalent of product placement. Think watching Back to the Future but with the ability to click to purchase Marty McFly’s Nikes (or be rewarded for a customer buying Nikes as a result of watching). Broadly speaking, content commerce falls into three main buckets: the ability to make a direct purchase relevant to the content (ecommerce); the ability to click through to an outside product link (affiliate model) or the ability to assign a value to the content if it played a part in the customer path to purchase (attribution marketing). 

It’s the aforementioned win-win because publishers can generate incremental revenue from existing content whilst brands only pay for links that work. In other words, publishers have stopped selling their audiences, and started selling to their audience. And it’s rapidly gaining in popularity as the technology now exists to make it easier for publishers and brands to track, reward, attribute and optimise directly versus having to pay third party partners to manage it. 

The four key benefits of content commerce for publishers, brands and—most importantly—the consumer are:

1. Authenticity

Quality publishers attract a loyal audience by being authentic, trustworthy and relatable. This means a connection to a purchasable product is of value to their audience, whilst enabling a publisher to retain their editorial integrity. The New York Times certainly recognised this when they bought consumer guide The Wirecutter for around US$30 million back in 2016. Content commerce is a very distinct proposition from advertising and also gives a publisher control over which brands they chose to work with so they can find the right fit for their core audience.  

Publishers have created trust with their audiences over long periods of time and brands should leverage that by working with them to create authentic content, as partners rather than as “advertisers.” 

2. Contextual customer experience

With more people working from home consumers are reading, viewing, and consuming content more than ever, as well as ordering more items online and shopping as a form of therapy (or perhaps that was just me!). Yet at the same time tolerance for digital display and disruptive online ads is declining, with things like Netflix’s documentary The Social Dilemma putting concerns about the use of consumer data into the mainstream media and everyday conversation. Content commerce plays to both of these trends by providing consumers with a highly contextual and non-disruptive experience that is also of utility to the customer.

3. Data insights

Publishers often have no visibility into what their audiences are actually buying - especially because advertisers usually don’t let publishers put a conversion pixel for CPM-based campaigns. Having the right partner relationship and technology provider in place lets the publisher obtain additional purchase insight because they’re able to fire an action tracker on the advertiser’s website. This insight can help publishers understand which types of content is the most effective in driving purchases as well as providing valuable data to help bolster future sales negotiations.

4. Avoid the adtech tax

If you’ve got the right technology in place to manage at scale, publishers can retain a greater share of earnings from content commerce deals compared to what they are used to in the advertising supply chain. Working with brands directly enables publishers to bypass a long train of adtech middlemen, each slicing off their share of revenue before they get paid. 

It’s therefore no surprise that since the New York Times bought The Wirecutter other publishers have been getting in on the act. Tribune Publishing (US publisher of the Chicago Tribune, New York Daily News and many other newspapers) bought a majority stake in product review site BestReviews, whilst closer to home Japan’s Women’s Health Magazine features a link to download the Noom app in an article about a new diet.

With ecommerce experiencing dynamic growth in Southeast Asia due to the impact of lockdown restrictions (with Google, Temasek and Bain estimating the e-commerce industry in the six largest Southeast Asian markets will reach approximately $172 billion in value by 2025) the content commerce opportunity is only set to rise. It will be interesting to see which publishers and brands embrace it during 2021.

Sam Morton is APAC partnerships director at partnership automation technology firm Impact