In-text ads tied to keywords on Web news pages are growing fast—and causing a stir in some newsrooms
For sale: "Boston," "telephone," "football," "Indianapolis"...and just about every other word that appears on some Web news pages. Having shifted much of their advertising budgets from print to online, big consumer-brand companies are increasingly attaching ads to selected words on newspaper and other media Web sites.
So-called in-text advertising, purchased by companies such as Ford (F), Intel (INTC), and Microsoft (MSFT), pops up in small windows when a reader moves a cursor over highlighted, double-underlined words in a story. Pausing over a link produces a bubble containing written pitches, voiceover, or even video.
This year the Web sites of several Gannett newspapers, including The Indianapolis Star, The Arizona Republic, and the Reno Gazette-Journal, began using in-text ads. New York City-based Vibrant Media, one of the leading firms that specializes in selling in-text advertising, has nearly doubled the number of publishers showing its ads in the past year. It delivers ads to 110 million Web users a month on nearly 3,000 sites, including the online arms of Cox Enterprises' The Atlanta Journal-Constitution and Hearst's Popular Mechanics, and the Web sites of TV networks such as Fox News (NWS), MSNBC, and the Bravo cable channel. McGraw-Hill Broadcasting (MHP), owned by BusinessWeek parent The McGraw-Hill Companies (MHP), runs the ads on Web pages for some of its TV stations.
The ongoing shift of ad dollars from print and TV to the Web has increased pressure on publishers to try unconventional formats. Last year ad spending on print newspapers in the U.S. declined 1.7%, to $46.6 billion, according to the Newspaper Association of America; spending on all U.S. Internet advertising rose 27%, to $19.6 billion, says research firm eMarketer.
Many journalists believe that selling the words in a story blurs the line between editorial and ad content. Some worry it creates an incentive to insert ad-linked words or order up certain types of stories. Forbes' online arm caused a ruckus in 2004 when it rolled out in-text ads. After an outcry among the editorial staff and negative media coverage, Forbes ended the practice.
Marketers claim it would be hard for journalists to know which words trigger an ad. Advertisers buy hundreds of words they consider related to their product. Vibrant's computer programs scan Web pages and choose words based on prominence on the page and story content. And word lists change constantly.
The Indianapolis Star began using the ads in August, initially in its auto racing pages. Now they can be found on stories throughout the paper's Web site. Patricia Miller, online sales manager, says some newsroom employees and readers voiced objections, but those "tapered off." "Certainly, everybody is trying to figure out the best way to generate revenue from their online properties," she says.
In a Nov. 20 story about Thanksgiving recipes on the Star's Web site, the words "cooked rice" were double-underlined. Scrolling over them launched an ad to buy a Sanyo rice cooker from Amazon.com (AMZN). Vibrant provides the paper with up to three ads per article. They're not placed in stories with a high percentage of negative words, such as "murder," or with words that advertisers feel could tarnish their brands, such as "gas guzzler," a phrase an SUV dealer could ask to avoid.
Publishers are paid by Vibrant and other marketing companies based on how many times readers scroll over a word. Advertisers only pay Vibrant for how many times a reader actually clicks on an ad. In-text ads draw a higher response than traditional Web ads: About 0.2% of Web users click on posterlike ads known as banners; Vibrant CEO Douglas Stevenson says 3% to 10% scroll over and click on in-text ads, depending on the category.