Can an Advertising-Driven Business Model Coexist With Products That Users Love?
How can we design products that users love, while also building a sustainable business model through advertising? User experience and advertisements seem incompatible.
For publishers or social platforms, content and services are normally free to use — and in our age of information accessibility, users expect it to stay that way. Meanwhile, product managers are tasked with maximising this user engagement and also developing revenue from it.
Many products swing in one direction: they sacrifice user experience to deliver pushy, unintelligent advertisements and absorb the consequent churn; or they tiptoe, showing advertisements infrequently and pouring resources into developing alternative streams of revenue.
But as with most of life; the answer is not black or white. We exist in a grey zone between, but with several considered product decisions, I believe both user experience and revenue can flourish organically.
Consider this statement:
“In my product, paid content is as engaging as unpaid content.”
What would it take for this to be true, in your case? I can answer for the products I’ve worked on. Advertising would have to be smarter. Adverts would have to be less intrusive, more relevant, and overall of better quality.
There are several concrete strategies you can implement to prioritise a positive user experience while integrating advertising that is lucrative. In fact, I’d say the most lucrative adverts elevate the user experience. Here’s how:
1. Looks Matter
How advertisements blend into the user interface is critically important. Carving out a section of your homepage to whack in a standard banner will look compromised — advertising needs to sit seamlessly among permanent elements of the design. If you’re a publisher, that means native formats that match your content design. For social, it means unobtrusive inserts between profile listings. At Upday we met this challenge by taking a standard ‘interstitial’ format (a high volume, well-paying format traded programmatically) and serving it between articles. Every so often the user swipes from one article to the next and comes across an ad — they can swipe that away too with no obstruction.
- You can minimise refresh timeouts so that the page doesn’t ‘flash’ with changing content in front of the user’s eyes; this is distracting from the main focus of the screen.
- You should also pre-load the advertisement before the user reaches it, so that there’s no visual disruption. It’s amazingly common to see products that display a blank page and make the user wait for an ad to load. Have your paid and unpaid content ready at the same time.
Huffington Post has integrated a small, localised (I’m in Germany) native ad right on the homepage. Volume of impressions would be massive and my experience is not at all disturbed.
2. Pick Your Moment
There’s a time and a place for everything, and advertisements are no exception. Devote some time to thinking about when an ad should be shown, and try to integrate it into a natural user journey.
- For example, a user has just finished viewing another user’s profile and has sent a message. Now they’re returning to the main list of profiles/news — they’ve finished one task and have not yet started another. Take this opportunity to show an advertisement, and you’ll get the attention of users who haven’t just been interrupted.
- Consider staggering the advertisements a user sees so that they don’t see too many per session, or too many within a short time frame. You can even scale this so that new users don’t see any ads within their first few sessions, to give them time to adjust to the platform and encourage loyalty.
- Finally, it should go without saying, but just in case: timing advertising in a way that blocks users from progressing on their path is extremely bad form. Ads that have a time-based delay for dismissal or that pop up in the middle of a critical pathway might result in an unintended click or two, but they also cause loss of users’ trust and ultimately churn. This is especially true for videos ads, which can often be found repeatedly blocking users from doing what they came to do (looking at you, YouTube).
Here’s what we designed for Upday: a normal article card on the left, and an advertisement on the right. The user swipes the ad away just like the article before it — unless of course, they click it!
3. Find Your Audience
If you take nothing else away from this article, take this: you should only show advertisements to people who will be interested in them. This is intuitive — we always try to target content to interested audiences, so why should advertising be any different? This means spending time and energy getting to know your users, segmenting them into audiences and targeting programmatically-sold campaigns to people who are proven to respond highly. If you know the gender or age of your user or can estimate it, these demographics are the very first dimensions by which to tailor an advertisement. Anything else you can add is an advantage — do you know about their interests, or their age group? Other sites they’ve browsed?
- If you don’t have any data, start collecting it. This should be your top priority. Consider using a data management platform to benefit from third-party data.
- Demographic targeting, interest targeting, behavioural targeting, audiences and retargeting should be regular members of your advertisement vocabulary.
Best-practice audience targeting deserves a blog post of its own. For now, it’s enough to say that when considering your strategy for advertisement, how the advertisements look is less important than who sees them. I could see the world’s pushiest, time-delayed overlay ad, but if it correctly predicts my desire for Ben&Jerry’s Cookie Dough ice cream home delivery on a Friday night, I’m still going to click it.
Lovoo has integrated what looks like a ‘mobile medium rectangle’ (see the IAB’s (Interactive Advertising Bureau) definitions here) and it’s clearly programmatically sold, probably connected to a data management platform that knows I’ve been researching sportswear products recently. Well targeted.
When you target advertisements well, click-through rates rise because users are more interested than they are in one-size-fits-all content. The content is more relevant — who cares where it came from? This means your platform earns more, but it also means that advertisers can spend less on wasted impressions, and that your users can see fewer, more interesting ads. It’s a win-win for all parties involved, and thanks to the speed of data-driven advertisement culture, it should soon be a basic standard across the industry.
4. Set Standards
We all have examples of ads that stick in our memory for their sheer awfulness. I still see technicolor Candy Crush bubbles in my nightmares. Before you protest; I’m not saying they’re ineffective, I’m saying they deprioritise the user. But there’s something else all these ads have in common: they’re cheap. They’re the bottom of the auction barrel, and that’s what you’ll see in your product if you don’t consider a minimum selling price. You may take a hit to fill rate, but try to balance that against click-through rates of better ads and the cost of the users you lose from a terrible experience and you’ll find it a small price to pay overall.
Unsurprisingly, Twitter has next-level targeting. This native ad is so well targeted, I barely noticed that it was paid content at all.
- Establish competitive floor prices to ensure the quality of programmatically served ads. Review and adjust these regularly, country by country.
- In direct deals, collaborate with the advertiser to develop creatives that make sense and don’t make your eyes want to vomit. Invest time in this, because anything you can’t be bothered to design, users won’t bother to interact with. Low-quality ads are no longer a forgivable appendix on an otherwise thoughtful platform.
This might all seem obvious to you – and with good reason. None of what I’ve proposed is rocket science. We’ve used these techniques of experience design and individualisation on content since the dawn of products. We try to recommend products, stories and profiles that users will be interested in and engage with. Applying what we know to what we’re discovering with paid content is simply an extension. To develop a user base that’s stable, engaged and even evangelistic, you need to deliver an experience that makes sense. Your users will do the rest.
Some resources you might find helpful:
(And finally, here’s a really terrible banner ad sitting on the Washington Post’s homepage. It looks like it came from iOS6 and I’m not sure what the call to action is. They don’t have any other ads on the mobile homepage. Poor user experience and low revenue!)