The CMO Show:
The CMO Show: The Guardian’s...

With its origins in overacted infomercials and stodgy advertorial, native advertising hasn’t had the best of reputations over the years. Times, however, are a-changing as leading publishers like The Guardian, find ways of combining quality storytelling with corporate messaging, while maintaining a strong commitment to editorial integrity.

In this episode, CMO Show hosts Mark and JV are joined by The Guardian Australia‘s, managing director Ian McClelland, for a fascinating chat around the high-level trends that have seen native advertising positioned side-by-side with independently-produced journalism.

When The Guardian launched its online masthead in the Australian market in 2013 it took local readers and other publishers by storm. Not only does the publication retain a very strong editorial policy, it also increasingly makes revenue from native content.

A highly-regarded digital-first strategist, Ian shares his insights on how The Guardian has created and retained a committed audience through an era of fragmented commercial models and modes of delivery.

“The two things I’ve been doing for 15 or 20 years are helping broadcasters to create new revenue streams and working with brands to generate what’s relevant to new technologies,” Ian said.

“Native advertising like any type of advertising or communication only works in the context of a broader strategy.  You have to know why you’re doing it and you have to know how it relates to all of the other things you’re doing.”

Listen to the podcast below and subscribe on iTunes and SoundCloud.


The rise of native advertising####

The CMO Show production team

Producer – Megan Wright

Audio Engineer – Jonny McNee

Design Manager – Daniel Marr

Graphic Designer – Chris Gresham-Britt

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Mark Jones (MJ)
Jeanne-Vida Douglas (JVD)
Ian McClelland (IM)

Mark              Hey, JV, how you doing?

JV                   Not too bad Mark, how are you?

Mark              I’m quite well. I am totally geared up for this episode of the CMO show.

Mark              Today we’re going to chat with Ian McClelland who’s the Managing Director at the Guardian Australia.

JV                   Which is really exciting because he’s a storyteller and we’re storytellers and what we do is take clients on a really similar journey.

Mark              And, well, what happens when you get lots of media people together?

JV                   We all want to talk about the same thing which is audiences.

JV                   And this is what will be interesting about talking with Ian is because he’s the managing director of the Guardian Australia. So he is very focussed on taking the Guardian’s advertisers on the same journey that we take a lot of our clients on which is how to become publishers, how to understand the difference between audience and customer base, how to really create engaging content and what’s really interesting is how to ensure that the company that they’re working for, the brand they’re working for is behind them on that journey.

Mark               It is not a small task is it?

JV                   It’s not easy at all. When – when you’ve got the CFO asking you for return on investment and where these – all these new customers are coming from, and you’re trying to support a newsroom model where you’re constantly having to produce new content and new story ideas, I mean it’s not – it’s not an easy job.

Mark               So let’s take a break for a moment and we will be right back into the conversation.

Mark:             Our very special guest today, is Ian McClelland, the Managing Director of the Guardian Australia. Thank you for joining us.

Ian                  My pleasure, good to be here.

Mark               Now, a quick background firstly. Obviously a Brit, you know, came out here at some point in time.

Ian                  Yeah.

Mark               Tell us the story.

Ian                  I was dragged out here, kicking and screaming by an Australian woman.

Mark               That is not true is it! The dragging there…

Ian                  Going over there, nicking our men.

Mark               Yeah.

Ian                  I met my wife in London…

Mark               Yeah.

Ian                  We both worked in broadcasting about 15 years ago.

Ian                  And I think on day two she said, “You do realise when we have children we’re moving back to Australia”. And – and I…

JV                   On – on the second date! [Laughs]

Mark               This is date…

Ian                  On the second date, yeah.

Mark               Yeah, date 2, right.

Ian                  We got onto date 3 and on after that and then we eventually had children and as most things that she demands, or predicts, comes true, we moved to Australia. So yeah, we were here about four – we moved about four years ago.

Ian                  I was seconded over to FremantleMedia Australia.

Ian                  So – so Fremantle were brilliant at working with the big three or four broadcasters and doing $20 million seasons of Australia’s Got Talent or Australian Idol or Grand Designs and these big shows and mainly the shiny floor shows as they call them. But what – what they weren’t very good at was getting money from brands to create content and also create content that works on multiple digital platforms, whether that’s YouTube or on a mobile device or…

Mark               Right.

Ian                  …wherever. So – so these are the two things – and I’d been doing that for sort of 15 or 20 years and helping – helping broadcasters, you know, to create new revenue streams, to work with brands closer to generate content and also make content that’s relevant to the – all the new technologies we’re developing.

And then the Guardian announced that they were launching in Australia and having been here for a couple of years I was kind of really missing the Guardian.

Ian                  As a reader, I was thinking there’s a real Guardian shaped hole in Australian media that maybe wasn’t there five or ten years ago.

Ian                  And so they wanted someone who was used to setting up those companies and, you know, building rapidly basically.

Mark               It’s a classic perfect fit story really isn’t it?

Ian                  It was yeah.

Mark               I was just going to ask, just briefly on the Trust because – for people who don’t know the background of – of the Guardian and makes it particularly unique, obviously it’s that Trust angle…

Ian                  Yeah.

Mark               …but then you’ve got the business side, so very briefly how is it unique in the media landscape?

Ian                  Yeah sure. So – so the ultimate owner of the Guardian is the Scott Trust. The Trust’s responsibility is to keep the paper independent, free of any commercial or political interference in perpetuity. So that’s their only mission is to keep that independence in perpetuity. All the money that they generate goes back into that purpose and they have a vehicle, Guardian Media Group, that owns all of its assets and companies that help produce the profits to – to keep that purpose going.

Guardian Australia was slightly a unique experiment I guess. We wanted to launch in Australia. There was an opportunity provided to us with a source of funding from Graeme Wood, the Wotif entrepreneur…

Mark               That’s right.

Ian                  …and philanthropist. And he offered to provide the startup capital to the business here. That was enough startup capital for a – for a business plan over a three to five years period without need of any more capital. And the idea was that we’d just use that. Build from scratch and then basically wash our own face before that money ran out and so that we didn’t need additional funding from – from – from the UK. Although they provide us with an immense amount of resources and expertise and all the international content and the great digital products and services.

Mark               Yeah. I know there’s all sorts of press. I don’t want to give it any credence beyond what it deserves but you’re happy with how things are going?

Ian                  We’re exactly on plan, in fact we’re ahead of – about a year ahead of plan and yeah, sometimes I think we’re – we’re, you know, we’re – like any startup you have a first three or four years of losses and that’s your startup capital and then you get to a point where you, you know, increase your revenues and reduce your losses until you reach a breakeven point and then you start to make profit.

JV                   Tell me though, at the same time as you’re building the – the company and I guess the revenue stream, you’re also building the brand in Australia and what I find really interesting is you’re holding onto this notion of the Guardian being associated with excellent quality journalism and storytelling as well as really establishing a very strong presence in native advertising. And – and doing – and having a reputation for very high quality native advertising and storytelling there. How do you actually marry – marry – how do you marry independence…

Ian                  Yeah.

JV                   …with native advertising. Because they’re not natural bedfellows?

Mark               Yes, strange bedfellows?

Ian                  I think it’s a really good question and it’s a – it could potentially be a massive minefield that whole – the whole area of native and side by side with quality journalism. And, I mean first and foremost we – the way that the business is run is that I am responsible for all the commercial and operational side of the business. I report into a global CEO, he reports into the Scott Trust. Emily Wilson who’s our Australian Editor in Chief is responsible for all of the journalism, all of the editors and journalists reporting to her, she reports into Kath Viner, who’s the Global Editor in Chief. Kath reports to the Scott Trust. So there’s absolutely no way structurally that the commercial side of the business can tell the editorial side of the business who to hire, what to write, what not to write etc – we have absolutely no control.

With – as – as we’ve seen over the last four or five years or so our commercial model has massively fragmented and that’s a – that’s a good thing. It’s been a necessary thing and a good thing and so we’ve seen our, the introduction of lots of sort of consumer revenue channels, so non-advertising based revenues, and that’s – that’s sort of you know, a safe thing to do and a sensible thing to do and also, you know, a good opportunity. And we’ve – we’ve introduced some forms of subscription around a premium version of our app. So our app is free – there’s a free version but there’s – there’s also a premium version which obviously have extra benefits.

Mark               I mean this is the thing about publishing. The world is changing around us, but the types of the demographics and the location of the people that you’re interacting with don’t really change, do they?

Ian                  No, I think – I think that’s right. I think – I think if you’ve got a – a really specific audience that you’re trying to target and you can identify what that audience is interested in and – and also what the relevance of that interest is to your core business and the – and the products you’re – you’re – you’re meant to be selling, I think – I think it’s a really good thing to do. I mean we’re talking to more and more brands now about utility, not storytelling.

Ian                  There’s a desire for brands to engage more with their audiences and to tell stories and to properly communicate and participate in – in two-way conversations with – with audiences. And I think that’s probably a result of there being so much advertising on – on so many platforms and in so many forms that to get real cut through, then that real close engagement, that very, very deep storytelling and – and – that a brand can tell, or – or a conversation that a brand can have around a certain subject with its target audience becomes more and more important and becomes more and more valued than just a massive reach that you can – that you can get on straightforward advertising.

Mark               Well, isn’t that your differentiator?

Mark               What makes you different to Fairfax or News?

Ian                  Well – well I think we were lucky in a way that what advertisers wanted was exactly what the Guardian had been doing for, you know, 200 years which was really engaging an audience being highly authentic, being real – having – being trusted greatly because of the quality of our journalism, the techniques and the technologies we use to deliver that journalism

And we’ve seen triple digit growth of our native revenues in Australia.

Ian                  We’re making our language even clearer, so we’re going to say “paid for by” and then the sponsor…

Ian                  An explainer that says basically the – the money for this content has been provided by a brand and they’ve had sign off on – on – on the content. So they’re – they’re in control. And then “supported by” and then this is the same as – as if we receive money from a sponsor or a foundation even, that they’ve provided the funds for something that we would have done anyway or we were doing anyway and they’ve – and absolutely no control other than providing the funds. And – and we explain that all. And so we’re pretty comfortable now with that terminology and we know that our readers are because we’ve done this in dialogue with them.

JV                   And so you’ve still got rising revenues associated with native advertising. What I’m interested in is whether or not there are also rising expectations on the part of the clients that are walking through the door. What – what are they looking for from you?

Ian                  The clients that we work with are really, really excited. I mean some of the – there’s two – probably two categories, what one set of clients are very used to doing traditional advertising.

Ian                  Native is – is new to them and they are, maybe there’s pressure internally or externally they feel like they ought to try it, they want to have a go but they’re quite – not quite sure what its value is, how they measure it and whether it’s really relevant for their brand.

Ian                  And then the second – the other type of – of client that we work with is – is people who have worked with us before, we’ve experimented, they have a really clear marketing plan that native forms a part of that and what they want from us is just – just to do that brilliant work, is to push the boundaries and is to trial new formats…

JV                   Awesome storytelling basically.

Ian                  Yeah, yeah, and just keep on doing it bigger and bolder and better, you know.

JV                   And how is developing content for mobile going to change those – those very high sort of production values that – that your native advertising has – had traditionally had?

Ian                  It’s no good just re-versioning your web product for use on a mobile device and you – there’s lot of bad examples of that – of that being done. It just doesn’t work and it’s – it could be really detrimental to a brand if they do that. On the other extreme, you’ve got some brands and publishers or whatever, going all out and using absolutely every single sort of bit of mobile technology, the latest, you know, thing and it’s just completely irrelevant to their message or their brand or – you know, or their audience. And so – and so I think it’s always about, and always has been about, even before sort of mobiles were invented, was about using the right tools and the right medium to convey a particular message to a particular audience and – and – and I think that so how something – if you’re thinking about a campaign in totality, quite often now there’ll be a – there’ll be a display, desktop based display, desktop based display element that’s sort of high impact, there may be activation or event elements so we really get people involved, we might document that.

Ian                  We work with a – a number of creative and media agencies and they might – and they might have very good tools and resources that we can use inside media agencies for example, they have good social listening, and distribution skills and analytical skills and so we can maximise the distribution of the content that we’re creating for the brand and then the third part is the brand themselves. And so quite often and increasingly the brand has their own media platforms.

Mark               Which is a great segue to the next thing we wanted to speak to you which is your views on branded content and if you like brands that are creating their own media properties. Because obviously one of the reasons why they want to work with you from a native perspective is access to an audience.

Ian                  Yeah.

Mark               When you start out and launch a blog for example…

Ian                  Yeah.

Mark               Well you’ve got no readers, you know… I mean you might have a newsletter, and the social and you can do advertising and so on, but working with yourselves you can get access to/borrow someone else’s audience. What’s your view about how you see brands evolving and changing in that – in that storytelling space.

Ian                  I think that’s the sort of – the promised land isn’t it? And I – and I think that if you can do – it’s so difficult, but it’s so difficult to do it well and actually to do it half-heartedly or not – not have the funds or the commitment to build your own media platform long term, that can do more damage than good. In fact it would do – it would do more damage than good.

JV                   Yeah.

Ian                  And so I think a lot of – I think that’s brilliant if you really get it right. If you look at Red Bull for instance and what they’ve created around a media platform all around extreme sports and experiences…

Mark               Yeah.

Ian                  …they have – 100 per cent committed to that strategy and they have piled millions of dollars…

Mark               Oh yeah…

Ian                  …into that strategy. And what they’ve come out with is absolutely fantastic and absolutely works for them. I’ve seen a thousand media platforms that brands have attempted to create and just not realised either one, they’re still too – thinking about their brand and they have their brand at the centre of their marketing plan rather than their target audience – audience at the centre of their marketing plan. And I think that’s what Red Bull did really, really well.

Ian                  And I think that’s the – the first mistake that’s – that’s quite often made, is you’re just thinking about your brand and how does our – how does our brand live as a media platform or as a – or as an app or as a utility.

Ian                  And – and then the second thing is 24/7 nature of a – a media platform or a utility or a community.

Ian                  It’s a completely different skillset. And I just think – you can – it’s doable, you just have to be – you have to be prepared for that and then the third thing is the amount of money it takes. And so you have to start thinking about– you have to start thinking about a start – you have start thinking like a startup then, how much can we afford to invest, for how long can we burn cash, does this thing need to generate its own income or is it – is it sustainable through our – through our marketing budget for the – for the main business. And so I think those three areas really have to be thought about before launching your own thing.

JV                   What do you wish people had – had already asked themselves and already prepared before they walk through your door so that you’re not having…

JV                   …to do as much, I guess, guidance and explain to them how it – how it all works. What do they need to know before they begin?

Mark               This is like your quick fire tips on how to solve the universe.

Ian                  So – so I think that the most important thing is to understand native advertising and branded content in the context of a holistic – in the context of a marketing strategy.

JV                   Yeah.

Ian                  And I think the fault lies when people – when marketeers feel under pressure to do some branded content or to do some native because it’s a buzz word and everyone’s doing it.

Mark               Fear of missing out..

Ian                  Yeah, fear of missing – missing out. That’s a distraction from a proper marketing strategy isn’t it?

JV                   Absolutely, yeah.

Ian                  And I – I think that native advertising like any type of advertising or communication only works in – in the context of a broader strategy. You have to know why you’re doing it and you have to know how it relates to all of the other things you’re doing. You have to – it has to relate to your PR and it has to relate to your – your brand advertising and a whole – and then it’s tied into a calendar of your product launches and everything else.

JV                   And what do brands need to understand about the difference between a customer base and stakeholders who they’ve traditionally spoken to, and an audience? What’s the difference between those two ideas?

Ian                  Consumers are becoming audiences aren’t they? You know, and I think what’s happened with social media and all of the communication channels and information channels that consumers are now provided with is that they’ve suddenly become audiences and – and maybe even more than audiences – but they – they – they – I think brands have…

Ian                  They’ve got a voice and they’ve got access to unlimited information and so, one, they can check the facts of what you’re saying and to see if they’re true. They also can – they can check everything you’re not saying. So what your business practices are and what your company is really doing and then they can tell the world about it – they can tell all their friends about it and they can tell you about it.

Mark               One of my favourite sayings at the moment is, you know, the audience is revolting. [Laughter] They’re revolting because they’re so loud and obnoxious obviously, but they’re also not going to play by the old rules anymore.

Ian                  Absolutely.

Ian                  And this is – the only difference now is that you can hear it. You can hear what the response is immediately and that’s slightly terrifying.

Mark               Ian, I suspect what’s happening is that when you get three people in a room who are talking about the thing that they love very dearly, that we could talk for a very long time.

Ian                  I thought we really just started, I thought we were just warming up!

Mark               Ian McClelland Managing Director at the Guardian Australia, thank you very much for your time.

JV                   Definitely, thanks very much.

Ian                  Yeah, yeah it was my pleasure, great to chat.

JV                   What I found really interesting was the – the challenges marketers are facing when it comes to creating and disseminating native content really similar to the ones our customers face when they’re creating branded platforms. They really need to understand a lot about who their audience is and how to target them, and how to communicate with them on a human basis which is – which hasn’t traditionally been at the – at the forefront of thinking in – in sort of – in terms of advertising production, for example.

Mark               Well, yeah, I mean this is obviously pretty well worn territory but it’s moving from a push model of buy my product, you know, I’ve got a message, or I’ve got a campaign, and I’m going to obviously do a great job of that from a creative perspective and targeting it to the right audience too. To moving to, if you like, a conversation or an engagement model where I want to actually incorporate what they say and – and develop a more of a – well, I don’t know if anyone really wants a peer relationship with a brand. But it’s sort of the echo of that isn’t it, from publishing.

JV                   The thing I found fascinating too is the extent to which, and this hadn’t occurred to me before but branded content and native advertising really force the – the marketer to think of their audience in human terms and – and to really understand more than just sort of demographics and numbers, but really understand who they are as people in order to be able to speak with them on a human level.

Mark               Yeah, this is why I love persona development, any time we get to talk about personas, you know, with customers like – okay, now let me talk about your persona. Do you have one? And they’re like, oh well, we’ve got seven. You know, okay, that’s about six too many!

JV                   Because that’s really bringing that human element – that’s really about bringing that human element into storytelling.

Mark               Yeah, exactly right. Well that’s it for this week of – well that’s it for this week’s episode for the CMO Show, thank you very much for joining us.

JV                   Yeah, thanks for listening.


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