InPublishing: Need a sizable new revenue stream? There’s one right under your nose…

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Are you a regional publisher looking for a significant new revenue stream? If so, read on. The chances are high that you are already sitting on a treasure trove of potential new revenue from existing clients, that you haven’t been able to monetise yet. But, according to Christian Scherbel, CEO and founder of Smartico and Justin Lello, their UK lead, when I met them over Zoom in mid-October, their Smart Ads model, which is already well-established across mainland Europe, can unlock that revenue and can be up and running within a few weeks with minimal set up and ongoing overhead for the publisher.

The question any regional newspaper has to ask itself is this: In any given edition of my newspaper, what is the number of print-only advertisements?

(By ‘print-only’, they mean advertisers who have taken out a print ad with you, but who do not do any corresponding digital advertising with you.)

If the number is approximately 30 or more, then, by adopting the Smart Ads model, says Christian, you are looking at a five, possibly six, figure new revenue stream for your title.

Each Smart Ad starts with a print ad and results in a mobile first banner ad, landing pages and reporting dashboard.

This group of print only advertisers, adds Justin, is made up of small to medium sized businesses who typically order print ads priced between £100-£1,000. They have an existing relationship with you, trust your brand which they’ve known for years and believe in the value of print advertising. They are aware of the digital revolution and would like to do more digitally, but the digital upgrade packages offered by regional publishers are beyond their budgets.

Some of them will have dabbled with Facebook or Google advertising and will in all likelihood, says Christian and Justin, have been left scarred by the process. Those digital behemoths rapidly drain budgets, put the onus squarely on the advertiser, and offer little in the way of assistance and handholding to time-poor small businesses.

These local businesses are expert at what they do – be that plumbing, double glazing, landscape gardening – but lack the technical know-how or time to engage properly with digital advertising.

If they were to be offered a digital solution from a media company they trusted (like their local newspaper who they already advertise with) for a low price, which involved no additional work on their part, but which delivered them an attractive digital ad linked through to a bespoke landing page, a set number of guaranteed impressions on that newspaper’s local website with a dashboard page to show them the results, they would leap at it.

This is precisely what publishers that sign up with Smart Ads can offer their SME print advertisers.

And, based on their experience in Europe over the last ten years, it is an irresistible offer that very high percentages of SME print advertisers (often in the region of 80%) take up.

Crucially, says Christian, this is new revenue – from advertisers for whom publishers previously had no digital solution for.

This solution caters specifically for the long tail of SME advertisers, not your key accounts and larger advertisers who have technical know-how and sizable digital budgets and for whom your own in-house agencies and studios already do great work. The Smart Ads solution does not step on their toes.

How it works

Smartico was founded by Christian – an aviation engineer by training, but a media entrepreneur by choice – in 2013.

The opportunity for publishers that he spotted was the large number of print-only advertisers in local newspapers that publishers had no digital solution for.

The solution he came up with – Smart Ads – was his answer to that.

The concept is clean and simple.

Smart Ads allows publishers’ sales reps to offer their SME print advertisers a Smart Ad upsell of, for instance £99, when they order their print ad. So, their £500 print ad becomes an order for £599.

Once the advertiser has ticked the box and provided the print artwork, the following happens:

the publisher routes the print ad through to Smartico
Smartico extracts the key information and images from the print ad and also pulls additional content from the advertiser’s online presence (its website and social media pages) to create the following:

An attractive web ad which Smartico books straight into the publisher’s ad server with a designated number of impressions to serve. This web ad links through to…
An attractive landing page, usually with a clear call to action.
A link to a reporting dashboard for the ad, which shows the amount of time people have spent on the landing page. (Importantly, Smart Ads reports number of minutes of engagement, not click through rate, which Christian says is the most uninspiring of statistics. 0.5% click through might be an industry standard, but to the advertiser, that quickly translates into “99% of people did not click on my ad”.)

Smart Ads is an established player across Germany, Switzerland, Austria, France and Benelux.

They work with over 200 publishers and over 400 titles, serving tens of thousands of Smart Ads each week.

Their customers include major newspaper groups like Axel Springer, Mediahuis, Tamedia, Madsack, Dumont and Bauer, along with local independents of all sizes, like Mühlacker Tagblatt, Schwäbische Zeitung, The Highlander Haliburton (Canada), Le Dauphiné, Luxemburger Wort and many more.

With its team across six European countries, the company employs 50 people, many in IT / tech along with a cohort of native speaking web designers who provide the all-important manual input that takes the content and information extracted automatically from the print ad and online sites, and turns it into a compelling digital ad. Automation, says Christian, is what enables them to operate profitably at scale, the human involvement in the creation of every ad is what sets them apart. It is, says Christian, “our secret sauce”.

For Christian, every Smart Ad they produce must be “beautiful” and for that to happen, the human eye is essential.

Having established a strong base in mainland Europe, Smartico is now bringing its offering to UK regional newspaper publishers, which Christian and Justin see as having similar scale and needs to their continental peers.

Is it for us?

How can a UK regional title work out whether the Smart Ads solution will work for them?

“It’s all about establishing a business case and we can help you do that. An initial half hour chat will soon determine whether there is potential or not,” says Justin.

“If we think there is,” he continues, “then we would ask you to provide us with an e-paper of a recent issue, and we’ll go through it, identify the ads where there is Smart Ad potential. We will then feed the figures into our spreadsheet to establish a business case. We will also take a couple of the print ads and create a test Smart Ad so you can see the results for yourself.”

So, all a publisher needs to do to establish whether Smart Ads would work for them is have a half hour chat and provide an e-paper. It’s as simple as that.

“And remember,” adds Christian, “we only make money when our publishing clients sell a Smart Ad. So, for the relationship to be truly win-win, there needs to be a critical mass of SME print advertisers. It’s not in our interests to pretend there is a business case where there isn’t.”

Getting started

Assuming a business case has been established and the publisher wants to proceed, the set-up phase is normally about 6-8 weeks.

On the technical side, things that needs setting up include the automatic routing of print ads to Smartico and the ability of Smartico to book the finished digital ads directly into the publisher’s ad server. These are straightforward steps which the Smart Ads team is highly experienced at talking publishers through.

On the business side, Smartico will help the publisher decide on the ideal bundle packages to sell, how to price them, the key components, the phraseology and, crucially, how to market and sell them in such a way that delivers the best results.

“Sales training,” says Christian, “is a key ingredient of our offering. For us to succeed, we need your sales reps to hit the ground running. So, we explain to them how the Smart Ads process works, we show them examples, we school them in how to make a compelling offer to their clients.”

“We have a lot of experience, built up with our European publishing clients over the last ten years, about what works and what doesn’t.”

“For instance,” he continues, “we have found that a ‘forced bundle’ approach – where the advertiser has no choice but to accept the Smart Ads upsell works less effectively than a package some of our clients call, ‘the feel good bundle’, where the addition of the Smart Ads component is the default, but where advertisers can theoretically opt-out.”

“The new digital revenue is our main pitch to publishers,” says Justin, “but it’s not the only thing. By embracing Smart Ads, publishers now have a digital product they can offer local advertisers as an attractive alternative to Google and Facebook. It helps not only to deliver the digital transformation of a large part of your print advertising base, but also of your local sales reps who will, sometimes for the first time, have a credible digital solution to offer their clients.”

Win-win

“The beauty of Smart Ads,” says Christian, “lies in its proven ability to deliver sizable new revenue streams for publishers from existing customers. Beyond a short period of tech set-up, agreeing bundle options and sales training, Smart Ads delivers profit for every ad sold from day 1, with minimal ongoing overhead.”

“And, critically,” adds Justin, “we don’t get in the way of your existing studio arrangements and digital offering for key clients. We focus solely on the long tail of SME print advertisers that are not doing digital with you.”

“It might sound too good to be true,” finished Justin, “but our success in Europe over the last ten years shows that it’s not. Give me a call, and I can talk you through how we can deliver new revenues for you.”