Home The Sell Sider Brit + Co Banks On The Demise Of Banner Ads

Brit + Co Banks On The Demise Of Banner Ads

SHARE:

Brit-Morin-Brit-and-CoWhen Google vet Brit Morin created Brit + Co to focus on the millennial DIY set, she didn’t want to rely on the web’s surest, most turnkey form of monetization: banner ads.

She thinks banner ads will become extinct. She also believes programmatic will fall by the wayside as advertisers choose branded content, video and native formats over the 300×250 boxes that dominated the web’s first act.

“Traditional banner ads are not extremely effective, especially for reaching a millennial audience that is mostly mobile,” Morin said.

With the aim of becoming the next Martha Stewart, Brit + Co developed a two-prong strategy focused on content and commerce. It started selling advertising in 2012, focusing on branded content and a single high-impact ad that Morin claims gets click-through rates multiple times higher than run-of-the-mill banner ads.

Then it added commerce. Recognizing its many crafting customers, Brit + Co developed a curated site in the same vein as Etsy. The business was successful but “didn’t feel differentiated,” Morin said. Then the marketplace grew more crowded when Amazon Handmade launched last fall.

All of that led to Brit + Co raising $20 million in Series B funding last year to pursue a different commerce strategy: DIY classes and kits. The 55 classes, delivered in an online video series with accompanying material kits available for purchase, range from fashion illustration and travel photography to building a social media brand. Morin’s 92-person company plans to double the amount of classes it offers in the next 6 months.

Morin talked to AdExchanger about how Brit + Co reaches its millennial female viewers, its all-in gamble on platforms and how it approaches monetization.

What is Brit + Co trying to do that’s different in this space?

We always planned to be a media company and a commerce company. When I started this 4 years ago, I knew I wanted to build the audience first and create great content that people would share. That’s why we didn’t truly test commerce until mid-2014 and didn’t double down on commerce until our Series B. We wanted to make sure there was an appetite for content and [to] stay true to our mission of igniting creativity.

Many other pubs have tried and exited content-commerce models, including your own company. Why is that?

We were producing millions of dollars of revenue in the first year, so it was less about the business not working. What we didn’t love so much was that it was expensive to scale the drop-shipping model, unless you were investing a lot of money into it. And it didn’t feel differentiated. What differentiated us more was the classes; it felt more like a natural concept to us.

Subscribe

AdExchanger Daily

Get our editors’ roundup delivered to your inbox every weekday.

How did working at Google inform what you’re doing now with Brit + Co?

I was there 2007 to 2011. When I moved to the YouTube team in 2008, 2009, I started to understand how content creators were leveraging the platform and what types of content resonated most for millennials, since they were the primary consumers of YouTube, and how brands thought about monetizing through video and platforms like YouTube.

When I started working on Google TV [the internet-connected set-top box and TV set is now Chromecast], my biggest awakening was that traditional media brands did not believe in monetizing their content unless there was a paywall in front of it. That was when the light bulb hit. A lot of the traditional media players were going to be slow in putting content online and monetizing it. That created a huge window for new media startups.

The other thing I took away was that this generation of millennials cares about connecting with real human beings and not brands. That was the impetus to put my name behind the company and have my name and face be the front of the brand. I felt like our audience wanted to learn from a real human.

How do you approach platform monetization? 

They are driving tens of millions of unique visitors for us, and we are bullish about monetizing content on social platforms. As we look at new product features like Facebook Live or even Snapchat on our brand story channel, we are actively finding new ways to monetize the investments our content team [makes in those platforms]. It’s just about who can move the quickest to figure it out.

What’s your perception of what advertisers want from publishers today?

I am hopeful that advertisers see that traditional banner ads are not extremely effective, especially for reaching a millennial audience that is mostly mobile. Mobile banner ads have proven to not work very well, while mobile branded content is a sure way to reach millennials. And the content has to be distributed in a place where millennials are going. For us, that means social networks. Advertisers that work with Brit + Co tap into our relationships with Snapchat, Pinterest and Facebook and reach a gigantic audience across the world.

If mobile banners don’t work, what happens to the whole advertising space that was built on 300x250s?

I think that side of the business will completely die. That was why we chose to never do banners. I do think there is potential for higher impact creative. We have one of our own, which we refer to as the “story plate,” and the conversions on that unit are triple or quadruple that of a traditional format. Contextual advertising and native content inside of a social feed is going to be more powerful [than banners]. That is why you have seen advertisers move their dollars from banner advertising to Facebook advertising, where it is inside a user’s feed.

What does that mean for the world of programmatic and ad tech?

It’s not going to die instantly. For media buyers, it’s an easy way to showcase reach. I just think there are so many formats to be experimenting with. A significant portion of the ad dollars that go into programmatic will go into branded video and live video, things like geofilters on Snapchat and native advertising on Instagram or something Pinterest has up their sleeve. That bucket of dollars that goes into programmatic will be shifting as brands and advertisers try new things.

What is Brit + Co doing with Facebook Live? 

We are doing a video nearly every day. We have tried to find our slant on what makes it compelling for our audience. The most recent show we have been producing, we are calling “Creative Request Live,” which is a throwback to the MTV show “TRL” or “Total Request Live.” This week, for example, we brought in a creative expert and are hand-lettering popular song lyrics from the ’90s on demand.

When you’ve raised money, are investors looking at you as a media company or a tech company? 

Our media business is our foundational business. However, we do get valued a bit differently because of the commerce business. They look at the brand like a Martha Stewart or even Disney. I would like to build a brand like Disney today. They have a product and merchandising offshoot and [have] diversified into a different category.

What’s ahead for Brit + Co?

There are three main priorities. One is continuing to work with advertisers in new and interesting ways. Given that we are an exclusive publisher on many social networks, we want to leverage that access for our advertisers. Second is scaling our commerce business through the online classes and kits and ensuring we have a different library of classes to choose from. Third is continuing to invest in video, from live video to 30-second formats to series.

Would Brit + Co create a TV series?

We don’t have anything currently to announce, but I have watched as brands like Vice build a name for themselves on TV. Video is the talk of the town right now. I think more pubs are going to be creating TV content and potentially owning TV channels. Ultimately, TV channels will live online or on traditional TV boxes as well. TV series are going to be morphing into one and the same.

What are media companies doing right – and wrong – right now?

People doing it right are embracing new platforms and features of those platforms quickly and experimenting how to monetize them. It’s definitely a risk. Any of these social networks could change their minds – their algorithms – or go out of business. It’s a risk, but it’s worth it right now. Media companies should diversify their audiences so they aren’t fully reliant on Google for SEO or Facebook or Pinterest. The healthiest startups have the most diversified traffic sources.

This is part of an interview series with media leaders about the future of digital advertising. Check out previous interviews with The Atlantic, Bloomberg Media, Evolve Media, E.W. Scripps, Forbes, Mic, The New York Times, Purch, Refinery29, Thought Catalog, Time Inc.,The Washington Post and Ziff Davis – and more to come. 

This interview has been condensed and edited.

Must Read

Advertible Makes Its Case To SSPs For Running Native Channel Extensions

Companies like TripleLift that created the programmatic native category are now in their awkward tween years. Cue Advertible, a “native-as-a-service” programmatic vendor, as put by co-founder and CEO Tom Anderson.

Mozilla acquires Anonym

Mozilla Acquires Anonym, A Privacy Tech Startup Founded By Two Top Former Meta Execs

Two years after leaving Meta to launch their own privacy-focused ad measurement startup in 2022, Graham Mudd and Brad Smallwood have sold their company to Mozilla.

Nope, We Haven’t Hit Peak Retail Media Yet

The move from in-store to digital shopper marketing continues, as United Airlines, Costco, PayPal, Chase and Expedia make new retail media plays. Plus: what the DSP Madhive saw in advertising sales software company Frequence.

Privacy! Commerce! Connected TV! Read all about it. Subscribe to AdExchanger Newsletters
Comic: Ad-ception

The New York Times And Instacart Integrate For Shoppable Recipes

The New York Times and Instacart are partnering for shoppable recipe videos.

Experian Enters The Third-Party Data Onboarding Business

Experian entered the third-party data onboarder market on Tuesday with a new product based on its Tapad acquisition.

Albertsons Takes Its First Steps Into Non-Endemic Advertising, Retail Media’s Next Frontier

Albertsons is taking that first step into non-endemic advertising next week via a partnership with Rokt to serve ads to people who have already purchased groceries.