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Independent research, commissioned by the Association of Publishing Agencies (APA), revealed that customer publishers' digital activity has grown 114% since 2005, with an estimated increase of 33% for 2008 compared with 2007.

The survey - which interviewed 30 customer publishing agencies, six brands and six digital agencies - also found that the emergence of new platforms, such as social media, user-generated content and podcasts, means publishers now deliver digital content to 37% of their client bases.

The variety of services that customer publishers have been involved in range from producing basic online editorial content (93%) through to web hosting (34%) and e-mails, e-zines and microsites (72%).

According to the APA survey, brand owners are choosing customer publishers over digital agencies to deliver branded content, as they value editorial skills more than agencies, which are generally more likely to outsource such work.

APA chief operating officer Julia Hutchison said: "Customer publishers' USP is their editorial expertise - our members employ journalists who understand what readers want online."

Cedar claims it became the first customer publishing agency to deliver a combined transactional and content brief for British Airways' online shopping portal, which planning director Robin Barnes said represented the future model of customer publishing. "The magazine and website now perfectly complement each other - an achievement for BA that would have been more difficult if two agencies of different disciplines had been involved," he added.

But agencies such as Ad2One and Profero - which have delivered branded content for C4.com and The Sun Online - argue that online editorial is only one of a number of services they offer to clients.

Tom Hyde, Profero new-business director, said: "Having good content is always key, but it's the agency's job to understand the client's needs and work out how best to communicate this with the consumer. This may be online editorial, or we may use other tools such as gaming or a quiz."