By Shivan Durbal, Managing Director, Black Glass
Publishers opening up their 1st party data and pulling out of programmatic was broached in 2020 by Digiday. Publishers were experimenting with pulling inventory back to avoid commoditizing their brand and inevitably to increase yield and price floors for critical inventory assets.
Fast forward to today and it’s clear that the (3rd) party could be over—or at least in more active flux. Publishers have more (and better) tools at their disposal, which, by the transitive property, means that quality may be better and advertisers may get more value.
The good news: Publishers are exploring value-driven models
The bug in the ointment for publishers is the issue of paywalls. Simply put, that approach is only one piece of being a sustainable business. A raft of borderline inventory doesn’t necessarily equate to much love from advertisers.
Bloomberg, for example, has embarked on a strategic shift in ad inventory management. The company is moving its model away from 3rd party ads and open RTB (programmatic) ads—meaning, they have found a way and/or scalable path, to monetize without over reliance on programmatic and exchange-based delivery systems. For them, this is partly due to its subscription-first model, which a premium brand like Bloomberg can experiment with. The unlock is rich 1st party data—and troves of it—which means more robust monetization.
The good news is that other publications may look at Bloomberg and fly in its wake, finding more meaningful value for advertisers while keeping the lights on and bright. Overall, these are smart moves to make and marketers can benefit.
The bad news: Price increases could be coming
What we haven’t yet seen in the trades, in a big way, is an observed price increase in open web advertising inventory accessible to programmatic buying systems or through more direct buying methods with publishers who have moved inventory away from real time bidded supply side systems.But this is likely to become a key area of focus for CMOs, agency buying teams and marketers. The more publishers reduce inventory in programmatic, the more they need to show value to advertisers.
Looking at the next three to six months, CMOs should be on the lookout for ad spend waste, poor ad quality and artificial price increases – by way of increased competition, inflated eCPMs floors, direct deals and inventory reserves. Brands need to avoid elongated ‘learning’ phases, inefficient targeting algorithms or proprietary targeting technology that doesn’t meet the mark vs. its programmatic predecessor. Also keep a close watch for any lack of fraud, viewability and brand safety adherence to industry or company standards are also red flags.
So what CMOs can do about it?
1. Hedge publisher relationships with proactive outreach
CMOs and their teams and in many instances agency partners, should forge as many publisher relationships starting with any inventory they can glean from programmatic reporting systems that currently drives marketing and business results”. Through active conversations, start learning about their roadmap and getting ahead of it.
2. Create new or better deal structures
Ensure structured deals offer access to that inventory based on terms that make sense for the business’s goals. Sometimes this is a private marketplace deal powered by an ID between SSP and DSP. Sometimes this is a predefined set of delivery and payment rules with a notion of pre-buying (hedging) or committing to some amount of activations within the year and access to beta testing options or first look rights to inventory.
3. Implement a two-part measurement system
Part one: CMOs can use 3rd party measurement partners’ data to understand more about where their customers see their ads on the open web and what publisher they are on when they exude a call to action off of ad messaging. CMOs’ teams need to go beyond DSPs reports. They may also need to increase investment and capability in data—from a data intake, storage and transformation and customer identity perspective.
Part two: CMOs need a method to review publisher prices over time. Measuring prices in aggregate and over time versus what core KPI campaigns are driving at is crucial. Overall, CMOs need to know if any potential changes to price, with the promise of better targeting and quality, are offset by the KPI(s) they’re optimizing against.
The bottom line: This is another “thing” for a CMO to watch and manage in an already stressed environment. But these three recommendations can help marketers, their teams and agency partners navigate what stands to be significant 2023 publisher changes while taking control of ROI.
