It has been a tough slog for online publishers over the past decade, who have faced challenge after challenge from the might and scale of the platforms to the recent privacy regulations and browser changes that have hit ad revenues hard.
Yet with each challenge comes opportunity – one where publishers can honestly hope to reclaim their rightful place in the advertising ecosystem. Could 2020 even kickstart a publishing renaissance, one that works better for media owners, readers and advertisers alike?
We are already seeing a wave of innovation as publishers seek to diversify their revenue streams in the wake of changes forced upon them.
This is not just tinkering with new and emerging ad formats and units, but a reengineering of their very business models informed by the data they uniquely hold. Because those who don’t or won’t can only hope for ever diminishing returns until they are unsustainable.
The cookie crumbles
Regulations such as GDPR and CCPA and the browser changes that seek to block tracking cookies by default are fundamentally disrupting the digital ecosystem.
Advertising built on third-party cookies no longer functions across great swathes of the internet as the data cannot be connected, users identified or ads optimised. In fact, around half of the web is effectively hidden from publishers today. With Google’s Chrome set to join Apple Safari and Mozilla Firefox in cracking down on cookies, that’s only set to grow further.
It is tempting for the industry to seek workarounds to the rules or design new ways of identifying individuals around the web – but that’s flawed thinking. Instead, smart publishers and advertisers will embrace the changes ahead, changes that will naturally make for better marketing and better outcomes for all.
This, especially so for publishers, who have been short-changed in a third-party world. Such cookies automatically put publishers at an apparent disadvantage and unable to drive real revenue from their own data because it is already widely available across the web.
Why first-party data will grow in importance
If publishers instead activate their first-party data they can offer what advertisers and agencies are increasingly demanding: brand safe, contextually relevant environments with engaged audiences – all in a privacy-compliant way.
Meanwhile, after years of chasing scale and driving down costs there is a sense that advertisers and agencies are re-evaluating how, where and when they spend. They are increasingly looking for value-added opportunities over the convenience of commoditisation that technologies such as programmatic currently offer, the long tail as well as short-term thinking and results.
What does this mean for publishers in practice?
Publishers face challenges around two main topics: scale and maximising advertising revenue. Scale, or more specifically a lack of scale, is a common problem – even though many publishers have millions of unique users on their sites. Yet when it comes to targeting them for advertising, a large proportion of those users seems go missing – when you look in your ad server, there’s a big disparity, and you struggle to deliver on campaigns.
Take The Stylist Group, whose programmatic, data and technology director David Hayter, says he realized the publisher needed to switch to a first-party world after being asked to create an audience of gin lovers. Having thought that gin would prove to be a pretty big segment for Stylist, he was shocked to come up with just 13 unique users.
Choose the right technology
When Stylist decided to change its data management platform it could only identify and target about 45% of its unique users.
DMPs and tools can make it harder for publishers to target users and harness their first-party data, and hard to respond to RFPs. Yet publishers such as Stylist need the technological means to activate and analyse their own first-party data effectively.
By switching to a tool that doesn’t rely on third-party cookies, publishers can start to collect, analyse and activate their entire audiences across all devices and browsers. Because Permutive is built on edge computing, rather than the cloud, data is processed on a user’s device, which is more efficient, effective and privacy compliant.
In Stylist’s case, switching its DMP meant that targetable inventory went from 45% of the users viewable in Google Analytics to 100%.
Understand your audience
With the right technology, a publisher can target users in milliseconds to serve relevant advertising. They can also begin to better understand and package their audiences, segmenting users at a granular level using all of the information that they are collecting about on-site behaviour and look back at all historical data, with none of the previous limits.
This valuable and unique insight makes it easier to package audiences for advertisers and provide rich strategic direction for campaigns.
Stylist saw its advertising yield double as it was able to sell inventory at higher CPMs, due to the value of its audience data. It is also seeing growth in rebookings: one such advertiser increased its spend by 50% from one campaign to the next due to campaign performance and the post-campaign insights offered.
Educate your sales teams
Established buyer relationships with third-party data providers have weakened publisher bonds, yet a publisher’s first-party data is the biggest and most valuable differentiator it offers an advertiser. Publishers must prepare sales teams to feel confident in educating buyers on the issues with third-party data, and the benefits of first-party data.
Publishers must also continue to prove the benefits of direct relationships over curated data on the open marketplace. Although moving from open to private marketplaces is becoming more common, due to their better quality data and targeting, many buyers are still wed to the open marketplace and there are still issues around cost and trust in PMPs. Meanwhile, publishers need visibility of potential revenue streams, bid pricing and buying patterns in order to encourage better pricing for open inventory.
Make the most of your quality consented data
As the source of quality consented data, publishers should take advantage of legislation by leveraging the quality and privacy compliant benefits of it, especially when compared to third-party data. Publishers enjoy enviable relationships with their readers, with many choosing to actively sign up for newsletters as well as willingly giving up their information in other ways too.
As the gatekeepers to active, highly engaged consumers, quality publishers have everything to gain from the rise of first-party data and the demise of the cookie.
Marketing Director, Permutive
About: Permutive is the data platform built for publishers. Built on edge computing, the platform gives publishers the ability to connect their user data in one place using secure and scalable technology that does not rely on third-party cookies. The result is a significant increase in the quality and scale of data collected so that publishers can drive more revenue and decrease costs. Clients include BuzzFeed, The Guardian, The Economist, Condé Nast International, Hubert Burda Media, and Immediate Media. Find out more at permutive.com