Recent revelations have shed more light on “Jedi Blue,” the codename for Google’s alleged proposal to lower digital ad fees for Facebook and give them other benefits such as speed in header bidding auctions. In return, Facebook was to pledge support for Google’s header bidding alternative Open Bidding.
The news is a betrayal of publishers’ trust and highlights yet again the overdominance of the walled garden; it should therefore be treated as a bellwether moment for all digital marketers.
But there is much more to come, and while Facebook and Google will always have a place in the marketing mix, publishers will need to reduce their dependence on them and shift the balance of power.
Market consolidation
It’s likely that publishers will explore alternative options this year outside of waterfall models such as Google’s, and as a result, header bidding will grow in scale. While the tech giants are undeniably valuable for publishers due to content syndication and the traffic provided from search, I think we’ll see publishers start to explore other monetization options. As part of this shift away from Google, I predict there will be greater use of trusted ad tech vendors to handle inventory which, in combination with greater advertiser demand, will help publishers’ CPM yields to gradually rise.
There are already deals taking place in the ad tech industry, such as Magnite’s acquisition of Nth Party, which specializes in secure audience data sharing and analysis, to expand offerings for publishers. These partnerships build on the many mergers and acquisitions in the industry from last year and are set to continue in 2022, giving publishers more capabilities to reduce their overreliance on the big industry players like Google and Facebook.
Essentially, these companies could become walled gardens in themselves, so that the open web will begin to split into two camps: publishers that operate as mini-walled gardens and publishers that rely on third-party ad tech support.
The rise of private marketplaces
Another way in which publishers can strengthen their own infrastructures and maximize revenue is through private marketplaces (PMPs), and these are likely to become more prevalent in the coming year.
One advantage of PMPs is that they reduce ad fraud, which is only becoming more important as the World Federation of Advertisers (WFA) has estimated that more than $50 billion will be lost annually to ad fraud by 2025. Fraud cuts into publisher resources and monetization opportunities, and it has the potential to reduce trust in ad-supported content if left unchecked.
Therefore, PMPs and programmatic guaranteed deals will grow as they allow publishers to choose trusted demand partners to bid on their inventory, which also leads to greater ad quality. Likewise, special interest networks will become more important as publishers prioritize reputable and reliable brands to buy their ad space.
However, the main value of PMPs is that they allow for the swift and easy implementation of new partners and, in turn, boost publishers’ revenues. The strong partnerships and trust that result from PMPs mean that, through exclusive access to their inventories, publishers receive a guaranteed spend from advertisers. Moreover, the selected advertisers are given preferential access, meaning that publishers can increase the cost of their inventory, further contributing to their revenue growth.
The greater transparency involved in PMP relationships allows publishers to gain a clearer insight into campaign performance, something that isn’t possible within the walled gardens’ black boxes. As a result, publishers are likely to increase their presence in PMPs as they begin to broaden their monetization strategies.
Exploring alternative opportunities
As advertisers begin to seek highly viewable, brand-safe inventory outside of the walled gardens, publishers can take this opportunity to understand their audiences at a granular level. This will enable them to provide valuable audience segments to advertisers and therefore offer them compelling targeting opportunities.
Their vast pools of valuable first-party data allow them to do this. From signup data, demographics and browsing interests, publishers are able to paint accurate pictures of their audiences. This makes publishers an attractive prospect for advertisers, who can tailor their campaigns towards specific segments. Moreover, the real-time insights gleaned from users’ actions enable advertisers to better optimize their campaigns and quickly adapt to changing trends and behaviors.
Alongside providing strong advertising prospects, publishers can look to evergreen and legacy content as revenue sources. Evergreen content provides a consistent and reliable source of traffic that can be offered to advertisers for dependable views. In addition, publishers can sell syndicated content to brands to help them increase their own site engagements.
Being proactive and bringing creative, intelligent solutions to brands and their agencies ahead of request for proposals (RFPs) will also be the hallmark of successful ad sales teams this year. But ultimately, publishers should always be respectful, flexible and open to rapid changes in the landscape.
Despite the outrage and disappointment, the revelations of Google and Facebook have sparked, the news gives publishers the opportunity to explore broader and more transparent options to complement their work with tech giants. Whether it’s employing first-party data strategies to better understand their audiences or partnering with ad tech vendors to expand their inventories, Google and Facebook’s unlawful agreement will spur change among publishers and could create a fairer ecosystem for all.
