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An Opportunity for Publishers to Benefit from the Pandemic

An Opportunity for Publishers to Benefit from the Pandemic

The COVID pandemic has created a massive disruption to all our lives and expectations none less than the over $US 300B digital advertising market. This article discusses some of the key issues that the industry must confront if it is to survive and prosper.

TWIN PUBLISHER CHALLENGES

There are numerous challenges confronting publishers. Two of the leading challenges are keyword blacklisting; and declining programmatic effectiveness.

Keyword Blacklisting

In March, BuzzFeed News’ Craig Silverman reported that Integral Ad Science, a digital ad verification company, had over 3,000 advertisers blocking the term "coronavirus."
This double-whammy followed reduced ad spend in many categories, like travel, which had already hurt publishers’ revenue streams.

Moreover, as the team at Branded, a newsletter published by Claire Atkin and Nandini Jammi, reminded us:
“Blacklisting keywords without whitelisting legitimate news sites deprives publishers of ad dollars. By doing this, we are keeping ads away from real eyeballs. Worse, where do those ads go? They are likely ending up on fake news sites that know to avoid the word “coronavirus.”

Research from IAB has reinforced this, finding those news publishers are twice as likely to be blacklisted vs. others.

Earlier this year ad fraud researcher and consultant Augustine Fou told Digiday that “This extraordinary event is exposing how brand safety tech works — using stupid keyword lists — it is not happening more often, it is just more evident. Previously it was not as visible how bad keyword blocking was for legit publishers.”

Fou’s comments came in response to moves from some advertisers to ensure that their ads didn’t appear on websites mentioning “coronavirus.”

As a result of keyword blacklisting, major publishers including Der Spiegel, The Guardian, The New York Times, and The Wall Street Journal have all been impacted.

In the UK it is estimated that news publishers lost around 50M pounds sterling between April and July due to this practice.

Declining Programmatic Effectiveness

Globally, according to Zenith, more than two of every three display ad dollars are being spent programmatically, with the worldwide market for programmatic advertising predicted to be worth $US 98.2 B in 2020.
Put another way, around 68% of worldwide digital ad spend is now programmatic, up from 44% in 2015, a figure which rises in markets like the USA (84.5%) and the UK (88.9%).

COVID, however, has demonstrated some potential pitfalls for publishers who may be dependent on this advertising model.

In the US, at least one major local news publisher witnessed sudden declines in per-view programmatic revenue as a result of the coronavirus and keyword blacklisting.

McClatchy's Vice President of News Kristin Roberts told staff, in a memo to staff obtained by Axios, that "the money we get every time someone reads or watches an individual story (“programmatic” revenue) is declining, rapidly - that per-view rate of revenue has dropped

It’s not easy to determine the impacts at other organisations, but other outlets may have seen similar numbers. Outside of the US, other markets and publishers have been similarly affected, but not necessarily to the same extent, given their reduced dependency on programmatic revenues.

POTENTIAL PUBLISHER SOLUTIONS

In response to these twin challenges of reduced programmatic effectiveness and keyword blacklisting, publishers have explored several different options.

Focussing On Subscriptions

After initially dropping paywalls for COVID content, some publishers reinstated them. The move to subscriptions and reader revenue is a long-term financial driver for many publishers. But the need for this emphasis was reinforced by sudden declines in per-view programmatic revenue.

In a memo to staff, McClatchy’s Vice President of News Kristin Roberts explained "Since our coronavirus coverage began, 13% of views were by people who would have been stopped by the paywall if it had been up. If we converted even a tiny fraction of those people, we would have generated more in subscription revenue than we are earning on the per-pageview (“programmatic”) revenue."

In response, Axios reported the company allowed local editors to determine which stories would be in front of the paywall, and which ones would be behind it.

This decision, which other publishers will also have wrestled with, saw the company trying to balance the provision of public health information with an imperative to drive subscriptions in a bid to meet shortfalls from advertising and other revenue streams.

Being More Creative

Although the coronavirus crisis had a positive impact on website traffic for many news site publishers they were not necessarily able to monetise it through digital advertising in the way that they would have liked.

As a result, this has encouraged some publishers to think differently about how they can work with advertisers; and perhaps emphasised the need to avoid going “all in” with ad tech solutions like programmatic.

The Interactive Advertising Bureau (IAB) highlighted some of these opportunities in a report at the end of April, which included sponsorship and other content adjacent opportunities, as well as lower rates and pushing campaigns back to later in the year.

Elsewhere, in a webinar moderated by Dan Rua, CEO, Admiral, and Christian Hendricks, President, LMC (Local Media Consortium), publishers offered their thoughts on additional strategies and approaches.

Mike Orren, at The Dallas Morning News, for example, recommended that publishers “carve out some of the premium inventory and offer it to local/premium advertisers for free to create goodwill.”

Big Tech

Recognising the challenging economics that many publishers faced (and the pressure they were under to help), platforms stepped in to offer funding and other forms of support for publishers.

The Google News Initiative, for example, distributed funding to more than 5,300 local publications. They also agreed to an ad-serving fee waiver on Google Ad Manager, often a major publisher operating cost. Jason Washing, Managing Director, Global Partnerships wrote “Many news publishers around the world use Google Ad Manager to support their digital businesses with advertising,” Acknowledging the impact of the pandemic on the global economy, he announced in April that Google had decided to waive ad serving fees for news publishers globally on Ad Manager for five months.

These limited cost savings were no doubt welcome for publishers given the overnight impact of the pandemic. Nonetheless, there were understandable calls for the tech sector to do more. One such advocate, Jason Kint, President and CEO of Digital Content Next, argued that “At the same time newsrooms have necessarily shifted coverage towards informing the public on this global pandemic, immature tech platforms are blocking the funding of this journalism. We repeat our call for the advertising technology and verification platforms to dedicate urgent resources towards solutions here, including exempting or encouraging trusted news organizations as a default.”

Encouraging Advertisers To Advocate Journalism

Recognising the challenging economics that many publishers faced (and the pressure they were under to help), platforms stepped in to offer funding and other forms of support for publishers.

In response to the level of keyword blocking that publishers were seeing, David Cohen, President of the Interactive Advertising Bureau (IAB), offered some stark words for brands, agencies, verification companies and others in the advertising supply chain. “Please immediately instruct your brand and agency teams to update your programmatic and all other media buying to enable advertising surrounded by topics you would have previously avoided, including "crisis," "COVID-19," "coronavirus," etc. The faster you do this, the more lives you will save. Every dollar you spend on credible news sites helps save lives. It ensures that credible news organizations can afford the staff required to provide critically vital information. It ensures that reckless disinformation efforts will be blunted by news that is accurate, fact-checked, and reliable. It ensures that the public at large — the people who buy your products — stay alive and well.”

In a joint statement, the News Media Alliance and Digital Content Next made a similar call. Alliance President & CEO David Chavern stressed the important life-saving work that news outlets were producing.

Whitelisting & Ad-Block Recovery

According to the 2020 PageFair Adblock Report20, by the end of 2019, 763 million devices around the world were blocking ads. This includes 537 mobile devices as ad-blocking becomes platform agnostic.

The pandemic has once again identified the need to address this situation, by encouraging whitelisting, ad-block recovery (whitelisting + ad-reinsertion), as well as the need to serve better ads.

This is particularly important given the paradox whereby audiences were spending more time with media, yet publisher revenues (especially from advertising) appeared - in some cases - to be in freefall.

Against this backdrop, publishers can ill afford to miss out on potential income as a result of unserved ads.

“We’ve been engaging ad-block users for almost a year now,” David Rowley at Advanced Local told an industry, “and we’ve seen our ad-block rates significantly reduced over time. I’m very grateful in the sense we did this before this pandemic and now we can monetize almost every user that comes to our sites.”

It should not have taken a pandemic for other publishers to also embrace this need, but in some cases, COVID-19 has acted as a catalyst for reviewing these issues.

Showing The Impact Of Ads

At the same time as addressing these issues, publishers arguably also need to make a better case for the impact that ads on their sites are having "Ads placed next to coronavirus content are getting more attention than they would normally," Mike Follett, managing director of the London-based Lumen Research, told German media giant DW22. “Brands are shooting themselves in the foot by blacklisting around keywords associated with the coronavirus Follett said.

Eye-tracking research conducted by his company revealed that two-thirds of digital ads were being noticed, compared to just over half six months before the pandemic. New research suggests the global eye tracking market will grow to become a $US 1B industry by 2025.

Next-Gen Technology

Finally, another technological advancement is also worth noting. As ad tech evolves, AI and semantic understanding look set to offer potential solutions that will benefit publishers and allow advertisers to move away from crude blocking lists. In its place comes contextual targeting, whereby ad tech recognises that words can mean different things in different settings.

One example of this in action is Mantis, which IBM describes as “an AI-powered screening tool that understands the context of articles and images to help publishers unlock more ad-safe inventory.”

Moreover, customers are seemingly more open to this technology, according to new data from DoubleVerify’s 2020 Global Insights Report. This suggests that better ads, more relevant to the content that they are reading, is more likely to be seen, improving both viewability and potential click-throughs.

For publishers, this may have reiterated the need to deploy a wide range of strategies to improve the delivery of digital ads, as well as the creative relationships they have with advertisers.

Alongside this, the pandemic has shown how publishers can be advocates for change both in terms of reshaping the supply chain of digital ads, as well as getting marketers and agencies to think differently about their relationship with content and the adjacency of their respective brands.

When it comes to advertising strategies and their relationship with ad tech, COVID-19 - as it has with engagement and subscription strategies - may be another instance where the coronavirus crisis acts as a catalyst for publishers to do things differently or reinforce the importance of existing strategies.

With thanks to Axion, Digiday, and The Drum.


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