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Publisher Syndicates: Redefining Digital Monetization

Publisher Syndicates: Redefining Digital Monetization

Globally, the spending on digital marketing is growing much faster than traditional marketing. Within the display digital marketing world, advertisers have been conditioned to primarily focus on scale (size of the network), reach (targeting segmented audience and guaranteed delivery) and engagement data (authenticated measurements). This article addresses the numerous critical content monetization issues confronting leading publishers and discusses potential alternatives to the status quo.

INTRODUCTION

With mobile phone screens becoming the most dominant for display and social media becoming the most dominant user engagement ecosystem, the world has seen the emergence of two distinct models:

  • The closed ecosystem model (e.g. the Facebook walled garden model); and
  • The open ecosystem model (e.g. the Google Delivery Network).

Various studies have shown the ROI of closed ecosystem models are far superior to the open ecosystem models.

Figure 1: Comparisons of closed ecosystem model vs. open ecosystem model

Source: AdSense

Almost all walled garden examples are large social media solutions that effectively provide a platform for peer-to-peer communications and engagement applying user-generated content. Each walled garden has a large, connected audience and self-serve front end portals enable multiple advertisers to access this captive audience.

In contrast, traditional media publishers who have gone digital or digital-only media publishers who publish their content, have mainly relied on open ecosystem programmatic models for monetization. By aggregating inventories from several types of content publishers, leveraging insights captured from online interactions, and providing easy to use engagement portals, the open ecosystem model addresses the three key needs of digital advertisers namely: size; reach; and data. But this model is not optimal for content publishers. With this model, content publishers create content and invest in the acquisition of audiences but have limited control over the monetization process. This model treats digital inventory as a commodity. To participate publishers need to use standards defined by the auction paradigm – losing all options to directly engage brands, agencies, or SME’s. Further, GDN/Programmatic consumes up to 55% of advertising budgets within an environment where available inventory is continuously growing.

With privacy issues delivering a death blow to the omnipresent cookies, the programmatic model is going through hyper-transformation making programmatic-dependent publishers even more vulnerable to issues beyond their control.

This article explores the potential of “Publisher Syndicates” as an option to address the short to medium term needs of content publishers to leverage the current industry-wide hyper-transformation impacting all content publishers across the globe.

Note: This whitepaper focuses essentially on digital advertising. Ultimately, traditional advertising models are also evolving rapidly and converging with digital advertising models. Infomo provides advertising solutions that seamlessly address the rapidly evolving requirements of both traditional and digital content publishers.

PUBLISHER SYNDICATES: AN OVERVIEW

The digital era has seen traditional media publishers becoming digital and the emergence of digital-only publishers. While every traditional business is going online, many pure online businesses are rapidly growing. The convenience of the handheld mobile device has also seen the creation and deployment of various types of mobile applications. With this unabated and continuous increase of digital inventories, which in the main is reliant upon programmatic advertising, publisher’s inventories are being ever-increasingly commoditized.

To combat this commoditization of their inventories, leading publishers around the world are beginning to form publisher syndicates to combat the vagaries of the programmatic model. In many countries, such industry syndicates already exist like The Digital Newspapers Association of India (DNPA) and The Indonesian Digital Association (IDA).

Table 1: Table of potential publisher syndicate partners

Publisher
Type

Publisher
Medium

Primary
Channel

Secondary
Channels

Media Content

     
 

Newspapers/Magazines

Print

Web/App

 

Television

Broadcast/Streaming

Web/App

 

Radio

Broadcast/Streaming

Web/App

 

OOH/DOHH

Billboards

Web/App

OOT Apps

     
 

News

App

Web

 

Music

App

Web

 

Video

App

Web

Utility Apps

     
 

Payments

App

 
 

Taxi/Travel

App

 
 

e-Commerce

App

Web

 

Health & Fitness

App

Web

 

Others

App

Web

Enterprise

     
 

Banking & Finance

Web

App

 

Retail

Web

App

 

Health

Web

App

 

Government

Web

App

 

Others

Web

App

 

Within each syndicate, there exists severe competition driven by the power of the content produced or by the conveniences offered as utilities. It is interesting to note that each syndicate member is focused on offering “differentiated value proposition and capabilities”, user experiences, and customer services.

However, most publishers utilise the open ecosystem model, dominated by GDN/Programmatic processes, when it comes to monetisation. For reasons referenced previously the revenues accrued for their inventories is ever-decreasing.

Each publisher within each syndicate has a defined audience and some knowledge about that audience. This first-party data is of the highest value to publishers who wish to take control of their monetization destiny. However, up to now, most publishers have relied upon audience data gathered by GDN/Programmatic to capture detailed audience targeting data that is then used for programmatic campaign targeting.

LEVERAGING THE POWER OF PUBLISHER SYNDICATION

Marketers require size, reach and data. If members were to take a consortium approach to aggregate their inventories within each syndicate, the issue of scale is addressed. However, this is easier said than done as members inherently compete. Nevertheless, today most publishers offer their inventories to GDN/Programmatic instead of working together as a syndicate. Hence, syndicate solutions will vary from one syndicate to the other. All syndicate offerings can be hosted at one central location using a single underlying infrastructure. The digital newspaper industry example discussed below is specific to print newspapers that now offer digital content.

A Digital Newspaper Industry Syndicate Model

For example, let us explore the newspaper industry to better understand some fundamental reasons behind the behaviour of members within a newspaper industry syndicate. To make this even more precise, let us explore print newspapers that are now published with digital mastheads (web and apps) in addition to print.

  • In print, the individual newspaper publisher competes for demand (using direct sales covering brands, agencies, and Small-Medium Enterprises (SME’s) and subscribers (paid subscriptions). Albeit, in most cases, the print business is declining.
  • In digital, the individual newspaper publisher sources advertising from GDN/Programmatic networks while also investing heavily to attract and maintain users who are no longer loyal nor want to disclose their identity. The power of the publisher's content is the main drawcard for attracting audiences. Unlike print, in digital the potential addressable audience size is substantially larger.

In print, the newspaper publisher sales team directly interacts with brands, agencies, and SME’s selling the value of the publisher brand and opportunities to customize campaign displays. This generates premium pricing and predictable ROI from inventory monetization.

In digital, all newspaper publisher inventories are treated equally in the Real-Time Bidding (RTB) process regardless of brand value thus commoditizing publishers inventory. More predictable GDN/Programmatic techniques such as Programmatic Guaranteed are sub-optimal for the publisher. There is no direct sales engagement between the publisher sales team and brands, agencies, and SME’s as there are no opportunities to customize, as the open ecosystem processes of GDN/Programmatic are by definition standardized.

GDN/Programmatic as the transactional middleman within the monetization processes has stripped the capabilities of newspaper publishers to directly interact and engage digital marketers from brands, agencies, and SME’s. These digital marketers demand:

  • Audience Scale;
  • Guaranteed Reach; and
  • Measurable Data.

Today most publishers can only obtain this with GDN/Programmatic, at a cost to the publisher.

Newspapers have already formed associations or syndicates in many countries. However, while such associations enable individual members with a conclave of fellow members to address industry-wide issues, no association has been successful in addressing the issues caused by dependence on GDN/Programmatic for monetization. Players like PubMatic have tried to create syndicates of publishers, but PubMatic is another programmatic intermediary offering with no special capabilities to address the specific needs of the publisher syndicate and its members.

Currently, individual digital newspapers are limited in their ability to deliver scale, reach, or data. By handing over the power of monetization to GDN/Programmatic, each digital newspaper automatically becomes a member of that programmatic network. It is, therefore, safe to assume that each digital newspaper member accepts its role as a consortium member for sourcing digital ads. Having established there should be a publisher willingness to syndicate, let us further explore a newspaper industry solution for a newspaper syndicate.

Such a solution must be designed specifically for the newspaper publisher in mind but completely tailored to meet the needs of digital advertisers. In designing such a solution for the newspaper syndicate, several key criteria must be addressed.

  • Digital advertisers who use the system must obtain audience scale, guaranteed reach, and measurable audience data.
  • Digital publishers must obtain a pay-on-performance offering.
  • Individual newspaper members will continue to leverage their existing investments in GDN/Programmatic.
  • The solution must enable individual newspaper members to operate as a syndicate, pooling inventory and leveraging common syndicate driven DMP capabilities for sourcing and delivery of “standardized and automated campaigns”.
  • The syndicate portal must give any digital marketer the capabilities similar or better than existing processes to access known audiences of syndicate members.
  • Provide each member with the ability to directly interact and engage digital marketers from brands, agencies, and SME’s, offering them customized options to run 360 degree tailored campaigns leveraging publisher-level Data Management Platform (DMP)/Customer Data Platform (CDP) capabilities. The ability to deliver customized campaigns will enable each member of the newspaper syndicate to seamlessly graduate from only plain display digital marketing to more lucrative performance marketing.
  • Exploit the full monetizing potential of content by advanced user engagement strategies.

To deliver advanced capabilities, a syndicate solution must enable the newspaper publisher with advanced options to offer innovative digital + print bundles. The success of this model is dependent on individual members syndicating their inventories. However, a standalone instance can be used by any newspaper that has progressed from print to digital channels.

THE INFOMO SYNDICATED SOLUTION

Figure 2: The Infomo syndicated solution model

Diagram

Description automatically generated

The figure above articulates the fundamental business model of the digital newspaper industry syndicate offering.

Inventory across members can be consolidated. Using the syndicate-level DMP/CDP capabilities, the syndicate (or its representative) can directly engage brands, agencies, and SME’s. The syndicate level self-serve advertiser front-end becomes the single gateway for marketers to access the syndicated inventories of all publisher members.

Individual members can consolidate their inventory across multiple digital properties and, leveraging the publisher’s own DMP/CDP, offer a self-serve front end for marketers for customized campaign opportunities. As response management for customization is also offered by individual members, user response data will be used to further refine the publisher’s own DMP/CDP instance.

This is a neutral syndicate-based offering, and the syndicate sets the rules enabling members to either consolidate their inventory for syndicate-based offering or use a stand-alone instance for customized campaigns combining both digital and traditional inventories as innovative bundles.

THE VALUE PROPOSITION

There are many global companies like PubMatic providing standard DSP + Ad Exchange + AdServer + SSP programmatic capabilities. Beyond fulfilment, such programmatic solutions do not offer any specific differentiated capabilities either to the digital newspaper publisher’s syndicate or to individual members who require differentiation.

The nationally-hosted digital newspaper syndicate offering will provide syndicate members with a comprehensive range of unique add-on functional modules over and above those provided by legacy programmatic capabilities. It provides:

  • Opportunity to syndicate inventory for industry-standard IAB campaigns.
  • Closed ecosystem capabilities, enabling each member to control its own digital + traditional marketing value chain.
  • Advertisers will have access to scale, reach and data and the ecosystem solution will offer full transparency within a zero-fraud environment.
  • Enables syndicate members to reestablish direct engagements with brands, agencies, and SME’s.
  • Neutral syndicate solution that provides a comprehensive DMP/CDP strategy without any compromise on data security.
  • Seamless transition to lucrative performance marketing with full built-in response management.
  • Newspaper syndicate specific business use cases.
  • Publisher-centric advanced options for user engagement:
    • SmartNotifications.
    • SmartAudio.
    • SmartVideo.

CONCLUSION

Established in 2018, Infomo is a Singapore-based AdTech company. It has business operations in Australia, India, Indonesia, and Vietnam and is currently expanding into Singapore and Malaysia.

Infomo is the first company in the world to create plug and play platform monetization industry solutions for inventory sellers. A single nationally hosted instance can support a variety of industry syndicates.
Infomo comprehensively addresses the adverse issues of the Google-designed and influenced “GDN” (Google Display Network”) or “Programmatic” advertising process from a seller’s perspective. Privacy issues are now driving this segment through hyper-transformation.

More than 8000 companies are offering GDN/Programmatic capabilities within the standard digital marketing paradigm. Almost all Targeting data was collected from third-party cookies and/or third-party data management platforms (DMP’s). The Infomo ecosystem, with its innovative Hybrid DMP/CDP, enables industry syndicates and their members to directly interact and collaborate with brands, agencies, and SME's thus reducing dependencies on GDN/Programmatic for monetization. The Infomo syndicate offerings enable syndicate members to seamlessly transform from commoditized digital display marketing to offer brands, agencies, and SME’s comprehensive capabilities to customize their campaigns and capitalise on performance marketing techniques.

Infomo is on track to establish a network of 750 million connected screens across Asia in 2021.

For further information please write to: This email address is being protected from spambots. You need JavaScript enabled to view it..

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