Triopoly drives evolution of media monetisation

As Alphabet, Amazon and Meta continue to dominate global adspending, accounting for more than 40% of the total last year, many media owners are being forced to evolve their operating models to survive, says the latest Global Advertising Trends report from WARC.

Why it matters

The weakening of the historic bond between content, audiences and advertising is underpinning the upheaval in the media industry. It is becoming harder for content-creating publishers to remain competitive against data-rich performance channels like retail media, and sustain publishing businesses through online display revenue alone.

Amazon, for example, earned $37.7bn from advertising services in 2022. In context, the entire global publishing ad market will be worth $47.2bn in 2023, per WARC Media data, a decline of 7.7% year-on-year in 2023. 

What it means

While no longer sufficient to support many media owners in isolation, advertising remains an attractive, high-margin source of revenue. Media Modules in Flux highlights key trends driving changes in how media companies make money.

• The proliferation of SVOD services is coming to an end as key media players – think Netflix, Disney et al – move to ad-supported business models. As well as catering to consumers’ desire to access content for free and save money, this signals that profitability is being prioritised over revenue growth.
• Where legacy channels offer both digital and offline formats – i.e. media like video, audio, publishing and OOH – ad investment is increasingly likely to go to digital formats in CTV, audio streaming and DOOH.
• It is still possible to build a robust, ad-driven media business in niche areas, as demonstrated by Washington, DC-based publishers like Axios, Punchbowl and Politico, which aim their products at influential audiences in the US capital.

Key quote

“The reality of the publishing industry is that you really cannot have an original content model that is mostly or solely reliant on display advertising revenue. Ad money is being eaten by retailers because they have really good data of what people purchase” – Brian Morrissey, media analyst and founder of The Rebooting.

Download a complimentary sample report of WARC Global Ad Trends: Media modules in flux here.