The effects of COVID-19 on consumer behaviour, coupled with the end of cookies, are opening up a new chapter for publishers and advertisers, says Zara Erismann.
Over the past two decades the publishing industry has faced a wave of almost continual digital disruption. Today, media companies find themselves competing against technology giants like Facebook and Google for online ad revenue and managing the complexities of programmatic advertising. Further, growing consumer and regulatory demands for digital privacy are forcing them to search for new ways to deliver the transparency and targeting advertisers yearn for.
In our latest piece of qualitative research – Building the Future of Publishing – we talked with industry experts to understand what publishing’s future relationship with advertisers will look like. The good news is that, amidst an evolving media landscape, most media companies see the current challenges as an opportunity to roll out a sustainable advertising infrastructure that is platform-neutral and allows them to establish a heightened sense of value amongst both readers and advertisers.
The research points to three key areas of change that advertisers need to be aware of.
1. Accelerated digital transformation is good for business
Pressure from changing behaviours due to coronavirus, alongside the deprecation of third-party cookies, are acting as a catalyst for reform, as publishers double-down on their pursuit of digital revenue streams.
While most publishers were already on a path of digital transformation, they have been forced to adapt much more quickly in 2020. This strategic change accelerated the urgency with which publishers look for solutions to their advertising challenges.
With publishers reporting a large influx of digital traffic, the key focus is on initiatives that will help them build a digital foundation for the future. This is an opportunity to build a model that is based on their directly-owned relationships. Advertisers will benefit here too, as they will be able to maintain data-driven activation with publishers who enable addressable inventory.
2. People-based ad decisioning will be an improvement on cookies
While the imminent demise of third-party cookies has had a profound effect on the advertising model, the reality is that many already saw them as out of date. Unsurprisingly, an array of alternative technologies are already coming to the fore. While experts are looking to the trade bodies to bring clarity, currently the industry view is that we’re likely to see an ecosystem that uses a mix of solutions to provide advertisers greater insight around targeting, audience segmentation and measurement.
Along with this comes optimism around using user-based approaches rather than the inferred fragments that third-party cookies offer. First-party audience data is opening up the opportunity for enhanced “people-based marketing”, which ultimately brings publishers and advertisers closer together. This approach also benefits users by placing privacy controls in their hands, thereby restoring the trust that publishers – and brands – lost due to the lack of transparency that was inherent in the use of cookies. The upside for advertisers is that readers engage more with ads on sites they trust.
3. Enhanced effectiveness will increase ad performance
Publishers have clear incentives to embrace authentication strategies because first-party audience data enables enhanced capabilities that provide advertisers with increased effectiveness and performance. Advertisers further gain more accurate audience activation, reduction in wasted ad exposures, and far deeper insights into everything from user behaviour to user preferences.
Publishers are attempting to flip the switch on three decades of ad measurement practices, to re-imagine the “click-through” on their own terms. As they do, they will be able to offer advertisers and brands a range of additional services that add value to their relationships and allow them to get even closer to their target markets. These are likely to go far beyond advertising and include things such as providing insights packages on buyer trends.
Final thoughts
This is a time to reimagine the digital value exchange with consumers in a way that re-establishes trust, transparency and choice. The foundations of the old publishing world may appear to be crumbling, but deeper user relationships through these value exchanges enable publishers to build a new foundation that offers additive benefits to advertisers, from greater efficiency to improved business outcomes. The efforts to build a better ecosystem have already begun, and the future looks bright for all parties.
