An Open Eulogy For Premium Publishers
Premium publishing isn’t dead, and Simon Dumenco of Ad Age makes this point compellingly clear. He ends his recent column noting that while a brand like Elle is flourishing, both Friendster and MySpace are essentially dead and buried.
So a eulogy for premium publishers is certainly premature or even misguided, but I can’t help but think one will be needed as long as premium publishers continue to sell off unsold inventory on the exchanges (open and private). As much as people explain why this “barbell” strategy makes sense, I can’t stop seeing it as a dumbbell.
“We need to maximize revenue from each impression” and “it’s better to get some money for unsold inventory than none at all” are solid reasons. So is the fact that “these dollars come from a separate budget and a different buying group at the agency.” “Besides” as I so often hear, “this train has already left the station.”
I understand the rationale, and yet I can’t stop thinking premium publishers are being sold tickets to get on the train -- but instead, will be run over by it.
Last Friday, I sought more answers. I had lunch with two people I don’t know well, who are well-regarded in this industry. They are a couple of heads and shoulders above me when it comes to understanding every aspect of the digital advertising landscape. So when this question came up at the table: “Should premium publishers place their inventory onto an exchange, either open or private?” I anticipated even smarter reasons why publishers should be doing it, and felt my head instinctively bow. My worst fears would soon be realized -- that I don’t know what I’m talking about.
Instead, I picked my head back up and listened intently to their views. Their answers surprised me, amounting to “F, no” and a funny joke about unknowingly digging one’s own grave.
What came next was the simplest explanation of why premium publishers continue to ignore the ramifications of this strategy. According to one at the table, premium publishers don’t recognize their competition.
I can concur. I often hear premium publishers talk about gaining market share against traditional brands they are used to tracking. No one ever says they are losing share to the Google or Facebook Exchange.
Competing for a spot on a media plan starts with communicating a clear point of differentiation and hence, unique attributes that complement the entire media plan. The exchanges are long on targeting, inventory, and cheaper prices but short on premium brands. So a premium site can easily point to that as a key reason why their site should be added to a plan that includes exchange inventory.
But now, when a premium brand salesperson is challenged on why a buyer should buy them, knowing that brand’s inventory can be bought through an open or private exchange, the answer is such a struggle. Overcoming this problem can includes labor-intensive custom site integration, which is great, but not easily replicated.
The clearest point of differentiation a premium site has versus inventory available on an exchange is its brand itself. Placing that asset on an exchange is like an NFL football team, while on offense, giving their best defensive player to their opponent. That defensive player is “unused” at that time, right? Why not make extra money leasing him out, instead of sitting on the bench?
This whole issue of direct selling versus programmatic comes down to trying to do both at the same time. You can feel the conflict this dual approach creates in hallways and conference rooms. Premium publishers should, instead, step back and look at what their business would look like if they chose one or the other. Then decide which picture they like better and hang that one on the wall -- not both.
The barbell strategy works for sites (like portals) that are weak on brand and strong on volume. It doesn’t work the other way around.