Commentary

How Publishers Gain Bargaining Power As New Platforms Enter Ad Market

Publishers are faced with a spectrum of new content distribution options.

Apple News has been sending much more traffic to publishers lately. The Atlantic reported that its traffic has doubled due to some changes to the Apple News app, surpassing Google AMP as a traffic source.

Snapchat is reportedly moving to a license fee model for its Discover platform, which is seen as a positive step for publishers.

It’s possible that Amazon will also launch a more aggressive bid for publisher content distribution in the near future.

After a long stretch of publisher submission to Google and Facebook, the rising competition between digital platforms is good news for publishers. However, publishers must not waste time on bad deals or spread themselves too thin, or they will lose their opportunity to increase revenue from the broader array of content distribution options in front of them. In order to succeed, publishers need to be on the offensive as platforms ask for content to fill their new features.

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Publishers need to focus on an extremely short list of metrics that indicate real performance for themselves as well as for advertisers. Using real performance metrics that matter, such as revenue or actual eCPM that considers fill rates and discrepancies is the best way to judge platform performance objectively.

Simply taking advantage of advertiser metric loopholes in a new product is not a good long-term strategy. Facebook is moving away from clicks in its Audience Network and will be favoring conversion metrics, which will benefit publishers that have created high quality advertising environments, not those that have gamed the click metric.

Revenue and ad performance are the most obvious metrics, but not the only way that publishers need to judge platform partners. There will be internal pressure to be on every platform at scale, something that is unrealistic for many publishers. Publishers must also score platforms based on logistical factors and brand fit. Logistical factors include integration duration and cost, operational efficiency, and reporting accuracy.

For example, Apple News is currently only integrated with a small number of advertising partners, such as the premium mobile ad network Kargo, limiting Apple’s revenue scalability for now. However, Operative and other advertising technologies are also in the process of integrating with Apple News, which will enable sales teams to more easily access, sell and report on the platform.

Brand fit matters quite a bit as well. Not every publisher is going to be relevant on Pinterest, or find advertisers that want to pay for inventory that is on Snapchat. For example, local news publishers where timely video content mostly consists of police chases and car crashes will be much less able to monetize Facebook Live than a lifestyle publisher streaming runway content, which is appealing to a wide variety of advertisers.

Now is also a good time for publishers to double down on relationships with publisher advocacy groups like Digital Content Next, and contact the Interactive Advertising Bureau (IAB) with opinions on best practices.

As more platforms enter the market, there will be a window where these groups are open to changing paradigms and setting new standards for issues like viewability, audience measurement metrics, engagement and video play standards.

The IAB has just floated new dynamic creative standards,which could end up being influenced positively by publishers. While publishers have been at the mercy of Facebook or Google’s reporting, they also must contend with a wide variety of conditional metrics handed down by agencies that lack their own standards. Publishers must unite in negotiations with these entities, using as a bargaining chip their biggest and most desirable asset: premium content.

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