Publishers' Ad Transaction Costs Rise, Despite Shift To Automated Buying: Survey

Despite the industry's shift toward automated ad-buying channels, time-consuming advertising-related transactional functions continue to cost publishers money and time that could be better used on new revenue generation, a new survey confirms. 

FatTail, an enterprise ad-tech company, worked with Beeler Tech and CoLab Media consulting to survey professionals at publishers.

The goal was to identify where technology can support greater efficiencies, while maintaining the human touch required to develop deeper advertiser relationships.

Executives at The Wall Street Journal, Barron’s, Bloomberg, Hulu, Hearst, and AutoTrader were among those participating in the survey.

Asked to name the most surprising finding, FatTail CEO Doug Huntington said that fewer than 25% of publishers queried think about implementing technology to address the persistent transactional inefficiencies.



Routine but highly time-consuming functions cited by survey respondents include checking on client status (35%), client communications (31%) and campaign reporting (28%).

What are the most time-consuming processes, and how can publishers fix them? Huntington cited creative management, things like sending reminders of creative due dates, following up with emails, answering questions and confirming status, providing spec documents, and providing screen shots of live campaigns.

“Many publishers keep a manual record of all campaigns and email clients based on that, which is extremely labor intensive,” he wrote in an email to Search & Performance Marketing Daily. “By far the biggest time sink and opportunity to mess up ad campaigns is the process of acquiring creatives and trafficking them to the appropriate campaign line item in GAM.”

To put this in context, he wrote, large publishers can have tens of thousands of campaign-line items running every month, with each line item requiring one or more creatives to be assigned to it. If the publisher doesn’t receive the creative materials on time or it is assigned to the wrong line item, issues can arise such as delaying the campaign, not hitting campaign objectives and metrics, publishers being on the hook to offer make-goods, suboptimal inventory allocation, and unhappy advertising clients. 

Huntington said that another challenge faced by creative professionals is the "need to comply with the publisher’s spec for a given ad placement -- and if they don’t the entire email intensive process starts over again,” he said. “Publishers need to provide proof that ads are actually running, which is typically accomplished by people taking screenshots and emailing them to customers.”

Some 60% of respondents agree there is not enough time or resources to service customers in the way they expect or the business demands.

About 65% of survey respondents also agree it is challenging to get information from siloed teams or systems. Some 36% of respondents said creative management stands out as a pain point that is highly time-consuming, and 22% say it is challenging.

Some 92% of respondents said the majority of communication with their advertising partners occur via email.

Huntington believes that other areas which should be addressed, as supported by the survey data, are payment processing and campaign reporting. Agency and publisher delivery numbers often don’t match, resulting in time spent by sales, ad ops, finance and others going back and forth with the customer to understand, investigate and resolve payment issues. 

“In addition to wasted time, we have heard from several publishers that AR days are too high and addressing this issue is a top priority,” he wrote. “Seemingly mundane tasks like providing campaign reporting can be time consuming because publishers often need to provide different reports for different advertisers, which again are distributed with individualized emails.”

When asked to cite the key challenges that premium publishers face today, Huntington said “preserving the integrity of professional journalism as revenue and margins continue to get squeezed by the major platforms and ad tech intermediaries.”  

To do this, publishers need to align with fellow publishers to create greater buying scale for advertisers. They should also push for intercompany automation to build deeper and more trusted alliances with their advertisers and drive down operating margins.

Some of the most important elements of the process includes achieving real-time information, same-day processing, and near-zero transaction costs.

These goals can be met “through the creation of an intelligent middleware communication layer between the publisher’s and the advertiser’s respective deal-based ad management tech stacks,” Huntington said. “The aim is to automate intercompany workflows and exchange information as it relates to all aspect of executing a successful ad campaign.”

Too often, important information is siloed within CRM, order Management, ad serving and finance systems. Both cause tremendous operational confusion and cost -- easily 30% to 40% of ad spend, he explains.

Much of this has all been addressed in the open programmatic (RTB) market, which has a lot to do with its general market appeal…”it makes advertising simple.”

These same virtues and capabilities should be applied to the deal-based market for premium inventory as well and would provide the additional advantages of preserving high-value relationships between advertiser and publishers while providing buyers access to differentiated premium inventory such as premium ad products and placements typically reserved for direct deals.

Next story loading loading..