Advertising Keeps Content Free

Every once in a while, when balking at new formats that might put off visitors, it is useful to remember that digital advertising is what keeps content on the internet free. It’s been a scant two decades since the first digital ads, and in the intervening twenty years digital advertising has been on a rocketing growth trajectory as more and more people have come online. PriceWaterhouseCoopers predicts that by 2017 the worldwide market for digital advertising will reach $186 billion. Online ad spend long ago outstripped print budgets, and now it has also gone past TV spending. Every year seems to bring another shattered record,  but it seems as if every dollar increase is accompanied by louder complaints by consumers that they don’t want to be targeted by advertisers.

We could understand this attitude better at the beginning of the internet, when the World Wide Web was the Wild Wild West and everyone involved was crying that “information wants to be free.” But that was when digital publishing was a miniscule part of publishing in general, and publishers thought that eyeballs alone would somehow bring revenue.

However, we are now into a generation that’s maturing without ever knowing a time without the internet, and that generation loves to watch videos, read, and play games on networked devices. In the coming generation, many household appliances and pieces of jewelry will also be networked, creating new potential advertising platforms. The public needs to be educated again about how publishing actually works and why the content it loves to consume can never be free unless it is supported by advertisers. This new generation, with its low tolerance for ads,  has already caused many newspapers to go out of business altogether and others to convert full time jobs to piece work. Digital advertising still doesn’t command the rates that print and TV did, even as it becomes a larger and larger part of the budget.  And yet, although addicted to real-time convenience, today’s consumers seem to be less and less tolerant of the industry that brings it to them.

In growing numbers they opt out of being tracked or targeted online and even employ ad blocking software, all in an effort to get away from the industry that delivers it largely free content.]

We like to think this is partly a problem of ignorance that can be overcome by education. But some publishers have begun to put up paywalls and others have gone to subscription services altogether. Neither of these solutions serves brands who are interested in drawing attention to their products in an increasingly noisy environment. And in the long run, neither of these serves a consumer who needs to know about new products and services, special offers, or service near her.

We need to spend more time defending the advertising ecosystem and reminding consumers they’re in a quid pro quo deal: free content means allow advertising.

 

Real Time Bidding at Scale: the Promise of 2015

2014 was the year Real Time Bidding truly took off. A subset of programmatic, RTB was met with suspicion on both sides of the ecosystem. Although at first advertisers were afraid of it, and publishers thought it would drive eCPMs through the floor, it turns out this hasn’t happened. In fact, the opposite may be happening as targeting gets better and online ROI grows along with it. Publishers who know their audiences and use their audience data can offer it to eager advertisers at higher CPMs.

RTB is probably the biggest advance in online advertising in years, because it puts power in the hands of advertisers, the people who are paying the bills. However, it also helps publishers. Handled by people who know how to buy media, RTB can finally provide brands the answer to the question John Wanamaker first asked: “which of my advertising dollars is wasted?”

That’s because, for the first time, advertisers can buy individuals rather than buying audiences in bunches like grapes, according the Mike Smith, author of the new book “Targeted,”  a primer of online advertising.

Smith points out that RTB radically changes the old audience aggregation paradigm. Advertisers can now decide which individuals suit them, and despite the fact that RTB means everything happens within split seconds, an advertiser still has the opportunity to choose individuals. In real time bidding, the advertisers make their own decisions, instead of relying on agencies or even networks. They can also choose how much to pay for each impression separately. In theory, this makes for a more transparent process.

Smith compares RTB to the music industry, in which it is no longer necessary to buy entire albums after iTunes made it possible to buy just a single cut out of an album. The aggregated audience is analogous to the advertiser’s play list. However, to create that play list takes time, and it takes the cooperation of both publishers and advertisers, who may have different data about the same customer. Most advertisers  have lots of customer data, but they don’t often mine it properly. They began by outsourcing their data management, but increasingly they are taking  data management in house and building their own DMPs, because with RTB they can use the viewing and shopping behavior of their own customers to determine their optimal audience.

Buying individual impressions rather than aggregated audiences is a massive shift.

The only remaining problem is how to buy them at scale, and that’s where a network like the ZEDO premium publisher network comes in. We can take an ad buy that comes in through our ZINCbyZEDO high impact formats division and produce scale for the advertiser through our network.  We can offer advertisers news, sports, travel, and other custom segments as we continue to grow our publisher network. And we can do this through a private exchange, which is an even more desirable way to buy.

We’re predicting a profitable year for our premium publishers as our ZINC team hits the ground running on the advertiser side.

 

Publishers Can Use Their Own Data to Target Content

In just one short year, mobile has propelled itself from second screen to first. The plethora of large screen smartphone models, even in China and India has brought millions of consumers off the couch or into the connected world. Many of those mobile users check their phones 150 times a day. What an amazing opportunity for marketers to deliver messages, as savvy advertisers already know.  But what does this mean for publishers?

For publishers, it means yet another year of change, but this year is more likely to be a year of opportunity. Like advertisers, publishers now have more and better data about their visitors. And in this environment, publishers should act like advertisers; they should market for visitors in much the same way advertisers do, by targeting content.  And by offering their data to advertisers seeking their audiences. But don’t worry; this won’t create more work for publishers, because as with advertising, this kind of targeting can be done programmatically, through automated workflows. Publishers have already begun to develop their own data management resources for targeting in house rather than using outside suppliers, and MediaPost thinks

…there will  be a focus on programmatic targeting of content, not just ads.  Although programmatic targeting of advertising is now very common for brands and advertisers, in 2015, we’ll see a critical mass of publishers begin to leverage behavioral data to programmatically targeted content to optimize experiences for users on publishers’ sites. Content will be personalized and specifically aimed at individual consumers on websites and blog pages, similar to the way ads have been targeted until now. Medium-to-large sized publishers will also invest in data management platforms and in-house programmatic resources.

For publishers this also means less focus on the home page, because that might not be where the traffic comes from. Some publishers, such as news, weather, and sports  are quite successful with apps, and can target contextually through location awareness; others, like Buzzfeed, target through declared interests. Still others are investing in content based on already-available data.

Better use of data for targeting by publishers will draw advertisers and publishers closer again, after years of being forced apart by ad tech startups who stood in the middle and performed the function of interpreting the publishers’ and the advertisers’ data to each other. Only if that closeness leads to more accurate contextual, rather than just demographic or psychographic, targeting will advertisers be able to measure the ROI of their ads and their content marketing with a specific publisher.

 

Podcasts: Are They the Next New Publishing Platform?

Serial is probably the most widely listened to podcast in history, and advertisers have found many ways to become part of its success. In addition to the MailChimp audio ads we have certainly heard if we listened to Serial, there are display ads on podcatching aggregators like Stitcher, and audio versions of pre-roll as well. podcasting publishers are gearing up for a good advertising year in 2015.

Although podcasts have been around for a relatively long time in internet time, they haven’t become popular until this year. NPR has made them part of its online presence, but since NPR doesn’t depend on advertising in the ordinary sense for its support (I’d say it is more of a sponsorship model),  even the most highly listened-to podcasts haven’t caught the attention of advertisers.

Until now. In 2015, we believe that online publishers will have more podcasts as well as videos, and there will be an opportunity for advertisers to participate. Although podcasts now scarcely make a dent in radio’s audience, they will. It’s just like when video first came online and advertisers thought people would never watch videos longer than a minute or two. As things become more mobile, all of this changes, and all bets are off. As early adopters like Adam Sachs, CEO of Midroll Media, parent company of podcast network Earwolf has said, “podcast ads work really well.”  podcast ad-sales network Midroll. Sachs also runs his own postcast ad sales network

As a long time listener to Leo laPorte’s podcasts on TWIT.tv, we know that podcast ads aren’t like other ads, because they are very often native ads. They are read by the hosts in the tone and the style of the show, and often the podcasters use the products they are talking about in the ads.  The podcast ad format is more like an in-stream ad. Realistically, it’s also pretty difficult to skip past a podcast ad.

That’s why we believe that podcast ads will catch on in 2015, and we are hoping our publisher partners will jump on these new formats for native ads on mobile. We’ve got a technical team working on formats for podcast ads, and we’d love your input.

 

Business Models for Publishing in 2015

Expect the roller coaster ride of ad revenues to continue, but to get smoother in 2015, especially for publishers who invest in a better mobile experience for their users and better ways to incorporate video into their sites.

The long awaited digital ad budgets are finally increasing. Ad budgets are shifting to digital faster and faster as brands who missed the digital desktop because they depended on TV for branding have discovered that their customers may not have cut the cord literally, but they’ve cut it figuratively — by the end of 2014, consumers were watching more video online than they were on TV. That’s going to continue in 2015.

2015 will indeed be the year of video. It will also be the year of mobile. And it will also be the year of native (whatever that may mean). Many publishers have already begun to establish digital content creation departments through which they generate content for advertisers. Even the venerable New York Times went native toward the end of 2014. These changes won’t go away.

Premium sites already know this;  Yahoo has been active acquiring mobile technologies and although its overall ad revenues may be flat, its mobile revenues are growing. The New York Times is experimenting with native ads.

ZEDO has been busy developing high impact formats that advertisers love, and that will help publishers increase their eCPMS next year. Our formats drive CTRs that blow away the benchmarks, and though we believe that CTRs are an outdated metric that doesn’t really measure what consumers are doing, as long as advertisers continue to rely on them we will keep producing formats that drive better results.

We do believe, however, that the metric we will all be using by the end of 2015, although perhaps just experimentally, will be engagement. We will be measuring how long readers or viewers are spending on a page, with a video, with an ad, and that will eventually be used as a method for setting price.

This is a big shift away from direct response and back in the direction of brand advertising, which used to be the stronghold of TV. Now that viewers have shifted to video, new metrics such as completion rates and share ability will be more important.

Another big change in 2015 will be the attribution of traffic. More traffic will be “dark,” i.e. will arrive at your page through social media recommendations and social sharing than through organic search. This year, we will have to find metrics to manage that traffic so we can optimize for it. It may involve less emphasis on the home page and more on internal pages with shareable content.

One thing you can say about our industry: it’s no longer the staid, unchanging industry it used to be. For those of us who enjoy technology and love to rise to new challenges, publishing has become more interesting than ever.

ZEDO Advertising Technology Updates – December 2014

Support for VAST 3.0

Features included:

  1. Skip event
  2. Progress event

Note: ZEDO Players are not VAST 3.0 compatible yet

Please refer to the knowlegebase for more details.

 
Passbacks for VAST Tags

ZEDO’s Passback feature can be used with VAST Compatible ad formats. There are times when Advertisers do not want Impressions from every user, so they just return empty responses. But you can use ZEDO’s Passback Tag feature to monetize Impressions that are not filled by your advertiser.

Please refer to the knowledgebase for more details

Mobile Advertising Makes Context Supremely Important

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Programmatic media buying has done many things well, but it has done one thing very poorly: it has not kept good track of one of advertising’s most important media buying tenets –context.  Context used to be the watchword of print media buyers, who chose audiences by buying certain magazines, like the New Yorker for elite readers or the Pasadena Press for local readers. This sort of buying assumed that if an audience was reading the New Yorker, it would be in the market for jewelry, good Scotch, or luxury cars. They could tell by the context. And it works.

Now we have more data, many DSP users and ATDs are targeting audience without thinking about the context in which the ads appears. They forget to choose the right sites for quality and for their brand.

But on which site the ad appears is still very important. The marketoonist cartoon explains this with clarity.

John Battelle said it best:

Wouldn’t it be better if the ads matched the content? ….

That’s how it used to be, back when ads were bought and sold in a bespoke fashion by publishers’ ad sales forces competing on the quality of their content and the audience it attracted. And it’s how it could be again, given the wealth of contextual information available to marketers today. It’s not an either/or choice: It should be both. It’s well within the programmatic ecosystem’s reach to surface contextual information.

To help programmatic buyers, ZINC offers only top tier high quality sites. This allows ATDs and other buyers on DSPs to know that they are advertising on the very best sites that match their brand. Yes, the price is higher, but the increased performance (just look at the ZINC CTRs to start with) more than justifies this. Many advertisers who buy ZINC programatically are amazed at the performance. To be fair, ZINC performance is derived from great, unique ad units that ZEDO builds and tests specifically. But we have seen clearly that performance is still further enhanced by serving these ads on great, clean high quality sites.

Does Ad Tech Give Publishers Protection?

While the purpose of ad tech is primarily to automate the workflow of buying and selling publisher inventory, a recent event involving Gawker, GamerGate and Reddit has revealed some unintended consequences of publishers’ adoption of technology. The TL;dr is that ad tech may protect publishers from angry readers who attack them through their advertisers, although it may also expose them to accusations of violating an ad tech vendor’s Terms of Service.

Here’s what happened:

First, GamerGate: GamerGate is a vitriolic response of the online gaming community to game reviewers the gamers think are too conflicted (too close to their sources) to be proper journalists. We’re not judging whether the journalists or the gamers wear the white hats. Probably all the hats are gray. All you need to know is that the debate rages on, with gamers attacking especially women journalists over their writings on the video game industry. The publishers who hire those journalists or run their reviews are also open to fierce criticism. Gawker seems to be drawing the brunt of the criticism right now, but this is a larger issue that applies to all publishers, either with respect to GamerGate or in the future with anything else a publisher runs that an activist audience disagrees with.

Second, Reddit: Reddit is where the gamers gather to express their point of view. One of the activities suggested by gamers on the GamerGate subreddit was going after Gawker’s advertisers. However, Gawker has some pretty loyal advertisers, because it is a site where engagement is high.

Third: After going after the advertisers proved relatively futile, these angry gamers decided that the next best avenue of offense would be to go after the ad tech companies Gawker uses to make its transactions. Because digital advertising is trackable, a redditor who says he used to work for Rubicon posted the names of all the ad tech companies Gawker uses, and tried to explain where Gawker violated their TOS.

Digiday’s John McDermott opined that the new development ” is also a sign that ad tech is now playing an outsized role for publishers, possibly exposing them to these kind of novel activism campaigns.”

But we don’t think that’s the correct conclusion. We think that the inclusion of ad tech in the media ecosystem does many beneficial things, and as a side benefit it protects the entire ecosystem of advertisers, ad tech companies and publishers from the repercussions of  small groups of angry activists.

More important, it helps publishers raise their revenues and lower their cost structures in the digital environment.

 

 

 

DFP Failure Gives Glimpse of the Future

One morning quite recently, this happened.

Google’s ad server for publishers (DFP) went down on Wednesday costing publishers across the world millions of dollars in lost advertising revenue. Google scrambled to fix their technology. It also brought some of the web to a  standstill as their ad server prevented pages from loading on some sites.

As a side effect this left the web free of their small banner ads , much as it had been at its beginning. On many tier one sites the only ads you saw were the sophisticated and attractive ZINC formats. Not many of them per page but good ads and well presented.

It was a great opportunity to think about how to redefine the way we present ads online. As banner ads are in decline the future is fewer but higher quality advertising – often with video ads on the web. These are ad formats that work for the publisher revenue goals, user experience and for the advertisers. That is what ZINC believes in.

We thank Google for turning off all their ad clutter so that we could get a glimpse of the future.