Why Do Publishers Monetize Digital Media?

More than two decades ago, former Microsoft chairman Bill Gates predicted the monetization potentiality of the digital media, stating “Content is where I expect much of the real money will be made on the Internet, just as it was in broadcasting.” 

His predictions came true. While the content is described as a king, data is emerging as the ‘Queen’ for publishers who built strategies and business models to generate revenue through digital advertising, subscriptions, affiliate linking, and eCommerce sales.

By now, it is evident for content creators and publishers that their future lies in monetizing the changing consumer behaviors by drawing insights from the data, which drives their advertising and subscription strategies to fuel their growth engine. 

Publishers have also found new content distribution options in digital media. Digital solutions have reduced or eliminated printing, production, and supply chain costs, providing opportunities to target global markets. The growth of the internet and technology, in general, has had a profound influence on how people consume media and seek diversified content. Given the plethora of choices related to digital media platforms and the content they offer for consumers, digital content publishing has truly come of age.

Content platforms and search engines like Google, YouTube, Facebook, Instagram, WhatsApp, Amazon, Twitch, and so many others have been offering opportunities for creators to make money by following digital monetization practices.

What are the different ways to Monetize Digital Media?

Digital media products are offered in various forms including eBooks, videos, tutorials, audiobooks, newsletters, podcast series, and e-magazines and publishers rely on a variety of business models for monetizing the digital media through which they are offering content. The popular among them are:

• Digital advertisements
• Subscriptions
• Sponsored Content
• Virtual/Hybrid Events
• Affiliate Linking

Digital Ads

While some digital media companies generate revenue by placing display advertising on their websites and email newsletters, others utilize platforms for running programmatic advertising on their websites. Digital ad spending grew 12.2% YoY in 2020, according to the Interactive Advertising Bureau and it is expected to reach $455.30 billion in 2021. While 55.2% of the money will be spent on display ads, 40.2% will go to search.

For the first time, Amazon’s share of the U.S. digital ad market grew more than 10% in 2020, with Google taking a lion’s share of 28.9%, and Facebook making 25.2% digital ad revenue. While Social media ad revenue in 2020 was $41.5 billion, making up nearly 30% of all internet ad revenue, the digital video saw 20.6% YoY growth, increasing its share of total internet ad revenue by 1.3% to reach 18.7%. Programmatic ad revenue was 24.9% at $14.2 billion in 2020 and the global digital ad revenue grew substantially. 

 Subscriptions

Digital media inherited subscriptions as one of the primary revenue generators from traditional media and 2020 saw many digital publishers and media houses that provide political and business news, and entertainment switches to a subscription model. The New York Times garnered a record number of paid subscribers by Q4 of 2020 and the trend continued even in 2021 with a 6.6% rise to $473 million. As a result, the NYT’s subscription revenue rose by 15.3% to $329.1 million. Thomson Reuters, which provides free analytical business news, recently adopted a paywall strategy for its website, reuters.com.

Sponsored Content

Sponsored content, or native advertising, is yet another way of making revenue for digital media companies. Here, sponsored content appears alongside articles on the publisher’s website, social media channels, or in email newsletters. Either the advertiser or the publisher’s staff prepares this content in various forms, including but not limited to articles, videos, tweets, stories, and podcast episodes.

U.S. native ad spend is expected to increase by 21% in 2021 to a value of $57 billion and spending on mobile has more than doubled between 2018 and 2020, reaching $45 billion. Native advertising is the second-best top-performing channel for video campaigns according to U.S. publishers. Advertisers are opting for this format as it is easier to understand than display ads and social ads. They are engaging the readers for a longer time; with a 48% low CPC.

Events

Although events have traditionally been used to promote brands through exhibitions, tradeshows, and summits, virtual events have gained popularity in 2020, due to many in-person events being canceled thanks to COVID-19. Both live events and virtual events are an excellent strategy for publishers looking to diversify their revenue streams but companies measure the success of virtual events differently. In fact, 87% of event planners consider it successful based on the opportunities it generated, while 71% of them are looking at deals closed. 

Affiliate Linking

Like social media platforms, digital media publishers have started inserting affiliate links into their content as a way to promote other products and generate additional revenue. The New York Times has been a pioneer through its product review website, Wirecutter. To keep their journalistic integrity intact, digital media companies should mark any affiliate links they include in their articles.  

Top Challenges for Publishers to Monetize Digital Media

The ever-evolving digital media landscape offers multiple challenges for the publishers and content creators:  

• Several initiatives to ensure user’s privacy restrict companies from relying on third-party cookies, used for cross-site tracking, retargeting, and ad-serving. This would severely impact digital ad revenue.
• Digital ads are difficult for publishers as they have to fight tooth and nail for the ad dollars with many existing and emerging players. Several socio-economic and political factors influence the ad revenue. Google’s ad revenue hit by 6% in 2020, the worst-ever dip since 2008, while Amazon crossed 10% ad revenue. 
• Metrics such as page views and click-through rate are used to measure the ad impact and determine ad revenue. There is no uniform way to gauge the user’s behavior to determine ad revenue.
• Search engine ranking is crucial for digital revenue and to remain in the first or second position for popular keywords. Publishers should have a thorough knowledge of the latest search engine optimization tactics. 
• Not all publishers are successful in mustering subscribers’ support, which depends on the publisher’s ability to win the trust of the readers with quality content and innovation.
• The publisher should have strong customer data and strategies to generate subscription revenue, which is time-consuming. 
• Ad fraud is one of the biggest challenges that advertisers and publishers face. Fake users and bots that boost click-through rates may try to tamper with ad units that need to be tackled.
• The timing and positioning of an ad greatly influence the user experience. Several studies have proved that anchor ads and pop-up ads irritate readers, leading to higher bounce rates.
• Publishers must constantly evaluate the situation and update ad units to serve as a platform to track user behavior and trends.
• Media giant Google and social media giants like Facebook and Twitter are crushing competition through aggressive mergers and acquisitions and not letting many small players thrive. 

Digital Monetization Best Practices

Think Mobile

More than 5 billion people worldwide are now using a mobile phone, most people in the developed world. Consumers around the globe spent an estimated $407.6 million across Apple’s App Store and Google Play. No matter what industry you’re in, it pays to develop a mobile strategy alongside your digital media strategy. 

Digital publishers must gear up to produce formats compatible with mobile to reach all customers right where they’re at–on their phones. Although the staggering figures are appearing very lucrative, digital publishers cannot ignore the other platforms.

Video Streaming 

People stranded at home spent more hours watching videos on demand on OTTs in 2020 and video usage is on the rise on all interactive social media platforms like YouTube. The video keeps people on your site longer and has a 41% higher click-through rate in video search results than text-based content.

User-Generated Content (UGC)

Social platforms like Facebook, Twitter, and TikTok have been on news, making digital media more participative and Apple’s UGC marketing campaign with #ShotOnIphone is a remarkable example of trust-building, showcasing authenticity, and boosting engagement and sales.

Interactive Experiences

Interactive experiences like games, quizzes, polls, surveys, competitions, video making, and events engage the audience better than making them passive recipients.

Winning the customer’s trust

Winning customer loyalty goes a long way for the publisher in building the digital platform. Privacy breaches, information leakages, antitrust behavior is harmful to the digital platform.

Quality Matters

The quality of content in websites, social media, and other digital media is measured by different standards depending on the platform. Although the digital marketing industry uses various metrics to measure its success, a publisher must strive to create engaging content that is capable of holding visitors on their site and platforms for a longer time. Publishers should constantly experiment with format and practices to make it more innovative.

Native Advertising for Content Promotion

Once you’ve decided which content you’re creating, it’s important to ensure it reaches your intended audience. Native advertising is one of the best ways to do this. Research from eMarketer shows that spending on native ads continues to rise, reaching $44 billion in 2020. Find a brand that aligns with yours and negotiate to publish some of your content on its platforms or vice versa. Getting in front of new audiences with quality content is key to building an audience and increasing sales.

Conclusion

Despite challenges, digital media is painting a promising picture for publishers to make money in innovative ways. The publisher, however,  must have to keep pace with evolving digital media publishing trends to remain in the race. 

The post Behind the Curtain of Monetizing Digital Media first appeared on Publir.

Online advertisers were using third party cookies for years as a standard tool used as a third-party tracking technology. However, in the near future, third party cookies will soon be the thing of the past as Google Chrome is going to support this functionality by 2022. Apple’s Safari and Mozilla’s Firefox dropped support for third-party cookies in 2017 and 2019 respectively, leaving Chrome – the most-used browser with a 69% market share – as the man standing.

What Would A Cookie-less World Feel Like?

So when we talk about a cookie-less world, we are really referring to a world in which ad tech vendors, marketers, advertisers, and others can no longer access third-party cookies set on websites.

Several brands including that of marketers, advertisers, publishers, and technology providers are yet to embrace the cookie-less future. Even though many of them believe that such a future may have a serious impact on brand building.

Aroscop and Brand Equity took a poll in their new study with over 450 technology providers, advertisers, and marketers. Out of all of those brands, 22% of the respondents were confident that brand building would have serious consequences without cookies. The study also showed that only 8% of these brands were prepared for the shift and deployed alternate solutions for it. However, 35% of the respondents are actively looking for solutions to adapt to cookie-less marketing.

In the study, advertising agencies also stated that loss of clients, diminishing profits, and inability to acquire new clients would be their top priorities while entering the future without cookies.

What Are The Possible Challenges To Tackle In A Cookie-less World?

Nonetheless, there are a few challenges that brands and marketers would have to tackle while heading towards the cookie-less world. The first challenge would be for the advertisers to deliver personalized content to their users. For quite some time now, the advertisers relied on third-party cookies for personalization. After third party cookies being obsolete, personalization would have a severe impact. Apart from this, frequency capping could change drastically in the post-cookie era. Advertisers could have a tough time while managing the frequency of ads being displayed on the internet to users.

Behavioral targeting is another challenge that is fuelled by third party cookies currently. User behavior helps advertisers collect data to track and target prospects for them. It will be majorly affected without cookies in the future. Customer acquisition will also become more difficult. It is no longer about cold emails and offers anymore. Guiding the buyer through a sales funnel with relevant content across platforms has always been fruitful for the marketers. Cookie-less advertising will change the way brands acquire customers.

Self-reliant Publishers – Is This The Way Forward?

With cookie-less tracking, brands and marketers would have to rely on first-party data that publishers control on websites. Publishers are now building their own walled gardens providing advertisers with accurate data as they are drawing closer to the cookie-less world. Publishers would be in an extraordinary position connecting advertisers with high intent customers considering how rich data will become scarcer.

Furthermore, user privacy has become a real issue in this matter, and focussing only on cookies would not do justice to analyze how things would turn up. Using data to understand the behavior of the user has always been a key part of any brand objective rather than just to drive growth and gain profit from it. Building consumer trust and quality targeting must always go hand-in-hand when it comes to the goal of a brand.

Will Tracking Tools By Companies Successfully Tackle A No Cookie Environment?

Meanwhile, many companies have developed their own tracking tools and procedures while gearing up to perform well without third-party cookies. Google, for instance, has developed “universal IDs” that do not require third-party cookies and would identify users while tracking them across different devices. Although, the idea that in order to target the users many smaller publishers would have to use Google’s universal IDs, does not sit well with many in the industry.

Google is also starting to pitch a Privacy Sandbox as an alternative. The initiative is to help track while continuing to allow ad targeting within the Chrome browser. However, it seems to the advertising industry that the proposal may come with a catch. With Privacy Sandbox, cookies are replaced via five software-programming interfaces. Advertisers can use each API to obtain collective information concerning problems like conversion (which means how properly the ads performed) and attribution (meaning which entity is attributable, for instance, for a purchase). It acts as an alternate pathway that Google has presented to the market relying on anonymized alerts, which are not cookies, inside a user’s Chrome browser to take advantage of his searching habits.

Microsoft is also not far from developing a way to track its users without cookies. It can track users with its Windows software, including tablets and Windows phones, even the users of Xbox gaming systems. The tracking technology of Windows works by assigning a number to the user or a unique identifier. That unique number would track the user across Windows-enabled devices.

Pandora, the online music streaming service, is also hoping to leverage its first-party data to overcome the absence of cookies. Pandora gets the users’ login information including their email, age, location, and gender. The service cross-references the data with the US Census and their listening habits before offering the targeted inventory for advertisers. Because of its predominantly mobile-based audience, it is actually an advantage for Pandora to move to first-party data.

How B2B platforms are gearing up?

Likewise, B2B online targeting and personalization platform, Demandbase, has developed one of the first cookie-less ad targeting solutions. It allows users to identify a group of businesses to advertise to, as the targeting tool is solely helpful for B2B advertisers. The B2B targeting tool is an extension of Demandbase’s Company Targeted Advertising solution. It uses corporate IP addresses of visitors as a source of identification to know from which company the person belongs. With this tool, any time a user visits the Demandbase client’s webpage, it can track the IP address back to their company and potentially gain a new lead.

Skepticism & Forecasting A Cookie-less Future

Many smaller firms fear a takeover of online advertising by Google if cookies cease to be useful. One of such smaller firms is Xasis, an agency ad trading desk. It is proposing a new industry standard called “statistical ID”, rather than developing its own exclusive tool like the other companies discussed above. The idea of statistical ID is to identify users by their devices and other anonymous attributes. Instead of using cookies, the combination of these attributes will be used by the advertisers to target the users.

To sum up, everything that has been stated so far, a private marketplace (PMP) advertising environment could become common among publishers in the near future. It will act as a digital marketplace where advertisers can buy premium inventory for their advertisements. The main idea behind PMP advertising is data quality assurance. It is predicted that such an environment reduces the chances of ad fraud, enhances brand safety, and facilitates more accurate targeting. While this is a challenge for ad tech vendors and marketers, maybe it creates a path to provide more control to publishers and content creators. It will be interesting to observe how brands and marketers would adapt their offerings and services to cater to the new demands of advertising in a cookie-less era.

If you are looking at reading more about Cookies, click here and find out the impact Of 3rd Party cookie blocking on Ad Revenues.

The post How Are Marketers Gearing Up For A Cookies-less World? first appeared on Publir.

Before you commit to any one vendor, you should take time to research companies and be prepared with questions to ask those that you are interested in. Partnering with the right company will provide your business with sustainable, long term success, and should give you more time to focus on what you do best – creating content and managing your website.

Here are some questions that can help you identify the right ad provider for you:

1. Are they honest and transparent?

Entering into a partnership with an ad vendor should be a mutually beneficial relationship that’s built on trust right off the bat. The company that you choose to run your programmatic ads should be transparent about the value that they provide and how much they charge for it. Be sure to identify the rev share arrangement and the payment terms that the company operates within. Pay attention to the fine print, such as whether or not the vendor charges an additional ad serving fee or requires a long-term exclusivity commitment.  

2. Do they offer features and services outside of ad serving?

A diversified package of offerings can highlight industry knowledge and show adaptability. Look for partners that can augment your revenues by offering tools like subscriptions, fundraisers, and others. Choosing a company that has strengths outside of one specific offering can be of great benefit to publishers.

3. Are they future-proofing your business?

The ad industry is constantly changing and evolving. From greater data regulation (for e.g.: GDPR and CCPA) to the phasing out of first-party cookies, new government rules and technology policy changes can severely impact your business. Make sure your vendor has a pulse on these changes and is actively addressing these issues. 

4. Does the partner have references and material to share?

Any easy way to verify a partner is to check who they’re working with currently. Many companies have case studies, presentations and testimonials backed by data to support their strengths and successes. Asking for such material is a great way to verify the value add of the company, and to ensure credibility and legitimacy. 

5. Do they offer timely and accurate reporting and accessible support?

It’s important that you’re confident that you’ll be able to reach your provider when something goes wrong. Clearly communicating the importance of quick response time will be beneficial for both parties as it helps to establish expectations from the get-go. It’s also important to decide how often you’d like direct communication to be. You might find it valuable to hire a company that’s willing to tailor communications to meet your preferences, such as how often reports are delivered.

Hiring the right provider should increase your revenue and take the ad-portion of the business off of your plate. 

The post Questions To Consider When Choosing Your Ad Vendor first appeared on Publir.

According to a study conducted by the IAB, digital ad spend is down 33%, with 24% of survey respondents having paused all ad spend for Q2.  As you know, Publir has longstanding relationships with the most preeminent ad networks, trading desks, and SSPs in the digital space. Our conversations with these partners have indicated similar expectations to what the IAB has found, with a predicted drop in spend ranging anywhere from 20-50% depending on the vertical for Q2, and possibly for Q3.

April is expected to be the month that sees the most pronounced effects of the cutbacks.  Publir is taking a proactive approach to combating the effects of these market changes as effectively and extensively as possible. We’re opening up new channels of demand across our platform and are focusing on attracting advertisers that are spending now more than ever – health, fitness, education, and telecommunications services are industries that have ramped up ad budgets in light of the current circumstances.   

As we buckle down to continue delivering our publishers as much value as the market can provide, we look ahead with optimism to the Q4 months – a rebound in advertiser activity is expected for the most high-spend quarter of the year. It’s, of course, possible that we’ll see a resurgence in demand sooner, depending on the world’s continued response to the pandemic. Whatever the case may be, you can be assured that Publir is proud to be your committed partner through this time of turbulence – we’ll be here for you at every turn, and we will get through this, confidently, together. 

The post COVID-19, Ad Spend, and Publir first appeared on Publir.