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Advertising | Industry-Research

Targeting practices: a critical look at surveillance advertising

Personalized advertising offers relevance. And algorithms that help target specific products and services towards interested consumers can be beneficial. However, collecting massive amounts of consumer data is highly problematic. Some digital advertising methods use large-scale data collection, profiling, and data sharing in order to micro target ads based on behavioral habits and search history. Unfortunately, these practices are all aspects of surveillance advertising models.

The New Economic Foundation’s report, I-Spy, The Billion Dollar Business of Surveillance Advertising, explores concerns around surveillance advertising – targeted advertising using personal data provided by websites and platforms. In particular, the report examines issues around the collection and use of children’s personal information.

From data collection to buying and sharing data, surveillance advertising is questionable in terms of its legality. Data protection regulations like General Data Protection Regulation (GDPR) and California Privacy Rights Act (CPRA) are in place to protect consumers. However, it is clear from this report that market needs a thorough compliance review.

Mechanics of surveillance advertising

Real-time bidding (RTM) with algorithms and automation accelerated the usage and growth of data-intensive advertising. In fact, targeted advertising serves as the business model for two of the largest internet platforms, Facebook and Google. While many consumers are aware that they are being tracked, they are often not aware of the extent of that tracking.

The process of surveillance advertising:
  1. When we click on a webpage, a site identifies the number of advertising slots for sale and begins a bid request.
  2. To compile this bid request, the site assembles as much information about the user as possible. A standard bid request usually contains:

    – A user ID set by the supply-side platforms (SSPs)
    – Full referral URL, the link to the site where the ad is supposed to appear
    – Birth date
    – Gender
    – Location
    – IP address
    – Interests or segments previously assigned to the user
    – Other information collected directly, from a data broker, or inferred
  3. The information contained in the bid request is then used by demand-side platforms (DSPs), working for advertisers, to decide whether, and how much, to bid in an auction for the right to show the advertisement to the targeted audience.
  4. The winning bidder gets to place the ad on the page and to keep a copy of the data in the bid request.

The New Economics Foundation estimates that bid requests on U.K. users containing personal information are sent out at a rate of approximately 10 billion a day. This translates to approximately 164 bid requests per person per day across all the ad exchanges. This information is seen by a multitude of ad tech companies. In fact, vast amounts of personal data are broadcasted across the digital advertising ecosystem.

Advocating for children

Children are protection under the Data Protection Act (DPA) in the U.K. and under Children’s Online Privacy Protection Act (COPPA) in the U.S. The two laws require parental consent prior to any data collection, usage, or disclosure of the personal information for children under the age of 13. Unfortunately, the more children spend time online, the that more digital platforms and ad tech platforms companies target them to gather data. The data collection process also employs algorithms to keep children online longer. This leads to an endless loop of data collection and advertising.

Recommendations

The New Economic Foundation recommends policymakers address surveillance advertising as follows:

  • Ensure platforms do not serve surveillance-based advertisements to children. And if data is collected, the child will be compensated, and their data will be deleted.
  • Platforms tracking and collecting data have a legal responsibility to handle all in a fiduciary manner.
  • Eventually prohibit the practice of surveillance advertising.

Critical context

Extensive online tracking systems coupled with the use of online auction systems shifts the advertising paradigm from contextual to behavioral. Many marketers today prioritize targeting over ad environments that are safe for consumers and advertisers. . Unfortunately, data is now the holy grail, which allows fake news, clickbait, and user-generated content to easily be monetized.

Importantly, GDPR and CCPA legislation are critical steps to reset business strategies and their reliant on extensive third-party consumer data collection. However, enforcement has been uneven at best. And when it comes to kids, it is clear that much more needs to be done to curb these unethical, even illegal, practices.

Featured Post | Innovation

Do recommenders deliver more value to audiences – and the bottom line?

There are a number of reasons why legacy media faces fierce rivals in digitally native media – such as Netflix, Spotify, and Stitch. However, a critical competitive differentiator could be the fact that many of these brands are committed to delivering accurate, actionable recommendation systems.

Recommendation engines aren’t just about recommending content to your readers, according to Michael Schrage, a research fellow at MIT Sloan School’s Initiative on the Digital Economy and author of Recommendation Engines. They are platforms that facilitate online interaction. When designed well, they help organizations rethink how they can get more value from their data. They also offer more value to their customers.

“The biggest mistake media companies make is they think they are in content business. But they are the data business – and their data management sucks,” states Schrage. “While they won’t be able to rival Netflix, they still can engage with their communities so much better. It’s not just about how to tell a better story, it about how we can learn from people who read our stories and engage with them.”

Evolving engines

Recommendation engines, or recommenders, are nothing new. Amazon founder Jeff Bezos spoke about the value of recommenders back in 1998. He said that they offer an “opportunity to develop very deep relationships with customers.”

The good news is that, while they were once a feat of extraordinary technological effort, machine learning is changing that. In fact, it’s the ease with which they can be built, applied and utilized that makes them the most exciting and valuable applications of machine learning right now.

“The big difference now is that anyone can build a recommendation engine,” states Schrage. “They are cheaper, faster and better than ever. Plus, the underlying algorithms have moved away from simple correlations to much deeper and richer analytics, around diversity and relevance. As a result, the levels of sensitivity and specificity of recommenders have improved. And they keep learning how to get better.”

Virtuous cycle of engagement

That is the key to well-designed recommenders. The more people use them, the more valuable they become. And the more valuable they become, the more people use them, creating a virtuous cycle of data with audiences. However, according to Schrage, legacy media often miss this vital opportunity to improve both customer insights and engagement.

“These organizations treat recommendation engines as a sales tool. But they need to understand how to use their data and turn it into virtuous cycle,” says Schrage. “And the low-hanging fruit is advice and recommendations.”

In other words, recommendation engines are more than a UX differentiator. When effective, they enable organizations to build customer lifetime value (CLV). The former is transactional, while the latter embraces a longer-term view.

Increasing retention

“It’s the difference between ‘always closing’, and a salesperson who wants to forge a relationship,” says Schrage. “The question is: Do you treat customers as ‘one offs? Or do you seek to use data-driven advice to get people to come back and explore, while also building brand credibility?”

Reader regularity is a key factor in preventing churn. The industry has long been concerned about unengaged subscribers. Recent research reinforced this concern when it revealed nearly half of digital subscribers to local news outlets are ‘zombie’ readers who visit a site less than once a month. These customers are far most likely to cancel their subscriptions than are frequent visitors.

The study also found that personalized, local content is a key factor in retaining subscribers – which is where recommenders play a big part. One great example of this is with the Dutch newspaper, NRC. After personalizing its newsletter, using an AI tool, 22% more readers demonstrated habitual reading behavior. However, there is a lot more to recommendations than personalization.

While recommendations can be personalized, it’s not the only – or the best – option. Personalized recommenders require large amounts of data on users, which a system won’t have with new visitors, or those that don’t sign up. This can cause what is commonly coined ‘cold start’ problem.  This occurs when a recommender system cannot draw inferences, due to a lack of information. Another problem with personalized recommenders is the potential for bias, which can be a particular problem for news sites.

Automated customization

This was a concern for the non-partisan news organization POLITICO Europe, when it launched Pro Intelligence in 2019. Pro started as a pure news service. However, it bought the start-up Statehill in 2018, so that it could build out a one-stop shop for policymakers. The platform, which accounted for 60% of POLITICO’S income in 2020, now offers news, analysis and relevant, external information within a single dashboard.

Every piece of content on the Pro platform features recommendations, from legislation to court cases, and press releases to news from the editorial team. However, the algorithm doesn’t require user input to customize the experience. Instead, it employs an auto-tagger, which uses key words, dictionary mapping and natural language processing. [Editor’s note: An in-depth look at this is available to DCN members.]

“We don’t have the engineering capabilities in our organization to dedicate to a personalized algorithm. And we’d probably be too afraid to introduce it, in case of bias,” said Karl Laurentius Roos, Director Technology Development. “But our auto-taggers mean we can surface news and data automatically, which has a real impact on the end user’s productivity and understanding.”

Pushy algorithms

Pushing news, via email or mobile notifications, remains POLITICO Europe’s most effective way to integrate their services into their users’ day. However, Roos and his team are currently building products that will pull the user into their ecosystem.

“If we can enable user access to pull more content themselves, we’re increasing the product utility and value captured each time a user accesses our content,” said Roos. “For us this translates into connecting news with data and wrapping it seamlessly across our desktop and mobile experiences.”

According to Schrage, other media brands doing a good job with their recommendation systems include the Wall Street Journal, Dow Jones, Bloomberg and Pocket. However, not everyone agrees that recommenders are beneficial to business. Slate built Myslate in 2015, which worked on personal recommendations, based on users telling them what they wanted, rather than machine learning. After an initial experiment, the online magazine decided that keeping the infrastructure running wasn’t worth the amount of reader minutes it generated.

“For the recommendations to work we needed to ask them to sign up, which added friction to the experience,” explains Greg Lavellee, VP, Technology at Slate. “But I’m not convinced that recommendation systems are worth it. People tend to personalize their own experience. They know where they want to go on the site. They find the content they want – you don’t have to shove it in their face.”

Culture shift

Try telling that to the likes of Jeff Bezos, Reid Hastings, and Katrina Lake. Nonetheless, media brands may be concerned they don’t have the capabilities, budget or data to build a successful recommendation system. However, Schrage says the issues aren’t necessarily technological or financial, they are organizational and cultural. Recommendation systems don’t just require an IT upgrade, they require a rethink of business fundamentals.

“Legacy media have had the sh*t kicked out of them by companies that literally didn’t exist 10 or 15 years ago,” he states. “It’s because the tech giants have committed to using data to learn. They take good design, good data and good recommendations seriously.

“This is what other media brands need to emulate in order to bridge the digital divide.” In fact, he says that media companies need to learn how to leverage customer’s behavioral data to drive value and grow business. “Algorithmic plagiarism is essential to future health of legacy media.”

Perspectives

DCN’s must reads: week of May 27, 2021

Here are some of the best media stories our team has read so far this week:

Perspectives

Marketing cloud best practices for publishers

The innovations in marketing technologies and platforms over the past decade have been transformational for the marketing industry. For publishers, the latest and greatest in MarTech and software can be both groundbreaking and challenging. Innovations in marketing automation have revolutionized the order-to-cash process for media organizations across the industry. However, other modern marketing tech — like most marketing cloud platforms — have posed challenges for marketers in the publishing world. 

Helping publishers or marketers

But why are these innovations so helpful to general marketing teams yet so challenging to publisher marketing?

In simple terms, many of the marketing platforms today are not built to accommodate the needs of publishers and their marketing teams. Lack of speed, minimal out of the box capabilities, and antiquated features and UX pose a challenge to publishing organizations in terms of marketing cloud set up, cost, reporting and continuity.  

It is those that allow media org marketers to follow the current marketing cloud best practices for publishers that are assisting in publisher marketing success. 

Choosing the right platform

In simple terms, many of the marketing platforms today are not built to accommodate the needs of publishers and their marketing teams. For instance, most marketing cloud platforms are created to host one main brand. However, media companies often have a dozen or more brands, under their parent company umbrella. These need to be housed together though they operate separately. This poses a challenge in terms of marketing cloud set up, cost, reporting and continuity.  

Many of the big names in marketing cloud software today cannot be used by media brand marketers without a stifling amount of customization in-terms of platform setup and integrations. Even with full scale custom integrations, most do not satisfy the needs of publishing organizations. The fact is that they can be somewhat antiquated and not optimized for the speed most publishing companies require.

However, it is important to note that there are marketing cloud platforms (like Saithru) that are configured to host publishing and media brands with ease. When selecting a marketing cloud platform, it is imperative to choose one that is built to allow media industry marketers to follow the current marketing cloud best practices for publishers.

Curated content capabilities

One of the most crucial aspects for marketers is publishing curating content. The ever-growing consumer demand for digital content has bolstered the need for publisher brands to aggregate their original content with curated content from reputable sources. This provides readers with the content they demand and develops trust between them and the publisher brand.  

Developing a strategy for curated content is a cornerstone for media brand marketing teams. However, it cannot be done without proper planning and technology that includes content curation capabilities. 

Excellent audience segmentation

Audience segmentation is a critical component of marketing strategies for all marketing teams. Yet this is even more true for publishers. Because of the breath of their brand audiences, marketers in publishing companies have another layer of segmentation to consider. This means that marketing cloud tech they employ must allow for in depth segmentation. It must also have the capability to automate that segmentation consistently.

Yes, audience segmentation enables marketing teams to create appropriate messaging. However, it also informs curated content, customization, and engagement strategies for both the publisher and their advertising clients. Without properly executed audience segmentation strategies and the marketing technology to enable it, publishers cannot succeed. 

Customization is crucial 

Just as important as segmentation is the customization that derives from it. As best practices go, customization has ranked in the top five for all marketing teams for years now. Enabling a customization strategy has become more and more crucial as customers inboxes and feeds become more and more cluttered.

In simple terms, aggregating customized messaging is the best way to bolster engagement with audiences. And that is the goal of all marketers. For publisher brand marketers, this is exponentially more important. That’s because they are striving for engagement of their brands for their parent company as well as their advertising clients. In other words, engagement by way of customization is at the heart of multiple ROI streams for media organizations. Ensuring the ability to plan, curate and implement customization strategies efficiently through marketing cloud technology is more important now than ever. 

Drip campaigns for consistency

Constant and consistent messaging is another best practice for marketing teams in the publishing world. The amount of content, both editorial and media, that publishers output lends well to drip campaigns. This approach enables ongoing communications with audiences and increase user engagement. The difference between a drip campaign in the media industry and a standard marketing org is the sheer volume.   

Tying directly back to the numerous child brands publishers house, advertising clients, curated outside content, and original content, the volume of drip campaigns publishers must output daily can seem staggering. It is imperative that the selected marketing cloud platform can handle the daily output. It also needs to simplify the process via automations and enablement of standardized, consistent template systems. 

In summary

For publishers using marketing cloud technologies, there are key components that must be considered to ensure success. From tech platform selection to curated content, audience segmentation, customization and engagement, the best practices for publishers are more complex and crucial than ever before. 

Advertising | Perspectives

Digital media transparency: publisher best practices

As concerns about media transparency rise, marketers are becoming more selective about where they place their media investment. They are asking questions like: Where are my ads being shown? Are they being served to humans or lost to fraud? Are they delivering maximum ROI?

The industry has developed several solutions that bring greater transparency to the supply chain. This also helps marketers identify publishers that provide quality advertising platforms. When layered together, each of these complementary solutions offers more comprehensive protection. They also minimize fraud risk and assure marketers that their ads are being seen by humans.

Here are a few ways publishers can use these solutions to optimize their websites, improve system performance, and minimize fraud risk.

1. Implement Industry Tools

It is important for marketers to understand how their digital ads move through the supply chain. The IAB Tech Lab develops standards and solutions to increase supply chain transparency. IAB Tech Lab tools such as Ads.txt, App-ads.txt, sellers.json, and OpenRTB 3.0 (Ads-Cert) give marketers insight into the buying process by identifying authorized sellers of inventory. It is helpful for publishers to implement these solutions. However, they should also be sure to incorporate other IAB Tech Lab tools into their websites as they are released. In fact, implementation should not be considered a “one and done” process.

Once these tools are implemented, it is important to regularly update and edit these files to ensure accuracy. Publishers can analyze their site to learn who is selling their inventory with this new resource, Sellers.guide. Providing buyers with up-to-date information makes it easier for them to see who is authorized to sell your inventory as they compare your list with their ad tech vendor’s sellers.json file.

2. Follow Standards and Guidelines

As digital ad fraud became more widespread, the industry recognized the need for standards and guidelines to help disrupt the cycle of fraud in the marketplace. Organizations such as the Media Rating Council (MRC) set standards to define and measure invalid traffic.

The MRC also created a process to gauge a vendor’s adherence to these standards through accreditation. Using an MRC-accredited ad server is one step publishers can take to minimize fraud risk. By partnering with accredited vendors, publishers assure advertisers that they are doing everything possible to provide accurate metrics that meet or exceed industry standards.

3. Take a Proactive Approach

Publishers can also demonstrate their commitment to quality by being proactive in other ways:

  • Regularly update website content and social media channels
  • Track and monitor all traffic sources for IVT
  • Familiarize your team with industry guidelines and best practices so these standards are followed throughout your organization
  • Participate in a third-party website audit. This demonstrate to advertisers that you are providing them with a quality platform and a valid human audience

Following industry guidelines and best practices helps minimize fraud risk. It also proves to advertisers that you are providing them with a quality platform that delivers a real audience and results. Publishers must talk to advertisers to make them aware of all the steps they have taken to protect their investment and deliver results. The more advertisers realize the advantages of partnering with quality media, the more ad revenue they will direct toward legitimate publishers.

Industry-Research | Perspectives

Lessons learned from the pandemic-era subscription boom

The Covid-19 pandemic served as a catalyst for massive subscription growth, in part because consumers sought quality journalism to get accurate information about the virus. It also accelerated content consumption trends that were already happening. Let’s explore the main highlights across digital engagement, retention and conversion during a year of increased appetite for news content. We’ll also unpack how publishers can use this data to prepare for future shifts in consumer demand. 

Paid trials convert to full price more often than free trials

According to our Subscription Performance Benchmark Report, approximately 17% of new monthly subscribers in January 2020 signed up using a free trial as the pandemic spread around the world. By December 2020, only 5% of new subscribers signed up on a free trial. This indicates that publishers became more confident with their pricing and smarter about promotional strategies as the pandemic raged on. 

Free trials can attract a lot of new users upfront. However, they make less financial sense when there’s high demand for content. At the same time, there’s much lower lifetime value gained from users who subscribe on a free trial offer. On average, you’ll lose over a third of free trial subscribers to churn before those users are required to make their first payment. It generally makes more fiscal sense to use paid trials in acquisition campaigns since you earn a little money upfront and retain a higher volume of users over the long term compared to free trials.

Onboarding post-pandemic subscribers is crucial for retention 

As many new users subscribed to online publications for the latest news about the pandemic, the strategic focus for media publishers had to shift from acquisition to customer engagement and retention. Convincing people to subscribe is only half the battle; encouraging them to continue subscribing is the other half.

If new subscribers don’t engage with your website early and often, they’re far more likely to cancel the subscription at the first given opportunity. There’s also the risk that they could become “sleepers,” which are subscribers who haven’t visited your site in the past 30 days. According to our benchmark research, an average of 40% of subscribers on media sites are sleepers.

To minimize the number of sleeping subscribers on your site, you need to act fast. Over half of your annual subscribers and nearly two-thirds of monthly subscribers will cancel in the first year if they become inactive. Your mission as a publisher is to incentivize those subscribers so they remain engaged. That’s why onboarding programs are so helpful to minimize churn and boost customer lifetime value. Use programs like guided tutorials and onsite benefits promotion to showcase all of the capabilities a new subscriber can access using their account. These programs not only drive user engagement, but they’ll also create habitual patterns that keep subscribers engaged on your site.

The Covid-19 retention bump endured thanks to annual subscriptions

Given the volume of new subscriptions early in the pandemic, many publishers expected lower retention rates and higher churn as the year went on. However, those fears never materialized. We found that users who became subscribers between March and July of 2020 retained at much higher rates than those who became subscribers prior to the declaration of the pandemic.

In an effort to maintain higher retention rates during the second wave of the pandemic, many media publishers made a concerted effort to increase annual subscription rates across their websites. Annual subscriptions retain much better than their monthly counterparts, and they subsequently carry much higher lifetime value for brands and publishers.

Throughout Q4 2020, many publishers used special promotions and smart pricing strategies to increase demand for annual subscriptions. Publishers used special events like Black Friday and Cyber Monday to create short-term offers for annual subscriptions that, in many cases, more than tripled conversion volume.

Lessons learned

The Covid-19 pandemic continues to be a prominent and dynamic world event. Publishers should use this time to assess how user behavior impacted their subscription models in 2020 to make more strategic business decisions for 2021 and 2022. It is critical to:

  • Determine when and how people were most likely to subscribe
  • Analyze conversion rates, churn rates, special offers and trials to understand more about audience behaviors
  • Optimize websites with targeted messaging and personalized content that incentivizes greater onsite engagement
  • Maximize revenue opportunities with paid templates designed to boost conversions

By understanding these patterns, your business can make strategic decisions that will boost retention rates and, by extension, lifetime value. This will help you improve growth and develop a sustainable subscription business beyond this last year of high consumer demand.

Perspectives | Revenue

How HBR uses case studies and ebooks to sell premium subscriptions

When looking for ways to add value for premium subscribers, Harvard Business Review dug decades into the past. As Nini Diana, HBR’s director of consumer marketing put it, “Our archive is gold.” 

For 100 years, Harvard Business School has created case studies that bring real-world business dilemmas to life for students, entrepreneurs, and professionals around the world. These case studies dissect real-life situations in which managers have to make key decisions. Often, they must do so despite having incomplete information, conflicting priorities, or the pressure of ticking clocks. 

Harvard’s case studies often make their way into college lesson plans. Educators can access course packets to use in their teaching. “It’s an entire collection of solutions to almost any type of business problem,” Diana said. 

Turns out that Harvard’s 640 ebooks and thousands of case studies provide such a valuable selling point that one in five subscribers opts to pay 50% more to access them. “Despite being written eight or 10 years ago, they still have relevance,” Diana said. “A superuser of our content can benefit from any of them.” And HBR has found it wise to focus on the needs of the superuser. 

A valuable collection

Individually, most Harvard case studies sell for $8.95 per PDF and $15.05 for a printed copy. Ebooks are typically priced at$19.95 each. A five-ebook series on effective management — with titles including Getting The Right Work Done and Making Every Meeting Matter — sells for $90.

Certainly, some users are looking to solve a single issue, or for a very specific topic. However, HBR audiences generally face a wide range of business challenges and are interested in learning more. So, for just  $18 a month or $180 a year, 20% opt for HBR’s highest-priced subscription tier. It’s the only one  that includes access to a curated collection of case studies and ebooks. That price also includes HBR’s print magazine, full digital access, and full access to HBR.org’s archives.

Compare that to HBR’s entry level “digital” subscription, which offers access to HBR.org and its archive for $12 a month or $99 a year. For $12 a month or $120 a year, subscribers get full digital access to HBR.org along with six issues of the print magazine — but no case studies or ebooks. 

The premium tier offers a superior value for the type of audience that has the greatest affinity for HBR. In fact, Diana said the offer has been appealing enough to convince 20% of new subscribers to ante up for more. The offer has been particularly effective for driving subscriptions outside of North America, according to Diana. 

“As an institutional philosophy, we value print a great deal,” Diana said. Still, consumers who start with lower-priced digital-only subscriptions tend to skip the mid-tier offering when upgrading their plans demonstrating that it’s not print that’s the selling point. Rather, it is those case studies and ebook collections. 

Updates and value building

While premium subscribers don’t get access to every Harvard Business School case study and ebook, editors regularly update the selection that is available to reflect current corporate conversations. Recent topics of focus have included Blockchain, Black business leadership, and building workforces for the future. 

A new ebook is made available to premium subscribers each quarter. Premium users are able to access each title for a full year or until their subscription runs out. 

Subscribers currently can’t choose their own ebooks. However, that is a potential change user feedback has put on the team’s radar. “We’re always trying to rethink the product mix without upsetting the customer experience,” Diana said. 

HBR  learned how much its audience values ebooks and case studies through extensive user research, Diana said. Case study and ebook access were the two benefits users said would be most valuable to them — and most likely to convince them to pay more for an HBR subscription. 

They are “that thing Harvard can offer that no one else can,” Diana said. 

About the author

Meena Thiruvengadam is an independent journalist and editorial consultant. You can find her on Twitter @Meena_Thiru.

Perspectives

DCN’s must reads: week of May 20, 2021

Here are some of the best media stories our team has read so far this week:

Last week’s list: DCN’s must reads: week of May 13, 2021

Advertising | Innovation | Perspectives

Mitigating risk in the age of big tech

We have all purchased some sort of insurance to protect against the risk of an accident or a total loss. We often do this with little consideration because we all want to be able to sleep soundly at night. Yet few of us think about applying the concept of insurance to the tech that is mission-critical to a company’s revenue. As the dominant big tech players expand the control they have through their browser and ad tech ecosystems, publishers are rapidly losing flexibility. This means the time is now for media owners to think about what their “insurance policy” should cover.

In my last post, I mentioned there would be a lot of uncertainty when operating within multiple sandboxes (aka monopolistic platforms). Frequent rule changes and regulations imposed by the big tech platforms challenge media owners’ core business. And, as publishers must operate their sites or apps to survive, it is important to explore alternatives. 

This new dynamic means publishers will need to change strategies to navigate and extract the most value for themselves. The key to success is remembering that each sandbox, privacy rule, etc, is but one element of that sprawling big tech ecosystem. And the ecosystem itself is where publishers should heighten their focus.

Is your tech stack creating risk?  

The technical stack is the beating heart of any media organization’s revenue production. While it is a necessity, if left as the sole engine for driving a majority of your revenue, it creates the biggest dependency and single point of failure for any media owner. Why? Simply because the big tech platforms control the browser, the buy-side tech, the sell-side tech, and the identity tech… Talk about being a superpower. They own the whole ecosystem. And this has created an imbalance of control. This intentionally manufactured dependency allows big tech to generate vital revenue streams for their benefit first. It also poses a significant risk of revenue loss for publishers.

Operationally, it is possible to switch tech providers, but the stack isn’t easily replaced. I’m not advocating an outright replacement, as that is not the answer for most publishers. A singular tech stack may have worked in the past. However, it’s no longer tenable to depend solely upon a single company acting as judge, jury, and executioner. Publishers must be ready and willing to mitigate risk through diversification. A singular stack will no longer offer rules to monetize all types of traffic.

Protecting against loss

If the future means navigating a world dominated by the big players, the best way to protect your interests is to understand how to work with multiple providers. To start, one should use the main tech stack to extract the most value from what that stack will deliver. For most publishers, GAM serves as the main stack and requires publisher data to feed it. As long as consumers provide consent, revenue should remain intact. However, with the rise of consumer privacy regulations, we will see an ever-growing pool of users who won’t provide consent. 

Without consent and data, a secondary tech stack can complement a publisher’s monetization efforts. Additional value can be unlocked through options for targeting non-consented traffic. In instances of no consent, these impressions can be paired with semantic contextual targeting to help ensure ad delivery. Additionally, this helps protect against potential revenue loss.

Insurance policy: a second stack

A secondary stack may also provide rules that complement the rules of the main stack. For example, content classified with an R rating that gets excluded from one platform can be monetized by engaging another tech provider. The same can be true for niche advertising categories, such as cannabis. As more states legalize cannabis, depending solely on a provider that limits access to sensitive categories can have a large impact on revenue. Diversifying the stack also offers better monetization options for different ad formats and can provide access to different regions. 
So, while it may seem counterintuitive to operational efficiency, leveraging the respective strengths of multiple tech providers can result in greater efficiency and decreases your dependency on a single platform. Understanding what each offers can help you tailor a solution that best protects your interests and insures you against potential risk. 

Advertising | Perspectives

Why don’t publishers stand up for their brand integrity?

Around Halloween 2019, I was catching up on politics on a major news publisher’s site when an image in a 970X90 banner ad stopped me dead in my scrolling. I flashbacked to anatomically accurate depictions of female genitalia shown in junior high sex education class. Except this genitalia appeared to be sitting on top of a person’s neck.

This mask was graphic. But I could not look away or resist the urge to click. Yes, I took the risk that the same ad might follow me across the web for weeks. (Beware: the retargeting curse…)

“Full-head clam shell mask” blared the landing page title. A side angle revealed a harmless sea shell that someone was wearing atop of their head. Front and center, however? Female anatomy, and definitely an intentional resemblance. 

At the risk of being called a prude, I can’t imagine most people would enjoy being subjected to a “clam shell mask” ad while perusing the news. And I know publisher revenue folks would be horrified if this image appeared in front of their audiences. I can just imagine the screams from the editorial team.

Out of publisher control

Brand safety conversations too often focus on advertiser concerns when publishers are trying to shield consumers from offensive or harmful creative. As this ad proved, a premium publisher was serving me a tasteless ad. Yet, my curiosity was piqued—how did this explicit mask end up in front of me? If that was targeted advertising, what ever did I do online to make an advertiser make me think I’d want to purchase that? 

The ad had been served by a well-known retargeting firm, though I’d never visited the site in question. Investigation revealed the same site also sold a variety of guitar equipment, something for which I’m very much the target market. So I was most likely part of a lookalike pool .However, the advertiser or its DSP had been careless in selecting relevant creative.

Which brings up the conundrum—did the publisher have any control over the creative in that situation? Thanks to real-time bidding, no one on the revenue team had any clue that specific creative was going to give me nightmares. 

Sure, advertisers can use the IAB Content Taxonomy to pre-declare ad content. But if you’re serving a huge amount of creative dynamically—like a clam shell head mask—are you really going to spell out what might offend the end user?

Publishers and supply-side platforms are forced to have a lot of faith that their upstream partners (DSPs and buying platforms). The assume they are looking out for their best interests and complying with their acceptable creative policies. All too often, that faith is unwarranted and unwanted creative sails through the programmatic pipes. Publisher reputation and user experience is damaged, but the ultimate victim is the end user.

Brand safety goes both ways

I thought about the clam shell mask when I was reading the new brand safety report from the Global Alliance for Responsible Media (GARM), a World Federation of Advertisers initiative. Analyzing content across seven major social media platforms including Facebook, Instagram, Twitter, and YouTube, GARM discovered that more than 80% of the 3.3 billion removed posts fell into the categories of Spam, Adult & Explicit Content, and Hate Speech & Acts of Aggression.

That’s certainly alarming, but it’s only one side of the coin. When the ad industry talks about brand safety, it’s accepted that we’re referring to advertiser concerns about offensive web content. 

However, publishers are brands too. Also, keeping publisher brands safe from offensive advertising is also protecting consumers. This is particularly important when publishers monetize through the open programmatic marketplace. In this case, they have limited control over the kinds of creative that shows up on their sites. (E.g., disturbing clam shell masks!)

Categorically bad ads

Of the 1 million-plus sensitive creatives identified by The Media Trust, more than two-thirds were Adult and Provocative ads.

The Year in Sensitive Creative, a report from The Media Trust analyzed objectionable ads between March 2020 and February 2021. It reveals that nearly two thirds of the over 1 million creatives singled out were Adult (nudity, sex toys, adult entertainment) or Provocative (sexually suggestive content, profane language) ads. Other high risk categories include Alcohol and Political (big spike in inflammatory ads in October 2020). Another is Weapons, which has been on a disturbing incline since the November 2020 elections. 

Bad creative goes beyond serving someone an ad with nudity or inflammatory subject matter. According to the report,  nearly half of the ads related to coronavirus over this period were outright scams. These ranged from price-gouging on PPE to false or unverifiable claims about masks, air filters, and sanitizers. That isn’t just a risk to user experience. It’s also a safety concern for consumers being preyed upon by bad actors. On top of that, publishers face legal liability in heavily regulated categories such as Medical or Pharmaceutical.

Overall, scams made up 47% of all coronavirus-related creative, but during summer 2020, that share was closer to two-thirds, putting consumers at high risk.

Publishers have long been the last line of defense in protecting consumers from bad ads—particularly when it comes to malware and malvertising. DSPs and buying partners have shrugged off their responsibility in keeping consumers safe from objectionable ads and outright scams, all while watching revenue roll in. 

Embracing responsibility

The good news is that many upstream partners like DSPs are starting to recognize the importance of complying with publisher creative policies. They are also realizing their responsibility in protecting consumers. Ensuring a high-quality ad experience is increasingly seen as good for business for buy-side platforms. So, they’re using AI-powered categorization systems to identify potentially offensive creative at scale.

The amount of creative violations detected in the second half of the period analyzed in “The Year in Sensitive Creative” was markedly lower than the first half. In particular, the amount of Adult creative has fallen 73% since November 2020. This suggests that advertisers either switched tactics or moved onto less stringent platforms.

But that’s still a problem. Too many unsavory AdTech providers are willing to look the other way on publisher brand safety. Leaving consumers vulnerable to offensive and manipulative ads should be unacceptable. This is particularly true given that technology to identify sensitive creatives at scale is readily available. It’s time all upstream AdTech companies are held accountable for the creatives they let loose in the programmatic ecosystem—such as disturbing full-head clam shell masks.

I’m afraid I can’t find the screenshot I took of that graphic mask… But trust me, you don’t want to see it.

Industry-Research | Revenue

Understand consumer expectations in the ecommerce journey

As digital publishers diversify revenue strategies and develop ecommerce businesses, it is important to understand the consumer purchase process. For many publishers, ecommerce is more than just affiliate links, branded content, and online stores. Publishers are exploring investments in online shops, unique product offerings, wellness programs, virtual learning, and events. With new ecommerce businesses and multiple digital touchpoints consumers, expect an efficient and personalized shopping experience.

BlueVenn, a provider of tools and analytics for marketers, explores consumer purchase behaviors and engagement in a new report, Digital Divide. They partnered with OnePoll to survey 4,000 consumers and 500 marketers in U.S. and U.K.

Key findings include:

  • Over half (55%) of all respondents in the U.S. report that having a personalized shopping experience with a brand is important to them. Interestingly, only 27% report that brands provide a similar and cohesive shopping experience across all channels.
  • While marketers report that their businesses collect a lot of consumer data, only four in 10 report using the information. Clearly, it’s important to analyze the data and incorporate the findings to improve the consumer experience.
  • Fifty-seven percent of U.S. consumer report that they prefer to share their data directly with a brand they trust. This offers a unique opportunity for publishers to grow their ecommerce businesses since they already have a direct and trusted relationship with consumers.
  • Mobile ecommerce is the new norm in the U.S. Six in 10 U.S. respondents (61%) agree (32% “strongly agree” and 29% “somewhat agree”) that they’ve increased the amount of time they shop on mobile compared to last year.
  • The top two digital channels that U.S. consumers use to interact with brands include email (61%) and desktop/laptop web browser (51%). Interestingly, Facebook placed fifth (39%).
  • Close to two-thirds (63% “very important/somewhat important”) of U.S. respondents report that they think it is important for a brand to create a personalized shopping experience.In fact, 58% of U.S. consumers report that they are likely (23% “very likely” and 35% “somewhat likely”) to stop buying a product/service online due to the lack of a personalized experience.
  • Less than half (43%) of U.S. respondents report that brands understand their shopping need.

Browsing and browsers

When shopping for specific goods and services, U.S. consumers prefer overwhelmingly their desktop/laptop browser. Ranking and ratings:

  • Clothing, homeware, and exercise equipment – desktop/laptop browser (#1, 48%)
  • Financial services – desktop/laptop browser (#1, 41%)
  • Insurance – desktop/laptop browser (#1, 47%)
  • Cars – desktop/laptop browser (#2, 26%)
  • Charitable donations – desktop/laptop browser (#1, 26%)
  • Holiday or leisure – desktop/laptop browser (#1, 54%)
  • TV, movies, or entertainment – desktop/laptop browser (#1, 38%)

Diversifying product offerings and revenue streams is helping publishers deepen their audience relationship. As publishers continue to build their direct-to-consumer ecommerce portfolios, it’s important to monitor the consumer’s digital shopping experience. Understanding the process of multiple touchpoints and shifts in online shopping behavior provides insight into consumer needs and expectations. There is a growing opportunity for publishers to play an important role in offering consumers a cohesive digital shopping experience.

Perspectives

DCN’s must reads: week of May 13, 2021

Here are some of the best media stories our team has read so far this week:

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