Advertising Digital Publishing
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AOP research reveals continuing shift away from open programmatic for UK publishers

86% of respondents expect most advertising revenue growth to come from outside open marketplaces

New survey results from the Association of Online Publishers (AOP) reveal UK publishers expect most future advertising revenue growth to come from outside of open programmatic marketplaces. Of those surveyed:

  • 42% consider the biggest potential advertising revenue growth to come from non-programmatic direct deals
  • 44% are most optimistic about private marketplaces as a source for advertising revenue
  • Only 14% of respondents expect open programmatic to be their primary advertising revenue driver in the next three years, trending down from 20% last year.

These findings come from ‘Digital Publishing: Outlook and Priorities for 2023’, a study conducted by the AOP to explore the sentiment of the UK digital publishing industry and how it is adapting to current and future challenges. The survey was conducted between 5th December 2022 and 11th January 2023, and received responses from 92 publishers and 16 solutions providers.

In the survey, B2B publishers named lead generation (28%), events (22%), and sponsorships (20%) as having the most revenue growth potential, while B2C publishers look towards subscriptions (17%), sponsorships (15%), and display advertising (13%). Publishers that cater to both see promise in ecommerce (23%) and affiliate marketing (19%).

Industry confident it can weather recession while prioritising ESG

Despite Bank of England forecasts of a recession, publishers and solutions providers feel they are well-positioned to manage economic challenges, with both having an average confidence rating of 7.2 out of 10. As for how the industry plans to adapt, top priorities include ensuring a diverse and inclusive workplace, recruiting and retaining new talent, and developing new revenue streams through product innovation.

This focus on DE&I is reflected in the high intent to meet Environmental, Social, and Governance (ESG) targets, with 80% of respondents stating they have either already published an ESG plan, or are working towards developing one. Two-thirds (67%) agreed that ESG was core to the values of both their business and employees, while 58% agreed that advertisers and agencies expect them to develop and implement a policy to meet ESG goals.

Progress plateaus on readiness for third-party cookie deprecation

Publisher confidence in organisational readiness for the deprecation of third-party cookies was rated at 6.5 out of 10, the same as reported in last year’s survey. While confidence has plateaued, there have been significant shifts in how publishers are preparing: only 4% of publishers said data sharing collaborations with other publishers was a top priority, down from 20% last year.

Instead, the publisher focus areas highlighted in this year’s survey are:

  • improving the engagement funnel to build up first-party data (23%),
  • implementing tech solutions for a 360-degree audience view (15%), and
  • investing in personalised user experience solutions (15%).

Over half (58%) of publishers reported they are investing in tools to ensure audience data informs everything they do, with 21% of publishers admitting to not having a joined-up internal strategy in place around audience data – up from 4% in last year’s survey.

The trend away from open programmatic is unsurprising, as frustrations around transparency and equitable revenues have been mounting for years.

It will be interesting to see whether the improvements identified in ISBA’s follow-up transparency study can move the needle back towards open programmatic in the future. Also, it’s fantastic to see ESG as a core focus for the vast majority of respondents and that the impetus for change is being driven both culturally and commercially.

Richard Reeves, Managing Director at AOP

In response to the survey findings, AOP will facilitate ongoing discussions on the key themes outlined in the report, including subscriptions, ESG, and first-party data strategies.