In 2022, national brand U.S. ad spend reached nearly $100B, but brands are becoming more selective about where they invest. To succeed in this challenging market, publishers can adapt their revenue strategies by focusing on growth categories, tactfully adjusting their share of wallet, and investing in areas important to consumers and advertisers. Standard Media Index’s Darrick Li explains more…
While alarm bells continue to ring of a potential recession, advertisers have begun re-evaluating their campaigns and strategies. And although the industry typically mirrors shifts in consumer behavior, one thing is certain – while consumers may be cutting costs, advertisers generally aren’t.
In 2022, Standard Media Index’s pool representing over 90% of total national brand ad spend reached nearly $100B – upending pre-pandemic spend in 2019 by 13%. Clearly, brands are still investing but they are being very discerning of where and with who. With this in mind, publishers have the unique opportunity to adapt their revenue strategies and still win ad dollars in a challenging ad market.
Publishers that are staying ahead of growth categories, tactfully shifting share of wallet each and every month, and investing in areas that are important for both consumers and advertisers will stay ahead of the curve. Here’s how:
Create a great user experience
At the end of the day, the most important part of any publisher’s business is growing, engaging, and maintaining readership. And that’s best achieved by curating a great user experience for them, with tailored, personalized content. In practice, this can be anything from recommended articles based on what they have already read, to serving relevant advertising related to what’s currently on the page – or to a reader’s specific interests. Not to mention the benefit of more advanced tactics like video formats.
While it’s not a new idea, it’s clear that publishers need to provide content in the forms that consumers want it. And with short form video content (think TikTok) taking off significantly, publishers should look towards formats that ensure engagement. In the end, user experience must be worthwhile in order to maintain readership – and if the readership is loyal, the advertisers will follow.
Know your data and its value
In anticipation of the loss of third-party cookies, advertisers are scrambling for accurate audience data. As such, first party data has become crucial and coveted. If publishers can truly understand who their audience is – their first party data can be their greatest asset, and their biggest selling point.
In truly understanding their audience, publishers can then identify which advertisers make the most sense – and effectively showcase the value of their inventory to the right brands, maximizing the value of their inventory by honing in on their advertiser sweet spots. This can be especially powerful for smaller publishers who may not have access to the same sales resources as bigger publishers, and thus need to be strategic about who they spend time selling to.
However, this all needs to be done with privacy top of mind. It will be critical for all publishers, big or small, to establish transparent, privacy-compliant policies for collecting and processing their first-party data. Just because advertisers are spending more, doesn’t mean they aren’t taking necessary precautions – every dollar spent under economic uncertainty is increasingly scrutinized, and data from each and every campaign must produce actionable insights to maximize ROAS.
Flexibility above all
The buy-side needs flexibility with their investments. We’re already seeing this pattern play out in the video landscape, with less than half of marketers’ video advertising budgets allocated to upfront spending this year. And the same is true for the wider advertising ecosystem.
Flexibility is a much easier ask for digital players (in comparison to traditional media) and advertisers took notice with digital investments reaching 58% of total share in 2022. Traditional publishers can only compete if they work hard to try to make that flexibility easier for their clients. With that flexibility, they and other publishers across the ecosystem lessen the uphill battle to maintain relationships and see revenue – if not immediately, in the long term.
In an advertiser-prioritized technology landscape, publishers can win too – it’s time to take a seat at the table, assess assets and their value, and drive revenue while supporting advertisers and benefiting the consumer experience.
VP Sales, North America Media Owners, Standard Media Index
SMI accesses actual spend from the world’s largest media buying groups, as well as leading independents, and then organizes that data to create a clear, granular, and easy-to-use database for our clients and agency partners. Depending on the market, SMI captures between 70 and 95% of all agency spend.
Clients use SMI data to determine media mix models, create competitive benchmarks, and gain visibility into pricing level data. The data also allow them to understand marketplace trends on a product category level, evaluate ROI of tentpoles and sporting events, and break out ad formats by media type to highlight the effectiveness of different kinds of placements. SMI’s data supports insights covering 34 countries around the world – and that number is growing.