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Weekly Roundup: Supply Transparency, CCPA Framework, Users Over Ads, and More.

Adtech Weekly Roundup
“The first response was to add more ad impressions in order to increase revenue. But we knew if we did that, we’d just get even more ad blockers. We were at a dead-end street. That’s when we started on this user-first strategy.”

Supply Chain Transparency

In adtech, transparency has always been in the spotlight. From media buyers to publishers, everyone tends to opt-in – for learning more about users and ad transactions with the help of raw data. MediaMath, one of the well-known DSPs in the market aims to bring much-needed transparency to the supply chain with its new framework. 

Dubbed as “SOURCE”, the framework will handpick both supply and demand to create an accountable and addressable marketplace for buyers, sellers, and intermediaries. SOURCE partners with publishers, buyers, and intermediaries such as ad fraud verification and viewability measurement vendors, to come up with a marketplace. 

“What we hear from every part of the supply chain is that it’s hard to get aligned on things like transparency, fraud, and discrepancies in the current environment” 

– Joe Zawadzki, CEO, MediaMath (AdExchanger).

Who’s in?

As of now, Havas Media (with its own advertising customers), Rubicon Project, Telaria, and publishers such as Business Insider, News Corp., and The Weather Company, along with Moat and Oracle Data Cloud (for third-party verification) and WhiteOps (for prebid fraud detection) have partnered with MediaMath for kickstarting SOURCE. 

Roadmap:

Media Math’s CEO Joe Zawadzki said the product has been in development for the past year and will begin its 15-month run with the partners now. The company aims to divert 100 percent of its campaign via SOURCE by the end of 2020. 

Takeaway:

1. “Supply chain transparency” will eventually gain adoption and publishers will soon be able to access raw data that includes who’s bidding and at what prices, brands and Cos. buying more impressions, and more. In fact, Google Ad Manager promises to let publishers access bid-level data soon. Interesting, in this case, a DSP catches up with the trend. 

2. More data means more transparency, but not more revenue. Unless you know how to crunch the numbers and derive actionable insights from the bid data, you won’t be able to reap the benefits.

IAB’s CCPA Framework

We knew how hard it was for publishers to prepare for the GDPR impact. So, IAB launched a Transparency and Consent Framework (TCF) and later Data Transparency Framework to help the ecosystem to become compliant and run personalized ads. While the framework still faces questions from privacy regulators and data watchdogs, it assisted the industry to move forward. And, the frameworks are constantly updated to fix the loopholes. 

Similarly, IAB Tech Lab is planning to reveal a framework for California Consumer Privacy Act (CCPA) and the proposal has been sent out last week. 

CCPA Limitations on Adtech

In CCPA, a third-party cannot sell personal information to another party without a) getting explicit consent from the user (if the user is a California resident) and b) providing a mechanism to opt-out. Due to practical and technical limitations, several third-parties in the adtech chain including ad exchanges, SSPs, and DSPs wouldn’t be able to see whether publishers are actually acquiring proper consent and giving the users an opportunity to opt-out. 

Besides, CCPA requires publishers to have a written contract with “sub-processors” (service providers of service providers) if it wants to share even limited information with them [sub-processors] for the purpose of reporting and measurement. 

Framework Details

IAB hopes to pave a way to deal with the limitations. The to-be-released framework will provide the third-parties to know whether 

– the user is from California,

– the publisher meets the criteria for “business” under CCPA,

– Got explicit consent from the users and provided an opportunity to opt-out. 

It also proposes a limited-service provider contract (IAB Contract) if the user (consumer) opt-out from the provided mechanism.

Do Not Sell My “Personal Information”

On top of these, a Do Not Sell My “Personal Information” button/link will be displayed to the user on the homepage, privacy policy page, and all the other pages where publishers would like to run personalized ads. 

If a user clicks on it and decides to opt-out the downstream parties (ad exchanges, SSPs, DSPs, etc.) are bound by the IAB contract to not sell or use the information unless it for the publisher’s stated business purpose (for example, measuring performance and reporting). 

Technically, IAB’s contract converts third-party into a service provider for publishers. So, using the information for building profiles, sharing bid data with advertisers, retargeting, etc. are barred under the contract. 

Takeaway:

IAB will release the technical specifications in the near future so that industry players will become compliant before Jan 1, 2020. We’ll keep you posted (If you haven’t already, sign up for the receiving the roundup in your inbox). 

User-first Strategy Increases Ad Revenue

In our weekly roundups, we’ve discussed (here and here) how prioritizing user experience over ads has led to increased ad revenue. Last week, Digiday published a piece on how Burda Media increased its ad revenue by reducing ad clutter. Here are the highlights. 

Ad-culling test

Like many other publishers, Burda Media faced with ad blocker problems. The publisher realized 30% of its traffic uses ad blockers and decided to cut down the ads to get those users back. 

The media company cut almost a quarter of its ad impressions across all of its digital properties. As expected, the revenue started to go down instantly – costing the publisher a seven-figure revenue loss overnight. But the publisher knew the risk and took it. Burda closely worked with Coalition for Better Ads to make sure it delivers the right (and a better) user experience and ran its site with necessary ads. 

The impact

The impact of reducing ad units is clearly positive over the long run. The ad revenues across its sites increased by 38% YOY (on average) in 2018. Burda Media’s flagship site “Focus Online” increased its user base to 23 million in 2018 from just 16 million in 2016 and revenue by 44% in 2018. 

Takeaway:

The quote from the publisher’s digital wing CMO Martin Luetgenau summarizes the takeaway for you. 

“The first response was to add more ad impressions in order to increase revenue. But we knew if we did that, we’d just get even more ad blockers. We were at a dead-end street. That’s when we started on this user-first strategy.”

– Martin Luetgenau, managing director and CMO of Burda Forward.

To make up for the lost revenue, increase ad impressions and cluttering the experience for the users who aren’t running ad blockers, will eventually end up installing one. Burda Media studied its users and delivered what they need while increasing its ad revenue over the long run. 

Metrics To Track

Ad viewability is undeniably an important metric for a publisher to track and improve consistently. Media buyers will pay better if you have an impressive viewability and domain or placement viewability is one of the signals for buyers to bid on your impressions. But is viewability enough?

At the Advertising Week, Kargo’s president Ryan McConville shared a study that concluded viewability isn’t the only metric to track and improve – the environment matters a lot. The research studied 482 participants watching ads across different platforms including gaming, apps, desktop, mobile, and Instagram.

Gaming ads garnered 90% viewability, but brand recall is poor. Because the participants remain focused on the game itself and they didn’t look at the display ads that were in-view all the time. Furthermore, the study found large ad formats on mobile performed better than the rest and its ad effectiveness score (percentage of time user spent looking at the ad – out of the total viewable time) stood at 10.8%. 

Takeaway:

While it is essential to optimize for viewability, it is also important to consider the environment in question. If you’re a mobile or desktop publisher, optimizing for viewability (with larger ad formats) tends to increase brand recall. If you’re a gaming publisher, it’s necessary to consider where the user focuses and what’s the intent of the screen-in-view; not just viewability. 

Taboola – Outbrain Merger: What It Means For Publishers?

Recently, two of the biggest native ad networks Taboola and Outbrain announced that they’ll merge in $850 million deal – aiming to take on the advertising duopoly (Facebook and Google). 

Numbers:

The companies will have access to 20,000 properties after the merger and reach 2.6 billion users in total. For context, Facebook reached 2.41 billion people (MAU) and Google claims to reach 90% of Internet users. So, the scale won’t be a problem for the advertisers looking to use Taboola (Taboola will be the name of the company after the merger). 

To many of the people in the industry, the announcement isn’t really a surprise. Both companies were discussing the M&A for a long time (for a better part of the decade, as per Taboola’s CEO). 

What it means for publishers?

Expansion:

The second thing to notice is the goal of the company (after the acquisition). As Taboola is already investing to expand into video and app environment, the M&A will only accelerate the process. Outbrain’s investment in AI will continue to help the new company in the same area and improve its advertising capabilities. 

Race to the bottom:

“My concern would be that by coming together and an inability to pitch their quality control or safeguards against each other, we end up with the race to the bottom.”

According to Digiday, several publishing executives are afraid that the deal will get rid of the competition b/w the two and ultimately create a “race to the bottom” scenario. I.e., both prices and ad quality may go down. 

Moments that matter

How Publishers Are Responding to Ad Blocking – eMarketer.

‘The tip of the iceberg’: News publishers are embracing registration walls (again) – Digiday.

Essential Second-Quarter Stats for Ad Tech and Platforms – AdWeek.

Media Rating Council Guidelines Bring New Definition to Cross-Screen Viewability – AdWeek.

Google Faces iPhone Privacy Lawsuit After Court Reinstates Case – Bloomberg.

Automatad Team

At Automatad, we help publishers to monetize better without hampering the user experience. Our products are live across hundreds of publishers, earning them incremental ad revenue with every passing second. You can request a free audit to get an estimated revenue uplift today.

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