- Google Ad Manager retained the top Supply Side Platform (SSP) spot in 2021, with Amazon and PubMatic in second and third place
- A widespread omission of granular targeting techniques has seen a re-emergence in the importance of publisher-provided IDs (PPIDs), but publishers are anxious about relinquishing control to Google
- Google, Meta (formerly known as Facebook), and Amazon accrued 47% of global ad spending in 2021
- Despite the adtech industry claiming to be prepared for a post-cookie world, 46% of industry leaders have no clue about alternative addressability and measurement solutions, while 55% still don’t have a viable first-party data collection system in place
- IAB Tech Lab is creating a specialized working group for the development and deployment of PETs (privacy-enhancing technologies) as the obvious next step of Project Rearc
- BBB National Programs Digital Advertising Accountability Program reminded advertisers that fingerprinting needs to be announced to users, who need to be given an option to opt-out
- Vice Media Group rolled out plans to diversify revenue by 2024
- The New York Times reached 10 million subscribers ahead of its target year 2025 and plans on getting 15 million subscribers by 2027
Top Supply Side Platforms in 2021
Advertiser Perceptions surveyed 150 US-based publishers with an average monthly unique visitors of 3 million to determine the top Supply Side Platforms (SSPs) in 2021. They needed to have a programmatic ad selling business and already use or plan to use an SSP. Google Ad Manager was still the most preferred SSP at 73%.
Reference Image Source: AdExchanger
However, competition for the second and third spots was fiercer this year, with Amazon retaining their second spot at 46% and PubMatic gaining ground at 42%.
“There is still very much healthy competition for that third, fourth and fifth spot,”
– Lauren Fisher, EVP of Business Intelligence, Advertiser Perceptions (Src)
It needs to be noted that these reports are before the revelations and news on Google’s Project Bernanke and their alleged Jedi Blue collusion with Facebook. What effects such revelations have on Google’s future standing as the preferred SSP is yet to be seen.
“On the sell side, it’s Google’s show,”
– Kevin Mannion, Chief Strategy Officer & President, Advertiser Perceptions (Src)
Big Three Set to Absorb 50% of All Ad Money in 2022
Ebiquity reported that tech’s ‘Big Three’ accounted for 47% of global digital ad spending in 2021. Google, Meta, and Amazon grew their share in all the money spent on advertising by a considerable margin, as 2020 saw them only controlling 39%. Google reported advertising revenue of $73.3 billion in Q4 of 2021.
Meta made $33.7 billion over the same period. However, it faces more pressing problems, having lost almost $10 billion in annual revenues owing to Apple’s blocking of in-app tracking. Some advertisers might pull out of investing in Meta owing to a lack of data. The company is currently on a long-term plan to reinvent its ad business with privacy in mind.
Amazon reported its advertising revenue of $31 billion in 2021, for the first time ever. This jump from $19 billion in 2020 allowed it to maintain a considerable advantage over Microsoft, Snap, and Pinterest.
State of Data in 2022
IAB collaborated with Ipsos, a market research company, to release their State of Data report 2022. They surveyed more than 200 industry leaders across various brands, data companies, publishers, and agencies regarding their preparedness for a cookieless world and perception of how prepared they are.
Only 46% of industry leaders have proper knowledge about alternative addressability and measurement solutions like Google’s Privacy Sandbox, The Trade Desk’s Unified ID 2.0, or Microsoft’s Parakeet initiative. This implies a lack of awareness and feasibility regarding alternative future approaches to replace third-party cookies. It also indicates an absence of the insights needed to make adjustments for accommodating these alternatives.
Furthermore, around 55% of publishers do not have viable first-party data collection solutions to make up for measurement or addressability requirements once third-party cookies become obsolete. They do not have options for audience matching to provide to their advertisers – leaving them thoroughly unprepared for the impending future. Publishers need to immediately start adopting solutions for a post-cookie world. Rebuilding their ad stack around first-party data, creating first-party audience segments in Google Ad Manager 360, or similar solutions need to be adopted to cope with the impending future.
Reference Image Source: IAB State of Data 2022
Related Read: What is unified ID 2.0 and how does it work?
Misunderstanding Around Cookieless Measurement Techniques
Revealed as part of the IAB State of Data report, there is a general lack of knowledge on alternative solutions for third-party cookies, with 77% of industry leaders believing that they are abundantly prepared for the future. It is a self-appraised rating of their preparedness and marks a 15% growth in perceptions YoY, contradicting their organizational readiness. Essentially, most industry leaders are oblivious to what alternatives can help them prepare for the post cookie world, while mistakenly thinking they are quite ready.
More than two-thirds of buyers have not increased their usage of AI, with 66% following outdated measurement strategies. This report measured the industry’s readiness for data collection, measurement, and optimization, and highlighted a false sense of security and confidence amongst publishers.
Despite 60% of respondents knowing that third-party cookie deprecation will affect ad-measurement, they are yet to install adequate solutions. Machine learning and AI infrastructure, privacy compliance authorizations, attribution and measurement models, and campaign functions are all but in place.
The Re-emergence of Publisher Provided Identifiers
As the adtech industry debates on how useful Google’s Topics API might prove to be, it has reinvigorated the interest in publisher’s first-party data, as well as the long-forgotten PPIDs (publisher-provided identifiers).
PPIDs are used to facilitate measurement and targeting without third-party cookies. However, they are only limited to a specific publisher’s media since PPIDs are usually attached to logged-in users or a first-party cookie. Buyers can use these PPIDs to reach unknown audiences, albeit under a frequency cap. PPIDs are seeing a comeback owing to changing privacy policies and a rampant omission of granular tracking techniques.
Yet, they are not typical and do not offer scalability. Most publishers do not want their proprietary data to be widely distributed and use PPIDs within their own systems. Also, it cannot be used in programmatic deals such as open auctions and is mostly used for direct deals with buyers.
However, Google has entered the fray, realizing that larger publishers will want to share such feasible targeting solutions to attract advertisers as third-party cookies phase-out. With Google trying to integrate PPIDs across all programmatic deal types, there’s a rising anxiousness about how the tech giant might use this data. With Google requiring the use of this data across the entire tech stack of Google, many publishers are reluctant to enter a deal where they might have to compromise control.
Data Privacy Updates
IAB Tech Lab Forms a Specialized Working Group
IAB Tech Lab has signed off on developing a specialized working group to develop best practices and standards for deploying privacy-enhancing technologies (PETs). Examples of PETs include on-device learning and processing, differential privacy, secure multiparty computation, and various kinds of cryptography. These technologies minimize sensitive information inside a data set to be compromised and protect them via data-masking.
From an advertising perspective, these PETs should enable companies to derive value from data to conduct attribution, measurement, and analytics, while keeping the data secure. With many self-proclaimed ‘privacy-first’ techs, PETs are a concrete step towards standardization and interoperability.
It is also the reasonable next step in IAB’s Project Rearc, which redefines personalized advertising in a digital space keeping privacy regulations and platform changes in mind. PETs plans to develop secure multiparty computation standards and scrutinize cryptographic techniques that work best. Next, they will vet existing post-cookie proposals such as interoperable private attribution and finally launch open source projects.
“We really want to drive this [working group] towards delivering actual open-source software people can directly download and deploy, rather than just specifications,”
– Shailley Singh, SVP of Product, IAB Tech Lab (Src)
However, privacy-first solutions need to be used carefully to ensure privacy. For this very reason, PET solutions would need to use a combination of such privacy-centric technologies in tandem to ensure feasibility and accuracy.
Related Read: Everything you need to know about IAB’s Project Rearc
Watchdogs Issue Warning on Fingerprinting
BBB National Programs is an independent, non-profit that oversees dozens of US self-regulation programs. One of their programs is the DAAP (Digital Advertising Accountability Program). These industry watchdogs reiterated that app advertising companies relying on fingerprinting methods to deliver targeted and personalized ads must notify users that their data is being collected. Users must also be given an option to opt-out of such tracking techniques if they desire.
Fingerprinting is a method that collects user data based on device characteristics such as brand, OS version, IP address, screen resolution, and processor, amongst others. While most users are notified of such data collection when using advertising IDs, companies forget to do it when it comes to fingerprinting.
To remind advertisers of their responsibility towards privacy and to provide users with control over their data, the industry watchdog has reiterated this warning that it issued eight years ago. This statement further comes only a few days after Apple stopped support for cross-device in-app tracking without prior user consent.
Vice Media Looking to Diversify Revenue by 2024
Vice Media Group is on a path to diversifying its revenue generation streams. Advertising, which remains the primary source of revenue for the publisher’s digital division, is to become only a third of the company’s revenues by 2024. The rest of the two-thirds are to be dedicated to commerce and consumer-centric opportunities.
While this aim can be considered ambitious, Vice Media is adamant about it, and the process is already underway. It recently introduced a commerce vertical, Rec Room, which along with Most Wanted (a shopping vertical of the newly acquired Refinery29), contributed to a 3% YoY growth through affiliate revenue.
Vice Media further plans on diversifying its revenue by investing in affiliate content and exploring a verticals’ sub-vertical to produce content. They also want to launch affiliate programs on their magazine i-D. They also recently introduced a donation functionality to their news product and introduced Waypoint+, a subscription product for their gaming publication. Another project that Vice Media has is to attract revenue from the creator economy by rolling out their ‘Stories Studio’ in Q2 of 2022.
“Our revenue is primarily ad-supported, but we’re opening that up. And we’re very, very bullish on diversification and running hard at that,”
– Cory Haik, Chief Digital Officer, Vice Media Group (Src)
The New York Times’ Subscription-first Strategy
Mark Thompson, the former CEO of The New York Times, had claimed back in 2016 that they aimed to grow their subscriber base to 10 million by 2025. Back then, The Times had only 1.6 million digital subscribers. Fast forward to 2022, The Times has already reached that goal much ahead of time.
The acquisition of The Athletic, a sports subscription website, is a significant contributor to this achievement and added 1.8 million paid subscribers to The New York Times. However, prevalent perceptions were that the company would have achieved the 10 million target anyway through organic processes.
The new goal now is 15 million subscribers by 2027. With a high-value bundled subscription package in the pipelines and the acquisition of popular vocabulary puzzle Wordle, this goal might not be too far-fetched. The Times also reported $2 billion in annual revenue for the first time since 2012.
Moments That Matter
- Meta’s ad revenue model is vulnerable compared to Google – eMarketer
- UK government seeks solutions to address malvertising campaigns – The Record
- Apple’s privacy changes are bothering Meta – The New York Times
- What will digital advertising look like six years from now?; The IAB warns of ‘Measurement Blackout’ – AdExchanger