Content provided by Yield Executive Summit Sponsor, Operative.
THE PUBLISHER’S CHALLENGE
Publishers contend with a lot of factors as they navigate programmatic advertising: How to choose the right demand partners, when and how to adopt new waterfall and header bidding strategies, how to make programmatic direct deals profitable, managing a ton of conditional metrics and measurement discrepancies. At the same time, they are faced with producing more revenue with too few resources.
What makes matters worse is that the ecosystem does not favor the publisher. Closed marketplaces are vertically integrated from trading desk to publisher inventory, creating black boxes. Ad tech companies are one-upping each other to get access to a publisher’s best audience first, creating overlap . Buyers are getting more and more sophisticated in RTB strategies, depressing yield. Data leakage risk increases with every new technology on publisher pages pages. Market transparency is non-existent.
For example, our client Outdoor Sportsman Group (OSG) was using programmatic partners to fill unsold inventory across its sites, but was unhappy with its return. Their strategy was the “set it and forget it” approach, which netted them only 2 percent of its total digital revenue from programmatic. The problem with that, programmatic accounted for 34 percent of OSG inventory. OSG also felt that it was sending too much of its inventory to programmatic channels, but was unsure how to increase yield. Similarly, another client of ours, Frankly, Inc. was unable to properly optimize programmatic bidding scenarios automatically or access the reporting they needed to improve programmatic performance.
Hint: It hasn’t been publishers and advertisers. The ad tech tax is real. Just look at revenue growth for the tech companies that are fueling this arms race. Neither advertisers nor publishers are meaningfully participating in this value creation.
The paradigm has got to change for publishers, and it can – with the right setup and partnerships. Since third parties aren’t built to support publishers in the programmatic market, publishers must take it upon themselves to create a more streamlined, profitable business, working with vendors and buyer partners that are transparent and aligned with publisher profitability. Publishers understand that programmatic is not automatic, and many complexities and manual processes make it difficult to advance, they need to focus on eliminating needless complexity just because the market pressures them to take IOs at face value.
WHERE DOES OPERATIVE FIT?
For the last decade, we’ve brought control and transparency to our customers’ direct sales business through the Operative.One platform. Our publishers have the tools to drive yield and squeeze profitability through automation.
Now we’ve created Operative Compete to bring customers’ programmatic business under control. Additionally, Compete allows our customers to create transparency and drive up revenues through smart yield decisions done at scale using automation. Within two months of working with Operative, OSG realized a 114 percent increase in programmatic CPMs. Additionally, OSG was able to increase the amount of inventory it sold directly—from 66 percent to anywhere from 75 to 90 percent, depending on seasonality and programmatic availability. These improvements resulted in a 6 percent bottom line increase in digital revenue for the company. In short, we’re turning the tables back in favor of the publishers. To learn more about Operative’s solutions, please reach out to info [at] operative [dot] com.