Today’s market conditions are extremely challenging for online publishers. Not only are they facing the same economic pressures as every other business, but they’re also dealing with an impending paradigm shift as we near the end of third-party cookies.
To get some expert perspective, we recently sat down with the Chief Product Officer at Sovrn, Brian Bouquet, who shared his thoughts on the steps publishers can take today — and the importance of a long-term strategy.
Following is a quick recap of the key takeaways from our conversation.
Q: You have an interesting professional background, including time in the travel & hospitality industry. How do those experiences translate to your role with Sovrn?
A: My time in travel & hospitality provided some important insight into the way brands think about marketing and targeted campaigns. Publishers need to understand that they play a vital role in the overall value chain. Because of that, you can’t focus entirely on maximizing ad revenue; you also have to deliver results for your marketing partners.
This can be a delicate balance. You need to keep visitors engaged in the content you’re creating, and you need to generate revenue, but you also need to deliver conversions for your monetization partners. Otherwise you aren’t providing the value brands need, and you won’t be able to keep their ad spend long-term.
For example, Outside magazine publishes high-quality skiing and snowboarding content on their website, which keeps their audience coming back. In addition, they serve up ads for companies that are interesting to this audience — like ski resorts, equipment, and apparel. On top of that, they also have to deliver a good user experience that increases the chances those ads will convert, by optimizing page layout, limiting the number of ads on the page, etc.
Q: Let’s talk a little bit about your role as Chief Product Officer at Sovrn. What is your focus and how is it different from other product roles?
A: When I started working in product management, my role was focused on a single product. I collaborated with the product leadership team to determine product direction, and then worked with the engineering team to design and build the product. As you advance through the ranks in product-focused roles, you go from owning a product, to owning a group of products, to finally owning a portfolio of products.
As Sovrn’s Chief Product Officer, I work closely with our CEO to define the vision for the company, as well as our short- and long-term goals. Then it’s my responsibility to make sure our portfolio of products — including Commerce, Ad Exchange, Ad Management, and Signal —delivers on that vision and moves us toward our goals. Defining a holistic product strategy requires knowing the industry and where it’s headed, knowing our customers, and knowing what we want for the company over time.
Q: We try to encourage publishers to think this way as well, by focusing on their entire tech stack rather than one-off point solutions. What advice can you give publishers to help them think more like a product officer?
A: Being a publisher on the Open Web is complicated. The technology is fragmented, so you often wind up with a lot of single-point solutions. It’s operationally challenging to manage all those different solutions and vendor relationships, and it’s equally challenging to make them all work together. Working with tech partners who can solve multiple business problems is worthwhile, because it can dramatically reduce the complexity of your tech stack.
One thing publishers often don’t realize is that those point solutions can actually create misalignment with your monetization partners. Many ad tech solutions are designed to place as many ads as possible “above the fold.” That may sound like a good idea if you’re focused on maximizing revenue from every site visitor — but it won’t help with conversions or user experience.
Publishers need to think about creating long-term value for their monetization partners and long-term relationships with their audience — rather than chasing short-term revenue opportunities. Make sure you’re delivering on the value that your partners are paying for. If you’re selling ad space, you want to make sure it converts for the advertiser, or they won’t continue spending money on your inventory.
Q: Publishers are facing some really challenging economic conditions, which can make it hard to focus on the long term. What can publishers do now to preserve long-term value and future proof their revenue strategy, regardless of economic conditions?
A: A lot of today’s macro factors are out of our control. That said, there are three things publishers can do help weather the current economic storm and position themselves for future success:
- Invest in technology that preserves consumer privacy. We all know cookies are going away. That means the future is in user-consented, publisher-provided data. Publishers have a direct relationship with their audience, and they know their site visitors better than anyone else — which puts them in a really valuable spot. Invest in technology and strategies that help you activate your first-party data and capitalize on that direct value exchange.
- Get serious about revenue diversification. When ad spend is down, as we saw during Covid, publishers can preserve their revenue stream by adding strategies like affiliate (or commerce). With a more diversified strategy, you’re better equipped to manage short-term volatility and generate sustainable long-term revenue.
- Keep more of what you earn. Publishers should be putting pressure on their tech partners to make sure they’re keeping more of the revenue they create. A lot of this comes down to pricing models, so look for vendors that don’t cut into your profits with excessive revenue shares. If you already have contracts in place, you can always go back to the vendor to negotiate more favorable terms.
Q: Are you seeing any bright spots for publishers amid this challenging economy?
A: There are some really interesting things happening in online publishing right now. First and most importantly, the very definition of a “publisher” is evolving as sites move beyond their traditional niche. The New York Times is a great example of this. Rather focusing purely on news and information, they’re branching out into entertainment, lifestyle, and even commerce — for example, with NYT Cooking, Wordle, and the acquisition of Wirecutter.
We’re also discovering new ways of reaching the online audience, and content is moving beyond simple text. I believe there’s a lot of upside and revenue potential for publishers as marketing budgets move into these rich mediums.
The third opportunity I see is around audience data. Consumers are becoming more protective of their information and less data is available for ad targeting. This is driving a wave of innovation focused on enabling publishers to collect audience data and communicate it to ad partners. There’s still work to be done, but this has the potential to lessen the revenue impact of consumer privacy changes.
For more insights to help grow your business on the open web, visit the Sovrn blog. You can also contact us at email@example.com for more information about our comprehensive suite of publisher solutions for commerce, advertising, and data.