Traditional publishers and advertisers historically go hand in hand. But standard ad monetization isn’t working for many publishers anymore. As non-traditional publishers and marketplaces launch walled gardens-–and see billions in returns–-traditional publishers are following suit. This article discusses this transition and its implications for your business.
A traditional publisher is a company who makes their money almost entirely from ads, such as media companies, free content producers, and mobile games. Even if they offer subscriptions, like most digital newspapers, ads drive a substantial percentage of their revenue.
For reference, the PEW research group reports that from 1956-2020, newspaper advertising revenue surpassed circulation revenue every single year. And in 2020, digital advertising made up nearly 40% of that ad revenue. Traditional publishers, free or subscription-based, depend on ads.
Since their survival depends on ad revenue, these brands often resort to OpenRTB programmatic ads for scale, resulting in ad-heavy pages, slow loading experiences, and standard ad units. When you think “digital ad publisher,” you likely picture this.
It’s true that ad networks/exchanges like AdX, Criteo, and OpenX drive quick and easy revenue for publishers.
These shortcomings can have major repercussions: slow page loads alone could greatly hurt your revenue. Amazon reports that just a second delay in load times would result in a $1.6B loss in yearly sales revenue for them. For a traditional publisher, this could translate into fewer people subscribing and/or users abandoning the site versus reading multiple pages in the same session.
Due to these limitations, traditional publishers are increasingly launching homegrown ad platforms to drive new revenue and future-proof their ad offerings.
Though traditional publishers typically focus on programmatic “sponsored content” and standard banner ads, there are many innovative ad units they could incorporate, such as engaging, user-friendly native advertising units.
On top of engaging ad units, you have the ability to integrate unique targeting options that advertisers will pay more for, like:
As mentioned, most traditional publishers rely on standard programmatic ad networks to scale their revenue. Moving away from this model is understandably scary.
The good news? You don’t have to! Most publishers building their own native ad platforms are doing it alongside their programmatic programs, not in lieu of it.
Indeed, the value of building a native, direct-sold offering can’t be understated. As Facebook reported, native ads benefit both the publisher and advertiser:
In this world, then, you could maintain your current revenue stream while incorporating high-value, innovative native ad units that won’t annoy your users.
Building an in-house ad platform can take years, cost millions of dollars, and require dozens of ad tech engineers. Even if they see the value in native ad monetization, many traditional publishers are unwilling to make this sacrifice.
Maintaining this ad product, moreover, requires even more time and resources. Between server costs, engineering resources, certification fees, refunds for bugs, and so on, the costs involved can scale greatly over time.
Given these hurdles, many brands stick to the status quo and never launch their own ad programs — a boon to competitors who have.
Fortunately, there’s another path: Kevel. We provide a suite of ad APIs that make it easy to launch your own ad platform in just weeks. You get the customization of an in-house build with the speed of a third-party solution. With Kevel, you can keep using your current ad server for programmatic ads, but integrate native ads alongside them (with all the targeting features you want). Contact us today to learn more.
Sarah is an experienced writer with a software background, allowing her to translate between ad tech experts and lay readers. As Kevel's Associate Product Marketing Manager, she helps broadcast new products and features.