There were a number of highlights in October for the now, and the future of digital media from regulation & consolidation to fragmentation & revenue opportunities. Firstly though let’s start with a nod to the past.
27th October 2019 marked the 25th birthday of the banner ad – a huge moment in internet history, one that led to a multi-billion dollar digital ad industry, but one that also resulted more recently in the rise of ad blockers and privacy browsers. Furthermore, in the 25 years since we’ve seen the rise of mobile phones & smartphones, the rise of cookie-based tracking, and the speedy growth of one of the most valuable assets ever created – data!
As such, there’s a real challenge in the industry now to make ads better for everyone, as well as look at where else we can generate revenues to enable our much loved publishers to keep providing us the content & digital experiences we crave, whilst keeping brand safety and user privacy at its heart.
1. CCPA is coming…and other regulatory news
On the theme of user privacy, many US publishers are preparing themselves for California’s Consumer Privacy Act set to take effect on January 1, 2020. These regulations piggyback off of other sweeping privacy legislation — like Europe’s GDPR — and essentially aim to give consumers greater control over the data they share with businesses. The next few months will be key as US publishers ensure they’re compliant, with a similar grace period to GDPR. Whilst the long term value of such regulation will benefit the industry’s integrity, some predictions suggest initial CCPA compliance costs could hit $55bn!
Over in Europe, our top court ruled that pre-checked consent boxes for dropping cookies are not legally valid. Consent must be obtained prior to storing or accessing non-essential cookies, such as tracking cookies for targeted advertising. Consent cannot be implied or assumed. This is further pressure from European regulators in addition to the looming ePrivacy Regulation, which will clamp down on how cookies are used for ad targeting.
Another month, another abuse of trust & privacy. This time it was Twitter that admitted to “inadvertently” using data meant for security purposes to target people with ads. It will be a space to watch to see whether any fines come their way, how it impacts users trust in the platform, and how big brands react to investing budget in the platform.
2. Secure-by-default cookies
With plans for Chrome, Firefox and Edge all to adopt the new ‘SameSite=None; Secure” cookie settings in the new year in ongoing efforts to improve user privacy, its important to understand & begin to implement changes sooner rather than later.
The new model assumes all cookies should be protected from external access unless otherwise specified, and thereby safeguarding sites and their users as default. The main 2 changes are that cookies with no SameSite attribute will be treated as “lax” therefore blocking them, whilst even cookies with the SameSite=None attribute need to be tagged with the Secure attribute in order to be sent across sites with an encrypted connection. The latter of those changes provides protection against network attacks as well as enabling greater transparency and user choice.
3. Publishers explore revenue alternatives…
Publishers are facing a new set of challenges around balancing revenue streams (e.g. subscriptions vs advertising), new privacy regulations and restricting tracking cookies. To that latter point publishers are chasing ways to commercialise their first-party data; primarily by creating audience identifiers that help clients target the right people at scale, without relying on third-party cookies, then expand how those audiences can be monetized.
Many publishers are actively pursuing beyond-the-cookie strategies that prioritise identifying audiences using first-party rather than third-party cookies. In some cases, that’s led to extended contextual-targeting offerings that incorporate more granular targeting around audience intent, behaviors, sentiments and interests. In others, it involves more second-party data partnerships with advertisers or selling first-party data to be used for targeting audiences outside of their own properties.
Fancy a chat about revenue alternatives?
4. …and Media Consolidation
Further consolidation was seen in media again in October in what many see as an effort to outlast, not outrun the industry and take advantage of the scale that such collaboration can bring. Consolidation can help publishers strengthen their first party data propositions. For example; Group Nine Media has been a keen acquirer recently snapping up PopSugar, Vice is acquiring Refinery29, and Future announced it is acquiring TI Media.
The target is to create a model for the next-generation media company with continued opportunities to scale, deeply loyal and engaged audiences, multiplatform expertise, and highly diversified revenue. Being data-driven and experimental has given a number of next-gen or new-age publishers distinct identities and powerful propositions for advertisers to find highly engaged, digital audiences.
The largest consolidation news came with the merge of Taboola and Outbrain – 2 content recommendation giants – in a $850m deal to take on the duopoly. A quote from Adam Singolda – founder & CEO of Taboola – that really resonated was this:
5. Media fragmentation and change
The most consistent thing about the media industry over the last 25 years has been change – new devices, new channels, new ad formats, new regulations, new audience types, etc, etc, etc! Media fragmentation has become the norm with people constantly modifying what media they consume, how they consume it and when they consume it. The more recent rise of channels such as Over-The-Top (OTT) media services and podcasts & rising audio channels represent new opportunities, but the challenges largely remain the same: Understanding the engagement of these audiences to optimise their experience.
Snapchat is a great example of new media and it’s growing up fast. ‘Share to Snapchat’ is their latest effort to better integrate with media owners such as BuzzFeed, Vice and Pink News the first publishers to sign up. This follows on from moves at Snap to bulk up its ad offering with the launch of dynamic ads for retailers.
6. Hope springs eternal for publishers trying yet again with Facebook News
Facebook News debuted in alpha testing towards the end of the month, with Facebook reportedly paying media partners licensing fees as well as allowing them to monetise via referral traffic and Instant Article ads, but no ads from advertisers within the tab. This month also saw Facebook open search ads to all advertisers enabling, for instance, retailer ads to be included in the News Feed and Marketplace search results; whilst also testing ad placements in the Groups tab.