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The Real Hero in the Fight for CPMs

Can Publishers Sell Quality In Real Time?

By Published on . 2

To call real-time bidding a polarizing topic feels like an understatement at this point. Walk into any digital marketing conference, start talking about RTB, and stand back and watch as the room starts to resemble Tea Partiers arguing with Wall Street Occupiers – except everyone's wearing chinos.

One side is excited about helping advertisers match ad to consumer in a fast, efficient manner. The other is wringing its hands out of fear of dropping CPMs. But in all the talk, both sides seem to forget one of the key drivers in the quest for higher CPMs: quality, and the fact that it is not solely determined by the publisher brand.

In the RTB debate, I've talked with more than one publisher concerned about dropping CPMs and the channel conflict that comes whenever they sell inventory outside their direct sales team. Many publishers have been wary of networks and exchanges for years for fear of commoditizing their inventory.

When they do leverage networks and exchanges, anonymity is a publisher's friend, helping them avoid channel conflict and pricing degradation on their direct buys. But environments built on anonymity encourage buyers to focus solely on finding audience, which actually devalues the publisher's content – the exact opposite of what they want. While publishers feel they're protecting their brands, anonymity actually commoditizes their audiences. The implication is that content means nothing, as long as it attracts eyeballs.

So how do you build a marketplace where publishers remain anonymous while driving higher CPMs? Well, it's not RTB as it stands right now. Matching the right ad to the right consumer in a real-time environment is one way to do it, and it's alluring to advertisers for all the obvious reasons. But the best way to boost the CPM is to give more insight into the quality of the content. Visibility into quality boosts the value of every page, and thus drives higher prices.

An advertiser's definition of "quality" often depends on what kind of pages they are looking for, but there are a few rules that hold true across any buy. A "quality" page is a page that is not bogged down with 50 ad units. It is a page that has actual content on it. As we've seen time and again, it's also a page with a topic that is relevant to their ad message. Furthermore, it's an actual webpage that consumers will visit, and not an empty domain parking page.

These factors all play into the overall performance of a campaign, and performance is RTB's number one advantage, according to marketers surveyed by Econsultancy. Performance is followed closely by reducing waste and better targeting, both of which are possible with greater visibility into quality. The next most important factor for marketers is transparency, which of course is at the heart of the concept of buying "quality." If the intent is to raise CPMs, then the factors most important to buyers certainly count. Publishers who insist on not revealing their brand must still be evaluated on the quality they deliver.

Advertisers pay a premium for publisher direct purchases because those transactions come with the assurance that the advertiser knows what they are buying. The only way for DSPs, trading desks, and exchanges to mimic the comfort level of premium ad buys is via quality content. When advertisers are enabled to buy inventory with the same assurances they get from premium publishers, then the medium is bound to grow.

ABOUT THE AUTHOR
Andy Ellenthal is CEO of Peer39.
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