The evolving landscape of programmatic advertising has presented publishers with numerous challenges, especially as the industry continues to move towards sell-side curation. This trend involves Supply-Side Platforms (SSPs) partnering with Data Management Platforms (DMPs) to manage and sell publisher data through curated private marketplaces (PMPs). Advocates of this approach argue that it allows publishers to reclaim the value of their first-party data. However, not all publishers share this optimistic view. Concerns surrounding control, transparency, revenue, and pricing have marred the enthusiasm for sell-side curation. Amanda Gomez from The New York Post is one such publisher who has voiced significant reservations about the implications of these arrangements.
Transparency Issues in Sell-Side Curation
Automatic Enrollment and Lack of Consent
One of the primary headaches for publishers in the realm of sell-side curation is the issue of automatic enrollment in curated PMPs without prior consent. This method often leads to unwanted and unexpected changes in revenue-sharing models and the introduction of new line items without publisher approval. Amanda Gomez has been particularly vocal about these concerns, emphasizing the need for greater transparency. Publishers like Gomez demand clear, detailed reports from SSPs, which should include data on the audience segments created, the deal IDs, CPMs, and revenue generated through these curated deals. Without such transparency, publishers could face significant conflicts with their existing direct sales efforts.
The lack of consent and automatic enrollment not only compromise publishers’ control over their data but also create operational complications. Revenue reconciliation becomes more challenging when unexpected line items appear. Additionally, the automatic nature of these enrollments can lead to a misallocation of resources, where publishers inadvertently support campaigns and advertisers that don’t align with their strategic goals. Such issues inevitably lead to inefficiencies in managing campaigns and significantly impact publishers’ trust in their SSP partners.
Control Over Data and Audience Segments
Maintaining control over data and audience segments is another critical challenge for publishers in the current programmatic landscape. When SSPs and DMPs control the curation process, they essentially dictate how and when publisher data is used, leaving publishers with minimal say. This lack of control over proprietary data is problematic, as it can dilute the uniqueness and value of a publisher’s audience segments. Without detailed insights into how SSPs are leveraging their data, publishers are at a disadvantage compared to curated private marketplace operators.
Jeffrey Goldstein from Future has also expressed his worries about this dynamic. He highlights that the initial favorable terms of curation deals could easily be renegotiated to less favorable ones once publishers grow reliant on the revenue generated. This reality creates a precarious situation for publishers who may feel pressured to accept any terms offered to maintain revenue flow. Furthermore, if premium inventory is included in curated deals, the risk is that CPMs may drop due to programmatic bidding, as opposed to achieving higher CPMs through direct deals. This concern underscores the need for establishing stringent data management protocols and demanding greater transparency from SSPs.
Pricing Transparency and Control Challenges
Effective Pricing Floors
Pricing transparency is yet another major concern for publishers engaging in sell-side curation. Effective pricing floors are not always established by curation vendors, which can result in a lowered bottom line despite the generation of some revenue. The absence of these pricing floors diminishes a publisher’s ability to control and predict revenue, bringing uncertainties that are difficult to manage. Stephanie Layser from Amazon Web Services has stressed that managing effective pricing controls through indirect channels presents operational difficulties.
Pricing floors play a crucial role in safeguarding the value of a publisher’s inventory. When insufficiently established, auctions for ad inventory might settle at prices lower than anticipated, adversely impacting revenue. For larger publishers managing multiple inventory types and audience segments, maintaining and adjusting pricing floors on-the-fly proves to be an onerous task. Tools like Google Ad Manager’s Unified Pricing Rules add to this complexity, which often leaves publishers grappling with vast amounts of fragmented data and inconsistent revenue patterns.
Long-Term Commercial Terms
The long-term commercial terms of sell-side curation deals pose another challenge. Jeffrey Goldstein’s concerns resonate deeply with the issue of initially attractive terms turning less favorable over time. As dependencies on the revenue generated from these curated deals increase, publishers find themselves in a weaker negotiating position. This has broader implications for the sustainability of a publisher’s business model, as relying on these curation deals can bring unwanted volatility.
As SSPs and DMPs manage these curated marketplaces, they can leverage insights and data to their advantage, potentially renegotiating terms that are less publisher-friendly. This dynamic is further exacerbated if these deals become long-term revenue sources for the publishers. With premium inventory thrown into the mix, the risk of lower CPMs remains a persistent challenge. The tension between maintaining high prices through direct deals and navigating the fluid, often undercutting nature of programmatic bidding remains at the forefront of revenue strategy discussions.
Navigating the Programmatic Landscape
Importance of Transparency and Control
The shifting terrain of programmatic advertising has brought multiple challenges for publishers, particularly as the sector leans towards sell-side curation. This emerging trend sees Supply-Side Platforms (SSPs) collaborating with Data Management Platforms (DMPs) to handle and monetize publisher data via curated private marketplaces (PMPs). Proponents of this model assert that it empowers publishers to reclaim the value of their first-party data. However, not every publisher is aligned with this positive outlook. Several issues, including concerns over control, transparency, revenue, and pricing, have tempered the enthusiasm for sell-side curation. Amanda Gomez from The New York Post exemplifies a publisher with significant hesitation about the potential effects of these collaborations. Her reservations highlight the complexities and divergent opinions within the industry as publishers navigate this evolving landscape. The success of sell-side curation hinges on addressing these concerns to ensure it benefits all stakeholders involved.
