Month: March 2021

The tightness of the traditional TV ad market has led TV networks to whittle down the money that advertisers are looking to spend on their linear networks’ inventory. As a result, an advertiser submitting a $10 million deal to a TV network for its linear inventory is likely to see that amount reduced to the point where a cut to $7 million is considered a win, said the agency executive.

Other agency executives concurred that linear TV ad budgets don’t carry the same weight they once did if an advertiser is unwilling to allow that money to be moved to the networks’ streaming and digital inventory. “TV isn’t quite worth the same as it was in the past,” said a second agency executive.

“It’s not like [the TV networks] are doing anything that doesn’t make sense, but they want to get away from traditional dayparts and demos, and the quicker they can help clients to move in that direction, they’ll incentivize that behavior,” said a third agency executive.

However, the TV networks are putting such a premium on their streaming inventory that it is disincentivizing some advertisers from making the moves to be more flexible with where their ads appear. Whereas cable TV ad prices often hover around $10-12 CPMs, the streaming prices typically range between $20 to $30 CPMs and in some cases stretch much higher than that. 

Last fall when WarnerMedia began pitching advertisers on HBO Max’s forthcoming ad-supported tier, it was asking for an $80 CPM, which many agency executives balked at. The company has since lowered its asking price to a $65 CPM, which agency executives said remains excessive. “That’s still two to three times what we’re spending on Hulu,” said a fourth agency executive.

The price disparity between TV networks’ linear and streaming inventory is not the only hangup that advertisers have when it comes to so-called “fluidity” deals that enable ad deliveries to flow across a network’s linear, streaming and digital inventory sources. An interconnected challenge is that the advertisers worry they won’t get what they’re paying for. 

If an advertiser is paying for an ad to appear in a broadcast network’s primetime show, it doesn’t matter so much to the advertiser whether the ad is served in the show’s linear airing or the streaming version. “But if we’re giving the network the ability to optimize [where the ad appears], the immediate thought is they’re going to run it in unsellable inventory,” said a fifth agency executive. This person said the concern is most acute when it comes to TV networks’ digital inventory, such as the clips they post to platforms like YouTube. “Is an ‘SNL’ clip on YouTube with a 15-second pre-roll worth the same as running in ‘SNL’ on Saturday night? Probably not,” this executive said.

Nonetheless, in pushing advertisers to accept their streaming and digital inventory, the TV networks are being realistic about the state of the TV ad market, and agency executives acknowledged that advertisers will need to be as well. Of course, accepting that reality is much easier than making true inventory fluidity a reality. 

“Once we get past everyone accepting that we’ve got to move in this direction, how can that work?” questioned the fifth agency executive. “You’ve got to get the ability for sellers’ yield management systems to project delivery across screens in this way, and if they’re telling us they’re going to be able to deliver X million impressions across their platforms, how are they able to monitor that and actually do it? How do we post it on the back-end because different platforms are not measured in the same way? All of that gets very complicated.”

Benowitz is working closely with new hire Joy Profet, executive vp and head of growth and operations, who comes with longtime experience on the sales side of Essence Communications, both when it was a Time Inc. property but also when it was spun off.

“I specifically understand the challenges and thresholds that might have unintentionally precluded some of the black-owned and black-targeted media from participating in the traditional processes,” said Profet, who noted that the Equity upfront will be ongoing on a monthly basis, not just a one-off event. “I wouldn’t have taken the role if I didn’t feel there was a true desire to take us from intention into measurable, meaningful action and transformation in this space.”

Benowitz added that IPG’s intentions go beyond just doing good; it’s a matter of reaching out to a cohort that has had a profound effect across society in numerous ways. “This audience are influencers — they’re at the forefront of fashion, music, culture and social justice,” she said. “Those are things we see more and more that consumers are responding to. And our current spend is just not reflecting where we should be.”  

Benowitz and Profet both cited deep research from MAGNA that shows Black consumer spending potential is estimated at about $1.4 trillion. Additionally, it’s a younger audience, with an average age of 32 and that Blacks Americans are at least two times more likely to start a business. “This audience also feels that advertising needs to do a better job of representing them,” added Profet. “They’ll consume content they believe does a better and more authentic job of representing them.”

The ultimate hope, explained Benowitz, is that the Equity upfront will become something akin to the Newfronts, growing into a marketplace in which all agencies participate — but for this year it’s just IPG. Future Equity upfronts will address other specific segments, including Asian Americans and the LGBTQ+ community. 

On a smaller scale and largely overlooked when it was announced last month, Dentsu partnered with minority-owned broadcaster Urban One with support from GM, P&G and Kroger to launch an audio program called More Than That with Gia Peppers, featuring Black guests tdiscussing topics that impact Black audiences. Part podcast and part radio show, Peppers’ program will “dive into the worlds of the award-winning writers, venture capitalists, social activists and advocates for wellness,” according to a Dentsu release.

This Creative Shop Started a Media Department, and Good Things Happened

Hanson Dodge, a Milwaukee-based creative shop, found a new gear of success when it opted to bring media in-house in 2019.

Michelle Millar, now the vp and group director of media and activation media incorporation (and a former media executive with Best Buy and Haworth Media), started consulting with Hanson Dodge in mid-2019 to form a media unit, then formally joined December — right before the coronavirus pandemic hit. Since then, the department has grow from three to seven people and has led the charge on some of the agency’s new business and bigger clients.

Millar pointed to Creminelli Fine Meats as a media-driven win, and work with Keen Utility footwear that cemented media’s place in Hanson Dodge’s DNA. Media “drive[s] the ship on what we do for [Keen] and we more than doubled their business” via a shift to e-commerce from marketing brick-and-mortar outlets, she said.

With Creminelli, Millar said the ability to create an integrated strategy “allowed us to come up with different solutions than if you had separate media and creative agencies working on it.” For example, Millar and HD’s creative director Joe Ciccarelli are working together to not only identify foodie groups inclined to purchase specialty meats, but then tie the messaging directly into the channel/media, be it a food publication headline or a food blogger’s post (the campaign hasn’t started yet).  

Color by numbers

It’s no secret that the pandemic — literally a year old this week in the U.S. —has led a surge in online and digital behavior across all consumer segments. What it has not necessarily led to though is a rise in consumer satisfaction with the experience, according to research issued last week by Broadridge Financial Solutions.

The company’s survey, conducted among 3,000 U.S. and Canadian consumers 25-plus last December, found that while 70% of consumers have interacted digitally with at least one provider, almost 60% believe companies need to improve their customer experience – among younger, more digitally-savvy millennials, that latter number rose to  71%.

Once they did interact, a huge 84% of consumers said they expect companies to make it easy for them to interact across print, digital and other channels. It seems companies have a way to go in delivering on that satisfaction if it’s not made easy or at least personalized. More than two in five consumers (43%) stopped doing business with a company because it did a poor job of personalizing the experience, led again by millennials (59%) and Gen Xers (51%) compared to only 28% of Boomers.

Take off and landing

• IPG’s Mediahub landed media responsibilities for pest control firm Terminix, while corporate sibling The Martin Agency secured creative duties. The estimated $35 million account had been split between Barkley, which had handled creative and offline media, and Tinuiti, which handled digital. First work is expected out this spring.
• San Francisco-based market accelerator consultancy Traction, which specializes in helping in-house brands, hired Brian Hovis as senior partner and head of performance marketing. Hovis was most recently vp of marketing for Nordstrom.

• In sad news, Horizon Media last week announced that Serena Duff, its longtime executive vp and general manager of the West Coast region, passed away Feb. 26 at the age of 54.

Direct quote

“As media partners, we have to make sure that we’re testing alternative solutions to the cookieless world. Every holding group should have a solution. With us, we’re working with [internal data unit] Kinesso on how to empower clients with first-party data to ensure they’re going to succeed. Obviously, clients that are heavily dependent on third-party data and that have invested in DMPs are playing massive catchup and they’ve spent a lot of money on this technology that we need to have alternative solutions [for].”

— Amy Armstrong, newly minted global CEO of Initiative, responding to Google’s announcement it will stop behavioral tracking online behavior.

“One of the things we’re noticing from new business conversations, is a bigger focus on planning campaigns around audiences, and not channels. Advertisers are trying to get away from bombarding audiences with ads, which means gaining a better understanding of the context of environments where ads might appear. We’re also looking at connected TV  as well as the changing roles of big platforms that were just performance channels, but are branding ones now too.” 

— Amanda Morrissey, global president of Dentsu’s iProspect, which recently merged with Vizeum, responding to a question from Digiday’s senior news editor Seb Joseph about where the company’s growth will come from in 2021.

Speed reading

• Digiday senior media editor Tim Peterson looks at the need for both buyers and sellers in this year’s upfront marketplace to adjust to new realities, from declining linear viewership to greater flexibility in looking at non-linear platforms including YouTube viewership.

• Digiday’s platforms, data and privacy reporter Kate Kaye examines the impact of Google’s bombshell decision last week to stop tracking and targeted advertising, and how some ad-tech players are trying to find the positive in the news.

• Future of Work managing editor Jessica Davies reports that families have been under acute pressure to meet work and financial commitments while also homeschooling their kids through various rolling lockdowns over the last year. Meanwhile, kids have suffered their own anxieties and mental health issues as a result of the pandemic. To address this, agencies have invested extensively in mental health and wellbeing support programs.

• Variety explains the thinking behind Nielsen unloading its advanced video ad business to Roku, which propels the surging streamer into the addressable advertising game and places the research giant squarely in the measurement space.

• Wired takes a look at the less-noticed, but equally disturbing, impact Tik Tok had on radicalizing MAGA supporters, in large part because of the way its algorithms operate.

• CNBC analyzes how the possibility of Amazon securing exclusive rights to the NFL’s Thursday night package of games for its Prime unit could have massive ramifications for its larger advertising ambitions. 

We heard about the strategies publishers had deployed to steer their organizations and audiences through the storm of the COVID-19 pandemic, and how those will inform the publishing business going forward. However, one critical theme that emerged from the Summit was that there’s no time to sit back and wait for life to return to “normal.”

Vaccines have raised hopes that we are moving toward the final phase of the pandemic, but an improvement in external circumstances will only expose a publishing industry in flux. The third-party cookie is in its death throes, and publishers need to act now to put robust first-party data strategies in place.

In video and television, the explosion of OTT and CTV has been a game-changer, and the money is following. The challenges ahead include standardization, streamlining and measurement. Meanwhile, publishers are redoubling their efforts to build and retain audience, and there are exciting developments in podcasting, e-commerce and much more to look forward to through 2021.

What publishers do in 2021 will chart the course of their business for the next several years, so now is the time to be proactive and energetic about tackling the challenges head on. After the year we’ve just been through, there are plenty of reasons to be optimistic. “We are a really resilient industry,” said Jason Tollestrup, vp, programmatic strategy and yield at The Washington Post. “I feel like every year there’s something that comes out in the marketplace that’s going to end advertising, and yet here we are, we’re still growing.”

The future of data strategy is now

The first months of 2022 will be the vanishing point for third-party tracking, and the switch could come as early as January. We heard one speaker after another reiterate that the time for talking is over — publishers have to get moving on finding the best solutions for their business. Building effective partnerships now will smooth the path toward life after cookies.

Publishers who succeed at building a strong first-party data troves will set themselves up for success in the post-cookie era. How they go about doing this is a matter for each publisher to decide. “There’s really no one-size-fits-all answer,” said Tollestrup. “It really depends on what type of publisher you are.” Subscription and newsletter models give publishers ready-made tools for authenticating user data. For publishers weaker in these areas, other strategies may be more apt.

Communities and consent

Gathering first-party data effectively involves more than just throwing up a subscription form on a landing page. “There needs to be some sort of value exchange,” Tollestrup said. “Why is the user going to turn over their information to you, and what benefits are you are you giving them?”

Building robust first-party data operations will go hand in hand with consolidating consent and trust between publisher and audience. That’s a multi-pronged task, but in essence it’s about forming solid communities around media brands, and that’s a theme many of our speakers touched on during the summit.

Kristin Heitmann, chief commercial officer, global media and marketing solutions at The Wall Street Journal and Barron’s Group, said strategic partnerships are a key plank of The Wall Street Journal and Barron’s efforts to bolster affinity within distinct audience communities. “Ideally they are multi-year partnerships because that allows both us and the partner to build an audience, to build community,” Heitmann said. “It doesn’t work as well if it’s month to month.”

Capitalizing on the OTT and CTV Revolution

The pandemic triggered a major shift in the way viewers consume video and TV content, with subscriptions to streaming platforms skyrocketing through 2020. That will continue, says Andrew Tint, head of programmatic partnerships at DISH Media. “There is still massive movement from linear over to the virtual MVPD and the OTT ecosystem,” Tint said. “Our viewership went from 3.3 hours a day to 4.2, our uniques went up to 11 million. We are essentially growing at a pace that is eclipsing even what I think we had expected, 700 million avails to 1 billion.”

“We’re seeing growing convergence of buyers and sellers around optimization of both the supply path and demand path. Increasingly, it’s simply more rewarding for both parties to have fewer paths to purchase, and to build trust around collaborations,” said Ryan Kenney, vp platform at SpotX. “While the open marketplace is useful in some scenarios … those one to one relationships are really where the buyers and the sellers want to be,” he added.

Fragmentation in the OTT/CTV space is a clear inefficiency. There’s a lot of discussion around the consequences of fragmentation and a chorus calling for standardization of performance measurement, as well as murmurs around how the industry might consolidate further down the line.

Look for improvements in ad technology across all areas of publishing to push progress throughout 2021. The Washington Post’s Zeus suite serves as just one example of the kind of technology that empowers publishers to increase ad revenue, optimizing ad supply and also the speed with which ads are served. Buyers will continue to appreciate the kind of flexibility they were offered during the pandemic, and streamlined approaches to programmatic buying could be extended to other areas of publishing. 

Other Notes …

We heard from a number of leaders about the introspection — and action — that their organizations are undertaking to make their organizations more diverse and inclusive in 2021. Nobody is under any illusions about the shortcomings that exist in terms of opportunity, compensation and discrimination, but publishers are committing to a range of initiatives and projects inside their workplaces and externally to improve conditions for employees and to engage with communities who have often been overlooked or shut out.

“This is not a siloed HR initiative,” said Forbes CRO Jessica Sibley. “This has been a company-wide, top-down, bottom-up process. We’re listening and we’re learning, and we’re all committed to doing the hard work.”

Podcasting had a bumper year in 2020, with A-list celebrities launching shows and high-end production values becoming more prevalent. Sebastian Tomich, svp, global advertising, marketing solutions at The New York Times, said expectations are bullish for the year to come.

The company’ strategy is focused less on quantity and more on producing talent-driven hits that appeal to distinct demographics. The Times is expanding its roster of shows led by star reporters like Kara Swisher and Ezra Klein, with its recent acquisition of the Serial brand a major coup. The trick is finding the optimal relationship between talent and advertising. The Times maintains a firm line that hosts will not do ad reads — instead, they are investing in a creative suite tasked with devising innovative ways of shaping ad messaging within podcasts.

In terms of alternatives to traditional advertising, publishers are harnessing e-commerce more effectively than ever, recognizing the role they can play as funnels serving a specific community’s needs. Catherine Levene, national media group president at Meredith, said affiliate e-commerce is a great fit for many Meredith brands, since they’re already in the business of serving recommendations and product inspiration. In contrast, Levene said, media brands are less suited to stocking and managing physical inventory.

Vox Media’s svp of e-commerce, Camilla Cho, gave us a deep dive into best practices gleaned from The Strategist’s Two-Day (Actually Good) Sale in summer 2020. Cho said the event was “tightly curated” to ensure it delivered genuine value to The Strategist’s audience. “We wanted to make sure there was going to be something for everyone and ensuring that this was going to be actually good deals, not just run of the mill 10 percent off discount codes that shoppers can find anywhere,” Cho said. Items were only included if brands were able to offer the product at record low prices, or at least the best prices offered within the year to date. 

WTF

SPACs

Both in publishing and elsewhere there’s a lot of buzz right now about Special Purpose Acquisition Companies, or SPACs. These investment vehicles are attracting interest because they offer publishers a less demanding path toward raising capital on the public markets than the traditional IPO route. Bustle Media Group founder and CEO Bryan Goldberg spoke bullishly about the prospects of SPACs for publishers like Bustle, particularly given that venture capital cash has been hard to come by for media companies in recent years.

However, Catherine Levene of Meredith warned that going public in any context imposes unique challenges for the publisher. “There’s transparency like you’ve never seen before, and you’ve got to grow, so the proof is in the pudding,” Levene said.

Overheard

“Make sure that when it comes to February next year, don’t have some big project planned, because we’re going to have to all shift really quick when they decide to pull the lever.” — Jason Tollestrup, vp programmatic strategy and yield, The Washington Post

• Every publisher’s top priority in 2021 has to be to recognize that third-party data is effectively over as it stands and to get busy with forging the future of data. Tollestrup advised publishers to be rigorous in testing their plans for the post-cookie era, and to make sure they aren’t caught off-guard when the switch comes.

“What I see readers and advertising partners react to most positively is when we are willing to walk away from something in order to reinforce what our principles and what our mission is.” — Regina Buckley, president, Guardian U.S.

• Audience trust has never been so important to a publisher’s work as it is today, affecting not just the way the consumer engages with the publisher’s output but also the bottom line. Regina Buckley said publishers like the Guardian appeal for trust by spelling out a sense of mission, as well as being upfront and transparent with its community. Drawing clear lines as to what the company will not do for short term gain can stand the publisher in good stead for the long term, Buckley said.

“What are the right cuts that are going to make sense for a YouTube environment that might make a seven to ten minute video? And then also what is the full length piece going to look like on TV? We’re really thinking about it cross-platform at the beginning, so that things don’t feel repurposed in a way that the user is going to reject it.” — Jean Ellen Cowgill, global head of new ventures and GM of Bloomberg’s Quicktake

• In an ever more fragmented content ecosystem, publishers have to be thinking constantly about platform-appropriate ways to tell each story. Cowgill talked about how Quicktake devises content for distribution across multiple video and streaming formats — Quicktake’s largest audiences are still on YouTube and Twitter, but its content is also streaming across a growing range of CTV platforms including Samsung TV Plus, Apple TV and Roku.

“Around 20 percent of the U.S. population is Latino, and there’s a real issue of representation because definitely not even close to 20 percent of English language media reflects that reality.” — Romina Rosado, evp, entertainment and content strategy, Telemundo

• Rosado said the imbalance she highlighted is just one of the reasons why Telemundo plays such a critical role within Latino communities. This is vital not just in terms of representation, but also because the bond that Telemundo enjoys within communities gives it a platform that to challenge the kind of misinformation that has sown mistrust around vaccines and hindered messaging around other issues during the pandemic.

Stats to know

The period between March and October 2020 saw an 800 percent increase in monetizable advertising opportunities in the smart TV space alone. SpotX’s Kenney shared that data point to draw attention to the enormous potential that exists in OTT and CTV advertising — and that that kind of aggressive growth could well continue right through 2021 and beyond.

OK, let’s start with the basics. What has Google done?

Google’s latest statement boils down to two things: the first is that Google won’t build any user-level identifiers to track people online once third-party cookies are blocked from its Chrome browser. Perhaps more worryingly for the ad industry, though, is that Google has said these identifiers are not a good idea. It doesn’t believe they pass consumer expectations for how their data is traded nor does it expect those solutions to meet future regulatory standards.

“I think the legal case for addressing individuals on a one-to-one basis based on their external web browsing/content consumption is indefensible to start with when relying on third-party infrastructure for identity matching based on personal data, whether it’s hashed or not.” said Ruben Schreurs, group chief product officer at Ebiquity. 

Wait. What is a user-level identifier?

There are many user-level IDs competing to be the next standard to the third-party cookie, but it’s more likely that there will be a set of them, with different marketers using different ones based on their needs. Many of the more popular ones don’t rely on third-party cookies. Even so, that doesn’t make them privacy-compliant, as Google’s update suggested. For example, a number of IDs are focusing on hashed emails. There’s just one snag. These solutions could be — or have the potential to be — based on a consent model that seemingly decides any user who logs into a publisher has agreed to be tracked by all companies in the large alliances and networks being assembled across the industry. Google seems to think this will be the case.

But user-level identifiers have been in the firing line ever since Google announced third-party cookies were going. Why the big fuss?

While the update made it clear what Google thinks will happen to user-level identifiers, it had scant detail on whether it would block them from its owned and operated marketplace. If it did decide to go to war with these alternatives to the third-party cookie then that could be a big problem for many ad tech vendors. Observers got a glimpse of how big of a problem it could be when The Trade Desk’s stock dropped 20% over the two days after Google updated its stance on user-level identifiers, per CNBC.

“Google is subtly warning that alternative data identification models are at risk within their ecosystem and competitors, customers and partners need to be concerned about the long term implications of that,” said Bob Regular, CEO of ad tech firm Infolinks.

Could Google really go to war with the rest of ad tech over user-level IDs?

Stranger things have happened. After all, this is the same company that decided — weeks before the arrival of the General Data Protection Regulation in Europe — it wouldn’t share log-file data with marketers, a move that effectively kneecapped those who relied on that data for cross-device attribution. Google could be just as brutal this time around.  Indeed, the company has already made it clear that it will do what it can to prevent users from being targeted in unwanted, non-first-party ways. Whether this would translate into a full-blown block on those identifiers from Chrome is another matter altogether given Google is being watched by regulators. If it did make the move then it could be difficult to defend as Google is still using its own identifier on its own properties. To turn around and tell other businesses they can’t do the same could get tricky. Still, stranger things have happened.

“If Google can find the legality to do it, then it will be actively blocking it on the browser [Chrome] side,” said an agency exec who had met with Google execs to discuss the plan. “This doesn’t bode well for companies that are relying on an alternate identifier to grow.”

Will this push the rest of the market to pivot to Privacy Sandbox?

There are a lot of questions that Google must answer before consensus is reached. Much of the uncertainty is around if and how Google will privilege its own ads business over others. Questions like whether Google will have exclusive access to certain information from FLoC (Federated Learning of Cohorts) or any other parts of its Privacy Sandbox, or if it will stop using user click data for its own targeting, are being raised in meetings behind the scenes.

Google is often accused by marketers, publishers, and ad tech vendors alike for leveraging its technology — whether it’s the buying platform or the marketplace — to actually manipulate their revenue. If companies are going to bite the bullet and back the Privacy Sandbox then Google must be more open about its intentions.

“Replacing third-party cookies via cohorts rather than universal IDs, is a positive step towards a privacy-safe future for digital advertising,” said Joe Root, CEO of Permutive. “The challenge is the chaos this will cause in the interim, Google is all in on Privacy Sandbox proposals, which massively benefit Google — I can’t see Firefox and Apple implementing it.”

So, is this about privacy or a monopoly?

In many ways, it’s about both. While Google’s update tries to prove to the world that it’s acting ethically and with consumers in mind, it’s hard to ignore the more monopolistic agenda this could point toward. Not long after unveiling its FLoC solution, it could be argued that Google is trying to nudge advertisers to switch their focus to cohort-based targeting. Is this another example of a tech giant using the death of the cookie to give its own products an advantage within its walled garden? The Competition and Markets Authority (CMA), which are already investigating Google’s Privacy Sandbox tools, will have to respond.

“What this also reminds us is that digital advertisers cannot put all their faith in ID-based solutions for the post-cookie world,” said Peter Wallace, managing director, EMEA at GumGum, an ad tech company that specializes in contextual advertising. “That’s why advertisers will have to turn to solutions that don’t rely on PII data to create a more level playing field and allow a unified targeting strategy across the walled gardens.”

Help me read between the lines here?

Google is signaling aggressively that the era of direct consumer targeting as we’ve known it is ending. It pushed some ad businesses close to the ledge and made others walk back from it. The difference between the two groups is an acceptance that they will need to build their business around the Privacy Sandbox rather than hoping to find an alternative to it. Companies can still make money this way, they just need to make peace with the fact that they may never understand why their campaign ‘works’ or not and will be dependent on Google’s technology for future success.

Getting the market to depend on Privacy Sandbox is the new monopoly for Google going forward, and it’s one with greater scale because it removes the intellectual property of targeting and data knowledge, from the market and everyone else.

Why are marketers in a tizzy?

As it stands, there’s no strong solution for user-level attribution when third-party cookies go away. Sure, there’s a part of the Privacy Sandbox that’s focused on post-click attribution, but it hasn’t gotten very far. The hope had been that Google would be open to the idea of an alternate identifier being linked to its own identifier. However, that’s not going to be the case. So, it’s back to the drawing board for many marketers. 

“While the news certainly created immense uncertainty, it’s clear that when it comes to attribution, the ship has sailed on many of the current granular models that were universally applied across all spend,” said Mario Diaz, CEO at contextual-targeting vendor Peer39. “We’re looking at a world where marketers will have different attribution models based on where they’re running.  This also paints a clear road ahead for marketers to start looking at alternate data solutions that can survive these challenges, and still be universally applied.”

And where there is advertising money flowing, there are agencies to step in and help direct the stream.

While the opportunity to place ads on Black-owned publications became en vogue amid the social unrest movement over the summer, Black-owned media has been left disappointed in the months that followed that it took marketers so long to realize that their properties are worth investment.

“There has been a slight knock-on effect after the increased awareness of the Black Lives Matter movement last summer,” said Mariel Richards, CEO of U.K.-based magazine gal-dem. “Which is kind of bittersweet because it’s a good thing that we’re able to support our staff and our community with increased commissioning budgets that comes from this advertising. But it is frustratingly familiar that this money is coming from a time of crisis and that it takes a tragedy for this attention to fall on us.” 

GroupM, Havas Media and H Code all launched new multicultural private marketplaces or networks in the past year for brand clients to more efficiently buy ad spots in Black-owned media companies at scale. But some independently owned media companies are refraining from joining these agency networks, despite indications that the marketplaces are bringing in new clients and sales for publishers that are participating.

In June, Havas Media Group launched its version of a multicultural marketplace, its so-called social equity marketplace, in the U.S., later creating marketplaces in the U.K., France and Germany. The expansion will soon come to Spain.

The marketplace in the U.S. quickly gained steam and now claims that one-fourth of its clients are active in it. Furthermore, the marketplace offers programmatic ads for more than 1,200 BIPOC- and LGBTQ+-owned and operated publishers and media partners, including podcast creators and CTV channels, according to the company’s global head of programmatic, Ben Downing.

In its U.K. iteration, campaigns saw a 25% uplift compared to D&I-focused campaigns not purchased in the marketplace. And in all of the global social equity marketplaces, transactions have been consistent and growing since launch. In other words, clients are not just using the marketplace during key moments for Black audiences, such as Black History Month in the U.S., Downing said.

GroupM has had a multicultural division since 2006 but launched its programmatic multicultural marketplace in July. The PMP started with a portfolio of 300 sites. It now includes more than 500 media sites primarily operated by BIPOC creators or produced for BIPOC audiences, versus being minority owned.

The marketplace has brought in 20 to 25 new clients into the multicultural division, according to Gonzalo del Fa, president of GroupM Multicultural, but he said he expects significant growth in 2021 as his team moves out of the strategizing stage and into the execution phase. Especially when it comes to programmatic.

“We did have a lot of client interest, what became the challenge is that most of those sites were not set up programmatically,” said Susan Schiekofer, chief digital investments officer at GroupM, adding that her team consulted with the publishers in the marketplace to help set them up for programmatic transactions.

Overall, these marketplaces have convinced brands to more regularly allocate a portion of their advertising budgets to publishers that they might never have worked with before. This moment of time has also gotten brands to spend around new key moments. Schiekofer added that this was the first year ever that her team has had clients ask about Juneteenth campaigns.

But as agencies become more involved in the process, independently owned publishers say they lose direct contact with potential new clients, as well as autonomy over who is advertising on their sites and what they’re able to charge, leaving many skeptical and hesitant to join these marketplaces.

“After everything that came with Black Lives Matter, there are lots of agencies and organizations that are making quick money off of saying they are able to put a badge of diversity and ‘wokeness’ on a brand, without that brand having to actively engage with that community,” said gal-dem’s Richards. “It didn’t feel just like the normal moving and shaking of the advertising world, it felt much more like exploitation than it would have in any other circumstance.”

Richards said that gal-dem was included as a publisher in one multicultural marketplace for an agency that “specializes in buying diverse media,” despite not having had a conversation with that agency about the magazine’s inclusion. Richards would not disclose the name of the agency, but said that the experience left “a bad taste in my mouth.”

The advertising industry has historically been dominated by the white male demographic, Richards said, and in these situations, the agencies become the middlemen that profiteer on the money that is being earmarked by brands to support Black-owned media companies.

REVOLT, a music-oriented digital cable television network founded by rapper and producer Sean Combs, was approached by GroupM to join its multicultural marketplace, but turned down the offer, according to the network’s evp of ad sales Mike Roche.

In the past year, Roche said REVOLT added 40 new advertisers. Joining a PMP would not have allowed the company to gain the scale at the depth of spend it could reach on its own.

PMPs allow brands to “check the box of buying Black-owned properties through small allocations of media,” but the “brands that are looking to make the greatest impact on the culture” usually work with REVOLT’s in-house agency, Roche said.

The Plug, a newsletter turned online media company covering innovation and entrepreneurship in the Black community, also has not worked with any multicultural PMPs or media buying agencies, said the publication’s founder Sherrell Dorsey.

“It’s not a matter of being left out,” however, she said. “It’s when you’re looking for critical mass, sometimes the niche spaces just don’t fit. And I’m OK with that.”

Dorsey noted that the brand saw an increase of requests from brands over the summer, but declined to count this uptick in true growth and instead called it artificial.

That interest also began to wane by the start of the fourth quarter, she noted, with a slight pick-up again ahead of Black History Month last month.

“I think that you kind of have that crop of advertisers who feel like they’re doing Black media publishers a favor when they are approaching them and looking to advertise, but they don’t want to spend market rate for what it costs,” said Dorsey.

For many of these independently-owned media companies covering topics and reporting stories that have been largely marginalized by mainstream media, this additional ad revenue becomes even more crucial to their operations, so agencies taking a portion of that makes it an even murkier situation, Richards said.

“Not only do they take away your agency in terms of determining which brands are present on your website — which potentially could affect how people view your editorial integrity when reading it — but also they start to determine how much that that audience is worth,” Richards said.

Further more, gal-dem typically sets its CPMs between £15-25 ($20-35) due to its selective nature around who the advertisers are and the number of ads that run on site. But the agencies that Richards has spoken with in the past encouraged the magazine to drop its CPMs to £4-6 (about $5-8), even though publications of a similar size that have a whiter audience are being sold at £10-15 ($14-20) or £15-20 ($20-17) CPMs. Not only does it make Richards question the motive of the agency, but she said it is also very transparent that advertisers do not see Black audiences as having an equally high value.

“We’re trying to make a shift in how dollars are allocated, how campaigns are built. Let’s talk about a strategic relationship with a brand that goes six months, a year, two years.” said Damian Benders, general Manager of B Code Media, a division of multicultural advertising agency H Code that focuses on connecting brands with Black audiences.

In January, the B Code division was officially launched and rather than only being a programmatic solution to selling Black media at scale, Benders said that his team focuses on researching insights into Black audiences then takes a consultative approach to helping brands build campaigns that are meaningful.

“Black media suffers from the problem of building scale across a fragmented landscape. There’s a few top players that are bigger companies that have a bunch of brands, and then there’s hundreds of smaller players who are minority owned [that] aren’t getting most of the money,” said Benders.

Some publishers are taking the issue of limited scale into their own hands and either formally (or informally) creating their own networks of multicultural publications.

Roche’s solution mirrors the industry: He said REVOLT will launch its own version of a PMP by the end of the year, which will focus on creating a network of YouTube content creators and digital publishers.

Richards said gal-dem informally works with other U.K.-based niche publishers regularly, and will share RFPs that don’t fully match its specific audience.

Brands want to make sure they “get the scale within the community they’re trying to reach. That’s totally feasible outside of working with a white guy who says that he can buy programmatic advertising. And often we can do it more effectively because then you’ll get access to the talent directly through the publications,” she said.

Google touches Salon’s ad-selling universe “with a heavy hand,” said Justin Wohl, chief revenue officer for the publisher. Salon doesn’t have a direct sales team and doesn’t use private marketplaces to fill ad inventory, so the publisher is particularly reliant on Google. According to Wohl, 30% of the ad dollars that Salon received in the last month came through Google.

Google’s changes limit targeting in its ad exchange to relatively untested audience cohorts-based methods, which group people together into behavior-based audience clusters rather than targeting them on an individual basis. As a result of the targeting limits, publishers are expecting a hit and adjusting their programmatic revenue forecasts. “It’s a lot of potential dollars that could be devalued,” said Wohl.

Along with confusion surrounding the details of Google’s changes, the programmatic marketplace is itself so complex and opaque that some publishers can only guess at the ad revenue fallout. “We don’t have visibility into how much of the third-party ads running on our site via ad tech middlemen are impacted,” said Clark Benson, CEO of pop culture list publisher Ranker.

Google’s changes emphasize the use of first-party data, which both advertisers and publishers expect to be able to use to inform audience cohort segments, according to publishers and advertisers Digiday spoke with for this story.

First-party pivot
Google’s move only reinforces what publishers already knew about the importance of creating strong first-party data programs to insulate themselves from third-party cookie crackdowns in Apple’s and Google’s web browsers. “We are already risking 50% of our revenues from the moves in Apple and Chrome without a first-party data solution,” said a magazine publisher who asked not to be named. A lack of authenticated site visitors is also a concern, said the source.

Eventually, said Wohl, Salon intends to enrich its open market bid requests with first-party data, which the publisher is in the process of building.

But whether to push to generate more authenticated user data is no simple decision for Salon. The publisher has made a point of allowing readers to visit its site anonymously, and building up its own database of known users would require Salon to push people to register accounts with the publisher.

“To generate more first-party connections, Salon would have to put an ID gate in place and we’ve been really hesitant to do that,” said Wohl. “It’s a big pivot to say, ‘You know what? We want to track you in a big way.”

Another publishing exec who asked to remain anonymous said their site has been building out its first-party data program for three years now. So, the publisher can send those first-party signals along with inventory into non-Google exchanges to enable more targeted opportunities for advertisers than Google’s aggregated cohort-based methods.

Questioning identity tech
Google’s decision to stop allowing ad targeting using “alternate identifiers” built from hashed personally-identifiable data or emails in inventory it sells has some publishers Digiday spoke to wondering whether those technologies will be viable in other DSPs in the future.

Salon is among some publishers that are testing multiple cookie-replacement identity technologies from companies such as LiveRamp and ID5.

Others like BuzzFeed are holding back. Google’s change won’t necessarily drive any decisions about identity tech; advertisers will. “My comment on those solutions is that they’re going to be advertiser-driven. No one publisher is going to say they use one solution,” said Ken Blom, Buzzfeed’s svp of ad strategy.

Google will continue to enable alternate identifiers in its Chrome browser environment, and it will not block publishers using Google’s ad tech products for ad management purposes from using them. Publishers Digiday spoke to said they’ll look to other DSP partners if they want to sell inventory with alternate IDs attached.

Some publishers are OK with cohorts
Ultimately, despite the fact that some more vocal publishers have been critical of Google’s cohort-targeting approach and are skeptical of its performance capabilities, some publishers told Digiday they are interested to try Google’s Federated Learning of Cohorts (FLoC) method.

“All that open exchange revenue I get from Google will have some sort of FLoC identifier on it, so it’s OK,” said one publisher who asked not to be named.

BuzzFeed, which just launched an audience data platform called Lighthouse, backs Google’s approach — so much so, said Blom, “We want to do the same thing around custom cohorts with advertisers.”

But between Google and publishers, there is always tension, and while Blom said he expects to be able to leverage BuzzFeed’s first-party audience data in conjunction with Google’s cohorts, little is known yet about how the cohort process will work.

“It does sound like a black box,” he said.