Premium Pricing for Premium Content

Programmatic inventory – just say those words and in some circles, you can expect to cut CPMs in half (or worse). After contending with crappy long tail inventory, viewability issues, and fraud, it’s not surprising that advertisers want to pay less via programmatic channels. But they don’t have to. If you have premium inventory to sell on programmatic channels, you can command premium prices. And it’s entirely possible that 100% of your inventory is premium. But first, you need to make sure you’re calling a spade a spade. After working with many premium content publishers while at Operative, I’ve drawn some conclusions on what warrants premium pricing via programmatic:

Your Content is Professionally Produced

It all starts here.  Whether text or video, premium content must be created by talented writers and directors.  Without it, you won’t have an audience that’s valuable to you, let alone one that’s valuable to advertisers. I don’t think I need to say more on this aspect.

Users Love Consuming Your Content

In order for your audience to actually enjoy the content your creative teams produce, the website must be well-designed and the ad experience should be smooth.  This includes the mobile experience, which often gets destroyed without a customized design.  Users understand that publishers need ads to survive, and the ad blocking phenomenon is a direct response by audiences fed up with increasingly invasive ads.  As this mobile-focused article points out, user experience must be taken into consideration when deciding where, how many, and what type of ads you will serve. 

Publishers know what I’m talking about, yet they often get sucked into schemes to increase scale that ultimately erode quality content. In order to avoid the slippery slope of downward price pressure, publishers need to avoid the temptation of putting revenue over quality, because the two are inextricably linked.  Clickbait-style articles loaded with ad units get impressions, but what are those impressions actually worth to advertisers?  More importantly, how do users feel about your site once they arrive, either directly or through other avenues?  Can you count on them to come back again and again to read more content and generate more revenue?

Many publishers have split their content strategy in half. Premium stuff is sold directly and “long tail” stuff is traded programmatically presumably to cut costs – but guess what? It’s still not doing that well. Programmatic might be used by 80% of publishers but from their point of view it still carries negative connotations.  It’s labor-intensive, complicated, and involves far too many intermediaries.  The umbrella issue covering all the negatives is value.  If the benefits outweigh the cost, or, put another way, if yield is managed in such a way that a publisher’s revenue gains more than make up for any additional workloads, these criticisms of programmatic are forgiven.

In today’s landscape, with header bidding all the rage, latency is again threatening the user experience and therefore, the long term success of the content.  Long daisy chains or multiple header bidders (yes, even if they’re wrapped in a container tag) can cause lengthy page load times.  But a publisher can’t simply ignore PMP and RTB, whether based in the ad server or in the header.

Thankfully, there are steps you can take for both options in order to cut down on load times.  If you don’t want to go the header bidding route, you can shorten your daisy chain through a flattened waterfall that takes daily allocations into account (labor intensive but highly effective).  For header bidding and its effect on UX, this article, by Chris Cummings of Curiosity Media, is the best I’ve found, particularly his discussion on how to mitigate the negative effects.

You Know Who Your Users Are

Do you really know who you are as a publisher?  The answer to that question must be “yes” if you have any hope of understanding who your audience is.  And understanding who your audience is can allow you to put premium price points on the entirety of your inventory available for sale – particularly programmatic.

When programmatic began, advertisers sought audiences at scale, not caring much about where those audiences were.  There was no context, and thus fraud was rampant.  Publishers that know their content and their audience can provide advertisers with that context across all sales channels.

If you can say, without hesitation, that your site and content is brand safe, and that, as a publisher, you understand that your name is a brand itself, then you can start to get a real idea of how to price your inventory on all channels.  It’s the difference between demanding a price and commanding a price.

Your Team Can Sell Across All Channels

Finally, every customer-facing role must be conversant in programmatic if you want to maintain price integrity.  There is no real reason to lower pricing on inventory that is unreserved.  It’s the same content, viewed by the same audiences.  It should not be viewed as “value add,” especially when the customer is demanding to buy via programmatic pipes. In fact, it could be valued more highly because it can be cherry-picked by the advertiser.

Ultimately, monetization is about premium content and engaged audiences.  If you have the former, you’ll end up with the latter, and advertisers will pay for access, regardless of the sales channel.  You’ll move dollars up the yield curve, from RTB to PMP to Programmatic Direct (unreserved), Automated Guaranteed, and ultimately direct sales and Sponsorships.