3. Cross-platform metrics go mainstream
Just a few years ago, cross-platform metrics were the domain of a handful of companies like Tapad, Nielsen and comScore. But as mobile increased in importance, every publisher and advertiser took a keen interest in cross-device identification. Today my firm sees requests from large companies that want to own the technology themselves. They have the infrastructure in place to manage and analyze the data, they just need help setting and implementing the methodology.
The widespread demand for cross-platform metrics is not surprising. Both publishers and advertisers recognize the need to treat their audience holistically. The last thing an advertiser wants is to offer a new-customer discount to loyal customers already paying full price—a scenario that’s entirely likely if they can’t associate multiple devices to the same user.
4. Increased discipline around quality and valuation of audiences as a result of header bidding and reduced ad load
In a typical scenario, publishers go through a pricing exercise on a yearly or twice-yearly basis. They’ll grab relevant datasets (audience, viewability, fraud), sit around a room, and make a determination as to who their audiences are, which is the best performing inventory and what it’s worth in the market.
But header-bidding is changing that (and if it’s not, it should!). If a publisher is using header-bidding, those valuations are occurring with each impression serviced. That means publishers are getting high-quality insight on the performance of their audiences and inventory on a daily basis. These insights include the impact of viewability, fraud, and dozens of other quality signals on price. It can tell them what advertisers value, and how much of a premium they’re willing to pay for it. And it can tell them how those valuations change over the course of a day, month and season. Smart publishers will put a lot more discipline around these exercises, and will certainly increase their frequency.
5. CPM as the dominant cost basis sees a major challenger
CPM as a metric for buying and selling inventory doesn’t make a lot of sense. It’s wholly divorced from the transaction—a brand purchases 1 million impressions from a publisher, but how many test drives or tubes of toothpaste were actually sold? Increasingly, marketers want to know the business outcome of their ad campaigns, and publishers want to know the financial impact of their efforts to better understand and target their audiences and to improve traffic quality.
CPM puts all the risk on the buyer’s shoulders, while CPA puts it on the seller’s. Neither allows for collaborative, mutually beneficial optimization, and perpetuates black-box valuation.
Both buyers and sellers have signaled willingness to reevaluate cost mechanisms in light of the technical backdrop of big data, and the spectrum of path-to-outcome metrics available. One example of this is the Financial Times working closely with its clients to sell on a cost-per-hour (CPH) metric. Maybe this will take hold, or may simply be an evolutionary step since, as we learned from the election, change is in the air. But this is one area everyone seems interested in re-evaluating.
Benjamin Reid is founder of elasticiti. Follow on twitter @elasticitiinc.