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A publisher’s guide for the COVID-19 era

By François de Laigue
Seasoned AdTech executive. Columbia Professor. Microsoft alum. MIT.

 

Winston Churchill is remembered as a hero and a leader, not because of his time before the war (he was sidelined and discredited), but rather his time during the war when he displayed exceptional leadership. That’s because true leadership is not needed when everything is under control, but rather when things are at their worst.

As of April 17, nine major publishers laid-off or furloughed an average of 8% of their employees, many in their sales departments (AdExchanger). And we’re only a month and a half into what looks like a multi-quarter recession. Not everyone is born to become Churchill but we all play our parts and all have an opportunity in front of us to demonstrate true leadership!

What can I do Today? Weather The Storm.

In the teeth of the storm, a ship’s survival depends on two things: sea room and steering-way. Sea captain Max Hardberger.

  • Sea room is a safe distance from anything it might crash into, like a coastline
  • Steering-way is sufficient propelling power to steer rather than getting pushed around by the waves and wind

Similarly, what can publishers do to weather the storm?

Sea-Room: How Far are you from the Irreparable?

 

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For a publisher, 3 key considerations apply:

  • Demand drop: Adomik tracked a drop of 30%+ in March across programmatic buyers (whether direct demand or open exchange). In the US, we’ve seen a significant CPM drop (-40% over March, flat in April) while ad requests and impressions sold rose, but not enough to counter the CPM drop. We all know why. 65% of CMOs are bracing for moderate to significant budget cuts (Gartner) and 70%+ of campaigns have been canceled (IAB). The overall trend largely depends on economic activity which is expected to pick back up in the second half of the year and see accelerated growth through 2021 (as forecasted by Goldman Sachs, JP Morgan, DB).

 

  • Bad debt and write-offs: as we enter a period of recession, buyers with weaker business fundamentals may leave your accounts payable departments hanging dry. Being able to understand who’s best positioned to be a viable partner and cutting your losses today could turn invaluable. We have run DSP-level analysis for AdExchanger. The majority of DSPs’ spend compressed by 30%-50% over March. Some have much of their spend concentrated within a smaller customer-base which can be a double-edge sword: these DSPs can pivot faster to capture budgets and represent much needed demand, but also tend to be skating atop thinner balance sheets.

 

  • Opportunity cost: This crisis has taken the world by surprise. As a response some companies resorted to layoffs to lighten their P&L. The weight of these decisions far extends beyond what can be read on a P&L or balance sheet. Employee morale, lower employer brand, soured ex-employees, innovation opportunity cost, strained relationships with clients and partners can all come to haunt your company. Worse, they may signal an unimaginative leader unable to navigate challenging times. I personally subscribe to Peter Drucker’s wise words: “If we were to decide now, would we still enter the businesses we are in today?” which help tease out your company’s core strength and focus. If the answer is no, then perhaps it was never meant to be and now would be a time like any to divest the parts of your business that don’t accrue to its mission. Short of that, layoffs are most often a bet against your own company. It is worth noting that economic signals pointed to a recession around now as of the past 12+ months.

Steering-Way: Drive Viable Traction

Just like ‘steering-way’ is the ability to propel and steer your ship out of danger, it is critical for publishers sales teams to operate optimally during these difficult times – this means working smarter, not harder! For programmatic and media sales team, the question remains: When budgets are shrinking (almost) everywhere, which brands should I talk to?

 

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Using the Adomik platform, this is what we found: during the crisis, budgets started shifting on a weekly basis, including for top brands. March saw a decline in demand overall. But here’s the bright side. During March, 32% of large and mid-sized brands (i.e. representing the top 75% of spend, excluding long tail brands) initiated or grew their programmatic ad spend via directly sold and negotiated deals. These brands were primarily mid-sized brands with smaller shorter-term budgets than the usual juggernauts, many of which have decreased their spend.

In order to capitalize on where budget increases are and depend less on declining budgets, publisher sales teams need to refocus accordingly. Doing so will require some agility!

 

  • sales velocity: with deals usually going on for quarters with the largest brands, and month(s) for mid-sized brands, the current deals are to be planned in weeks (1-2 weeks). There are also more than 10x more mid-size brands than there are in the top quartile, which means 10x more potential opportunities for your pipeline.
  • deal size: third quartile brands are significantly smaller. For every $100K that a top quartile brand would spend, we see that a third quartile brand spend $8K.
  • deal cycle: fortunately, smaller companies tend to be much more agile and you may be able to close deals in a shorter timeframe
  • pitch: during the crisis and upcoming recession, it is key to highlight value, especially in the US where CPMs have taken a black eye.

 

With a high throughput pipeline, the key is focus. You can burn a lot of cycles knocking at the wrong doors.

Strategically, I recommend following Gartner’s 3 categories of Dark Sectors (travel, brick & mortar, etc), Shaded Sectors (automotive, tech & telco, utilities, etc) and Spotlights (news, essential CPG, etc). Adomik found the same brand vertical clusters in our analyses of the programmatic market. Having a strategy that weighs in on spotlight and shaded sectors will be key to navigating the next few quarters and through 2021. By allowing to track brands’ spend across programmatic in real-time, that’s where the Adomik platform can be of most help to programmatic media sales teams.

 

Now is a great time to think about what your business should focus on today for a better tomorrow.

Will you be ready to capitalize on growth on the other side?
What do you need to do today for your business to survive and thrive?

 

by François de Laigue
“I compiled a few thoughts based on discussions with execs running monetization at ComScore publishers and Adomik’s data on the programmatic industry.”
👉A publisher’s guide for the COVID-19 era.

NEW! Evolution of the Programmatic Market per Country

Adomik provides the most relevant market trends we are seeing in the programmatic market via our Benchmark Market index.

Additionally, you can get in touch at insights@adomik.com for more insights or explanation.

 

🆕NEW Adomik White Paper – June edition🗞️

Adomik has been providing weekly market insights across multiple markets since mid-March when we noticed a drop in Publisher programmatic advertising revenue. This document is a follow-up to our first “monthly white paper” on how Publishers were affected by the COVID-19 pandemic. Download full study now!

Weekly comparisons (June 2020)

💡Adomik Weekly evolution of the Programmatic Market – periods of June 1-7 and May 25-31.

All Market Digest 9 june 2020

🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain  🇫🇷France

 

Weekly comparisons (May 2020)

You will find below weekly comparisons for Programmatic Revenue, Sold Impressions and CPM, by transaction type, device, content category, media type as well as trends for a selection of advertisers.

 

💡Adomik Weekly evolution of the Programmatic Market – periods of May 25-31 and May 18-24 May.

All markets 3 June 2020

🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain  🇫🇷France

 

 

💡Adomik Weekly evolution of the Programmatic Market – periods of May 18-24 and May 11-17 2020!

All market charts 26 May

🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain  🇫🇷France

 

 

💡Adomik Weekly evolution of the Programmatic Market – periods of May 11-17 and May 4-10 2020!

All markets 20 May

🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain  🇫🇷France

 

 

💡Adomik Weekly evolution of the Programmatic Market – periods of May 4-10 and April 27-May3 2020!

all market charts 15 may

🌎 World  🇫🇷France

 

Download Adomik WHITEPAPER – May edition!

Adomik full analysis of the evolution of the programmatic market is now available for 8 countries. The study covers the periods of March 16-April 30 Vs March 1-15 2020 for the UK, US, French, Dutch, Belgian, German, Italian and Spanish markets, with comparisons for programmatic Revenue, Sold impressions and CPM, top Brands and %age change per country.  So get your copy now:

 

 

Weekly comparisons (April 2020)

💡Adomik Weekly evolution of the Programmatic Market – periods of April 27- May 3 and April 20-26 2020:

All markets Digest 7 May

🌎 World    🇫🇷France

 

 

Download full details per country and per period below:
💡Adomik Weekly evolution of the Programmatic Market – periods of April 20-26 and April 13-19 2020:
All Markets Digest 28 April

🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain:it:Italy  🇧🇪Belgium:drapeau-nl:Netherlands  🇫🇷France

 

 

💡Adomik Weekly evolution of the Programmatic Market – periods of April 13-19 and April 6-12 2020:

All market Digest 21 April 2020

🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain:it:Italy  🇧🇪Belgium:drapeau-nl:Netherlands  🇫🇷France

 

 

💡Adomik Weekly evolution of the Programmatic Market – periods of April 8-12 and April 1-5 2020:
All Markets Digest Benchmark 15 April

 🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain:it:Italy  🇧🇪Belgium:drapeau-nl:Netherlands  🇫🇷France

 

 

💡Adomik Weekly evolution of the Programmatic Market -periods of April 1-5 and March 25-29 2020:

Adomik All markets Digest 8 April 2020

🌎 World  🇺🇸 US  🇩🇪Germany  🇬🇧UK  🇪🇸Spain  🇧🇪Belgium  :drapeau-nl:Netherlands  🇫🇷France

 

Weekly comparisons (March 2020)

💡Adomik Weekly evolution of the Programmatic Market – periods of March 25-29 and March 16-22 2020:

🌎 World  🇺🇸 US 🇩🇪 Germany 🇬🇧 UK  🇪🇸 Spain🇧🇪Belgium:drapeau-nl:Netherlands 🇫🇷 France 

 

 

💡Adomik Weekly evolution of the Programmatic Market – periods of March 17-22 and March 10-15 2020:

🇺🇸 US 🇩🇪 Germany 🇬🇧 UK  🇪🇸 Spain🇧🇪Belgium:drapeau-nl:Netherlands 🇫🇷 France 

New! Discover BENCHMARK, Adomik’s Programmatic market index!

We Are Very Excited to Announce the Launch of Benchmark!

Benchmark is our revamped exclusive advertising market index and benchmarking tool, available in the US, UK, Japan, France, Germany, Italy, Netherlands, Belgium, Australia and Spain. It includes a new UI and some new features such as Market Overview, Analytics and Market Alerts, tailored to your success.

It is ideal to:

 

 

 

With Benchmark, when you log into the Adomik Platform,

Adomik Benchmark Market index

Source: Adomik Benchmark

  • You’ll read about Market figures, Top brands and Top buyers buying deals
  • You will react to hunt new demand & farm your successful relationship with buyers
  • Monitor how you leverage transaction types vs the market
  • Refine your pricing strategy
  • Understand how and where the market is growing compared to your own business
  • Detect how SSPs are connected to demand
  • Identify inventory scopes that are driving demand

Below is an extract from the Benchmark market data in the USA:

1. Market Figures for April**:

 

Market Revenue Trends

US Market Revenue Growth: -11.2%. The drop in revenue mainly caused by a decrease in both impressions (- 2.3%) and CPM (- 9.1%).

Zoom on deals

US Deals Market Revenue Growth: -21.8%

Deal Revenue Market Share: 17%

The drop in revenue from March to April comes as no surprise and is in line with historical data. The drop is more pronounced for the PMP market, with major brands such as Target, AT&T, Hyundai and State Farm reducing significantly their spend.

2. Top 5 Brands Spending on Deals in April**

Source: Adomik Benchmark

 

The top brands are pretty stable month-on-month, with Target as a new entry and Hyundai exiting the top 5.

3. Top 5 Buyers Spending on Deals in April**

Top-5-Buyers-Spending-on-Deals-in-April

Source: Adomik Benchmark

 

**Data extracted from Adomik Benchmark for the period between March 1st to 31st and April 1st to 30th 2019.

You can subscribe to a monthly newsletter called “Benchmark Newsletter” to receive programmatic market data and a short analysis for your country. It is available in the USA, UK, France, the Netherlands, Belgium, Australia and Spain. If you are interested in staying up to-date with the programmatic market, feel free to subscribe.