Publishing executives are eager to find ways to cut costs and expand revenue at their companies, especially considering the slowdown in the market. Greg Smith, GM of North America, Aniview, shares how publishers can combat this revenue challenge with AI and advanced data that can transform monetization strategies.
Nearly every publisher experienced a slowdown in ad revenue in Q4, with an average increase of just 3% YOY. Cutting-edge AI and advanced data can reimagine publishers’ monetization strategies, delivering increased CPMs (cost per mille), improved yields, and boosted revenue.
Even amid various layoffs, digital advertising spending is projected to increase in 2023.
Moreover, it’s expected to cross the $300 billion threshold in just a few years. As the industry progresses, let’s explore how publishers can leverage AI and data to enhance monetization strategies and achieve unprecedented success.
Build a Foundation with Data
For publishers, data is where everything starts. By utilizing data from multiple sources, publishers can get deep insights into users’ behavior and content consumption patterns, thus paving the way for a richer and more personalized user experience. But how can publishers effectively improve data collection and utilization? There are two distinct paths:
1.Build an in-house aggregated first-party data lake. This would require in-depth expertise in data warehouses and is a costly and time-consuming way to collect data. Although highly fruitful in the long run, as data ownership remains with the publisher, this method will take some time to start providing results.
2.Leverage third-party data from existing SSPs, ad networks and other publishers. Make sure that data collaborators are already integrated with multiple contextual targeting platforms so that results are produced starting from day one.
By collecting and using AI to analyze vast amounts of data from various sources such as websites, mobile apps, ad networks, SSPs (supply side platform) and social media, publishers can create detailed audience look-alike segments based on behavior, interests, and intent.
See More: 4 Ways AI Is Changing Content Creation and Marketing as We Know It
Improve with AI
The dramatic entrance of AI-powered tools has produced feelings of fear in many people to the extent that they may ask themselves, “Will AI take away my job?” However, companies testing and using AI assure that the technology will simply relieve employees of mundane, tedious tasks to free them up for bigger-picture projects and will not replace human work. Companies see a lot of promise with AI-powered technology. MediaOcean’s 2022 market report found that marketing professionals believed that AI and machine learning (ML) would be one of the top three most impactful resources to leverage in 2023. Exploration and experimentation are pivotal as the industry seeks to understand all the nuances of AI by testing results across multiple use cases. Let’s discuss a few of these use cases in depth.
AI-Powered Dynamic Floor Pricing
A few years ago, it was common for a head of publisher operations, for example, to manually change programmatic floor prices for dozens of placements on a daily or weekly basis to test and control experiments and then measure fill and eCPM (effective cost per mille). Today, publishers can leverage AI to enhance multi-variable floor-setting strategies by optimizing floor prices every second, increasing ad fill rates, improving monetization and enhancing overall campaign performance. Automatically adjusting floor prices prevents publishers from under- or overpricing impressions. Contrary to ChatGPT, which takes about 5-6 seconds to write a 3-page paper, AI for programmatic media adjusts pricing in milliseconds and algorithms millions of times per day.
Personalization at Scale
Personalization has become a cornerstone of successful digital advertising, and AI is the key to achieving it at scale. By utilizing AI algorithms to process vast amounts of user data, publishers can deliver personalized ad experiences to individual users, increasing user engagement and brand loyalty.
Optimizing Ad Placement and Formats
AI and data analytics can transform how publishers optimize ad placements on websites and apps. By analyzing user behavior, interaction patterns and historical performance data, publishers can determine the best positions for ads to maximize visibility and engagement without sacrificing the user experience.
Moreover, AI can help publishers automatically test and optimize various ad formats, such as banner ads, native ads and video ads, to identify the most effective formats for specific audience segments. This data-driven approach ensures that the right ad is delivered in the right format to the right user, increasing click-through rates and ad revenues.
Publishers: Three Steps to Take Now
Here are three actionable steps publishers can take now.
1.Identify what processes could benefit from improvements. Whether it be revenue, fill rate or ad viewability, publishers can find that evaluating current operations, infrastructure and strategies will yield tangible next courses of action.
2. Explore AI-powered solutions and automation tools to streamline yield optimization processes, and find a vendor that complies with IAB standards and data regulations such as GDPR.
3. Increase competition among demand sources. More high-quality, accurate and complete data on user behavior makes integrating easier. It also opens and connects more parties. Once demand is driven and publishers are in tune with what audiences want, they can aim for higher KPIs with advertisers.
AI certainly cannot solve every problem, but it can help address long-standing challenges for publishers. By automating the monotonous day-to-day tasks, publishing employees can contribute elsewhere, adding value to the bigger picture instead of managing individual brushstrokes. The bottom line is that AI will not take jobs; it will breed innovation, inspire and boost creativity, reduce inefficiencies and increase monetary gains.
How has your organization benefited from the use of AI? Share with us on Facebook, X, and LinkedIn. We’d love to hear from you!
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