It’s no exaggeration to say 2020 has proved a genuine rollercoaster for digital media. While online engagement hit all-time highs – especially for news content – tighter advertising budgets brought revenue lows. In the last few weeks alone, findings that UK publishing income fell less than expected in Q2 were swiftly followed by WARC’s mixed industry outlook: including modest but welcome ad spend uplift for 2021 and predictions of a potentially long-term road to full global market recovery.
So, what steps can publishers take to stay on track? Here, industry leaders give their recommendations for how to ensure a smoother ride in the year ahead.
Maximise digital video performance and reconnect with consumers
From boosting engagement to adopting a test-and-learn approach, publishers must keep their fingers on the pulse of consumer interest to sustain revenue. Paul Nasse, Managing Director, Northern Europe at Integral Ad Science comments: “Looking to 2021, the industry will be focused on regaining strength following the widespread fallout of the Covid-19 pandemic. All industries took a hit, but we’re seeing strong reasons for optimism in ad tech as advertisers and publishers realise the opportunities of digital consumption and the growth in areas such as programmatic and Connected TV (CTV).
“Next year, advertisers are going to be spending more on digital video than ever before as the format solidifies its status as the lynchpin to online campaigns, particularly within social platforms.”
With many predicting the digital-first focus of 2020 is here to stay, realigning advertising strategies to meet consumer demand is a must. Rachel Powney, VP of Marketing at Dugout claims: “With ad spend set to recover in 2021, brands will be assessing where best to invest to reconnect with consumers, after unprecedented changes in consumer behaviour over recent months.
“The shift to digital channels looks set to last in the longer term, with a continued reliance on online services and content reflecting the varying rates of recovery from the global pandemic. Aside from this, the convenient and accessible nature of digital content means it’s an area that will attract more time spent regardless of Covid-19 policies. As a result, brands will be considering how best to boost their online advertising – particularly through the most engaging medium of all: video.”
Powney goes onto explain that branded content, in general, will play a prominent role in reconnecting with consumers and creating meaningful and memorable moments: “For example, Tourism Authority Thailand, which was heavily impacted by the events of 2020, has recently rolled out a film series featuring Thai player Chanathip Songkrasin – that’s already been viewed over 5.5 million times – to rekindle the love of international travel among football fans. As we head into 2021 and consumers adopt digital channels in more areas of their lives, and spend more time on them, we can expect more creative video ads like these from brands looking to rebuild, and enhance, the relationships they have with their audiences.”
The rise of contextual targeting and advanced AI analytics
Although Covid-19 has been top of mind for the publishing sector this year, it hasn’t overshadowed the opportunities and challenges of advertising’s cookieless future. Nickolas Rekeda, CMO, at MGID comments: “Google’s phasing out of third-party cookies and Apple’s deactivation of IDFA are clear signs that industry players will need to learn how to market in a world of unidentified users – and some companies are already investing in alternative tools to replace cookie-based targeting. Without a universal identity solution in sight, contextual intelligence will emerge in 2021 as the leading targeting strategy for the post-cookie reality.
“Contextual targeting as a concept isn’t something new. But its further integration with AI technology will allow publishers to understand whether website content is relevant both in terms of brand message and site visitor’s interest, as well as analyse how specific content surrounding – such as page sentiment, visual components and language nuances – affects the probability of a person interacting with similar content and the reasons behind it.”
Additionally, Jürgen Galler, Co-founder and CEO of 1plusX reflects on how sophisticated, AI-powered technology has enabled contextual to develop: “Throughout 2020 the industry has been looking at alternatives to fill the gap cookies will leave once they are phased out, and publishers and marketers are still grappling with the question of “what’s next?”. There’s been lots of conversation on whether contextual targeting is an adequate solution, with some industry players indicating that it’s still a work in progress. But in reality, significant advancements in marketing technology over the last few years, in particular AI and predictive analytics, has allowed the development of more accurate and agile contextual targeting tools.
“In the coming year, as the industry learns to transition from behavioural analysis to more privacy-led alternatives, there will be increased focus on contextual intelligence as an advanced targeting model. This will allow publishers and marketers to combine their first-party data with more in-depth, real-time contextual analysis, and to glean crucial consumer insight from it.”
Diversifying revenue streams in the year ahead
Alongside a renewed interest in alternative targeting methods, the publishing sector will experience rapid innovation as media owners pivot their business models. Zack Sullivan, CRO UK at Future comments:“The gradual fade out of third-party cookies has already driven digital publishers to prioritise the diversification of their monetisation methods and seek alternative ways of offering targeted advertising. Next year, the countdown to Google’s support of cookies ending will begin in earnest, accelerating the race to find and activate viable solutions, before 2022 marks the finish line. As a result, we can expect to see accelerated adoption of universal IDs, use of first-party data and a stronger emphasis on expanding business models into wider areas; especially subscriptions and ecommerce.
“Over the lockdown period, digital media consumption spiked and Future witnessed significant organic traffic growth, with unique visitors to its UK websites up by 25% in August compared with last year, highlighting that consumers are looking for content from trusted premium publishers. This year has been a true test for the publishing industry and if it has taught us anything, it’s that the publishers who have put their consumers’ interests first are the ones to have grown their audiences and user loyalty, and will ultimately come out in front as the Covid-19 storm subsides.”
As part of this shift, delivering tangible business results will require publishers to advance their measurement capabilities. Paul Nasse at IAS also adds: “Those that win in the long term will be the ones who focus on maximising ROI. With marketing budgets still under scrutiny, agencies will be focused on interrogating data against benchmarks. As performance measurement gets more granular, advertisers will further optimise metrics to drive engagement and, ultimately, real business outcomes.
“Testing and learning will continue to be prioritised, after a year of social media boycotts, changing consumer behaviours, the US elections and an evolution in how agencies look at the media mix. The focus for 2021 will be on making sure that all elements of a campaign are being precisely measured, and while this is a well-established process for digital media, there is still work needed to align cross-platform standardisation.”
The future of industry partnerships
With the need for quality data and transparency more important than ever, big shifts in industry collaboration are predicted for 2021.
Pierce Cook-Anderson, Country Manager UK, Ireland and NL at Smart AdServer observes: “We’re seeing publishers plug in more and more partners in a bid to drive as many short-term revenue opportunities as possible before Google kills the third-party cookie. But as ad transactions become inevitably more inefficient, we can expect supply path optimisation (SPO) to be a big trend in 2021, with DSPs looking to streamline the number of SSPs they work with by cutting out resellers, those that don’t add value, and any non-direct connections.
“With an increased emphasis on closer relationships – which offer enhanced transparency and accountability – it’s likely supply and demand will start moving closer together, with partners that can offer direct access to buyers holding a stronger position going into next year. In this way, companies will look to become vertically-integrated to diversify their offerings and move into new areas that benefit both the buy and sell sides.”
Furthermore, the rise in the number of walled gardens will also impact how publishers approach their industry partnerships. Chris Hogg, Managing Director EMEA at Lotame comments: “We predicted in 2020 that publishers would see the forest through the trees in putting up walls. Some did, but the bigger players are banking on first-party data alone as their lifeboats. As publishers invest more in context and erect walls around first-party data assets, they will face increasing scrutiny to prove ROI and scale. Walled gardens may work in the short term for the likes of The New York Times but mid to small publishers won’t survive on context alone. This may lead those players to lean in more aggressively to data enrichment and testing multiple identity solutions, proving their flexibility and agility to meet marketers’ needs.”
Taking lessons from this year’s challenges and positives will be essential over the next 12 months. While audiences have a higher and more diverse appetite for digital content than ever, publishers must provide maximum value to drive sustainable success. As well as harnessing growing opportunities in video performance, AI-driven analytics and advanced data solutions, delivering tangible returns will be vital to retain close ties with the advertisers that support their bottom line.