AdMonsters Wrapper: 🌯Always Look on the Less Grim Side of Pandemic Ad Spend

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This Week
April 21, 2020
The Less Grim Side of Pandemic Ad Spend
Google Does Struggling News Partners a Solid
It’s Raining Super-Engaged Users
Hard Out Here for a Duopoly
Can CTV be Trusted?
Always Look on the Less Grim Side of Pandemic Ad Spend
Coronavirus Ad Revenue Impact: Sell-Side
Source: IAB Coronavirus Ad Revenue Impact: Sell-Side
You may often feel like quoting our greatest fictional president’s most powerful State of the Union address these days: “I know that s---’s bad right now.” But why not take a trip over to the IAB’s Coronavirus Ad Revenue Impact: Sell Side—a companion piece to its buy-side report from a few weeks ago—to verify those terrible feelings of dread? Yes, 98% of respondents expect a revenue decline; about 70% have re-forecasted revenue for the first half of 2020; and news publishers are getting it the worst, with 88% of reporting that advertisers want to cancel campaigns and 86% saying advertisers want to pause.
Why This Matters
But while you are there, you can look at the upside—or maybe the dim light versus the pitch black. As to be expected, certain verticals aren’t seeing as deep drops in spend, including CPGs, online retail, healthcare, politics, gaming, parent-related, and… beer, liquor, and wine.

Smart salespeople are using the opportunity to offer advertisers additional hand-holding, being extremely flexible when it comes to pausing or moving spend. Publishers are being extremely consultative for advertisers and very flexible in pausing—things that could come in handy as advertisers re-focus for the latter half of 2020. Just like buyers, 70% of publishers haven’t reforecasted for the third quarter or 78% haven’t for the fourth.

Perhaps we’re being too optimistic (totally out of character, we know), but maybe there’s a chance that the pandemic helps publishers rebuild corroded relationships with advertisers, especially at a key moment of ad tech development—the retirement of the third-party tracking cookie.
Google Does Struggling News Partners a Solid
Every cent counts at the moment for publishers—especially news publishers, who are seeing incredible traffic spikes while advertisers yank spend. News sites can be grateful then that Google is suspending ad-serving fees for those publishers for the next five months—on a global scale at that.
Why This Matters
Many publishers will be overjoyed by the revenue boost that follows this decision. But cynics that we are, we can’t help noticing this is not an altruistic move. Just like Facebook’s overture to local news providers in need, it’s a recognition that a depleted supply of online journalism is bad for business. In Google’s case, GAM ad-serving fees are a pittance compared to its revenue from search marketing. A search engine is only so valuable without a steady stream of timely and relevant content

Don’t take my word for it—here’s what Google SVP and Chief Business Officer (and man with enviable hair) said at the launch of the Google News Initiative in 2018: “A great search engine by its definition depends on access to the open web…. The last thing you want to see is a search engine that is not delivering quality internet and is quickly becoming a race to the bottom.”

So Google serves as an essential monetization component for publishers as well as a serious traffic source that itself is dependent on a steady stream of publisher content. Strange days have found us.

GNI’s and Facebook’s attempts to bail out the local journalism industry is a bizarre way of saying, “News publishers (and by extension publishers in general) are not making the amount of revenue they should be for their content.” The pandemic has (further?) exposed that publisher monetization is very, very broken. And these investments are merely bandages that are sure to fall off before too long.
It’s Raining Super-Engaged Users
With 328 million Americans all inside adhering to stay-at-home orders, there’s been a dramatic spike in content consumption. As people voraciously forage in search of high-quality content to keep them both informed and entertained, news and lifestyle sites have been deluged with a massive onslaught of traffic eyeing their content with rapt attention. In fact, traffic has soared by 70%, according to estimates published by Forbes, CNBC, and other publishers. Oh, where would we be without these unsung heroes?
Why This Matters
Sure, we’ve all heard that it’s been hard for publishers to monetize the booming traffic they’ve experienced since this pandemic began with advertisers concerned about brand safety and all. The more time spent on a pub’s site, the greater the opportunity to deliver ad messages to engaged readers.

And just in case you’re wondering, there’s been some evidence to back this up. While brands are staying away from hard news, eye-tracking specialists Lumen has found that audiences are engaging more with ads nearby Coronavirus content. They found that 66% of viewable digital ads were noticed compared with an average of 55% for tests conducted in the past six months. Playground XYZ similarly found that people’s attention to paid advertising increased by 6% in March, with some categories rising around 23%.

There’s a unique opportunity here for publishers to mitigate the loss in revenue. Partnering with a marketplace like Duration Media can help publishers to increase inventory and revenue with 89.6% viewable impressions.
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Hard Out Here for a Duopoly
You do have to give a nod to Google for shutting down a cash source when its own ad revenue is dipping. Yup, turns out the Duopoly is also getting whipped around by the pandemic as ad spend slows to a trickle. YouTube is seeing the same kind of crazy traffic spikes news sites are witnessing, but the advertiser dollars are not flooding in like in the pre-shelter-in-place days. And no surprise, you don’t see a lot of travel or entertainment ads on Google Search these days.

A couple of weeks ago, Facebook warned of ad slump, although services like Messenger and Instagram Live are seeing a flurry of traffic. Big problem? They’re much harder to monetize than other Facebook products, which are witnessing bottom-barrel pricing. Wall Street analysts believe both Google and Facebook will report a drop in annual revenue… For the first time ever since either has been publicly listed.
Why This Matters
The Duopoly may be suffering a bit on the ad side, but rival social networks that count on local, regional, and SMB business spend are getting creamed. Most notably Yelp laid off 1,000 employees and furloughed another 1,100. Analysts see the two—which can definitely squeak out the pandemic—as coming out the other side with an even stronger position when it comes to garnering SMB spend.

The lion’s share of Google and Facebook revenue comes from SMB at scale because the two offer self-service platforms with no real minimums. The pandemic is likely to throw us into a severe recession–possibly worse than the Great Recession of the late aughts—which means this pool is going to get spotty for some time, but when it comes back, the Duopoly will be there to grab it. However, publishers need to try and break in here with self-service offerings that deliver highly targeted inventory that’s nicely priced...
Can CTV be Trusted?
Connected TV might be one of the few bright spots for advertising revenue during the pandemic. This seems logical because a great deal of Americans are stuck in their homes right now willing to stream just about anything, especially if it involves tigers and peroxide mullets. And Roku’s recent earnings reporting backs this up: as streaming hours look to increase nearly 50% year over year to 13.2 billion in first quarter 2020, the company expects revenue of between $307 million and $317 million, higher than the previously forecast $305 million.

The same week, White Ops released details of a massive CTV bot network codenamed ICEBUCKET that challenged rosy perceptions of the space. Bots were hidden using the “limited signal and transparency of server-side ad insertion (SSAI)-backed video impressions,” according to White Ops. At its peak, the network impersonated 200 million people across 50 countries while spoofing content from more than 300 publishers. “28% of the programmatic CTV traffic White Ops has visibility into, or around 1.9 billion ad requests per day for the month of January came from this single operation,” the company shared.
Why This Matters
If the desktop web advertising is the Wild West and mobile is the Wild, Wild West, then CTV appears to be the Wild, Wildest West in the World of Wild Wests (Westworld?). Industry observers consider everything available programmatically to be extremely suspect. If just one bot network can account for 28% of impressions… What can you really trust, knowing that every scam artist out there is hot on the channel?

Let’s be honest—until we’re able to root out a majority of the fraudulent activity going on, nothing outside the blossoming walled gardens is going to be taken seriously. By then, it may be too late for a real open ecosystem to develop—meaning a lot of publishers will be SOL.
Sweet Tweet
one should no longer assume rational markets
Worth a Listen
What Happens In Adtech
What have we here?! Two industry vets attempting to discuss adtech in a non-PR and very unpolished way. We both know our s*** and will be bringing on a bunch of guests who really know their s***.

This week we introduce ourselves and discuss the only thing there is to talk about, the effects of coronavirus on the world.
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