Publishers face a myriad of challenges working in ad tech. However, amid these hurdles, opportunities for revenue growth are abundant, particularly in AI.
As the digital world embraces AI’s power, publishers can harness this technology to their advantage. To shed light on this transformative landscape, we turn to David DiAngelo, VP of Global Marketplace Development at Emodo, Ericsson’s ad tech division.
DiAngelo contends that the ongoing AI race is reshaping the power balance in search, potentially disrupting the search advertising industry and influencing publishers’ traffic sources. In the following Q&A, he imparts invaluable insights and recommendations for publishers navigating the AI revolution and successfully preserving and growing their revenue streams.
David DiAngelo: The current wave of generative AI tools, such as ChatGPT, Bing Chat, and DALL-E, has created significant public interest due to their ability to provide complete and efficient answers. This could disrupt the digital media industry and the advertising model that supports it.
Traditional search engines, like Google, have historically delivered search results through a list of links, including sponsored links. Generative AI, on the other hand, offers a more streamlined and user-friendly experience by providing comprehensive responses.
This shift in user behavior will likely have profound implications for the search advertising business, as users may no longer need to click multiple links to find the information they seek. Consequently, this could render search a less reliable source of traffic for publishers, affecting their revenue streams.
AB: Will AI disrupt the power balance in search, and if so, how?
DD: Yes, AI is poised to disrupt the power balance in search. AI search offers users greater efficiency and complete answers, which could diminish the reliance on traditional search results with sponsored links. This could lead to a significant shift in the advertising model as users are less incentivized to explore more profound search results and visit multiple sites, affecting publishers’ monetizable traffic.
AB: How can publishers offset potential traffic loss and preserve monetization in light of AI’s impact on search?
DD: To offset potential traffic loss and maintain monetization in the face of AI’s impact on search, publishers should embrace other generative AI tools. These tools offer several advantages, including strengthening revenue channels, streamlining workflow processes, and ultimately increasing overall revenue. For instance, publishers can employ generative AI to automate content creation, enhancing the efficiency of editorial procedures.
Additionally, publishers can explore AI-powered personalization to provide tailored content recommendations to users, increasing engagement and ad revenue opportunities. Furthermore, publishers should consider partnerships with AI-powered technology providers to develop custom solutions that address their specific needs, ensuring they remain competitive.
AB: How do premium publishers view new AI technology, and what are some examples of their innovative use of AI?
DD: Premium publishers generally have a favorable view of new AI technology because they have the resources to innovate and test AI tools.
Some premium publishers, like Expedia, Duolingo, Forbes, The Washington Post, and Bloomberg, have already explored AI’s applications for content generation. For example, Expedia uses AI to generate hotel recommendations, while Duolingo provides AI explanations for paying subscribers.
AB: How do smaller, long-tail publishers differ in their ability to adopt AI, and what challenges do they face?
DD: Smaller, long-tail publishers often face challenges in adopting AI due to limited research and development resources and a lack of tech vendor support. This can particularly impact niche sites that rely on search discovery for traffic. AI-generated content, like customized itineraries, can reduce the need for broad audience targeting, posing a threat to publishers dependent on search-driven traffic rather than name recognition or SEO expertise.
AB: What strategies can publishers implement to adapt to the changing landscape of AI and search?
DD: Publishers should adopt a proactive approach to navigate the changing landscape of AI and search in order to to secure their revenue streams.
One effective strategy is to leverage their growing influence within the industry. Publisher task forces and trade groups can advocate for AI chat providers to pay fees for crawling their pages, thus creating additional revenue sources. Moreover, publishers can collaborate with tech partners to implement AI-driven solutions that provide a competitive edge.
They should also consider diversifying their revenue streams by exploring sponsored content initiatives and embracing AI-optimized dynamic ad formats, which can boost campaign performance and help offset any potential revenue loss resulting from changes in user behavior.
AB: How can AI be seen as an opportunity rather than a threat for publishers in the long term?
DD: Publishers should view AI as an opportunity rather than a threat for publishers in the long term. By embracing AI technologies, publishers can enhance their capabilities in various areas. For instance, AI can improve user experiences by providing personalized content recommendations, increasing user engagement and ad revenue.
Additionally, AI can streamline editorial workflows, reducing manual labor and operational costs. Publishers can also explore new revenue channels through sponsored content initiatives that align with user interests. Furthermore, AI-optimized dynamic ad formats can significantly enhance campaign performance, leading to higher CPMs and compensating for potential traffic loss. AI offers publishers the tools they need to thrive and remain competitive.