Publishers Share Plans for the Many Unknowns of a Cookieless Landscape

A roundtable of ops leaders gathered at AdMonsters Publisher Forum New Orleans to discuss the most pressing issues facing the industry, including a cookieless future, what’s next with first-party data, and the Privacy Sandbox. 

The digital media and ad tech industry is in a unique position right now, as next year will bring about true privacy changes impacting core business models. Industry experts are left with many unknowns, including the question of whether a recession might still be in their rearview mirrors, tailing right behind them. 

At PubForum New Orleans, AdMonsters gathered a group of digital media executives for a roundtable discussion about the uncertainties facing the industry and how to navigate the winding landscape. Identity solutions and privacy are top priorities for many publishers as the third-party cookie begins to phase out.

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Q4 Qualms With a Dose of Cookieless Malaise

Since 2018, the most prevalent topic in digital media and ad tech has been what will happen when the nail finally hits the coffin of the third-party tracking cookie. Now, with the 2024 phase-out timeline on the books, things are getting real. Publishers are no longer simply talking about solutions, but putting real strategies and testing in place to figure out the future of addressability at scale.

One publisher mentioned that their company had recently been acquired, leading to expansion of their business and subsequent new questions about how to go forward in a cookieless world. They are working diligently to test solutions across multiple brands so they can be ready when the time comes. 

But not every publisher is working with the same resources necessary to solve for the cookieless future. One industry professional acknowledged that their team is too small to have a whole department devoted to figuring out the path forward, and said they were making a plan to tackle this challenge as their number one goal going into Q4. 

Another attendee explained that they were working with a team to create first-party datasets. However, they are in a niche industry where they are confident about who visits their website. A redesign this year cut this company’s inventory significantly. 

“We’re working with a really high sell-through rate for direct sales, which leaves little for programmatic revenue. We’re also increasing CPMs and working with our SSPs to monetize as much as we can with our redesign and lack of ads; we’re exploring bringing some ad slots back while keeping the user experience positive,” they explained. 

While the immediate concern for publishers is achieving Q4 goals, the threat of the cookieless future remains a thorn in their side. Defining a first-party data strategy leads the list for surviving the revenue hits that are sure to come. Publishers are rethinking how they present their value exchange to users to increase the likelihood of collecting more declared data. 

For example, a publisher might incentivize users to provide data through tokens or rewards to grow first-party assets over time. This way, publishers can build out audience cohorts and intent-based targeting strategies that help buyers engage with the right audiences in more meaningful and relevant ways.   

How the Privacy Sandbox Could Change the Game

We can’t talk about the end of third-party cookies without talking about the Privacy Sandbox, as they are two sides of the same coin.

“We’ll be testing more of the privacy solutions and figuring out from a programmatic perspective what works best for us and how we can continue to see the CPMs that we’re used to,” explained one publisher. They noted they are also diversifying their business model outside of their standard media business. Revenue diversification, for some, will be the only way to survive the coming storm.

Another participant predicted that the Privacy Sandbox would negatively impact their company’s revenue. “We are testing a lot more with our partners on Topics API. However, we are pushing the agenda on protected API as much as we can with as many groups as possible working closely with the CMA on this as well. This is an overwhelming fear we’re working on at the same time,” they added.

In early testing, Chrome’s interest-based Topics API showed promising results, but publishers are still worried they won’t meet their CPM goals.

User Experience is Paramount

Regardless of the challenging privacy landscape, ensuring the user experience remains seamless regardless of what is going on behind the scenes is critical. Advertisers are aware that too many ads can negatively affect an individual’s experience online, which can ultimately decrease revenue. 

The balance between ads and experience is imperative to achieving success. Noted a publisher in attendance, they are going through a website redesign and are working on the timing of building rapport with end users and when to re-incorporate ads in a way that isn’t annoying. 

Another attendee mentioned they keep some of their content behind a paywall where users have to exchange an email address to proceed with receiving free content, albeit still with ads. The publisher is still working to finetune the user experience overall.

Measuring outcomes beyond just clicks and conversions can help optimize the user experience. For some publishers, metrics like session RPM are becoming more important alongside traditional CPM metrics. As well, time spent on site and attention are also helping publishers to better understand how ads are performing.

One publisher admitted they had tried to incorporate more ads on their site, including exit ads, but the overall experience put users off so much that the company lost revenue. “We saw troves of traffic go away. It became really important to look at revenue not from an impression basis but by revenue per session and try to coax users into deeper sessions. Getting the user to stay on page longer is more valuable than having more ads on the page,” they shared. 

This publisher explained they saw these changes pre-COVID and acknowledged business is different now. However, they asserted that now that ad spend is in a bit of a recession it is the best time to make new investments to prepare for when ad spend ratchets back up.

Remaining Profitable in the Face of Uncertainty 

Growing revenue was a big part of the discussion, as companies look to diversify where their money is coming from. Others said they don’t think revenue from ads will disappear, but their goal is to grow the entire revenue pie. 

“We are leaning into other revenue streams, but I don’t think it’s at all leaning away from advertising. We are still expecting that to grow, and want other pieces of the pie to get bigger as well,” noted one industry expert. Revenue diversification into areas like subscriptions, commerce, and events is becoming increasingly important for many publishers. 

Some publishers said they are offering subscription services to boost their bottom line. However, one publisher talked about the realities of subscription fatigue, noting that due to rising costs, consumers are becoming more diligent about canceling subscriptions they deem unnecessary. Others even talked about exploring data marketplaces or selling segments of their first-party data to non-competitors, recognizing that privacy concerns may limit those aspirations.

The industry is in flux, and while no one has a crystal ball, it seems clear that diversifying revenue streams and capitalizing on first-party data solutions will be crucial to achieving growth in 2024 and beyond.