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APRIL 16, by MAX WILLENS

As ad buyers and sellers brace themselves for the coming cookie changes, companies that built businesses out on media’s long tail now find themselves closer to the center of the action.

Over the past year, ad management platforms such as Freestar and Mediavine have been beefing up their outreach efforts to recruit more publishers as well as advertisers, exploring partnerships with large DSPs and other platforms around identifiers, even joining the early trials of the products coming out of Google’s privacy sandbox.

“Three years ago, I don’t think I would have believed you if you’d said The Trade Desk is reaching out to us,” Mediavine CEO Eric Hochberger said. “DSPs that you normally would be pounding on the doors of are now reaching out to us.”

While the monetization platforms face the same challenges that independent publishers do — trying to balance between deterministic and probabilistic data, weighing alternate identifiers against each other, mulling Google’s various Privacy Sandbox initiatives — their scale has made them newly relevant, not just to ad buyers but even some mid-sized and larger publishers who, faced with the grim prospect of another giant overhaul to their business, are letting go of the rope instead, either opting out of advertising altogether or letting someone else do the work for them.

“We generally work with mid-tail publishers,” said Paul Bannister, the chief strategy officer of CafeMedia. “But more and more, we’re seeing bigger and bigger publishers working with us, because it’s so hard.”

Though the specifics of what they offer (and the kinds of sites they serve) differ slightly, in broad strokes, ad management companies all offer the same services to publishers: essentially passive income from advertising, in exchange for control over the ads run on those sites. In most cases, the publishers keep the lion’s share of the advertising revenue.

Dating back to last year, that pitch seems to have been compelling. CafeMedia and Mediavine in particular managed to grow the size of their audiences over the past year. CafeMedia’s sites reached 167 million unique users in February 2021, up 14% year over year. Mediavine’s audience grew about 8% year over year, reaching 121 million unique users, per Comscore. Over that same period, Freestar’s audience was close to flat, drawing 118 million unique users, compared to 122 million unique users the same month last year.

Growth in the number of sites under each platform was much stronger. All three platforms vacuumed up dozens and dozens of new sites in 2020, according to an analysis of Comscore data. Mediavine alone added more than 1,700 site domains to its dictionary definition in Comscore over the course of 2020, a 32% increase year over year.

“We’ve definitely grown our business development team,” Freestar CEO Kurt Donnell said. “We’re out there hitting the pavement a little bit harder. Companies that have never looked at ad management before are taking a fresh look.”

The actual number of sites each platform added may be even bigger; Comscore’s dictionary definitions omit sites that do not meet the measurement firm’s minimum reporting standards.

That scale, already significant enough to place all three companies in the Comscore top 50 list of digital properties, makes them a convenient place to shop, particularly as ad buyers look for more direct relationships to replace the open-market buying they were able to do using third-party cookies.

CafeMedia in particular has been hiring sellers this year, hoping that the removal of third-party cookies will open up an opportunity for Cafe Media to forge more direct deals to brands and agencies.

“Buyers are already strapped for resources,” Bannister said. “They can’t pick up 20 new direct relationships. They’re going to choose bigger partners.”

But the scale these platforms have is only valuable if it’s compliant with the new rules Google is making, so each is busy exploring different solutions, some of which require more direct participation from the sites they represent. For example, last September Mediavine launched grow.me, a single sign-on technology designed to help it gather first- party data across its network of sites.

But unlike a new ad unit, grow.me asks publishers to do something potentially a lot more disruptive to their site experiences, all to combat a problem that hasn’t even started yet and that many of Mediavine’s customers aren’t aware of.

“Most of our publishers are not reading ad-tech trade mags,” Hochberger said. “We’re in more of a position of trying to educate them. We don’t see them having the concern they should.”

There’s also the added issue of how useful first-party data would be for some of the hyper-focused sites ad management platforms often serve. “There’s a lot of publishers that don’t have very unique first party data to attach,” Donnell explained. “What do you learn about a logged-in solitaire user? There’s a decent number of content sites that are utilities in nature, that don’t justify [requiring log-in].”

Consequently, the ad management firms, like most every other publisher, are kicking the tires on lots of different solutions. Cafe Media is representing independent publishers not just in the privacy sandbox but in initiatives overseen by the IAB, W3C and Prebid, which is handling the identifier UID 2.0.

But just like the rest of the industry, none is in a position to be prescriptive about which solutions will win out. “Frankly, we don’t have a solution yet,” said John Shankman, the cofounder of Hashtag Labs, a startup that provides ad ops solutions to publishers. “I don’t think there’s an industry consensus yet.

Source: https://digiday.com/media/were-out-there-hitting-the-pavement-ad-management-firms-scoop-up-sites-ahead-of-cookie-changes/

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