Content recommendation: Revisiting the Why and the How
In digital publishing, the imperative for ad revenue growth is hardly new –and while over the last few years (due to both the pandemic and the duopoly’s ad share dominance) emphasis has been placed on subscriptions, it is clear that advertising income remains the principal opportunity yet again, for several reasons:
- GDP / Adspend on the up
The outlook for GDP growth in most major markets remains clearly positive and this historically is mirrored in the advertising market, most times overshooting the GDP trend.
- Capitalize on trust
Premium publishers are well positioned to begin reclaiming some market share as the last eighteen months have emphatically underlined the importance of user trust and the consequent brand safety benefits to clients.
- Supply transformed
This comes on top of a much-improved supply chain whereby leading content brands have differentiated themselves by investing in several areas, say improved viewability or reduced ad fraud.
- Flat reader revenue?
With the pandemic subscription bump largely over, focus is shifting to user retention – often quite successfully but this translates at best to flat income from readers.
From quantity to quality
A key consequence of both main revenue sources (subscribers and advertisers), emerging as broadly equally important in the near term, is the pursuit of common denominator principles that serve both markets. Perhaps the most fundamental one is the shift from quantity to quality.
In audience development, this is manifested in a focus ‘pivot’ from maximizing unique (mostly anonymous) users to engaging with readers with the aim of increasing visit frequency and duration as well as pages viewed, i.e. metrics that lead to registrations or subscriptions.
In advertising, this translates into resisting the temptation of a high ad load or intrusive formats, clearly bearing in mind that “AdX” is a notable subset of UX. It is thus hardly surprising that “Quality & Transparency” initiatives across Europe, launched or supported by national IABs, are moving beyond viewability, ad fraud and brand safety, into new parameters such as ad clutter.
A new tandem: (user) engagement and (ad) performance
Engaging with readers has proved so crucial for converting visitors to registered users or subscribers that its importance to ad performance has been somewhat overlooked.
This should be swiftly addressed – and corrected: simply put, more pageviews means more ad impressions but also more data (augmenting the potential for tailored advertising) as well longer reading patterns, increasing ad inventory and viewability.
As we move into customization and then personalization, higher engagement with content translates into higher engagement with ads, improving key metrics such as CTR and/or dwell time.
Applying this (and more) to Content Discovery
Indeed, it is personalization that is likely to prove a true game changer – across the board too, starting (as an accelerator to the “quality shift” impact) with a notable increase in pageviews and hence, again, advertising inventory. Likewise, the same applies to session duration, not only in terms of articles visited but, given higher reader affinity to the topic, scroll depth – and crucially, lest one forgets, this concerns both organic and sponsored content.
The truth is that ‘best practice’ varies from brand to brand and from audience to audience – and hence the real imperative here is constant experimentation. This can concern information architecture, issues of design and broader UX (possibly the closest correlating parameter to engagement, after content) as well as web performance, especially in a moment when Core Web Vitals are being updated.
You’ll never walk alone?
Perpetually optimizing Content Recommendation, and doing so in a targeted manner, is therefore a critical endeavor – but it can also be a tall order, taxing time and resources. Hence the crucial decision for publishers is whether to insource or outsource the necessary work or, indeed, to strike a balance in between, both for the initial set up and, perhaps more importantly, for the constant optimization effort.
The truth is that the majority of cases in all markets fall somewhere in a continuum, namely in between a 100% insource or outsource approach – hence what matters most is for premium content brands to fully grasp the scale of the task that ‘active management’ entails, both in terms of necessary talent as well as tools and, inevitably, cost.
And yet, staying on the initial “outsource/insource” dilemma may obscure a more fundamental question – namely finding not merely a provider but a true partner who truly understands the juggling needs between editorial, audience growth and commercial objectives (as well as assisting in managing distinct teams, i.e. often silos) and, using best practice from their scale and experience, be a catalyst in delivering a dynamic synthesis to bring the best results. A tall order indeed – but an imperative nonetheless.
If you’d like to discover more about Content Discovery, get in touch with our team today.