In present-day digital advertising, attention is the new mint. It's a delicate balance – between publishers trading their audience's valuable attention to advertisers, who, in turn, leverage ads to promote their products and boost sales.
As a publisher with highly effective ads, you have the power to demand premium prices (higher CPM) for your sought-after ad inventory.
However, in order for publishers to unlock higher CPMs, they need a way to measure ad effectiveness. Unfortunately, the traditional viewability metrics alone fall short of fully capturing the impact of ad effectiveness on the revenue publishers are generating from a website.
Because of this, the advertising industry has long sought improved metrics that go beyond mere views and truly measure the amount of revenue publishers are generating.
In this article, we will delve into the various factors that influence publishers’ revenue and the important KPIs that publishers need to consider for successful ad revenue optimization.
Yes, it does matter to publishers because it matters to advertisers.
The Interactive Advertising Bureau (IAB) and Media Rating Council (MRC) define viewability as at least 50% of the ad's pixels being visible on the user's screen for a minimum of one second for display ads and two seconds for video ads.
Because advertisers don’t want to pay for non-viewable ad impressions (ads that users won’t see), the viewability metric ensures that advisers pay only for impressions that have a high potential to be seen, enhancing ad performance and optimizing ad revenue.
The CEO/Founder of Assertive Yield, Nils Lind, stated that “Viewability is a crucial factor in revenue optimization. Ads must not only be present on the page but also viewable by users. Advertisers are increasingly adopting a "Viewable CPM" (VCPM) model, where they pay based on the number of viewable impressions rather than the total impressions. This shift in approach reflects the industry's understanding that impressions that go unnoticed hold no value.”
When ads are viewable, advertisers are more likely to see the value of partnering with publishers, leading to long-term relationships and increased ad demand. On the other hand, Demand-side platforms (DSPs) use historical data to determine the value they are willing to bid for a domain's ad impressions.
This value is influenced by the domain's track record of delivering viewable impressions. This underscores the importance of ensuring that ads are strategically placed for maximum visibility, aligning with the advertisers' goals.
But what does this mean for publishers? Should they aim for a100% viewability? - No, because it’s impossible to achieve it on one hand, and on the other it would heavily reduce the amount of ad impressions served on the page. Then - should they put as many ads on the page as they can? - No, because their inventory is going to get less valuable over time.
Somewhat a standard for an optimized in-content display ad unit viewability is to be considered at above 70% - at this point more advertiser demand has been unlocked for publishers - the one that targets high-viewability ads.
It’s also a sufficient number, to enable publishers to lazyload one or two ads below the fold (BTF), with the premise that the reader will scroll there and reach them, without risking the user to reach an ad space that is yet to load the creative (which will also lower viewability).
The main issue perhaps is that it’s hard to test it - different partners have different rolling averages and methods to address this, so if you optimize your inventory today - you will have to do it on the entire website at once and wait for the demand to catch up, while seemingly losing money - at least in the short term.
When it comes to the more in-depth metric here - time-in-view for ad impressions - there is a market yet to be developed - so perhaps it makes sense to keep an eye on the Attention metric as well.
When you go back to the basic concept of revenue, it's by definition influenced by a couple of things - the amount of inventory you have and the CPMs you are able to monetize that inventory with.
Now when you dive deeper into the many many factors that influence both of these, you might notice that viewability is one of the things that has an effect on both.
All things unchanged, higher viewability will have a negative impact on the number of ads you are serving, simply because you are aiming to serve the ads that have the highest chance of getting into the person's screen.
But if you go for it - in the long term - this should influence CPMs positively. The art is in balancing these two.
As a publisher, looking solely at the amount of revenue generated on a page at a basic level hides essential KPIs that significantly influence revenue over time. It also fails to account for the costs associated with generating that revenue.
As we all know, revenue generation is a critical aspect of your website's success, however, merely looking at the basic revenue figures generated from the viewability metric alone is not enough.
There are several hidden metrics that play a crucial role in determining the revenue generated over time and publishers simply lose out on a lot of money when they are analyzing the wrong metrics.
Now let’s delve into the various factors that influence publishers’ revenue and the KPIs that publishers need to consider for successful ad revenue optimization.
You should read more on the 11 Crucial KPIs for Enhancing User Experience and Driving Revenue Growth in Publishing
As publishers worldwide seek innovative ways to monetize their websites, it has become imperative to delve deeper into various aspects of ad monetization strategies.
Ad placement and layouts play a pivotal role in capturing users' attention and engagement. Typically, publishers are met with the ‘UX vs. Monetization’ problem of, “How do you maximize both without taking away from the other?” It's essential to strike a balance between visibility and user experience.
Most publishers know that it is important to show a certain number of ads to make maximum ad revenue, but plastering ads all over the page can lead to ad fatigue and detract from the overall user experience, potentially driving users away. A website with too many ads, poorly placed or hidden ads, may have lower CPMs for advertisers.
In fact, Ezoic claims that showing ads to different users (multivariate testing) based on preferences usually results in a net increase in revenue of about 56% on average and another insight by Salesforce shows that 80% of customers now consider the experience a company provides to be as important as its products and services.
Therefore, publishers must carefully consider the placements to ensure a seamless browsing experience while optimizing revenue.
Since every user on a site interacts with it differently and different ad placements may influence each user in a different way, it is important for publishers to conduct AB/n testing of smarter ad combinations and placements that work for the majority of their users.
When you look at the SSPs, (the ones that combine all of the publisher supply and send it out to the DSPs) is that these SSPs operate on a very thin margin. What they have to do is they have to really improve the revenue they are making per request they’re sending and requests coming in. But most of these SSPs apply something called throttling or traffic shaping.
That means that they remove certain traffic and don't even run an auction for it when they are getting too much traffic. If a domain now has a pretty high amount of requests being sent with low amounts of revenue generated per request coming in, this looks to the SSPs as a low-quality domain.
It makes a lot more sense for SSPs to run more auctions for the domain that is generating high CPMs per request compared to the domains that generate lower CPMs per request.
Therefore, the more placements a publisher has on the page, but actually not generating any value to the advertisers, the lower their CPMs become on the advertising side, and then the next kind of domino effect kicks in.
Now all the SSPs are reacting to the lower CPMs even more. So, the Win rate is one of the important metrics to keep an eye on with your SSP partners.
The concept of ad refresh or auto-refresh is gaining traction among publishers seeking to bolster their revenue streams. Ad refreshing involves dynamically updating ads within a webpage after a certain time interval, ensuring that users are exposed to fresh content and ads.
This strategy allows publishers to display more ads for a user in a single session without refreshing the entire web page content. If applied to the right units, ad refresh can increase the number of ad impressions and boost the publisher’s ad revenue.
Such ad units might be sticky ads, which are always on the page, ads next to dynamic content, or even in-text ads if the users tend to spend more time slowly reading through them.
However, it's important to strike a balance between refreshing frequency and user experience. Excessive ad refreshing can lead to banner blindness and annoyance, potentially driving users away from the site.
By strategically refreshing ads outside the viewport (as in some Single-page applications for the ad to be shown again right after) or during natural breaks in content consumption, publishers can enhance engagement and revenue without compromising user satisfaction.
It is true that Click-through rates (CTR) have long been a staple metric for measuring ad performance. This originates from the days when CPC ads were dominant, but since then the industry has gone a long way, focusing solely on CTR may not provide a comprehensive picture of user engagement and revenue potential.
Advertisers want real engagement and value from their ad placements, therefore, websites with accidental clicks or low intentional clicks will not provide the desired results for advertisers.
As a publisher, you might know the number of outgoing clicks - but the bounce rate on the end and the conversion rate might be much more important for an advertiser.
A study was conducted online among 1,106 respondents in the U.S. by Button, and it was found that the majority of respondents (64%) between ages 18 - 72 rarely or never intentionally click mobile ads. So, it is crucial to differentiate between accidental clicks and intentional clicks.
To optimize revenue generation, publishers should focus on creating compelling, personalized experiences and relevant ad content that encourages intentional clicks. This involves aligning ad messaging with user interests, leveraging contextual targeting, and employing interactive ad formats.
On the other hand, publishers should always be careful of getting hit with a Confirmed Click Penalty from Google - which may result in a bad hit to revenues. By prioritizing intentional engagement over passive clicks, publishers can drive higher-quality traffic and improve overall ad campaign effectiveness.
The proportion of ads to content on a webpage, commonly referred to as ad density, is a critical factor in optimizing revenue while ensuring a positive user experience.
Publishers often grapple with the question "How many ads should I put on my page?" The answer lies in finding the delicate balance between ad visibility and user satisfaction.
According to the Coalition for Better Ads “Ad density is determined by summing the heights of all ads within the main content portion of a mobile page, then dividing by the total height of the main content portion of the page. For mobile devices, ad density cannot be higher than 30%. Meaning, ads that take up more than 30% of the vertical height of a page are intrusive”
An excessive number of ads can lead to slow page load times, negatively impacting both user experience and search engine rankings.
Google recommends adhering to best practices for ad density, such as limiting the number of ads per page and avoiding intrusive formats that disrupt content consumption.
As the digital publishing landscape evolves, publishers are increasingly focusing on user experience as a driver of ad revenue in 2023. This shift underscores the importance of delivering high-quality, engaging, and relevant ads that seamlessly integrate with the overall user journey.
To improve ad quality and campaign performance, publishers should embrace innovative formats such as native ads and interactive multimedia. These formats not only enhance user engagement but also foster a positive perception of the advertised brand.
Furthermore, leveraging real-time data insights and predictive analytics can enable publishers to tailor ad content to specific user segments, maximizing relevance and resonance.
In this exploration of ad revenue maximization strategies, we've gone beyond the surface-level metric of viewability to unveil the intricate web of factors that contribute to enhanced revenue generation for publishers.
From strategic ad placement and ad refresh tactics to intentional clicks and ad density considerations, the path to revenue optimization is dynamic. As the digital publishing industry continues to evolve, staying ahead of the curve requires a holistic approach to ad monetization.
By striking a balance between ad visibility and user experience, publishers can unlock new avenues of revenue while cultivating a loyal and engaged audience.
To delve even deeper into the realm of publisher revenue maximization, explore our next article: 11 Crucial KPIs for Enhancing User Experience and Driving Revenue Growth in Publishing.
The transition to Yield Manager led to a significant improvements in World History Encyclopedia's programmatic advertising revenue. Within weeks, they witnessed a remarkable 25% increase in overall advertising revenue from programmatic advertising. This increase continued to grow, ultimately reaching an impressive 63%+.Read More
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