Convergence Gives Publishers More Ways To Sell Their Inventory
Platforms must address the huge gap between programmatic and premium
Programmatic might take up the lion’s share of media sales, but it’s still not preferred by premium publishers. While Insider Intelligence reported that in 2022 more than 90% of all digital display advertising was transacted programmatically, numbers can be deceiving. Giant platforms like Amazon, Meta and Google drive most of that volume, mainly through small and local advertisers. A lot of premium advertising is still sold directly. PubMatic recently estimated that 57% of connected TV inventory is sold directly, for example. There’s a good reason: Publishers can get significantly better costs per thousand (CPMs).
The sticking point for publishers is that there is continuous pressure from advertisers to transact programmatically because they are often focused on audience-based media buying and performance metrics that lend themselves to optimization via a demand-side platform (DSP).
Publishers aren’t about to stop advertisers from audience targeting nor are they going to drop programmatic. But they do need to address the gaping chasm that exists between programmatic inventory and high-quality premium inventory. Prices for direct-sold inventory can become artificially inflated because they are’t available on the open market, while programmatic advertising can see depressed CPMs because it’s only being valued for the audience, not the context or content quality.
Converged media sales can give publishers a new approach that can raise overall effective costs per thousand impressions (eCPMs) and close the gap between premium and programmatic.