"You are paying a higher CPM because we are talking about premium content"
"This is our most popular page on the site, we get the highest traffic on this and therefore we have a different CPM model for this, we call it a premium CPM"
As a media planner dealing day-to-day with sales reps, I've found a common thread in almost every single digital sales pitch...
Everyone has premium content?
Social Networking = premium content
Highlights of the football = premium content
Today's weather = premium content
One dog licking the bollocks of another (pictured above) = premium content
The word 'premium' is defined as "something of exceptional quality or greater value than others of its kind; superior". The issue here is that defined value is fairly subjective and is looked upon by sales reps as the value to the consumer, not to the advertiser.
My day-to-day encounters have led me to believe that 'exclusive' is the new 'premium', however, my major gripe with this is that we are surrounded by a digital landscape where only around 5% of content is actually exclusive and by way of today's consumer becomes another web environment's pot of gold in just a matter of hours. The permanence of exclusive content is rare. A movie trailer breaks on Ninemsn, within hours, it is posted on multiple blogs, Youtube, Facebook and the list goes on. As a consumer, I can get pretty much any video on a number of websites at a time that is convenient to me.
Most exclusive content is in the form of articles written by bloggers and journalists that are figureheads of online publications to create consumer loyalty so that users come back to a site day in day out to review updated content.
My questions are; Is there really a benefit around association with exclusive and very new content? Does it actually make it harder for an advertiser to cut through if the content is that damn good? If page viewing times and frequency of viewing increases, does this increase the likelihood of consumer engagement with my ad? If the user is that engaged with the content and is such a frequent visitor does that mean my ads become like wallpaper and that the consumer is glued to this so called premium content?
Some "premium content" based media owners find it hard to believe that historically, our ads work best from a response perspective in environments where users are engaged with very little content and are in their downtime - social networking, messenger, email - these are the environments that are least cluttered by content and advertising. While response isn't everything, publishers sell "premium content" on the assumption that there ads work better because people spend more time on a particular page.
Paul Fisher, head of the IAB recently wrote an article in AdNews urging media buyers to stop devaluing online inventory. It is the natural ebb and flow of digital media in Australia that is causing this significant rate reduction, not the media buyer. The fragmentation of digital media leaves most publishers with no choice but to live by the quote "Year of the Single Figure CPM". There is almost an infinite amount of inventory to buy which therefore creates quite a challenge for some of the bigger media owners who currently protect their yield by selling remnant inventory to ad networks.
If we get better engagement rates on historically cheaper sites who have more inventory to sell and therefore don't need to have as many ad units on a page, where does that leave the bigger media owners who put three islands on a page? Do they need to make integration opportunities more cost effective from a reach standpoint? Do they need to put their money where their mouth is and find a way to measure more than just the click to actually increase the frequency of publisher funded brand performance studies?"
The other major issue between social networks and major publishers is price premiums on use of ad space.
One major media owner recently came into our offices to talk about the different Homepage takeover options - it seemed that buying another 100 pixels below the fold would make the cost of the takeover another $10,000. It can be difficult to rationalise the extra investment to a client especially when social media owners sell ad formats on a flat rate regardless of the size of your targeted audience including ad units that let you integrate with a user's social calendar and encourage WOM. You are therefore paying for the audience, not the integration.
With such a disparity between the the volume of social media inventory and the revenue created, the opportunities for the social media hosts as well as third party publishers to monetise part of this inventory are endless. I envisage the competitiveness of online to heighten. The average social networker spends 22 minutes per user session. That is huge!
I certainly wouldn't call social networks premium content. However, at significantly cheaper CPM's, it is still a very compelling argument as a means of buying effective reach and creating brand integration opportunities.
Premium and integrated branded content is another term thrown around by the big wigs of digital media. A recent media owner referred to a sponsorship by an automotive client of a series of live concerts and harped on about how this was a great example of integration. After viewing the content, it seemed that it was simply a case of a great performer on stage with the automotive client's logo behind her. Is that really integration?
So after this long baffle about content, integration, what is premium? what is not? I have most likely confused you...What are your thoughts on the future of the way in which publishers sell ad space and the associated content around it? Does Paul Fisher have a point? Am I talking shiite again?