If you talk with any of the European electronics publications, you’d think that they were doing really well from the switch to online digital advertising, but research shows that it’s not conventional publishers who are benefiting, but rather it’s the internet giants Google and Facebook.
An interesting article cites Jason Kint, CEO of the trade organization Digital Content Next, who states that
“The collective analysis shows that the duopoly of Google and Facebook took more than 100% of the incremental growth in digital advertising for the first half of the year.”
“More than 100%?” This means that the research showed the two internet giants taking existing share away from other publishers as well as grabbing all the new money moving into digital advertising. One of the main reasons for this, in Jason’s opinion, was the incredible volumes of data that these two companies gather about internet users:
“The situation is only growing worse as it’s tied to the unique ability of these two companies to collect data across the Web, apps and contexts”
Can this really be true? It’s certainly true that the two companies are grabbing a huge share of the digital advertising market, although previous studies have suggested that there is some room for other players. For example in April, Morgan Stanley was suggesting that the big two were taking 85% of the growth in online ad spend. That’s still a huge, scary number for publishers.
What’s going to happen? With no look-in for internet darling Snapchat, nor ex-darling twitter, it might seem that there is no chance of publishers being able to fight the two giants of the online advertising industry. But I don’t see it this way. I believe that there is a fantastic opportunity for publishers to gather incredibly detailed data about the interests of engineers, and cut it at a level that broad advertising companies just can’t cope with. If they can do this, then publishers will not only endear themselves to readers, who will get highly relevant advertising, but they’ll also deliver outstanding results to advertisers. Frankly with CPMs and CPCs much higher for trade publications that for Google or Facebook advertising, the publishers are going to have to get smart about profiling the interests of their readers if they are to maintain the premium they attract over mainstream platforms.