Why publishers are shifting to first-party audience data

Publishers are seeking greater independence from Google by developing their own audience databases and selling direct to advertisers


Publishers have long lamented that people come online to read their quality content and yet the “duopoly” of Google and Facebook hoover up around two in every three pounds spent on digital advertising in the UK.

To add insult to injury, publishers have accused the duopoly of routinely monetising their stories in search results and through social media sharing, without any reimbursement. It was this angst that led to Facebook blocking news content in Australia before reaching a compromise and agreeing to pay for content. The deal was struck as both Google and Facebook are in the middle of rolling out new sections to their UK services that, for the first time, will pay for content.

Having won the argument on the principle of getting paid for use of their content, publishers are now being proactive on grabbing their share of the UK’s advertising pot. The timing is perfect with Google bowing to public pressure and preparing to drop the tracking cookies that aid advertising targeting, but consumers have found intrusive. 

As the old system of advertising comes to an end, the year ahead is going to see a huge amount of upheaval as publishers start collecting their own first-party audience data. This will include identifying visitors’ interests by content consumed and noting their email address, if they are logged in. Owning this data, and turning it into highly defined audience types, enables publishers to sell advertising direct to brands at higher rates, making media owners less reliant on Google’s data and advertising platforms. 

Publisher data improves ad revenue

Immediate Media, the owner of many special interest sites, including BBC Good Food and Radio Times, is an early adopter. Chief revenue officer Duncan Tickell reveals concentrating on developing its own data, via a platform provided by data business Permutive, has seen advertising rates more than double. 

Tickell believes this extra slice of revenue is not coming from Google alone, but also the adtech providers that sit between an advertiser and publisher and “gobble up data and revenue”. 

He points to a recent finding from a report by the Incorporated Society of British Advertisers and PwC which found only 51 per cent of the budget spend on an advertising campaign actually goes to publishers. The rest is sucked up by agencies, platforms and adtech vendors, including Google. The most worrying aspect is the report found 15 per cent of all campaign spending is completely unaccounted for. 

“We’re clawing back some revenue from everyone behind what publisher’s call the ‘tech tax’,” says Tickell. “It’s not only Google, with first-party data and selling directly we can avoid a lot of these adtech businesses in the middle.”

Other publishers weaning themselves off cookies to prepare for a first-party future are reporting similar success. Robbie Bates, head of programmatic and data strategy at Hello!, says advertising for the latter half of 2020 was 56 per cent up on the same period the year before, now the publisher is “less reliant” on Google. He also claims brands can expect a 33 per cent lift in click-throughs on their adverts when audiences are highly targeted and bought direct. 

Similarly, Anthony Hitchings, digital advertising operations director at FT.com, reveals the site ditched working with tracking cookies several years ago. Its most targeted audiences give the site a 44 per cent better yield.

Can publishers beat Google?

It all sounds like good news and to a certain extent it is. However, there is a “but”, Alex Brownsell, digital marketing industry commentator and senior editor at media researchers WARC, points out.

“This is a real opportunity for publishers to step out of the shadows and take advantage of in-depth knowledge of great audiences, which is very attractive to advertisers,” he says. 

“But collecting that data is very expensive and is probably only something a large publisher is going to do well. It’s possible many publishers just won’t have the resources and will keep on dancing to Google’s tune. It owns Chrome so will set the future rules of engagement in advertising. It’s a powerful gatekeeper.”

One option for publishers is to band together rather than fight alone. This is already happening for local media via 1XL, and national newspapers and magazines at the Ozone Project. Although they still need to invest in data-gathering capabilities, coming together allows them to offer advertisers vast scale through a single platform. It is necessary, Damon Reeve, chief executive at the Ozone Project, believes to help compete with the huge power Google holds over them.

“In the days of print, publishers earned money through advertising and distribution,” he says. “The problem now is Google is all powerful in advertising and it controls distribution; around 80 per cent of the clicks a typical news publisher receives will come from Google and Facebook. We have a massive year of transition ahead of us because Google will make sure that whatever it does next will suit Google, not publishers.”

Publishers must work with brands on targeting

As for brands, Pete Markey, chief marketing officer at Boots, believes publishers improving their understanding of audiences and dealing directly with advertisers can only be a good thing. The one aspect publishers need to improve on, though, is taking to the front foot and being more explicit with brands about what they are doing to improve targeting via direct deals. 

“Brands will work with media owners whose own audiences fit well with those of the brand and therefore allow the chance to deepen relationships and provide a better experience overall,” he says.

“So media owners can start to promote the opportunity they present for brand engagement. Brands will gravitate to this opportunity as it removes some wastage from targeting; it’s more laser focused.”

The switch to precision first-party targeting is gaining traction, but the feedback is publishers need to be more explicit with brands about the benefits of dealing direct. 

Media owners probably have the best part of a year, while Google works on a replacement for cookies. By the time a new system is launched, however, the publishers will have had the chance to both refine their direct-selling capabilities and how they are presented to brands.

This generous timeline means, by the end of the year, a partial shift in the balance of power between Google and media owners is on the cards.