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What are Publisher Coalitions and Why They are Killing your RPM?

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What are Publisher Coalitions and Why They are Killing your RPM?
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Publishers face the same challenge as advertisers on their side with AdSense. And suffer more from Google’s revenue sharing scheme. Which is, in many ways, rigged against publishers.

In an attempt to fight this sad fate of ever-shrinking revenues from Google, some large publishers decided to unite. And fight Google and Facebook at their own game.

What Are Publisher Coalitions?

A publisher coalition is a programmatic entity co-created by multiple media groups in order to mutualize their inventory and centralize audience data, knowledge, and best practices. Or in simpler terms: Premium publishers trading with premium advertisers in a private ad marketplace, selling their unsold inventory programmatically.

Types of Publisher Coalitions

Many coalitions are locale-based. For example, there’s La Place in France, ILX in Israel, CPAX in Canada, SouthernX in Africa, Agora in Greece, AOP and Pangea in the UK. This is great for local brands, but also for global companies and brands.

For example, if Apple wants to target users in the UK, the last service they’ll want to use is Google. They are more likely to turn to one (or both) of the local online publisher coalitions with programmatic buying through an ad agency.

The second type of publisher coalitions are market-specific. Like Style Coalition that offers advertisers premium placement on websites in categories like fashion, parenting, art, health and luxury.

Why they hurt CPCs?

You don’t need to be a rocket scientist to understand that big brands and agencies rather work with premium publisher coalitions. Programmatic is usually cheaper than direct ad space purchases, and it’s easier to reach a broad segment through one of the publisher coalitions. And there’s no risk to the brand, better control of frequency capping and more granular choice of ad placements.

What can you do about it?

If you can’t fight them (and you can’t)? Join them. If you have enough traffic and there’s a publisher coalition you think might accept you? Click on the link above to their respective website and contact them.

But most content creators and blogs can’t compare themselves to the Guardian or major news or content websites. So what can they do?

One of the main weaknesses of the publisher coalitions is their ability to handle hyper-local targeting on mobile. Small businesses targeting people living or visiting the area they operate in? Might pay more for each click than an international brand looking to raise awareness or views for their video ad. These small businesses are most likely to stick to AdWords, Facebook and Twitter ads. If you run a local site, you might want to start giving some attention to geographic areas in your locale, to attract more hyper-local advertisers.

Another weakness is demographics. Most major publishers can offer a certain degree of segmentation based mostly on statistics. So you can reach an audience of women ages 20 to 35 in France who are interested in fashion. But if you, as an advertiser, want to dig down deeper into the segmentation – you’re stuck.

Odds are that a niche blog about technology for the elderly won’t qualify for the publisher coalitions and will choose AdSense as a main method for monetizing unsold inventory. So no matter how large my marketing budget is? I would rather spend it on targeting my specifically defined audience than throw money at premium publishers and irrelevant viewers.

And of course, you can optimize the heck out of your current AdSense setup, squeezing out as much revenue as possible with A/B testing.

Come Together, Right Now?

Publisher coalitions are popping up all over the world, and it doesn’t look like this trend is about to stop. And it’s not surprising. Advertisers and publishers alike hate seeing Google and Facebook make money off their efforts and budgets. From the way it looks, these coalitions will expand to include more and more niche websites to offer better segmentation. They will also find ways to offer better hyper-targeting on the mobile web. Alternatively, Google will find a way to coax publishers back into it’s Googley arms either on AdWords, AdX or both.

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