It's more to do with declining ad revenues. GDPR has a role to play, but so do ad blockers.
You're making nothing at all from 20-30% of your visitors, because they're blocking ads. If you're actually following the GDPR, then your average CPM for EU users has tanked because you can't track them and can't serve targeted ads without an explicit opt-in.
Your average revenue per page view is declining, so what do you do? More aggressive ad units and more of them. Popovers and interstitials aren't new, they're just becoming more widespread because many publishers are starting to get desperate. Your bounce rate will increase, users will eventually learn not to click your links, you'll push even more people to use ad blocking, but none of that matters right now because you've got revenue targets to hit.
Can someone ELI5 to me why we can't simply have ads targeted to content instead of to visitors?
Native ads do this. It's a huge industry, and will likely get far bigger under GDPR. But it takes highly specialized techniques to make the numbers back out as an advertiser. There's a ton of fraud, the bidding strategy is very different from programmatic/retargeting, the ads that work are different, etc. Most of the ad industry doesn't know how to do this, and many types of ads simply won't be profitable on native networks.
From what I'm hearing from my friends that do ecommerce stuff, product ads targeted to the EU are no longer profitable across the board either. That will force a ton of review sites aimed at EU visitors to shutdown, along with many YouTube reviewers. As advertisers pull product ads out of the major ad networks because they can't make money, the revenue of publishers/content creators in the product review space will plummet in lockstep. Amazon has cut affiliate commissions to the point where turning to them is no longer an option for any site that costs money to maintain either.
GDPR seems to be on track to wipe out vast swaths of businesses serving the EU market, and not just the "evil" ones it was trying to wipe out. It's a shitshow, but it was entirely predictable.
I work in adtech. This has nothing to do with how effective targeting is, and a single site does not reflect the entire industry when they're all competing for the same pool of ad dollars.
There is a massive drop in EU programmatic advertising because of GDPR. Most EU advertisers now buy a few large campaigns with coarse targeting instead, and sites with the biggest reach like NYT will get more money but there's less money in the overall market.
This is another case of regulation benefiting the bigger players (advertisers and publishers). EDIT: curious what downvotes are disagreeing with here.
What's the evidence? This article? That's not the reason why, the whole EU market is down and there are just fewer but larger ad campaigns which go to the sites with the biggest reach. It's regulation causing consolidation.
This change will likely come with a push for better ads. Frequently these days you see whole articles that are actually ads.
They fact they must bode this low now speaks to the difficulties they're facing in achieving revenue growth. Most web users don't use an ad blocker.
Kind of hard to keep perpetual X% YOY growth when you're a Google-sized company. It is impressive for how many years they pulled it off, but those days are probably over.
Non-personalised ads command a far lower CPM than others.
One possible outcome is that publishers have to display even more ads to make up the shortfall. That'll just annoy users even more and so they'll either stop visiting the site make ad-blocking even more prevalent. Either way, the publisher is really the one losing out.
I run a directory-type website. Most visitors probably spent 30s on the site, getting the information they need right away.
I decided to change from 2 to 3 ads per page, make them bigger, and more in-line with the content, rather than just beside and below it. The ad network was a major search engine.
I managed to 3-4x CPMs. Traffic went down by 25%. Effectively, users encouraged this type of behaviour by publishers.
They are dancing around the issue avoiding to state the revenue that they had from EU targeted advertising. This is NYtimes, they attract american advertising and are primarily targeted at americans. They don't even rely on advertising anymore, they have subscribers. Their story is not very telling for everyone else. Anecdotally, since switching to contextual ads in may my adsense revenue has fallen by ~50% : https://i.imgur.com/Ec5LwZg.jpg
And yet, before GDPR, when all of this was happening, those sites still saw increase in visitors and still made money, because people learned to ignore the ads since the design of the core website was pretty good and ads were not obtrusive to user experience.
Traffic per user is decreasing that is why you are seeing moves like this to boost traffic. Their business model relies on traffic per user going up not down. They will continue to do immoral things like this until they go all out and change the terms of service and sell all your data to advertisers.
The main reason for that is because the advertising industry is trying to allocate the same advertising budgets to more inventory aimed at fewer users. Ad blockers are making a real impact and the novelty factor of ads wears off quickly.
That's why there is such an explosion of ad-tech firms, anything to get back to where they were last year in terms of CTR and engagement. Then the users become de-sentisized and then the whole cycle restarts.
One thing is for certain, publishers aren't using cohorts for how browser-breaking advertising is influencing their user retention and overall revenue. Fuck, some of the JS just for news site UI makes it clear no one is even testing their mobile sites on an actual mobile device.
If the ad block rate gets high enough, and if the CPMs do not increase in the face of dwindling supply, publishers will just make content available only in their own apps. Fake crises averted, things change, markets and businesses adapt.
They are buying pop ups so the user doesn't need to click anything. The ads on the publisher's side are sold on a CPM basis so they don't need to click there either. The math just isn't going to work if you need to buy clicks on one side and sell them on the other.
The big magic was basically video ads on the ad exchange. The advertisers paid more and had no actionable metrics to track, much less tracking clicks. There is some smart pricing, so the CPMs do get driven down, but not to 0.
The hard part to this is what happens when you don't get paid or worse you get a bill going back months for money already paid out.
I don't know if this is an appropriate question, but:
Why would a well-known site be sunset by its owner? In one word, revenue. Four years ago, when I came to Dr. Dobb's, we had close to $3 million in revenue, almost all of it from advertising. Despite our excellent growth on the editorial side, our revenue declined such that today it's barely 30% of what it was when I started.
A friend of mine's small business observed almost this same phenomenon. Can you elaborate why revenue has declined, even though page views have continued to grow? Is advertising fundamentally changing, and page views are no longer nearly as valuable as they once were? Or is it specifically because of Dr. Dobbs' context as a software dev news/blog site?
In particular, click fraud seems to be stinging my friend's business, but I assume it's not something that simple for Dr. Dobbs. Also, apologies if this sounds stupid. I don't have a background in advertising or marketing, but I find the subject fascinating and have been trying to learn about it.
EDIT: The next part addresses this:
This is because in the last 18 months, there has been a marked shift in how vendors value website advertising. They've come to realize that website ads tend to be less effective than they once were.
What I'm asking is, in what ways has the landscape changed?
EDIT 2: Thank you for Dr. Dobbs. It's been wonderful over the years, and I'm sad to see it go.
It's much less efficient to do mass ads than targeted ads. Giving a huge advantage to entrenched firms, and cutting off small startups. I guess that's what the EU wants though - protecting it's existing elites through exorbitant income taxes and regulations like these that favours big companies.
The ads have increased and the number of different ones have decreased; either they have less purchasers for ads for my demographic or something's going weird.
I only need so many ads for "current SAAS desperation".
This is ad companies dragging their heels and making the UX as bad as possible. It's clearly a good tactic because you're now blaming the EU instead of the ones tracking your every move.
You're making nothing at all from 20-30% of your visitors, because they're blocking ads. If you're actually following the GDPR, then your average CPM for EU users has tanked because you can't track them and can't serve targeted ads without an explicit opt-in.
Your average revenue per page view is declining, so what do you do? More aggressive ad units and more of them. Popovers and interstitials aren't new, they're just becoming more widespread because many publishers are starting to get desperate. Your bounce rate will increase, users will eventually learn not to click your links, you'll push even more people to use ad blocking, but none of that matters right now because you've got revenue targets to hit.
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