Publisher Revenue: Risk + Replacement Playbook

ArcSpan Quantifies the 3PC Publisher Revenue Risk + Revenue Replacement Playbook: Offers 1P Blueprint for Publishers to Overcome 25% Sales Jolt

ArcSpan’s first-party data monetization approach guides publishers to replace current 3PC-driven revenue through implementing high-quality, scalable audience-targeted data initiatives, achieving greater sales and stronger data management practices.

NEW YORK_June 13, 2024— ArcSpan Technologies, the innovative publisher audience monetization company, has released new data analyzing the extent to which the looming deprecation of third-party cookies in digital advertising requires publishers to revamp their audience data operations in order to maintain and grow their sales results. Through quantifying the expected data monetization disruption that publishers face over the coming 12-18 months, ArcSpan’s proactive solutions offer ways publishers can mitigate material revenue losses.

Key Headlines – Publisher Revenue Risk:

  • CPMs on Google Chrome will decrease 42%: ArcSpan analyzed the value of programmatic advertising over the past eight months based on the presence of third-party cookies (“3PC”) across browsers.
  • Google Chrome 3PC deprecation puts 25% of publisher’s total revenue at risk: The impact of a 42% decrease in Google Chrome CPMs translates to a 25% overall revenue loss for median publishers in the study.

Publishers should implement coordinated first-party audience data monetization strategies across direct and programmatic sales tactics to replace and boost future revenue: The good news for publishers is that there is a path and plan to replace and recover from the looming Google Chrome cookie deprecation. ArcSpan provides a blueprint for helping publishers to transition to a portfolio of stronger, scalable audience data-driven monetization tactics.

Figure 1: Publisher Revenue Impact

Study Approach:

In order to measure the potential impact of impending third-party cookie deprecation, ArcSpan analyzed data across a number of top-tier and mid-tier publishers. By dissecting publisher revenue according to channel, browser and cookie presence, ArcSpan was able to identify the portion of revenue most vulnerable to cookie deprecation. The analysis looked at the revenue distribution between Direct Sold and Programmatic channels, of which Programmatic is expected to experience the most pronounced revenue impact. ArcSpan observed an average distribution of 20% of revenue stemming from Direct Sales, while 80% was sourced through the programmatic channel. 

Next, ArcSpan analyzed the percent of programmatic impressions and revenue in which third party cookies were present. While these impressions comprised 68% of total programmatic impressions, they accounted for 80% of programmatic revenue. Finally, ArcSpan isolated the revenue attributable to Chrome browsers in which third-party cookies were present. Among the publishers analyzed, a median of 60% percent of total revenue was associated with programmatic impressions delivered via the Chrome browser where third-party cookies were present. This portion of revenue will thus be the most impacted by CPM decreases in the event that third-party cookie deprecation occurs without viable and scalable alternatives.

The analysis further quantified the potential revenue impact by observing CPM differences based on whether third-party cookies were present or absent. According to ArcSpan’s research, impressions lacking third-party cookies cleared at 42% lower CPMs. To summarize, ArcSpan identified a potential scenario in which 60% of publisher revenue could decrease by 42%, netting a 25% decrease in overall revenue.

Figure 2: CPM Decrease with No 3PC Present

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Revenue Risk Grows to 35% Amongst Heaviest Programmatic and Chrome-driven Publishers

While a potential revenue decrease of 25% represents the median in ArcSpan’s research, the range of outcomes can vary greatly across the publisher spectrum. ArcSpan highlighted a quartile of publishers who were most at-risk as a result of cookie deprecation. Publishers in this quartile tend to have greater than 95% of revenue sourced via programmatic, and greater than 85% of programmatic revenue coming from Chrome programmatic impressions with third party cookies. For this quartile of publishers, the total revenue at risk increased from 25% to 35%.

The Path Forward

Leading publishers are developing strategies to both prepare for a future without third party cookies and mitigate potential revenue losses under those conditions. These strategies typically take the form of a portfolio management approach and upgrading publishers’ revenue operations tools with a focus on first-party data quality, accuracy and scale. 

Chief among these initiatives has been the development of a first-party data strategy to increase the value of direct sales. Publishers are creating compelling first-party audience segments by processing and organizing contextual, content consumption, engagement, and offline data signals. Publishers are also investing in collecting 1P data from their users by offering on-site engagement tools such as surveys and polls, while more premium publishers have been able to acquire registered and even subscription users. They can then develop differentiated data product offerings to both earn data premiums and grow direct sales. A second initiative, which builds upon the first-party data strategy, is participation in audience curation opportunities. In this scenario, publishers with and without a direct sales team can feed audiences into curated deals that meet the buy-side needs to target consistent audience definitions at scale across multiple publishers. By partnering with the right platforms, publishers can leverage A.I. and machine learning to automate site content and data processing to create scalable audiences with accuracy and consistency.

In addition to strategies that support direct deals and private marketplaces, publishers are employing strategies designed to protect and enhance programmatic yield. One such approach is the development of identity frameworks that leverage alternative identifiers in programmatic transactions. A second practice is to incorporate first-party data signals in the programmatic bid stream through offerings like Google PPS and Prebid SDA. And finally, publishers can leverage machine learning in conjunction with their proprietary data signals to optimize programmatic auction prices.

Figure 3: 1P Revenue Best Practices

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Although Google has delayed the timeline for Chrome third-party cookie deprecation, leading publishers are keenly aware that they cannot become complacent. ArcSpan’s research highlights the revenue at stake in the event publishers are forced to accept the level of CPMs that are associated with cookieless impressions today. Regardless of a publisher’s level of readiness, it is important that they identify tools and platforms that can comprehensively address the portfolio of strategies that will enable them to protect and grow their revenue.

ArcSpan’s AMS platform provides Publishers with advanced tools to better organize, manage, activate and measure audience data to improve monetization. Leveraging big data and advanced Large Language Models, ArcSpan goes beyond standard industry classifications to support data accuracy and scale in delivering high-value audience cohorts across contextual, behavioral, intent, and attention-based targeting attributes.

ArcSpan’s collaborative approach to partnering with leading publishers further exemplifies its dedication to providing cutting-edge solutions that empower publishers in the ever-evolving digital advertising landscape.

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About ArcSpan Technologies                                                                                             

ArcSpan Technologies is a best-in-class sell-side audience monetization company empowering publishers to unlock the full potential of their first-party data to generate incremental advertising revenue. ArcSpan’s innovative Audience Monetization System (“AMS”), is a next-gen first party data platform (“DMP”) purpose-built to provide publishers with an easy to use, cost efficient platform that can process, manage, model, and activate the entire spectrum of publisher data to monetize audiences and drive ROI.  Established by digital industry leaders from Accordant Media, Dentsu, NewsCorp, Adobe and Beeswax, ArcSpan prioritizes consumer data privacy and fosters industry transparency. The company is headquartered in New York City with an additional office in London.

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