This is part of our series on Publisher Monetization: read the other parts on Premium Content and Affiliate Programs and eCommerce!!
In addition to display advertising, premium content, and lead generation models, a new revenue stream has recently opened to publishers thanks to the explosive growth of exchange based audience targeting, and that is, data.
The funny thing is that the data has always been there, it just wasn’t possible to decouple it from the media itself. So an auto publisher was naturally attractive to auto manufacturers because the assumption was that’s where the in-market customers were. The same people that were reading auto websites were also reading news sites, checking their email, and doing lots of other non-auto specific things throughout their day, but there was no way for an advertiser to know that until very recently.
Selling Your Data
Today, there is a massive data marketplace for virtually any kind of data an advertiser might want – last month’s series on demographic, psychographic, purchase intent, and social data is a great place to get a primer on what’s out there. What publishers may not realize though, is that they have the opportunity to sell data into this marketplace, as well as buy it to increase the value of their own display banners. That’s how most of the data is produced online today – data aggregators partner with thousands of sites that specialize in a niche topic and can identify one particular audience, and then combine every publisher’s audience into a single product. The data aggregators pay the publishers on a cost per unique basis, and then sell the data to advertisers and charge them on a usage basis.
Perhaps you have site that reviews high end coffee machines, or is all about eco-travel, or perhaps is written exclusively for people who want to learn to develop websites in PHP. While your audience might be relatively small, if there’s no other way to readily identify those people, it could be a valuable data to sell. This year in particular, there’s likely to be a huge market for political audiences – publishers that speak to registered voters, or either the conservative or progressive minded have an tremendous opportunity to monetize their data to supplement their own advertising businesses. Similarly, the London Olympics are a fantastic opportunity for obscure sports sites and London-focused travel & events sites to get involved in the data business.
No Niche? Consider Being a Match Partner
Even publishers that may not necessarily have a specific type of audience they can identify may still have a revenue opportunity in the data space by becoming a match partner. Simply put, a match partner provides the mechanism to bring offline data online. To be a match partner, publishers have to be able to tie personally identifiable information (PII) like first name, last name, email address, zip code, and other attributes that define a person to a cookie, and on a regular basis. Think about sites that have large email subscription databases, or on-site registration databases – many of these kinds of publishers have either enormous audiences, general audiences, or both. In either case, monetizing on-site ad inventory can be a challenge for these broad publishers, because their primary value proposition is reach, which is less and less valuable as exchange buying becomes more common.
As a match partner, publishers allow a separate company to place a cookie on their site, and pass a unique user ID to that company. Then, the publisher sends a table to the third party data company that maps the anonymous user ID to the user’s personal information. The data company can now use their cookies with this PII attached to help advertisers with offline data bring their data online. The advertiser, perhaps a retailer, typically has a large database of customers and valuable information about their purchase behavior, but no way to know who those people online. The advertiser has PII, but no cookie, so they provide their customer database to the data company, which matches the PII from the advertiser’s database to the PII they received from many publisher match partners, and eventually to a cookie. Now, the data company can sync their cookie with the advertiser’s DSP cookie, and finally enable the advertiser to use their offline data to target the same people online. In fact, the data company can usually add other attributes to the data, such as demographic and psychographic elements, because they likely already have a profile on that user from their own offline data sources.
Clearly there are privacy implications at stake with this mechanism, so publishers should provide complete transparency to their users around this practice, not to mention only work with large, respected data firms that have experience in keeping data safe and encrypted. But for publishers that act responsibly, being a match partner can be quite lucrative, typically much more so than selling data to an aggregator.
Making it as a digital publisher isn’t easy, but those that can manage a suite of revenue models are certain to find it more rewarding. The trick is to find services and features that are complementary to your core advertising business, and don’t distract from your core mission and focus.