Programmatic advertising is drifting away from open auctions and toward curated private marketplaces (PMPs).
This spells opportunity for publishers – particularly those with loyal audiences and strong proprietary data sets, according to Dave Strauss, The Guardian US’s new VP of revenue operations and strategy for North America. He joined in October.
PMPs “make sense as a buyer,” Strauss told AdExchanger. “You know exactly what inventory you’re buying, and the publisher can apply targeting on their side with first-party data.”
But chasing PMP deals requires a more sales-driven strategy and education to foster a new way of working with programmatic partners, said Strauss, who previously led revenue operations for Dotdash Meredith and Hearst.
Strauss spoke with AdExchanger about The Guardian US’s PMP priorities and how it’s tapping into other emerging revenue streams.
AdExchanger: What’s The Guardian US’s split between programmatic and direct ad revenue?
DAVE STRAUSS: We’re pretty evenly split. This industry is moving toward PMPs, and that’s our biggest opportunity. We’re under-indexed there.
Why are PMPs hot right now?
Cookie deprecation. As cookies go away, buyers struggle to effectively find their audiences [through open auction buys], so they’re slowing down that spend and looking to direct partnerships with publishers, which take the form of PMPs.
Direct spend will go up, too, but programmatic budget is moving toward PMPs.
How are you leaning into the PMP opportunity?
We’re training our direct sales team. We don’t want just one programmatic specialist; we want everyone to be an expert. We don’t have a video seller or a display seller. You sell the entire bundle.
SSPs are great partners and they have giant sales teams. They curate inventory, create deals and sell those deals to agencies and direct to clients. We want to pitch their clients together.
How do you decide which SSPs to prioritize?
We have a lot of partners on the page right now. We want fewer direct integrations but better partners. We’re going through all of our SSPs to make sure they bring unique demand.
The Guardian reported 2024 revenue of $327 million, down 2.5% year over year. Was this due to softness in the ad market?
We’ve seen CPMs drop for a short period of time, but our open auction yield is up over 30% since October. North American revenues have been gaining every quarter this year.
Programmatically, there was hesitancy to spend for [the two weeks prior to the election]. People were trying not to overstimulate an already stimulated user base. Political ad spend was immaterial and not something we focused on.
Are brand-safety vendors a problem for The Guardian US?
Brand safety is not the bad guy. I want us to see them not as something that makes us less money, but the opposite. We’ve been meeting with the major brand-safety companies frequently. We want them educating our sales team.
How dependent is The Guardian on Google for monetization?
Google is a strong monetization partner. They’re also our ad server. [But] we’ve seen a lot less demand coming through Google’s pipes. I don’t know if that’s intentional, and they’re starting to focus on other areas of their business. Maybe other SSPs are just getting better.
Do you think any of the solutions floated by the DOJ in the Google ad tech antitrust trial would be beneficial to publishers?
I’m a numbers guy, so I just want whoever bids the most money to win the impression, unless it’s reserved for a direct campaign. I can’t speak to whether anything is unfair, but my only hope for an outcome is that no one has an advantage and everyone has an equal playing field.
How dependent is The Guardian’s ad business on third-party cookies?
Not very. Our direct ad business is all first-party data.
From a programmatic standpoint, it’s almost hard for us to know. Buyers in the open market are probably using third-party targeting solutions, which are moving to PMPs.
What are you doing to capitalize on the pivot to contextual targeting?
Targeting based on content is a huge part of our offering right now, whether it’s takeovers on sections [of our site] or takeovers on keywords. We’re building more granular taxonomy solutions.
Is The Guardian considering a paywall?
We’re living in a time when a lot of news and non-news publishers are putting up some type of paywall. From a business perspective, I don’t think it’s the right model, because it doesn’t maximize revenue. And from a moral standpoint, I don’t think it’s appropriate for news organizations to be limiting who has access.
The Guardian doesn’t have a paywall, but it does solicit contributions from readers. This year, you netted $111.8 million from over 100 million contributors, up 8% YOY. How important is this revenue stream?
I’m not responsible for that area of the business, but it’s immensely important. This growth demonstrates the value of our users. They are committed readers who are voluntarily donating their money. They’re coming back multiple times a month or multiple times a week, many of them frequently throughout the day – and they’re coming straight to our website, not finding us through social links or other avenues.
Do you currently have any alternative IDs integrated?
Not yet. We’re actively exploring. But it’s complicated because we have a global approach and we have to respect international law, specifically GDPR.
Affiliate marketing was a priority for The Guardian a decade ago. Is that still the case?
We recently launched The Filter in the UK, which is a refreshed take on commerce, product reviews and affiliate content. I’d like for us to really focus on that next year. Not only does it provide a new revenue stream, but now we have this lower-funnel offering and we’ll have first-party data based on lower-funnel behaviors. There are also partnerships to be made with retail media networks.
We’re eager to see how this test goes in the UK, and hopefully we’ll implement it [in North America] soon.
This interview has been edited and condensed.
