Ep. 38: Beyond Traffic: How AI and Curation Are Redefining Publisher Monetization

[MUSIC] >> Hello, and welcome to the Pugway Podcast. My name is Tina Yanakino. >> And now, Mike Villalovos, and in today's episode, we're going to dive into the AI-driven shift in open web monetization. What rising CPMs are telling us given the following traffic that we're seeing, and how curation is really changing the game for publishers today. >> And joining us for this fantastic conversation is Amanda Martin, Chief Revenue Officer at Mediavine. >> Hey Amanda, how are you? >> Hi guys, thanks for having me. Of course, and before we dive into all those fantastic topics, do you mind calling the audience a little bit about your role in your background, just to give some context? >> Yeah, sure, so I'm currently Chief Revenue Officer at Mediavine. I've been here for about three years. I oversee all the go-to-market teams at the company. So from publisher development to buyer development, marketing, commercial partnerships, runs the gamut, basically if we're out talking to people not inside the company, they report to me. And if they're technical and product, they report to our CEO Eric. I have a slight unique background because I actually come from a mix of the sell side and the buy side. So prior to Mediavine, I was at Goodway Group Freight years. I did everything from client strategy to partnerships, to corporate development, to leadership roles. And really kind of got my programmatic chops on the buy side. But previously was on the sell side in digital advertising. So have been in the ecosystem my entire career, I predate programmatic. But have seen it all. I think I've done every job that there is from operations to sales and the likes. And so I've had a lot of great experience that I bring to the CRO role, which makes me a little bit more technical than your average CRO. But also well-versed on the buy side, which is a unique, more unique than it should be on the sell side of the industry. I agree with that. So I would say Jack of Altrade's master of all, which I'd love to see it. But it actually leads us perfectly into, I think, the first question, right? Because you've seen, like, we all started with the years of the mobile. Like 10 years of the mobile. Yeah, there was 10 years of mobile. And then we saw the death of the cookie obviously happening. And then the pullback, I bet the pullback from Google. There's so much that just changed there. And now we're obviously seeing AI and LM's take a strong hold on publishers, right? So how are you seeing the monetization of the publisher's strategy? But also what's the impact that is relevant and also what's just hype that? And maybe it's a small shift today, but actually not a big impact tomorrow. Yeah, I think what's interesting is that the impact runs the gamut. So not all publishers are being impacted the same exact way. Different verticals are impacted in different ways. I think the largest shift we're seeing is that the share shift of traffic leaving Google search going to any website is just different now. You hear about, you know, the zero click, like Google zero click trend. We've seen about a 20 to 20% increase in zero click activity coming out of search. That for some sites can mean a loss of 70% of traffic. That for other sites means that their traffic is growing right now. So there's not a uniform trend line across every single website. I think what it does is it creates a new world. In the world of open web search, you worked to get discovered through search. And any website could get discovered and could drive that SEO strategy and create an audience from search versus through brand authentication or from an audience that returns to your site on a regular basis. The real shift is sites that are winning are sites that have loyal, niche audiences and sites that are struggling are sites that definitely benefited more from search results and playing the SEO strategy game, which has just changed dramatically. So I think it's not so much once they're on the site that things have changed. It's how they're discovering publishers. But once they're on the site, things are changing as well. The monetization of the sites are not the same. And so hopefully this is a little bit of a seesaw where we're balancing loss of traffic with a demand shift in audience kind of relevancy and CCPMs continue to rise as you mentioned before. Yeah. And I guess that also leads into the sort of SEO or AEO. So how is Mediavine approaching now with its publishers? I'm more so just curious. Are you guys providing guidance on that webinars? Or are you kind of like I'm figured out? It's a little bit of both. So they have to live in both worlds. As much as the Google share shift is being felt at an individual publisher basis, Google searches still extremely relevant and will be relevant for a really long time. I think the difference is they now need to be discovered in agents and in AI responses in a way to get audiences to be aware of who they are and for them to be a brand authority on their kind of area of expertise. So that looks very different when you're kind of customizing your content for a click versus customizing your content for discovery, they do not follow the same pattern. So right now it is harder for publishers because they have to balance both. And right now the share of discovery turning into traffic from AI agents is fairly minimal. But the brand recognition coming from agents can be much larger. Whether that's positive or negative based on how the models are training on your site. So I think it's a balancing act of both and not all sites and all verticals are created equal. So some some AEO or GEO or whatever acronym we settle on in the long run about what it is is more relevant from some sites and for some other sites SEO is still king and that's that's where their focus stays. I agree that every site is going to be different, especially with content discovery. One of the challenges I would push on on you a little bit is the way the search bar has now been formatted where you have kind of like the AI aggregation of information. So it pushes everyone now below like below the fold. So like first now looks like the third spot basically essentially a mobile. I mean that's just an ecosystem shift versus discovery, right? Do you see that actually playing into the trends that you're seeing or what are your thoughts around it? Yeah, I mean I think that leads more to the zero click results than anything else. I mean if if your first response is not a clickable thing, you're no one's clicking. They're reading it and they're going, you know, they're moving on. I think also it changes organic search was enough to completely sustain a site in the past and I don't believe that's the future that Google's pushing and I don't believe it's the future that consumers will be kind of forced into. So we're starting to see publishers actually invest in obtaining traffic in a way that they didn't have to or it wasn't as self-serving before to do that because organic kind of won over. So I think that's the shift. It's not so much search. It's paid search versus overlay response. Yeah, and also goes back to every publisher creator. What have you needs to have a diverse strategy for revenue? I'm when she made a prior to seed tag and I remember at the time influencers now creators, we would always get so annoyed be like you just need a website. I know you don't understand it, but you need to capture emails, we need a website even if you get zero page views and most of your money is in meta. Unfortunately, meta dictates your life that and what's an important approach that you have to diversify. Yeah, and I think owning your audience is more important than anything and it's funny because I think this is a social media trend that everyone experienced when TikTok went black, like everyone was like oh my god, my platform's gone, my audience is gone and I think influencers learned that lesson in that moment. And I think in this moment, web publishers are realizing not all traffic is created equal and repeat loyal visitors are extremely valuable. And you know more about them and you have insights into them and you can recognize them. One off traffic spikes from a search or discover pickup is great, but it's not going to monetize at the same level that your regular returning visitors do. Yeah, I feel like I'm also seeing an increase in kind of the sub-stack approach. Like I just been seeing that a lot more recently. Like I've been an avid fan of sub-stack for a while, but I feel like I'm seeing it a lot more in the wild organically. Yeah, I think community is an interesting kind of diversion from like the search discovery realm and owning your audience. I think sub-stack is interesting. I think our publishers are looking to own their communities. So you have a lot of creators or publishers going to mighty where they can own their monetization efforts and they can kind of drive their own platform per se and not kind of live in a walled garden approach. I think sub-stack is like somewhere, I would call them somewhere between a walled garden and owning your own platform. And so I think that's publishers are just like influencers now. It's really about what do you own versus what are you willingly accepting, but know that you can't bet on forever for it to happen to you own. So like and that's a really good good topic to bring up, but we leave you look at the open web in general. It's always been kind of this vast inventory source whether it be long tail or premium didn't really matter. And now it's like what do you own, but also what are you gating off? So I feel like that's becoming interesting. Do you feel that we're starting to see more scarcity. being by intention, but are you seeing that trend starting to happen even more with like even premium publishers and gating because they don't want to be, you know, scraped by the LLM's basically? Yeah, an LLM's of eight everything at this point. Yeah, I mean, I think, I think it's twofold, I think it's how are you owning your audience, but then agents don't act like humans. Like agents do not have the preferences that humans have. They do not have the brand loyalty that humans have. So if you think about a premium brand, like the New York Times or the Wall Street Journal, like anyone is going to say, oh, that's a news organization. Like that's a good journalistic source. The agent doesn't have that bias towards a brand for like quality. And so I think what it means is that it's a neutral playing field in the sense of like, is your content unique or is it commoditized? Can you find it everywhere or can you only find it in your flavor on your site? And so I think it actually clears up a lot of opportunity for like niche sites that own a unique topic to actually grow in this, but I think it threatens sites that are extremely competitive or commoditized. And the scarcity kind of sits within the brand loyalty to your point, right? Do you have the audience? Do you have the people who like, intrigue about whatever your journalism is publishing? I think one of the interesting crimes I saw on Q1 was Google's search went down, but their CPMs, like the search CPMs went up. And the earnings call was up 70% year on year, which was like, wait a minute, how was that going up? And it turned out that there was monetizing much better and their CPMs just kind of got jacked up as well. Are you seeing that same trend of programmatic for the publishers today? Yes. I mean, we're seeing increased CPMs across the board. I think the difference is it's like obviously increased CPMs with decreased traffic. Isn't necessarily like an up-up-up story for a publisher, but we are seeing our inventory trade at higher rates than last year than the year before that. And I think it isn't that inventory is scarce, it's that audience is scarce. And like the open web was always just like the race to the bottom and you can find us anywhere and you can, you can't now because they're in world gardens where the advertising and brand spend is almost over-concentrated, over-message too. And then they're in agents that are not advertising friendly yet. And so if you really think about where you find your audience, it's harder and harder to find your audience, which drives CPMs up. So I think, do I think it's going to happen at a balance of traffic versus CPMs for some sites? Yes. Not for all sites. It depends on how much traffic you're retaining with your loyal audience. But CPMs are getting healthier, but they're getting more discerning. So advertisers are not spending on the open web. Like with just like a wherever I find my audience, it doesn't matter. They're getting far more particular about ad experience, brand safety, what is the content look like, how AI populated is the content. Like I think brands are actually getting more discerning, which is adding to the scarcity, which is a good thing for good publishers who have great audiences. Yeah, for sure. And something else that was pretty eye-opening recently on kind of the bot topic is how CloudFare even called out that bot traffic has exceeded human traffic for the first time in search recently. For mediavine and where you sit and publisher management, especially relates to their traffic, I feel like most publishers are probably using Google, not to pick on Google, but it's typically their ad server, typically their main analytics platform. How are you seeing the tracking of that difference in between bot and human traffic? Are you seeing any gaps or blind spots in that? And how are you helping your publishers unearth those data points? Yeah, so nothing against GA4 is directional at best because it does not categorize everything. And it is definitely influenced heavily by bot traffic right now. So publishers that are looking at RPM metrics are having heart attacks because it looks like their RPM is tanking, but the reality is that their bot sessions are spiking. And the math equation is just not actually measuring human consumption. So we actually rolled out new metrics in our dashboard. We call it monetize RPM, monetize sessions, monetizable impressions. We're basically, we are identifying a session by a session that we can confirm as a human and that ad impressions can serve against because no one can serve an ad against a bot. It doesn't work and it doesn't happen. And so what you'll see is you'll see a decrease on some sites of like 40% of their sessions are bots that GA4 is not distinguishing between, but when you look at the sessions that are humans, they're monetizing at an incredibly increased rate compared to last year. The scale isn't there, but the influx of fake bot traffic is really hard for them to discern what content is relevant to humans versus what content is just being scraped more by bots. I think something that publishers will pay far more attention to is the analytics becoming available around how bots are on their sites because it is skewing their perception of consumption of content and importance and relevancy of content on their site. If an LLM is coming to you all the time, tons of bot traffic, but never sending you any traffic, that isn't serving you in any way. And that content isn't any more valuable and you shouldn't create necessarily more of it. But if humans are coming to that content, then you should be creating more of that. So we created those metrics so that they could toggle between the full picture of everything and everyone coming to their site and then the picture of just humans coming to their site. It was like a new viewability metric. I mean, speaking of bots, bots can't give you attention, bots can't give you brand loyalty to your point earlier. But there's a fallacy that I've realized with publishers where, if they're losing traffic, they just increase the ad load. It's a short-term strategy. 100%. I understand why that would happen, but that can't be the reason you do it. That's also why you have attention. When you look at attention, it actually de-centivizes having too much ad load and it looks like having four to five slots versus 15, depending on certain publishers. That also plays in MFA territory. How do you think publishers should be approaching the long-term two point? It is short-term fix. The long-term fix to that. And does that change how they speak to buyers to even curate their own inventory in a way that's going to be more conducive to vertical buying or whatever it may be that's best for their business? Yeah. I mean, I think ad experience, I mean, when I was on the buy side, I always had preferences around ad experience, but I didn't have any tools in my DSPs or anything that allowed me to differentiate between a cluttered page and a non-cluttered page. So I was doing that all through kind of archaic manual block allow lists and trying to figure out on a desktop screenshot if I liked an ad experience or I didn't like an ad experience. Now there are so many metrics to your point, like beyond viewability. I don't know that viewability actually gives you much of an insight into someone's attention or how many ads are competing for that viewability metric, because every ad on the page can potentially have the same viewability if there's 10 of them, but it's a starting point. It's table stakes, I would say at this point. What we're finding is that we actually are moving our sites into fewer ad slots, fewer ad loads, because it's only helping boost those CPMs, but we're not looking at it like you can recover revenue by just adding more ad slots, because DSPs are much smarter now, and they are buying against ad experiences at a rate that they just were not even three years ago when I came to the cell side. Ad experience was not a deterrent for site spend, and now it is. So I think it could feel to a publisher like it's like your traffic is down, and now we're going to pick on you for putting more ads on your site. But at the same time, if we don't encourage better ad experiences, our performance won't support the CPM growth. And so if you can't support performance, and it's one thing that publishers are very far away from, publishers don't see any metrics about performance for their site. They do not get those metrics back from DSPs. They do not get those metrics back from SSPs, so they really don't know what's performing and what doesn't perform, then we go to great folks like Jones Media and different third party vendors to help us understand where our ad experience is better. We've found that when we optimize our ad experiences, we can increase performance by 28%, just by decreasing the ad load on the site. That boosts CPMs by 24%. So it is a balancing act. You're losing ad slots, but you're gaining CPM, but that's the game we're in now. It is not this, like, more is better. Well, I think part of it also goes into, like, it's not just ads slots, it's looking at sessions, right? So what's the page up in that session? Is it now going from one page view to now two, three, four, and you look at four times five ads slots, it's better than the 15 that you had in the first one, where you would have bouncing initially, right? So like, it's just looking at the depth and the quality of it versus just the initial kind of like the near of the ad load being the solving problem. I also think that publishers sometimes think if I just put this ad slot at the bottom of the page, it doesn't have any ramifications. If someone sees it, I get another impression. It's great. It deflates the auction dynamics for the entire page. So you are not getting the highest CPM for your top ad slot anymore because that bottom ad slot exists and it's changing the entire measurement of your entire page. We buy to have every single ad that's on a page going through an auction because we want to actually truly be deciding what the best ad slot is on the page. And I think we're moving into a space where that is being better understood. But you can't just add code on page and think it doesn't deflate all of your other impressions by 20%. You did not pay anything. It's like adding hub caps on a Ferrari. This is not going to look good. Yeah, I mean, it's lazy loading. We used to be a viable strategy, but you have to keep evolving as the industry evolves. And it's also the basic supply demand. Supply is shrinked. So demand is higher. Yeah. Yeah. And that is not a world that publishers have lived in before. And that's an adjustment. And it is a scary adjustment when you're like, I'm going to take ads off a page and then talk to a CFO about how revenue is going to trend. Like it's scary. But when we started doing it last year, we saw a nice balancing act. And for most sites, there are outliers that just can't support the revenue hit from taking you know, their audience doesn't trade at a higher rate with fewer ads. But for 80% of sites, fewer ads will serve them the same amount of revenue, if not a few percentage points gains. Yeah, for sure. And to call out one of the only buzzwords we haven't really covered in full yet. Shocking. I know. Curation, which I feel like when the industry started bringing it up a couple of years ago, well, at first, you're like, it kind of feels like seller-defined audiences, like lipstick, you're like, what's going on? And publishers again are constantly the last ones involved in the conversation to any change that takes place. And it becomes very reactive. But media mind in particular, you guys have been doing a few, a little bit of buzz on Curation this year and being at more strategic approach and something that publishers should definitely be more heavily involved in. I'm interested to hear how that's been going so far in the initial metrics you can share and just the overall approach for anyone who's not familiar. Yeah, I think so I agree when Curation came about, it felt like we were just like taking the same map to inventory and then putting a new name on it and calling it something special for non-participants to get into the ecosystem. It felt like a backdoor entrance for someone who couldn't get in before. But then when you encourage the publisher involvement and you can empower publishers to not only participate from an inventory standpoint, but also from being a curator themselves, it's a huge opportunity. Now we're talking to other publishers about how we work together to meet brand demand that they have, that we don't have or brand demand that we have that they don't have. I mean, I think it actually gets to a partnership level within the publisher space that we've never had. We were always, oh, I'm competing against every other publisher. Instead of a inventory in audience is pretty scarce and hard to find. If you're talking to PepsiCo and you can't find that audience, why don't you come to my sites as well? And if I'm talking to PNG and I can't find an audience, why am I not just tapping into your inventory as well? It's a win-win. So I think that's been a big shift, but even at Can this year, the amount of curation conversations I had where publishers were looking at it from a very defensive, like, this is not okay, this is going to cannibalize direct buys. I don't like it. I don't trust it. I think there's an element that AI also comes in here where the idea that only one owner of inventory can do a good job with that inventory is probably a bit of a fallacy and that like, there's a lot of signal to be brought to the sell side. So I think that's a big win. I also think it's a revenue source. I mean, for me as a CRO, it's another line of revenue that I'm driving that I was not getting from other sources and that's the same way I feel about a gentick AI buying. Like, everyone's kind of like, oh my god, is it just renaming all the players within the programmatic space? And I'm like, as a programmatic first seller, it's getting me direct dollars that I was never going to see. You wouldn't have won the budget anyway because you didn't have the scale. It's like, here's a solution to the problem. That's it. That's it. Yeah. And with the agent chick buying, I'm curious, has Mediavine dabbled in any of the buyer agent or seller agent conversations yet? Are you guys kind of keeping an eye on it? No, we're actually starting to see money flow. I would say it's early days, I'd say it's one of those situations where it's working, but it's not working the way it's gonna work. If you know what I mean, like, it's like, we're like forcing it to work right now versus it working just naturally. But I think what's interesting is that I see it as a huge opportunity for publishers to get closer to buyers. And that doesn't mean I think a certain acronym should get cut out from the middle. I just mean that like, my goal is to get closer to the money. And buyers are indicating that this is a way they want to get closer to the inventory. And I think the thing that's lagging on that side is again, the publishers weren't in the conversation when it started. And finally, everyone's realizing, oh, we got the money, but we don't have any inventory. And so it's kind of like it's coming back or it's doing the same thing that curation did, which is started as a buy side product. And then, oh, we have to get the pubs involved. I think a gentick's gonna get the pub side involved faster because it's more required for the tech to actually work and talk. We are, we're kind of exploring different paths, partnership paths for agent creation. Will there be an appetite for every single seller to have their own agent? I don't think buyers don't talk to every single publisher today. I don't think they're going to talk to every single publisher tomorrow, even if it's through AI. So I think for us, it's just about testing what pipes work most efficiently and work well and represent our inventory well. And so we're leaning into it. And I can honestly say that I'm starting, it's not pennies anymore. And that's exciting. That is. Yeah. And I feel like everyone created buyer agents to your point and then there was no seller agents. Yeah. How do I emerge from the seller in the buyer? Well, then that's where you get the like, it's a buyer agent that just creates a deal ID. That's it. And I'm like, great. That's efficiency for you. That's cool. Love that because I was an entrepreneur while that was one of the biggest pains that I had, right? But on the buyer seller agent side of it, it does also create a premium as well. Like, this is now this segment or this audience is going to sell for this. What do you like or not? And it meets all your criteria. So the buyer agents to say that objectively makes sense. It'll pay for that. And then you'll see the publisher rise again in terms of like the CPM cost. So I do think there's a lot of benefit there. Because I love the background that you came with so much, I got to ask you two closing questions. And that's what my own curiosity at this point. But the first one is going to be back into like the trend and the innovation that you're seeing take place. It's going to be more like which people keep an eye on. That's not being really watched closely now on the publisher side. And then the second one will be more personal. All right. All right. I would say I think on the publisher side, if there's ever been a time for publishers to lead and lean in and have a voice, it is right now. There is so much disruption. And I think sometimes publishers from both my buy side perspective and my sell side perspective tend to like to lean back and watch and then choose when it's safe to jump into the deep end. I don't think publishers have the benefit of waiting to jump into the deep end. So that means you have to get over your fears around curation. You need to get over your fears about a gentick AI buying. It doesn't mean that you don't need to pay attention to them. But it can't halt your innovation because it will move faster and it will move past you. And I think for especially for open web display and online video publishers like we represent. If we're not at the forefront, they're going to create products for CTV and CTVL. And so we have to get in there. And so I think that would be my piece of advice to publishers is do not you do not hold your yield so tight that you cannot take risks and try new things because being late to this game will will be the largest yield impact you see. Yeah. If you don't decide the industry will decide for you. I pass us. Yeah. And not really. All right. Let's go a little more personal route because you've again, back experience. What's the best and worst advice you've ever received? That's okay with one or the other. All right. I'll go with best advice I ever received. This was early on in my career a good way. And it was a piece of advice that I mean, I didn't want to get it when I got it. It's both negative and positive. But it was that you can be successful or you can be right. And there are very few times that you can be both. And so you need to pick and when I was younger, I was always trying to be right and successful. And I battled that pretty hard. And my boss came to me and said, you need to pick which one you're gonna be because you don't normally. Sometimes perfect storms, you get to be successful and right, but not very often. So I always keep that in the back of my mind when I'm in a situation. Yeah, I really got on post it. Oh, obviously. It's fun. Wonderful. I feel like I can keep talking to you for hours, but this has been wonderful. We're welcome back any time. Hope you enjoy your summer. And I'm sure we'll see you soon. But thank you so much for joining today. Yeah, thanks so much for the time. It's been great. Cool, we'll see you soon. I'll see you soon. Bye. (gentle piano music)