Commentary
The New Golden Rule Of Programmatic Ad Buys: Cutting Consumers In
- by Joe Mandese @mp_joemandese, May 10, 2024
In what may be a first-of-its-kind move, consumers who see ads targeted to them via programmatic media buys on the open web will get a piece of the action. You read that right: consumers will get a share of the revenue generated by the ads served to them.
While you get your mind around that concept, I'll go into some of the background -- including the who, what, when, where and whys -- of what led up to it.
Paying people to look at ads is not an entirely new model, even if it seems like an antithetical one.
I mean, when you think about it, most forms of advertising pay consumers indirectly -- usually be defraying the cost of accessing content, or a service like search, navigation, etc. But in recent years, a burgeoning marketplace has emerged of models that reward consumers explicitly for agreeing to be exposed to ads.
Most notably, this has emerged on gaming platforms that enable consumers to unlock premium upgrades by agreeing to view and ad exposure.
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Industry bodies have even come up with a term for this model, albeit a clunky one: rewarded opt-in advertising (or ROIA, which is kind of the inverse of ROAI, which stands for return-on-advertising-investment).
But most of those models still are indirect forms of payment -- you know, rewards like upgraded, premiums, points, etc. -- not cold cash, although there are some of those too.
I even tried launching a venture to do that some years ago as a side hustle while editing MediaPost. It was called Bid/r and it failed for a number of reasons, mainly because we ran out of funding, but also because we were too early in the game and most people -- consumers and marketers alike -- looked at me like I had two heads when I explained the model to them.
I'll spare you all the gory details, but a decade or so later, some people have credited me with being a pioneer of Web3 advertising models that cut the consumer in. Bid/r's model was actually very different than that. Our thesis was that consumers were the end-market for advertising, and therefore had the right to sell their own attention directly to brands that wanted to acquire it, and we were simply a platform for facilitating that.
During Bid/r's early startup years, I bumped into a number of people who had similar ideas, but with slightly different angles. One of them was Sue Fennessy, founder of Standard Media Index, which she sold and is now part of Guideline.
Fennessy went on to found social media app WeAre8, which also utilized a model that cut its users in on a share of its advertising revenue, as well as donating a percentage to charities.
She also recently announced she has changed her own personal brand, changing her name to Zoe Kalar. You can read more about that here.
I've written about WeAre8 previously, and it's still pretty early stage, but it is gaining mass, and this week it announced a deal that will extend its advertising inventory off its own platform and take it across the open Web via a deal with contextual targeting platform Public Good, which helps marketers target "values and purpose" based ads to consumers via an ad network or prominent editorial brands including HuffPost, Guardian, Hearst Magazines, Discovery Network.
WeAre8 calls the ads on its own platform, as well as the ones that will be distributed across Public Good's network, "Golden 8 ad units," which I think is an allusion to the "Golden Rule" (you know, do unto others...).
"The deal takes the ad unit that pays people and charity for every ad view (currently only available on the weare8 app) and distributes it across major publishers via Public Goods programatic network," WeAre8 CMO Luke Robinson explained to me this morning as part of a series of emails we exchanged.
He shared the image above, which shows the unit's call-to-action in an ad served on Food Network, which is part of Warner Bros. Discovery.
The ad says the user will receive four cents directly from WBD, while one cent will be donated to the Movember charity. That makes the net user/charity portion of a Golden 8 a unit buy a $50 CPM.
I asked Robinson what the total ad revenue split was for the programmatic ads served on the publishers' sites, and he described it this way:
"The payment split is consistent across web and in-app: 60% of every dollar invested goes back to people, planet and charity (55% to people, 5% to charity [of which 1% to planet through our carbon project partner, Ecologie, who carbon neutralizes all campaigns]).
I asked him of that was gross or net, but I haven't heard back from him yet. (Stand by for an update.)
Assuming we're talking gross, that means the total cost of the Golden 8 unit is about 8.3 cents per user, or about an $83 CPM.
I also asked Robinson what the revenue share between WeAre8 and Public Good is, and I'm waiting to hear back on that as well.
But I think the deal is kind of brilliant, because it helps solve an immediate audience reach need for both the WeAre8 app, as well as the advertisers who want to use it.
By expanding its audience to the open web, WeAre8 can scale its audience reach quickly, while also recruiting perspective users to install.
The screenshot below shows what happens when consumer not registered for WeAre8 receives one of the Golden 8 ad units offering to pay them for being exposed to the ad.
Personally, I'm rooting for WeAre8, because I think it's an honest and transparent model that recognizes consumers are now an active part of the advertising equation, and acknowledges it.
I still think there are flaws in its model, but at least WeAre8 is heading in the right direction and I can't wait to see what they do next.
Joe Mandese is the Editor in Chief of MediaPost. You can reach Joe at joe@mediapost.com.
I wonder how long before battalions of fake consumers junp aboard.
Joe, one of the flaws in the model is their definition of "viewing". It seems be be nothing more than the ad appears on the panelist's screen---with no overt action to indicate that it was noted or watched. -If the owner of the device was required to respond in some way to confirm that a "viewing' actually happened before getting payment, it would be an interesting and worth testing little idea though it's doubtful that it's a game changer for advertising as we know it.
Very true Ed.
A few more things to consider regarding "viewing".
First, thinking about how the existing TV ratings are calculated. Let's say someone, let's call him Joe, or Ed, or John, start to viewing a favourite program. The metering knows to the second when it was selected, in which abode, on which device, and who within the abode (well maybe not correct all the time as not all people registered). The viewer later sees an ad-break so goes flicking through other channels etc. The 'clock' stops for the original program until they surf back to the original program.
So, in the 60 minute program let's say tuned away for say 12 minutes. Therefore they only count as a 48/60 vierwer ... i.e. 0.8 of a viewer. And Ed, yes I do accept that they may have left the room, answered on the 'phone, started reading something etc. and mightn't have logged themselves off the Nielsen metering device, and yes they would have over-registered their viewing of that program. But by the way, the inverse is possible (and happens) that they do log themselves out from the program they were watching but forgot to re-register when they returned to the TV. The thing is no-one knows 100% accurately what occurred. The problem is that we are all humans.
Now regarding watching a streamed programy on their 'phone or other devices, there can be mistakes as well. For example you watch the start of a stream on TV, then need to do something else so turn the device off. Then a little while later you come back to the program on the TV, zip through it to where you had to log-off and then complete the viewing. Yes, they may have watched 100% of the program, but in two bites.
The big question is, does the system just count 'the starts'? Do they have the ID of the person in the home, the device, age group, gender, location etc.? If not how do they know whether this is a new viewer or a re-visitor? If not, how do they de-dupiicate 'the starts' of that one person into being a 'unique viewer' Then we would have a chance of accurately calculating what proportion of the content was viewed - was it 1.0 or maybe like the TV example of 0.8 of a viewer.
Until it is a level playing field that uniquely identifies, de-duplicates content usage, and evaluates what proportion of the content had an OTS (opportunity-to-see) FOR ANY MEDIUM then we have a mish-mash of dis-similar data that can be pretty useless if you are after accuracy (which you should be).
(P.S. It reminds me of a large digital entity here in AU who were PR'ing that their service could reach 142% of the 14-24s each week.)
Joe, in my publishing sweepstakes for 20 years, my members have won over $50 million in prizes. Incentive advertising has been around for over 100 years and still going strong. 2024 has been a record year in the number of sweepstakes. Two reasons. Advertisers want to create and improve their own databases. Second, the cookie elimination still have many VP marketers nervious about the future. It's cheaper to fill up the database now than to wait and not fully knowingg what will happen.
What you will see in the future is, incentives will expand because of the low cost including the cost of the sweep administration and prizes. Others will offer discount and coupon offers. While give money to the consumer to read a ad migght happen, reading is not the same as getting the person to fill out a entry form and clicking to confirm the data going into the advertisers database.
Fake consumers are part of the readership in every application out there on the Web. Inconsistent and unveriable data will always be the norm at Google and the rest will follow suit.