Co-founder and President of Adnimation, Tomer Treves, joined the Enterprise Podcast Network to discuss how publishers can maximize their ad revenue.
Below you can find a full transcription of the talk.
During the interview, Treves discussed with host Eric Dye a wide-array of topics, including:
- Adnimation’s proprietary hybrid header bidding, which has been shown to outperform standard header bidding by an average of 18%.
- Selling less ads for higher prices
- Adnimation’s access to Google’s CTV/OTT monetization product
- Why Adnimation works only with publishers and not advertisers
- Why Adnimation shows publishers their gross revenue
- The importance of maximizing revenue in the current market
We understand that you developed a proprietary hybrid header bidding technology. Can you explain what exactly it is and how it helps publishers?
Thank you for diving right into technology because it’s my favorite part of what we do. So Adnimation is a monetization company. We help publishers sell their ad space in a smarter way and for higher prices. And one of the most common tools in the market is header bidding.
It’s a layer of technology that runs an early auction among advertisers, just before the ad server loads to get more bids, potentially high bids from big advertisers that will compete with other advertisers within the ad server. And this header bidding has been become quite heavy on the devices that users use because we send bids to many different ad exchanges and advertisers and we need to run the auction in milliseconds not to slow down the user experience.
And we developed a layer of header bidding that actually uses both the device and servers. That’s why we call it hybrid header bidding, as we utilize both our strong servers in the background and the user devices. By doing both, by using both CPUs, we are able to do it in a more efficient way and faster. So the result is higher bids which come on time without slowing down the user experience, resulting in bottom line higher ad revenue to the publishers.
And that is certainly tremendous news right there. And thanks so much for your explanation. It makes it so much easier to understand. Now, how is it possible to serve less ads for higher prices? Get into that a little bit, if you would.
Well, I guess this is the biggest question, because at the end of the day, users don’t come to our websites and apps to see the ads.
They come to read and view the content and they want to focus there. And when we put ads there, we take away some of their attention. But this is the most common business model. As publishers, at the end of the day we want to deliver the best possible content and still make money from these ads. And so the short-term solution for many publishers will be to flood their digital assets with many ads because they get a few cents per ad and they want to make more money.
But in the long term, this won’t work. It won’t work because users don’t like it and they don’t return for more. When the content-to-ad ratio is too bad, the users just have a look, they see the ads, and they go away. But also from the advertisers point of view, they pay for the attention of the users, and with too many ads, they don’t get the attention that they were looking for.
So the magic sauce is to be able to sell less ads for higher prices. And this is exactly what ad Adnimation specializes in. And the factors to do that are from A to Z. It’s in the selection of the sizes and locations of the ads. It’s in the pricing mechanisms that we utilize. And we make sure that we don’t sell ads for low prices.
And of course, it’s by measuring many KPIs. The king, in my opinion, would probably be viewability, which means we only sell ads that actually get viewed by users and by such they pay the currency of attention to advertisers, without those ads way in the bottom or on the side that don’t really get in.
Due to that attention, we are able to place less ads and still – using hybrid hybrid head and other technologies – we run auctions to get the highest possible price on those ads and the result is less ads, higher revenue. And for the long term, not just for the short term.
Yeah, and that’s the bonus. The long term, that’s where it really separates from the rest of the crowd for sure.
Now, Adnimation launched the world’s first Google TV monetization product. Can you talk to us a little bit about that and the results you’ve been seeing so far? I’m sure listeners would like to hear a little bit about this.
This is very exciting. Animation has been helping publishers to make more money from their websites and mobile apps since 2013. That’s nearly a decade now. Well, it will be a decade in November. And we’ve seen it with websites in the beginning and then with mobile apps – how new platforms come in, users consume the content and they pay with attention to advertisers. And we’re now seeing another shift in the technology. And it has all to do with television.
Up until a year or two ago, we all watched television through traditional broadcasts, whether via satellite or cable. And in the last couple of years, more and more people watch television through connected devices. And that’s why we call it CTV (Connected Television). It will be through a streamer or a smart TV that’s connected online. And what happened here is that we don’t all watch the same programs at the same time. And as such, we don’t all have to watch the same ads at the same time.
We can use the smart programmatic approach of advertising online now with the big screens. Now, this is a very big opportunity for both publishers and advertisers. From the advertisers perspective, in the TV world they used to pay a lot of money just to get eyeballs with minimal option to target the audiences they were looking and with even lower options to measure the return on their investment because TVs were not smart enough to send back data.
In connected television, advertisers see a big opportunity to improve the results of their advertising, and they’re willing to pay relatively high prices because they come from the traditional TV world with their extremely high prices.
From the publishers point of view, this is exactly the opportunity because instead of the prices that are now pretty low for standard banners and video ads in mobile devices, now they can tap into the big TV budgets, the campaigns, the branding campaigns, and all they have to do is take their content to the big screens through CTV apps.
Now, CTV apps are relatively new, and any smart TV or streamer today, there are hundreds and thousands of opportunities for users to choose from them. They can see exactly the content that they want, but placing the ads in a smart way and selling them in a programmatic way is far from being mature. And at the moment there are a few ad servers and a few ad networks that allow ad demand and video advertising.
But in most cases, it’s almost impossible to enjoy the vast offerings of Google advertisers. And, you know, any big brand when they plan their advertising budget, they start by allocating a big chunk to Google and then the rest of the world. Today, these Google advertisers for CTV are not available for CTV publishers. And this is where Adnimation stepped in and we developed a tool that allows the connectivity of the Google platform to the standard ad service for CTV publishers.
And we were also the first to receive a license from Google to display such video ads from Google on CTV apps, connecting these two: the license from Google – Adnimation is a Google Certified Publishing Partner, and the technology that we developed. This offers a unique opportunity for CTV publishers to bring in new demand and new advertisers.
And these advertisers do one of two things: they either buy the ad space for very high prices or they at least bring competition to other advertisers to push their prices up. So from the CTV publisher point of view, they have an opportunity to increase their ad revenue substantially without any changes to the ad set up that they have at the moment. They just need to add a piece of technology from Adnimation and then they will have they will tap into these many, many Google advertisers for their CTV apps.
So this is very exciting. Numbers are rising quickly. We already sell millions and millions of video ads for relatively high CPMs, very high prices. And we get excellent feedback from both publishers and advertisers. And this is just going to grow in 2023 and next year as well.
It is mind blowing to see where advertising in the space has gone. And thank you for breaking it down on your Google TV monetization product. Thank you for that.
Today we’re speaking with Thomas Trevis. He is the co-founder and president of Adnimation, a monetization company that helps publishers maximize their ad revenue here on Enterprise Radio, a part of VP in the Enterprise Podcast Network.
Now continuing on, we understand that Adnimation only works with publishers and not advertisers. Tell us why that is.
Thank you for this question, because it’s part of why we started the company and why we’re very happy with what we do at Adnimation. We selected a side. We had to pick a side between publishers and advertisers, and we believe that the internet offers a lot of free and high quality information available to all.
But it’s all because publishers do a lot of work to create this content. And without the publishers, all this information is going to be either not there or not accurate or biased. And most of the ad tech world is helping advertisers buy ads for less. And then publishers were left with so little of the big budgets that we’re going into digital advertising.
And we’ve seen how publishers barely survive as businesses. And we decided to take the publishers’ corner to empower them to become stronger businesses. And by such, make sure that they continue to create the independent and accurate and real information, whether it’s the news or recipes, so that it will be available to all.
Now, some companies in the ad tech world, most companies, actually have a split website, saying: “Hey, if you’re an advertiser click here, if you’re a publisher, click here.” And they say that they serve both sides of the equation in the online advertising world.
But in my opinion, there is a strict conflict of interest between the two because when they offer advertisers a service, they tell the advertiser, “Hey, I’m going to get you the best audience and the lowest price.” But on the other hand, to the publisher, they say, “Hey, we’re going to maximize your ad revenue.”
And this is exactly the opposite. You can’t say, on one hand, you’ll get the lowest price, and to the other hand, you’ll get the highest price, because it’s exactly the opposite. And because of this conflict of interest, I believe that at least Adnimation had to choose and serve publishers only. And when publishers need to select their monetization partner, I strongly suggest that they look at what the company has to offer and if they serve both advertisers and publishers, because the money flows from advertisers, they would probably prefer the advertisers interests over the publisher’s interests.
And so I recommend working with a monetization partner that only works with publishers just exactly how Adnimation does. There are a few other companies out there that do the same, but not many, I can say that.
And that is certainly interesting and some good information as well. Now we also understand that you show publishers their gross revenue and not their net revenue as per the industry standard. Talk to us about why this is as well.
Well, it’s an interesting question, and I want to talk about it, but I also want to be gentle not to and not to offend anyone in the industry.
I’ve been in this industry for many years. I’ve seen companies grow and disappear. But what I really learned along the years is that when people stick to the truth and are honest with their businesses and their technology, then they thrive for many years.
And when they try and do things in the gray areas, it may work for the short term, but in the long term they’ll be losing and their clients will be suffering. And this is especially true when it comes to transparency and money and numbers. And we see more and more companies when they handle advertising and monetization, in their service to publishers, they show them only the net revenue.
So a publisher would log in and look at the dashboard and see, “Hey, yesterday my website generated $1,000 net and I can expect $1,000 at the end of the month.” But without transparency, it doesn’t really matter what the agreement says regarding the revenue share or the terms of payment. They only see a net number and they don’t know for how much the ad space is really sold for.
It could be that it was sold for $3,000 and in this case they only get less than a third of the revenue. And in the end, without transparent, some companies are pushed into playing with the numbers, taking more than they deserve. And sadly, I had the opportunity to see that in real reports and real numbers.
When we partner with publishers, we help them analyze their past earnings and in many cases we see that for years they were getting paid much less than they actually earned. And because of that, we decided on day one that we are going to show the gross numbers. With APIs and technology, we pull all the information, we put it into the dashboard and we show the publisher, “If I tell you that last week I sold on your website $10,000, you will see $10,000. And at the end of the month, according to our agreement, we will do a revenue share split. We will take our management fees, pay you the rest, but in a transparent way. This way, our interests are fully aligned and we grow together and we suffer together.”
But when companies show only the net revenue, there is kind of a shadow around or above these numbers. And the publishers don’t even know if this is the real number, if they get what they really should.
And I’m not saying that everybody is cheating and I’m not saying that many companies deceive the publishers, but I am encouraging the industry to be more transparent and to be more fair with the publishers and the advertisers. And because of that, Adnimation is proud to be the only company that shows in the dashboard the gross numbers.
And that’s why publishers who partner with us for monetization, they usually stay with us for years. The lifetime is not measured in months, but in actual years, because they like us for taking care of their technology; they love us because we double the revenue; and they believe in us because of that transparency. So I strongly recommend that other companies will join this movement in showing real numbers and being transparent in their technology, in numbers with everybody involved.
Tomer, really great to have you with us here today and appreciate what you do in this space on behalf of Adnimation and for all the insight and information shared here today.
In conclusion, tell us why is maximizing one’s ad revenue more important given the current market? Let’s conclude with that today.
Well, I think that if you look at everything we discussed today, we see that publishers are a core part of democracy today, because without them, there’s no news, there’s no sports coverage, there’s no freedom of information, there’s no freedom of access to information.
And we want them to survive as businesses and thrive as businesses to be strong enough to keep their information non-biased and real. And to do that, they need to maximize ad revenue as the leading source of revenue and the leading business model for most publishers, websites, and mobile apps. And I believe that when we talk here about online advertising, we actually talk about an important aspect of democracy and of freedom.
And in this, what helps me wake up in the morning and go to the office and believe that I’m doing something good for the world. And my team also believes in that. And if I can leave you with one sentence is, yes, publishers do something good and they should strive to make more money because with that they help the entire society to thrive and become more and more free and give that democracy open and feel good about what they do.