Tech viewpoint on publisher co-operatives
A view from Jay Stevens

Tech viewpoint on publisher co-operatives

It's no secret that many publishers are finding it difficult to compete with the increasing dominance of the digital giants, especially those in social and search.

The five biggest digital businesses combined increased their overall share of global digital advertising to more than 50 per cent in 2014. To compete and survive in the long term, publishers need to take a different approach – this means offering the kind of value to advertisers that the big guys can’t.

Individually, publishers simply cannot compete with the digital giants, nor the simple buying point those companies offer to agencies. But one means for so many Davids to match Goliath that has come to prominence this year is the publisher co-operative. Also known as a coalition or alliance, this coming together of premium media owners to sell their combined inventory and audience data on one platform is now a global trend.

Because of the significant quantities of first-party reader or subscriber data that these co-ops offer, advertisers can have access to exceptional depth and insight that can be used to make campaigns much more hyper-targeted. They also allow publishers to combine their heritage and trust, in many cases built over hundreds of years, making them even more attractive.

The evidence reveals that co-ops are working and driving benefits for publishers and advertisers alike. You only need to look at what La Place Media, the world’s first publisher co-op, has done since it started three years ago. Cost per mille increased by 70 per cent in its second year and revenue is forecast to be €20 million in 2015, with a reach of 70 per cent of France’s digital population.

Co-ops have also recently gone global with the launch of Pangaea Alliance, whose members include The Guardian, CNN, the Financial Times, Reuters and The Economist. The alliance provides collective access to some 110 million users spread across the US, Europe, the Middle East and Asia-Pacific.

But, while the trend is growing, one of the biggest hurdles to the creation of co-ops is publishers’ reluctance to share data with potential competitors. As media owners realise how powerful their data becomes when combined with another’s, these barriers should come down.

In this increasingly competitive digital world, co-ops might be the opportunity publishers have been waiting for.

Jay Stevens is the general manager international at Rubicon Project