The world of digital advertising is changing rapidly and on a day-to-day basis due to the Coronavirus pandemic. If you’re seeing lower RPMs over the last few weeks, especially lately, you’re not alone!
This post is an update on trends we’re seeing in the industry right now, so you can stay up to date.
Caveats: It’s important to note that these trends span thousands of sites, so many site-specific changes are averaged out. Some sites are seeing huge spikes in metrics and others are seeing very large declines. A single publisher’s experience may be very different from these averages!
Advertisers are cutting back on spending for now
Our ad sales team works one-on-one with many advertisers to negotiate unique deals for AdThrive publishers, and they’ve been touching base with our partners over the last week. Many advertisers are cutting back on their advertising spend right now for several reasons:
- Some don’t have products/services to sell at the moment. Either stores are out of stock of their products, or the stores that sell their products are closed. Or for retailers/restaurants/travel companies, their stores/hotels/airlines are closed or closing for the time being. With event cancellations happening across sports, concerts, and entertainment, they are also struggling to determine where to focus their traditional spend.
- Some don’t need to advertise to sell products right now. Their products are in such high demand that advertising would drive demand that they can’t fulfill.
- Some are trying to avoid Coronavirus-related content. They don’t want to be seen as capitalizing on a crisis. They’re also trying to figure out the right places and ways to advertise on this sort of content, but it takes time for them to figure this out.
Product shortages and Coronavirus advertising strategies will hopefully be addressed relatively quickly, so we expect some advertisers will be back in the short-term. It will be longer before stores reopen and some industries recover, and those advertisers will take longer to come back to market.
What we’re doing
We’re staying in close contact with brands and advertisers and working to help them understand how readers are behaving on your sites. We’re also educating them on how to spend safely (and why not all pages with Coronavirus keywords are risky to advertise on!) with the hope that this encourages creative ways to regain momentum.
RPMs are volatile
RPMs are seeing swings from one day to the next that vary widely across different websites. While your site’s RPM has always been made up of unique factors, those are coming into play more than ever as reader behavior becomes increasingly unpredictable and some posts see higher-than-normal or lower-than-normal RPMs.
Three major RPM components
You can think of the RPM for each of your posts as being made of three main ingredients:
- Advertiser spending (CPM)
- Reader behavior
- The ad layout that’s running on the page
Then, the RPM for your site overall is an average of the RPM for each individual post. (You can drill down into this in the RPM by Page section of your AdThrive dashboard.)
Advertiser spending is declining right now
This week, we are seeing advertiser spending drop. In some cases, CPMs are decreasing by 20% from the beginning of the week. Part of that is driven by advertisers reducing their spending, and part of that is being driven by more time spent on site — the more time a user spends on a site, the more ads they see, and later ads in a session earn less than earlier ones.
We’re also seeing more significant advertiser spending drops on content with the keywords “Coronavirus” and “COVID”. RPM on posts with those keywords decreases by 30% or more, although increased traffic based on those keywords may bring up net revenue for those posts.
Reader behavior is different
Pageviews are up, in general, across many verticals, but reader interest is shifting and evolving as world events unfold. As health concerns, quarantines, and school and workplace closures are top of mind for many, your star content from 1-2 weeks ago may not be seeing the same traffic, but other types of content are beginning to trend.
For more information on the types of content that is trending at the moment, check out our recent content insights post.
Time on page is up significantly for many websites and more time on the page leads to more ad impressions per pageview. AdThrive ads that are in view refresh every 30 seconds, so the longer someone spends on your site, the more you earn for that visit.
This means that net revenue may be a much more valuable metric to look at than RPM right now.
Ad layouts: page to page differences, video is staying strong
As you’re considering overall RPM and post-specific RPM, keep in mind the ad layouts running on pages that are receiving significant percentages of traffic. If traffic takes off to a post with ads turned off or that has fewer content ads because it’s much shorter than average, that can have a large impact on earnings and as a result, RPM.
Video content is performing exceptionally well right now. Video is seeing fewer negative impacts from recent changes than display ads, so video RPMs are hanging in there at the moment. As readers spend more time on the page, capturing their interest with video content is especially valuable for your overall earnings strategy. If you don’t have your own video content, we’ll create some for you — just ask.
If you are looking for ways to maximize earnings, the Auto-Optimize option in the Ad Preferences section of your AdThrive dashboard is a good option right now. While we are already checking in with every publisher regularly to offer suggestions, this setting means the AdThrive team will automatically apply every new ad opportunity to your site and let you know. We always love to hear from you if you’d prefer to reach out, too!
This week’s takeaway…
Because of increased traffic, decreased advertiser spend, and rapid shifts in readers’ online behavior, you may be seeing volatile RPMs and decreased (or flat) overall revenue.
The situation is also changing very rapidly. It’s likely that the industry sees more declines in the next few weeks, before any improvements. We will keep you updated as advertisers and publishers alike weather this storm together!