AI and evolving platforms push digital publishers to rethink revenue strategies

At afaqs! DigiNews, publishers examined the digital world's challenges and opportunities and discussed their strategies for addressing them.

The landscape of digital publishing is undergoing a seismic shift. As new content platforms like streaming services, social media, podcasts, and short-form video apps reshape how audiences consume content, publishers find themselves at a crossroads.

The pressure to innovate and adapt has never been greater, with the rise of AI, increasing concerns about ad customisation, and the relentless demands of advertisers for targeted, high-performing ad placements adding layers of complexity.

At the fifth edition of afaqs! DigiNews, formerly known as Digipub World, industry leaders came together to explore the future of monetisation in this rapidly evolving ecosystem.

The session titled New Age Monetization: What Lies Ahead - Trends, Challenges, and Opportunities featured a distinguished panel of digital media experts, including Idris Loya, CEO and head of innovation and technology at IDPL; Sanjay Sindhwani, CEO of Indian Express Online Media; Puneet Singhvi, CEO – digital and president of corporate strategy at Network18 Media & Investments; and Samarth Sharma, COO of Asianet News Media and Entertainment. The discussion was chaired by Pankaj Sharma, CEO and director of MGID India.

Sharma opened the discussion by highlighting the growing adoption of subscription models as an alternative revenue stream for publishers. He noted the shift in strategy as publishers seek to monetise their content beyond traditional advertising.

Sindhwani added that the subscription model is crucial for those serious about the content business, but emphasised that success requires a long-term approach, focussing on both acquisition and retention.

“It is a long-term journey for publishers to make it a viable alternative or an add-on to one’s advertising business. A lot of premium content comes from print newsrooms so the bottom line has to be enough to sustain the print newsroom. Also, there are two components to the subscription game - acquisition and retention. More than acquisition, I believe, one should work on their retention strategy,” he explained.

The discussion also delved into the complexities of revenue generation in the digital age.

In the digital advertising landscape, revenue generation typically falls into two categories - direct and indirect revenue. Direct revenue refers to income earned through direct sales of advertising space, subscriptions, or other products and services offered by publishers. Indirect revenue is derived from methods like programmatic advertising, affiliate marketing, and partnerships, where revenue is generated more passively or through third-party platforms.

Singhvi discussed the impact of Google's decision to phase out third-party cookies, which has sparked industry-wide concerns about the future of programmatic advertising. Despite Google’s recent decision to retain third-party cookies with user consent, the landscape remains challenging. Singhvi pointed out that publishers are now more focussed on first-party data and are navigating new privacy regulations, which are reshaping programmatic strategies.

Talking about optimising programmatic strategies to strike a balance between direct and indirect revenue, he shared that in the survey that Google did with its advertisers, there was an expected 34% drop in revenue for those who were using Ad Manager and about 21% drop for those who were using AdSense and that came down to 20% and 18% respectively in a privacy sandbox environment.

“During the cookie deprecation discussion, two key developments occurred: publishers began focussing on first-party data, and there was a global push for privacy regulations. This has led to a shift towards privacy-first technology. In the short term, programmatic strategies are unlikely to change significantly, as moving such a large ecosystem requires broader cooperation between advertisers and publishers. Direct revenue will continue to be prioritised, while indirect revenue will evolve, with richer data enabling better targeting and potentially higher CPMs,” he added.

Sharma shifted the conversation towards the growing importance of video monetisation, citing its potential to drive higher cost per mille CPMs. He stressed the need for platform-specific strategies, particularly on platforms like Instagram, where video content is heavily promoted.

“Video monetisation is a priority for everyone because of the higher CPMs it drives. However, what we've seen at our organisation and others is the need for a platform-specific video monetisation strategy. For instance, on platforms like Instagram, there’s a significant platform push for video content in terms of views."

He further stressed the importance of a solid short-form video strategy, but said that its ultimate goal should be to convert viewers into long-form content consumers, leading to monetisation.

“At a platform level, there is a need to customise video production. The primary point to remember is that you're catering to the same user who is viewing your short as well as long-form content. We are chasing both views and revenue metrics at the same time,” Sharma stated.

Idris Loya brought attention to the role of AI in digital publishing, noting its potential to optimise ad placements and enhance ROI. However, he acknowledged the challenges publishers face in balancing the often conflicting interests of audiences and advertisers.

“The audience and advertisers have conflicting interests, and as publishers, we try to serve them one at a time. To do that, we arrange content and ad space in layers to cater to both. I think AI can be useful in identifying those possibilities and maximising the opportunity. Eventually, the traffic is for the revenue,” he said.

While discussing strategies to attract more international audiences to boost business, Loya highlighted the disparity in revenue rates between domestic and international markets.

“The revenue rate we get from other countries is much higher than the domestic rate. In the domestic market, one has both direct and indirect revenue. What we need to crack is direct revenue from overseas audiences,” added Loya.

As the session concluded, the panellists agreed that the future of digital monetisation lies in innovative strategies that can adapt to the rapidly changing media environment. 

We would like to thank our sponsors, MGID (Co-Partner) and Jagran New Media (Gold Partner), for their support.

Watch the full session here: