The news: It’s been over six months since Bloomberg removed third-party, programmatic advertisements from its website in favor of starting its own first-party ad platform called Audience Accelerator, and early results are strong.
- On the logistics side, advertising load time and visibility improved 15% and 20%, respectively, Bloomberg chief digital officer Julia Beizer told Adweek.
- New advertisements have clickthrough rates up to four times higher than their predecessors, and CPMs (cost per 1,000 impressions) are up 20%.
Why it matters: The news publishing industry has shrunk dramatically over the last decade thanks to dwindling ad revenues ceded over to the Google and Meta duopoly. That decline has thrown it into conflict with tech companies, but the fact that no new widely applicable revenue model has emerged remains.
- Bloomberg’s change offers some insights for how struggling publishers may be able to turn their businesses around. One lesson, Beizer told Adweek, is not to treat websites “like a math equation.” Beizer said that readers come to Bloomberg expecting quality content, which makes ads and subscriptions a “second priority.”
- That’s not to say that Bloomberg doesn’t care about advertisers: It means that Bloomberg recognizes a need to create strong content to advertise against, rather than content that is designed to generate as many ad impressions as possible.
- To take the plunge into cutting programmatic ads, Bloomberg severed a years-long relationship with Taboola, a programmatic ad firm that companies looking to capture a greater share of the ad market had joined forces with just months earlier.
Our take: Bloomberg’s new advertising model provides some hope for revenue-starved publishers looking for a change, but it’s also a move that only a company like Bloomberg could make. Before pivoting, advertising only made up 5% of Bloomberg’s revenues—a drop in the hat compared with its much larger subscription business.
- For those who can’t afford to make such dramatic changes, there are still lessons to be learned from Bloomberg’s strategy of prioritizing content to increase advertising value.
- Partnerships with AI firms and a series of legislative moves around the world to force the ad duopoly to share revenues with digital publishers could also provide a cushion for struggling media outlets to experiment with advertising strategies.