Revenue Optimization

Seasonality Trends in Ad Tech Industry: A Guide for Publishers

Publishers who have been in the industry for some time must be aware that ad revenue is impacted by several factors. The ideal way to optimize ad revenue is to pay attention to all such factors and optimize your website accordingly. One of the key factors that affect ad revenue is seasonality.

As a publisher, you might have noticed that during some months, your revenue increases or decreases noticeably. This is due to ad revenue seasonality. 

While publishers may not be able to control the onset of seasonality effects, they can definitely optimize ad revenue to some extent. We have curated this blog to help publishers understand seasonal trends in terms of revenue and preventive measures that they can take. 

What Causes Seasonal Fluctuations?

According to Google,

seasonality is any predictable fluctuation or pattern that occurs during the same weeks each year.

For instance, many publishers may have noticed that their CPMs increase during the holiday season. This could be the time near Christmas for countries such as the U.S. and the U.K. or the time near Diwali in India. 

Seasonality driven by holidays mostly comes under the cultural aspect. Other than this, publishers may have also witnessed high CPMs because of commercial aspects, which include end of season and black friday sales. 

So, what exactly happens when such events take place? 

Firstly, advertisers spend more money on their campaigns. Secondly, the number of users on websites including e-commerce and social media increases. Both of these factors give publishers a chance to earn higher revenue than they do normally. 

2020 especially witnessed a significant rise in the number of online consumers because of COVID. As per eMarketer, consumers in the U.S. were estimated to spend $190.47 billion on holiday ecommerce purchases in 2020. This was a whooping $50 billion more than 2019’s spending

No doubt, publishers benefit considerably from such seasonality trends as they get a chance to serve an increased amount of ads to a wider audience. 

Similarly, publishers may notice decreased traffic and get lesser deals during months like January and July. This occurs because of the drop in ad spending, as advertisers are engaged in planning activities. The user behavior witnesses change as well, because they get back to a relatively normal routine. 

Such seasonal patterns may affect publishers to a large extent. But with some strategic planning, the damage can definitely be minimized. 

Quarter Wise Breakdown

A lot of companies divide their year in 4 quarters: Q1 (January to March), Q2 (April to June), Q3 (July to September), Q4 (October to December). The following points focus on providing publishers with knowledge about what they can expect during these different quarters. This will further help them to leverage seasonality trends.

  • Q1: Most publishers might be familiar with the term January slump. During the first quarter, advertisers are mostly focusing on devising new strategies for the year and therefore, spend less money on ad campaigns. Moreover, the purchasing behavior of users changes widely as well in January. They are less keen on buying things after the shopping spree for Thanksgiving, Christmas, and New Year. 
  • Q2: This quarter is much better in terms of revenue generation for publishers. Since advertisers spend all the leftover funds on ad campaigns in Q2, publishers get the opportunity to serve an increased number of ads. 
  • Q3: Even though the July slump is not as bad as the January slump, it is a slump nonetheless. Several advertisers start their financial year in this quarter and are engaged in planning for the rest of the year. This means that the money allocated for ad campaigns during this quarter is lower than the last quarter. Due to this, RPMs decrease for publishers in Q3. 
  • Q4: Last but definitely not the least, Q4 is probably the best quarter for all publishers. End of the year witnesses a surge in the number of online users due to the high number of cultural holidays that fall in this time. Because of this, brands spend extravagantly on their ad campaigns. Publishers can leverage this and earn high revenue during this quarter. 

Tips for Optimizing Revenue Generation According to Seasonality Trends

Now we are going to talk about how publishers can maximize their revenue when their inventories are in high demand and what measures they can take to stabilize their earnings when demand is low. 

Q1

The earnings in this quarter are mostly low, which is nothing to worry about. But you can take the following steps to ensure that your revenue doesn’t drop too much and to prepare for the rest of the year. 

  • First and foremost, you should focus on optimizing your inventory. Consider experimenting with different ad units, ad placements, and ad formats. You should keep up with all the innovative ad sizes and layouts that you have at your disposal and if possible use them to add value to your inventory. 
  • Remember that quality content is always an important part of websites. So, it is not advisable to put any less emphasis on it, even if the traffic on your site is low. By prioritizing content you are essentially giving users an incentive to spend more time on your website and increasing engagement. This will further ensure that your site ranks better in the coming months. 
  • Content quality is one part of enhancing SEO for websites. Other than this, you should continuously keep a check on website health and keyword optimization. You can also consult ad ops professionals, as they can effectively monitor your website. 
  • Opting for private marketplace deals can be a good solution for this quarter, since programmatic auctions may not give you the desired results. PMP deals give you more control and increase the value of your inventory. 
  • Bringing down the floor price after Q4 may actually help in getting a higher number of deals. This will further increase the fill rates on your website. 
  • February is much better than January in terms of revenue generation. You can take advantage of events and holidays, namely Super Bowl, Valentine’s Day, and President’s Day sale in this month. 

Q2

Publishers will notice that their websites are performing much better than the last quarter, which means that they should be doing whatever they can to improve their revenue generation. The following points can be of help for the same. 

  • If you were able to handle Q1 in a good manner, you would notice that traffic and user engagement have increased in the second quarter. In order to leverage it, you can try increasing the floor price for your inventory to get more revenue. 
  • Check if the ad formats you used in the last quarter are actually performing well. If they haven’t led to increased ad viewability, you should consider discarding them and using ad formats that work for you. 
  • In the second quarter, you can also leverage honorifics, namely Mother’s Day, Memorial Day, and Father’s Day. 

Note: Avoid making any major changes to your website on dates of any kinds of events or holidays in order to prevent any technical problems.  

Q3

In this quarter, performance of websites is not as bad as the first one but can still dwindle a bit. Publishers will again have to pay attention to some important factors to earn as much from their websites as they can. 

  • You can start the quarter by reducing the floor price a little and then try increasing it again in the middle of the quarter. The changes don’t have to be as drastic as the first quarter, but you need to readjust and see what is working best. 
  • Q3 is also the time when you need to prepare for Q4. In order to do this, you should majorly focus on optimizing your inventory. Experiment with different ad placements, ad formats, and ad units. By the end of the quarter you should have figured out which ad formats and ad placements have higher viewability. 
  • Like the first quarter, you can try PMP deals in this Q3 as well. This will be helpful if you think your inventory is not getting an adequate amount of deals through conventional methods. 
  • 4th of July and Labor Day are two days to look out for in this quarter. 

Q4

This quarter is probably the most exciting time for a lot of publishers. If you are being provided with a lot of opportunities you should also know how to make the most of them. Consider the following points for making the most of these seasonality trends. 

  • Make sure that you are aware about the different holidays and events that fall in this quarter. This means that even if you belong to a country where a festival or event is not a big deal, you should still be taking measures for optimizing your inventory accordingly. This is because your users may belong to the place where that festival or event is celebrated. 

Also Read: 15 Holiday Tips for Publishers

  • Right at the beginning of the quarter you should test if all important aspects of your website are working properly or not. This would mean developing an effective traffic strategy, decreasing page latency, optimizing keyword research, and checking your website’s performance on different devices. 
  • This is a time when ad viewability for your creatives should be high. Since more users are browsing and more customers are purchasing things, optimizing for ad viewability will be of great help for increasing your revenue.  
  • It goes without saying that you should be increasing floor prices in this quarter for getting as high returns as possible. 
  • You can take advantage of dynamic allocation in this quarter for maximizing your revenue. Adsense and Ad Exchange line items make use of this feature automatically. This can help increase your revenue without compromising with your guaranteed deals. Dynamic allocation is a great way to take care of the remnant inventory on your website. 
  • Lastly, using tools such as Google Analytics and Google Ad Manager insights to track user engagement and website’s performance will give you the needed insights for optimizing your site. 

Final Thoughts

It is important for publishers to understand that seasonal patterns and changes are going to occur inevitably. If your revenue declines in one quarter you can always incorporate necessary changes to increase it in the next one. 

More importantly, publishers should know what tactics they should use at what time to make the most of each phase. In addition to this, preparing for the coming quarter is highly recommended for leveraging every opportunity that presents itself. Adhering to the above mentioned points can help publishers to take advantage of seasonality trends. 

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