The conversation was conducted under Chatham House rules so Digiday could share what was said while maintaining the executives’ anonymity. 

Here are the key takeaways:

Ad budget planning remains (relatively) stable

“I don’t think we’ve necessarily seen a material change in the cadence of budget flow … There’s definitely shifts and changes – tariffs impact auto, tariffs impact everything. So as macro changes happen, that definitely has an impact on individual marketing plans. But I don’t think it’s materially –  year-over-year – vastly different from where it was before.”

“We’ve seen people prepping for the [4th] quarter, and it’s been… a good amount of success for [Q4]. I think with the ups and downs with AI, it’s more so how can we pump it down and make sure that we can stay true to our commitments, and make sure we can deliver on all of them?”

“The open auction side of things – because that’s directly proportional to the traffic that you receive – has been a bit tricky [to forecast or understand]. Unless you have a really, really high sell-through rate, the traffic drops definitely affect you.”

Publishers’ traffic is tanking 

“We lost about 50% of our traffic, stabilized, and have been there for a long time… My job [in rev ops] is, how do we extract more money per user? And that’s where we’ve done a decent job. Have we recovered it all? No, but … we’ve improved our revenue per user by 40% … We’re not back where we were. But that’s the other way of trying to figure out how to offset that.”

Blurred lines between optimizing for search and optimizing for AI

“[We’re trying to figure out] how to optimize more for AI to end up in the AI engines, and increase traffic through them – and sort of given up on trying to find ways to figure out algorithms. I think we’ve all been trying to do that for a year. I think we’re just sort of beating a dead horse at this point. They’re going to do what they’re going to do. I think most publishers are doing best practices. We spend a lot of time and effort in doing and optimizing search engine optimization … and we have [only] seen marginal increases.”

“My attitude towards doubling down on SEO? That sort of assumes we sucked at SEO in the beginning — and we’ve been in business for over 20 years. So what, we’ve been horrible at it for 20 years? There just wasn’t low hanging fruit there in my mind. Sure, did we improve things? Yes, but those are marginal improvements. That’s like 10% improvement.”

How some publishers are squeezing out more revenue per user

“We did a big project with onboarding. We had a nine-step process for people to onboard. And we were like, no wonder people aren’t onboarding as much. So we cut that down to literally two … That’s made a big improvement with 33% more people actually [becoming] active after they downloaded the product, which is huge for us. So we’re trying to do more things like that.”

“[For us], it was new products. It was ad stack optimization, ad logic optimization. How many ads do we show? How often? Where do we show them? How do we get better at positioning ads within our site, where they’re more endemic, and we’re getting high results?”

“We have our own native card module … rather than rely on maybe a vendor like Taboola or Outbrain … We had success with that … [with] higher value offers running in our accounts, not toe fungus ads and belly fat ads. And it turned a $2 RPM into [$13]… It’s not as many offers, but there’s much higher revenue potential for those higher value clients.”

“We’re in a slightly different boat as a pure streaming player… There’s definitely been a more intense focus on yield management, how we prioritize guaranteed, direct business versus programmatic, how we ensure that we’re filling our pods and breaks to maximum capacity, how we manage our internal marketing and promo cards versus sold advertising. So there’s always a little bit more juice to squeeze, if you try hard enough.”

Direct side, good. Open auction, bad

“On the direct side, we are not seeing any negative changes. It’s been healthy.”

“You want to obviously stay away from the recirculation partners. We don’t rely on that or plan on relying on that. We just hope we don’t have to add more ad tech middlemen to make it worse for us.”

“The open auction… is just getting muddier by the day, and there are more buzzwords coming every three months. We previously looked at SSPs as our allies, and I think it’s something that publishers have to kind of be careful of nowadays. It’s ensuring that we’re choosing our partners correctly, and making sure that we are working closely with agency holdcos, and getting more business from each one of them, and coming up with more robust publisher products.”

DSPs: friend or foe?

“We look at SSPs as our partners … There’s definitely a heavy level of distrust when DSPs are trying to cut out the SSPs to work directly with us. Everybody wants the fee compression. Nobody likes paying an ad tech tax. I think conceptually, we love the idea of making 20% more money … if we cut out a middleman. But practically speaking, every attempt we’ve seen by a DSP to work directly with publishers has really resulted in more value being extracted for that DSP and the tech players, rather than the underlying publishers. So we look at SSPs as our yield management agent in the ecosystem.”

“If we directly connect to a DSP – maybe short term — we’re going to see a spike, because we’re the new favorite child for the DSP’s facilitation team. But that’s a short term spike and long term we just see that as degrading our margin and degrading our ability to manage that yield.”

Amazon is making the DSP market more competitive

“We’re finding that [The Trade Desk] may be a little bit more reasonable on certain aspects of partnership, whereas before, there was an assumption that everybody has to work with them on whatever the terms are that they want. Now there’s a little bit more competitive landscape.”

“[The Trade Desk is] working much closer with us to accommodate requests, feature requests, reporting, improvements, things of that nature. Even as little as a year ago, those types of requests would not be materially considered by their team and they were just added to the backlog.”

AI impact

“The biggest area that we’ve implemented AI has been around order management and internal workflow improvements.”

“They’re bespoke, in-house built tools for us, not necessarily off-the-shelf commercial solutions … We’ve been pitched by dozens of vendors, and whenever we’ve tested off-the-shelf products, they look good in the sales pitch. But when you stress test them with real data and the complexity of bad, inconsistent things that happen in the world of advertising, they falter almost immediately.”