05 Dec What a year… it been a ride!
2016, for most web lead publishers, has been a year of creeping but steady change in several major market places, including the very large and all important auto insurance vertical. Prices in several important verticals have slowly collapsed in something akin to a slow moving train wreck. From day to day and even week to week the changes appeared almost unperceivable (in part because the recent mergers of several of the largest lead aggregators have allowed changes to happen almost invisibly, behind closed doors.) However over time revenues and conversions just kept draining away.
By the time most publishers and quite a number of aggregators truly started to realize what was going on, the serious effects were already in place and it was too late to do anything but significantly reduce costs and try to find other marketplaces. How did this happen? I’m not sure, but what you can see is that there’s been a rapid consolidation in terms of fewer and fewer buyers where most publishers had established relations. In addition or maybe as a result, buyer behavior began to change with several instigating practices that really created negative consequences for publishers.
Among these were aggressive scrubbing and fewer pixel fires. Both resulted in less and less revenue per lead. But to be fair, it’s hard to ferret out if this started or was the result of more and more publishers sending out “refreshed” or “recycled” data as leads. Whichever, the negative practices escalated on both sides unit it became difficult to even recognize what had been, just a few years earlier, one of the most vibrant marketplaces on the internet.
Where does this take us and what do we learn? Your guess is probably as good as mine. It definitely shows that even when we’re acting in unison, we’re capable of destroying our own livelihood. It also shows that technological advances to improve transparency can have far reaching unintended consequences… Many of them negative.
Can we dig out of this hole and get back on firmer ground? It’s very hard to say but my guess is probably not in the near term. Expectations, pricing and technological capabilities have to be much better aligned than they currently are. It’s easy to pontificate about “quality” but not pay the real price to insure it or to delude ourselves that prices being offered are sustainable without deceptive practices by buyers to cut corners to cover the true costs of running the buyer’s business. It’s deceptive to think overheads are small or generating leads is easy to do without significant investment.
We’ve a long way to go… Will we get there? It’s anybody’s guess.
Final Word: Countershot Media has come to some conclusions of its own as to where many publishers and advertisers should consider putting their effort in 2017. Contact your account manager to discuss.