Introducing the SLoP model measuring publisher power

This week we present the SLoP model for measuring publisher power. And there was some big news this week as the AdTechGod and The AdTech Forum joined the Marketecture family. Read about it in AdExchanger or listen to this week’s pod.

Vendor Interview: Semasio

Semasio (formerly Fyllo) is a data specialist creating custom models for customers, with a special focus on regulated industries. Ari interviews CEO Jeff Ragovin about how they make data work in the cookieless world.

Marketecture Vendor interviews are free for a week, then go behind the paywall. You can become a member for just $40 per month to access the complete catalog.

Podcast: AdTechGod and Jeremy Bloom join Marketecture

Big changes are afoot here are Marketecture. We’ve joined forces with the zany online presence known as AdTechGod and the amazing educational content from the AdTechForum.

ATG joins Ari and Jeremy to talk about what it all means, man.

Listen to the pod now:

• Spotify

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• Anywhere you listen

The “SLoP” Model of Publisher Power

In last week’s newsletter I proposed The Internet Advertising Map, a model to map web publishers by consumer “openness” vs advertiser flexibility. There was a lot of feedback on where specific publishers should be moved, but overall feedback was extremely positive.

One friend-of-the-newsletter suggested their own model to specifically evaluate publisher business model strength, and generously permitted me to run with their ideas. So today I’m publishing some thoughts on what I’ve dubbed the “SLoP” model. What is SLoP?

• Scale

• Loyalty of users

• Performance

Let’s dive in.

One isn’t enough

The first insight of SLoP is that having only one of the attributes isn’t enough to create a big business. Scale without performance or loyalty gives you low CPMs and an unsustainable model. In a sense, MFA sites are in this category.

Loyalty alone is basically a popular blog (not that there’s anything wrong with that).

Performance without scale is an affiliate site, or some types of ad networks.

But combine any two and you are cooking with heat. Scale + Performance is a money maker — think Amazon or Walmart Media. Scale + Loyalty gives you a base to build all kinds of revenue models — like Snap or Pinterest. And if you have all three, well I think we know who’s got those goods.

Here are some graphs

Let me start with a huge disclaimer. I know a lot of these graphs are wrong. I spent a couple of hours moving tiny logos around and there’s no science involved. This is for funsies. Don’t get mad.

Performance vs scale

High performance and high scale is the elite advertising zone. You’ve got “Walled Gardens” along with commerce media. Money. I’ve put the CTV leaders, including YouTube, in low-ish performance and high scale — debatable since CTV “performs” but in a less direct and measurable way than other media.

Loyalty vs scale

Loyalty is an important driver of publisher health because it prevents disintermediation. If your users login, give you emails, directly navigate to you, or otherwise have a direct relationship, you don’t need to sweat every algo change from Meta and Google.

The big difference here is the CTV players moved to the upper-right to play ball with the Walled Gardens. Leading global publications like the NYT and WSJ also move right, showing strength with consumers.

Loyalty vs performance

Drawing attention to the upper left quadrant, performance without loyalty seems to me to be a dangerous game. Mobile install networks are great businesses, until they aren’t. Same with commerce media, you can make a lot of money but if the consumers move elsewhere so does the business.

Oh god, the logos are so small

You knew the master graph was coming, didn’t you? Putting all three SLoP metrics into a single graph is challenging, but I think you can pretty clearly see the trend. Being closer to the middle means you have more power to your business model.

Is this useful?

The author of the SLoP model specifically mentioned the model’s usefulness for evaluating the equity value of media properties, and I think that’s quite powerful. Does this company have 1, 2, or 3 SLoP attributes and how strong are they vis-a-vie direct competitors?

For the buy side, there’s an ongoing conversation about the number of media companies to invest in given diminishing returns when adding marginal properties. Looking at Scale vs Performance can bring insights as to which properties might be worth expanding to vs cutting from the plan.

Reading list

• Seedtag buys Beachfront giving the European-centric contextual network a foothold in CTV

• The suit from Colossus against Adalytics has been updated with reliance on work by Dr. Fou and there’s a long LinkedIn argument about it

• Scope3 adds campaign and media reporting

• Emodo is dead

• IAS announces anti-deep fake tech

• Costco is now in commerce media selling “Hot Dog Intenders” (we made up the last part)

• Lara O’Reilly investigates a “vibe shift” in the attitude towards verification vendors