TMG shifts to advertiser-centered programmatic approach, doubles revenue

By Mark Toner

Editor’s note: This is one of 11 case studies featured as part of INMA’s strategic report “Programmatic Advertising Opportunities for Publishers,” released in September.

Like most publishers, TMG Landelijke Media B.V., the Amsterdam publisher of De Telegraaf, has struggled with the decline of print revenue and not-fast-enough growth in online revenue.

To address this, TMG created Publisher Market, an automated-trading initiative that aims to help other publishers implement automated trading and leverage their combined power against giants like Google, Facebook, and Group M/Xaxis.

TMG started with yield management in 2009. That evolved into automated trading in 2010. The goals were:

  • Gain more revenue.

  • Avoid channel conflict.

  • Lower the cost of sales.

Instead of looking at revenue from direct sales, TMG began making decisions using P&L figures based on total advertising space available. It also differentiated advertising prices to boost the number of products available to advertisers and better fit their needs. 

Today, TMG offers cost-per-click (CPC) and cost-per-action (CPA) along with traditional CPM display campaigns. It also offers self-service advertising for local and smaller advertisers.

Since transparency in pricing is key to the success of programmatic, the traditional rate card evolved to one based on the net prices advertisers pay, rather than displaying gross prices with huge discounts. 

To attract additional advertiser spending, TMG makes additional revenue channels available. Basically, it shifted from a channel approach to an advertiser approach: Instead of working with just one sales force, the advertising space can be sold by partners as well. This increases the number of advertisers that can be reached. 

To avoid channel conflict among these different partners and their own products, the direct sales account managers focus on advertisers, not individual products, while the most important metric shifts from the channel being used to the total spend per advertiser. 

Automated trading has also helped address the relatively high cost of sales by focusing on workflow efficiency. The self-service platform from Publisher Market not only makes it easier for advertisers and agencies to spend money, it does so at a lower cost by decreasing handling time so the revenue per account manager can increase.

The results thus far have been encouraging, says Danielle Heerenveen, marketing and communications director for Publisher Market. TMG’s revenue has doubled since 2009, with revenue growth 500% above the market average. Costs are also down: Traditional revenue is handled with a 44% reduction of sales resources, while new revenue is now generated at 40% of the original cost of sales. 

About Mark Toner

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