By Seb Joseph • March 21, 2025 •
Ivy Liu
2025 is shaping up to be a brutal year for publishers hoping programmatic ad auctions would keep the cash flowing.
Things are so bleak that not one would speak on the record about their dwindling fortunes. Better to suffer in silence than to become the industry’s next cautionary tale.
“There’s still quite a lot of softness in money coming from the open auction,” said the revenue lead of a publisher in North America.
“Still” being the operative term. The slump that took hold last fall hasn’t just lingered — it’s deepened. What started as a downturn largely confined to ads sold through Google’s ad exchange has spread like contagion, dragging down auction prices across the board — no matter which ad tech vendor is running the sale.
“We’re talking double-digit CPM decreases across the board so far this year,” said the revenue lead, who declined to get into specifics for fear of making the open market, where ad prices are set in real-time auctions, seem like a lost cause.
Others are less delicate.
One exec, speaking to Digiday on condition of anonymity, said CPMs for online display ads bought through those auctions in the fall were down as much as 30% compared to the previous year’s fourth quarter. So far, they haven’t seen anything to suggest this quarter will be any better. If anything, the past few months have reinforced their view that the open market is, at least for now, in a rut.
“Q1 thus far has been an extension of what we saw in November and December — a soft open web market, particularly with video,” the exec continued.
Even the faint glimmers of recovery haven’t been met with enthusiasm.
Some publishers have noticed early signs of a rebound in certain pockets of the market, but no one is rushing to celebrate. A cautious optimism, if it can be called that, has settled in. But before they dust off the pom-poms, they want something more concrete than a few encouraging data points.
“We’re not seeing any challenges so far this year,” said the revenue boss at a publisher in the U.S., who exchanged anonymity for candor because they were not authorized to speak to Digday. “I don’t want to jinx things but it’s a continuation of how well the business fared in the fourth quarter where our RPM was 5% on the previous year.”
As worried as these publishers sound, it’s not paranoia if the data backs it up.
Open auctions account for just a fraction of U.S. programmatic spend ($14.67 billion), compared to the $29.52 billion spent in private marketplaces, according to eMarketer. And the shift has been years in the making. Between 2022 and 2026 U.S. ad dollars spent in direct deals — not programmatic auctions — are projected to grow from $89.11 billion to $154 billion, according to eMarketer.
The latest earnings reports from major ad tech vendors, often the most reliable barometer of programmatic market health, paint a similarly grim picture as the earlier anecdotes. Magnite, for instance, saw slower than expected growth in the fourth quarter, dragged down by sharp drops in CPMs for display and video ads in November and December. The slump was severe enough to cause the ad tech firm to miss its revenue guidance.
Then there’s the early data from this year, which has offered little cause for optimism. Display CPMs plunged 33% in January year on year, while video CPMs tumbled 39.2%, leading to an overall 35% drop, per analytics firm Databeat. Sure, post-holiday slowdowns are expected, but this one is especially anemic — perhaps a casualty of the growing economic uncertainty in the U.S.
What might have once been brushed off as a seasonal slump is starting to look more like a full-fledged downturn. And if publishers have learned anything, it’s that when the market wobbles, programmatic auctions take the hardest hit.
Should this happen it would be just the latest in a long series of blows shirking the open market. Privacy crackdowns, cookie depreciation, supply-path optimization and brand safety concerns have been chipping away its scale for years, redirecting ad dollars into more controlled environments. A downturn would only compound that.
That said, the extent of the damage is hard to completely comprehend.
Not every publisher relies on the open auction. Many do better selling directly to advertisers and agencies, sidestepping the volatility of real-time bidding. Even those still tethered to the open market may not be entirely without options. After all, depressed CPMs aren’t solely a reflection of weak advertiser demand. They’re also a symptom of a supply chain riddled with inefficiencies. Duplicate bids, rampant resellers and an overabundance of inventory continue to dilute the market, driving prices down.
https://digiday.com/?p=572663
