Publishers grapple with Q1 ad revenue challenges in a ‘buyer’s market’

By Sara Guaglione • March 31, 2025 •

Ivy Liu

This article is part of Digiday’s coverage of its Digiday Publishing Summit. More from the series →

It’s been a tough three months for publishers, according to executives who spoke during a closed-door town hall session at the Digiday Publishing Summit in Vail, Colorado, last week.

“Not a great quarter. Traffic’s down. Advertisers are very timid in spending. They’re in a wait-and-see mode. So this is definitely the downslope. We expect it to come back, but definitely not a great quarter,” said one publishing exec.

Q1 is typically a slow quarter for ad revenue, as post-holiday spending slows and new ad budgets get reset. But the exec said the downturn they’re experiencing now contrasts with the same period in 2024, which was their company’s “best quarter … ever.”

A few publishing execs in attendance at the event chalked this up to the fact that it’s a “buyer’s market” right now, putting downward pressure on ad pricing. But what this means for the rest of the year remains to be seen.

Advertising firm Magna lowered its 2025 forecast last week, adjusting U.S. year-over-year ad sales growth to 4.3% from 2024, down from the 4.9% growth for 2025 the firm predicted in December.

On the connected TV side, a “glut of inventory” from big players like Amazon and Google has put downward pressure on CPMs, another publishing exec said during the Summit town hall. They said ad revenue was a few percentage points higher than last year, but was still lower than expected.

And several publishers expressed concern over the rates being made on CTV. “We’re hearing deals get cut at [$15 and $10 CPMs]. … That’s just not sustainable, especially for anybody here,” said a publisher exec. “That’s a slippery slope. Once you go down to [$10 CPMs], you’re never going to go back up.”

Meanwhile, the open advertising exchange is also suffering. The same exec said the open market was down “about 20-ish percent” compared to last year. “We’re not really able to put a finger as to why that is,” they said.

This is reflective of what the wider programmatic market is experiencing. The programmatic ad slump last fall has arguably become a full-on downturn this quarter, according to Digiday’s previous reporting. The open market is down double digits for some publishers.

Reduced demand for custom content

Several execs blamed advertisers’ focus on lower-funnel marketing for the ad spend slowdown, and a drop in demand for custom and branded content.

“We’re seeing a decrease of interest [in custom content], because a lot of it is awareness-driven. We’re seeing some of our newsletters and some of our custom products … decrease, driven by lower-funnel targeting,” said one publishing exec.

Another exec in the town hall said they were more often seeing “something lower-funnel” getting added into custom content, such as a call to action, links that drive to purchase or QR codes.

“So whereas before it was branding and telling stories, [marketers] want to also incorporate something that’s a little bit more lower-funnel to satisfy the demands that they have from their executive team,” the exec said. Upper-funnel marketing like brand awareness campaigns are often the first to get cut during times of economic uncertainty.

Is a “bounce back” coming?

One exec said they think the “objective” of custom content has changed — but that eventually there will be a “bounce back.”

“We are already seeing it in retail media networks … people wanting to change their objectives to more upper-funnel tactics, which means that retail media networks will just be media networks. So I think we’ll eventually see that bounce back. I just think we’re in this point of constraint,” the same exec added.

Another exec said a “major advertiser” pulled “a significant amount of money” from upper-funnel activity, and their company saw “decreases” in leads and other KPIs. Eight months later, “they came back,” the exec said.

“It’s painful. Sometimes they have to go away for a little while, and then they test the waters, and they see results, and they come back,” they added.

Another exec agreed: “We’re starting to hear a lot more about mid-funnel. I’m sure it’s gonna go right back up to upper-funnel at some point.”

Publishers grapple with Q1 ad revenue challenges in a “buyer’s market”

It’s been a tough three months for publishers, with a downward pressure on CPMs and reduced demand for custom and branded content.