Welcome To The 4th Quarter Of RTB
With football season in full swing and the holidays just around the corner, I’d like to make a few predictions for the final quarter of 2013. Last year, real-time bidding was on the rise, with spending under $2 billion. But this year, it’s estimated that U.S. advertisers will spend more than $3.36 billion on RTB, according to eMarketer. While the rapid growth will likely slow down a bit as the programmatic buying industry matures, it’s predicted that RTB will account for more than 29% of all digital display spending by 2017.
Last year, in this very column, an exec from my company made a prediction that quality would be a recurring theme – from viewability to brand safety to fraud identification – as RTB continued to rise.
Here are my predictions for how Q4 will pan out:
- The main growth in RTB has been from first-party retargeting, more widely known as site retargeting. As consumers, you should expect this marketing approach to continue with a vengeance. If you put something into a shopping cart and abandon it in Q4, you will be followed around until Dec. 31 – unless you buy it! Marketers have an embarrassment of riches when it comes to targeting their customers. You should expect advertisers to throw the kitchen sink at RTB this year, including first-party data, third-party data and data-driven media purchases (like search retargeting). We’ve had decent economic growth this year compared to some in the not-so-distant past, so expect marketers to maximize their holiday buying this party season.
- More sophisticated marketers will use dedicated attribution companies that use algorithms to help them spot the best and worst performing inventory, and will have far more efficient ad spends. But even they will have trouble figuring out the overlap with smartphones, tablets and the old-fashioned desktop/laptop. As a result, there will be overspending.
- There are a couple of new exchanges on the market this year: Facebook and Twitter. Theoretically, FBX was around last Q4, but given that its exchange was only launched in September 2012, there wasn’t critical mass for last year’s holiday season. This year will be different. Look for FBX to kill it this year as advertisers flock to a known commodity where their ads will be in view. Pay attention to Facebook’s News Feed ads and how brand and performance marketers leverage these as formats for retargeting purposes either for brand awareness or specific promotions. Twitter will follow on FBX’s coattails, but direct response/performance-driven marketers will mostly use FBX, largely because Twitter’s platform is still in its infancy and brand advertisers tend not to be first movers.
- There have also been heated debates about bots, fraud and viewability on digital ad exchanges. But expect the lure of performance to keep the RTB growth engine fired up. These problems aren’t fixed, but there are tools that help (Integral, Spider.io, Double Verify, and all the attribution companies) – and the promise of being able to reach the right person at the right time with the right offer is too alluring to scare marketers away from RTB.
While quality and viewability continue to be important themes, just as we had predicted, other emerging trends, such as retargeting on social platforms and the use of data for audience buying and ad measurement have also been recurring topics. As we enter the fourth quarter, these themes will take charge, driving advertisers to test new waters for seasonal events and holiday campaigns, which will ultimately push RTB spending to new heights. Look out, Q4: Here we come.