As RTB demand increased from the marketer side, publishers have opened up more and more inventory on the exchanges, which has created larger reach and an even richer ad experience for audience-based media buying.
A study released earlier this year said that global RTB inventory grew by 61% year over year (Q4 2011/Q4 2012). The last bastion of display to fall to RTB is premium inventory and that is already happening. Premium inventory creates more creative opportunities for large brand advertisers, which leads to larger budgets for audience-buying.
Despite this frenzy, we are about to see a decline. Display advertising, defined as a non-text ad that you see on a desktop or laptop, is supposed to max out in 2013 at about $32 billion globally, and then start a gradual decline of up to $3 billion between 2014 and 2017. RTB will still increase during these years at the expense of more traditional IO – site-specific display deals. However, if display advertising is reaching its zenith, then RTB will max out, too. Print, radio and TV advertising increased separately for 50 years or more before they started a decline. Display begins to decline after about 15 years? What gives?
Part of the answer is the inevitability of numbers. Gartner shared data in April that showed tablet sales will surpass desktop and laptop combined by 2015. Other data, released in April by the IDC, cited that shipments of desktops and laptops dropped 14% year over year (Q1 2012 / Q1 2013). Therefore, if you’re selling fewer laptops and desktops, then you’ll deliver fewer ads to fewer eyeballs on them.
All of these points combined with the fact that more than 90% of consumers are using smartphones should be enough to move the needle in mobile advertising. However, just because you are buying off the exchanges on desktops doesn’t mean it’s a simple transition or addition to tap into mobile RTB. In fact, while display advertising has grown to mean all ads on desktops and laptops, mobile advertising is nowhere near as homogeneous.
In display, we just have the Web, but in mobile, we not only have different form factors (phone vs. tablet) with different usage patterns, but we also have apps. Even the simplest mobile ad -- a Web ad on a tablet, has to contend with the conundrum of Device ID vs. Advertiser ID (Apple) vs. Cookies. Even if you’ve solved this problem, very few of us have the login data necessary to identify customer #12345 if we see them on a laptop, tablet or phone. Different forms of advertising delivered across different devices will have different levels of impact. People are more likely to be susceptible to suggestion on their tablet than they are on their smartphone, due to the trifecta of device size, time and location of use.
Finally after all of the famous “years of mobile,” the massive number of tablets that Apple has shipped has created the critical mass to make a significant dent in the market. We’ve got to think beyond desktops and the @eb. Tablets are the place to focus on next. Stay tuned.