The RTB 500: What It Is, Why We Created It, How You Should Use It

Like its name implies, the RTB 500 is a composite index, much like Wall Street’s S&P 500, except that instead of representing the supply and demand of shares of company stocks being traded publicly on financial exchanges, the RTB 500 represents the supply and demand of advertising impressions being traded public on Madison Avenue’s audience exchanges.

For the first time, there is “public” data on the market behavior of people who buy and sell media.

We didn’t invent that, the marketplace did. The minute Madison Avenue shifted from “buying media” directly (or indirectly, as the case may be) from publishers to “buying audiences” through open exchanges, the behavior started to become transparent. Anyone with a bidding engine can peek into the open “bidstream.” All we did was organize it in a way readers can look at simply, and we decided to use the Wall Street metaphor of a stock index to do it, because as long as I’ve covered Madison Avenue, agencies have used that analogy to describe what they do.



The first time I heard it articulated that way was back in the 1980s, when I was a reporter covering the media “markets” for Adweek. Then DDB media chief Page Thompson (now head of OMD), called me into his office to brief me on the Omnicom shop’s approach to media. He told me his clients were like Wall Street’s institutional investors, and the role of his media department was to act like “portfolio managers,” but instead of stocks, bonds, commodities and other financial instruments, they traded in media time and space.

I bought into the concept big time, and eventually came to see other analogies between Madison Avenue and Wall Street, including the idea that what differentiates a commodity from an equity is the value of research and data that can put a dimension on the “goodwill” value of the intangible parts of those assets.

And the truth is, the best suppliers of media always have and always will do that. Sometimes, they do that with hard numbers — quantitative or qualitative research  —demonstrating the value of their audiences, and especially the connection they have with what they publish, telecast or stream. Or, it’s done with performance-based data, proving what people do as a result of being exposed to advertising on their medium.

Sometimes, they do it with sizzle, smoke, mirrors and emotional appeals that may not be quantifiable, but which set them apart from other seemingly me-too media options. ESPN is much more than just a “sports network,” and The New York Times is much more than just a “newspaper.” They are indelible brands, unique ways that people experience content — news, information, entertainment, and yes, even composites of data — in ways that are different than what they can find from other publishers of content.

In an era when anyone or any organization can publish content, I believe those equity differences will increase in value, not decline, as people — advertisers, agencies, trading desks,and the most public sources of all, consumers — seek to differentiate value from the increasing supply of seemingly lookalike impressions.

That’s where the RTB 500 comes in. Like Wall Street’s S&P, we selected 500 companies — in our case, media companies that trade a portion of their inventory in the open RTB marketplace — to represent the kind of audience suppliers most big advertisers and agencies would think of as having high equity value. While we won’t be singling out the performance of individual publishers in the composite, it includes suppliers such as AOL, CBS, The New York Times, Rolling Stone and Yahoo.

To be clear, the index is not representative of their ad inventory’s supply and demand — just the portion that gets traded on exchanges. How indicative that is, will be up to the marketplace to decide. But it’s not different than the logic of having 30 Dow industrial companies or 500 S&P companies representing the sentiment of Wall Street investors. They are just subsets of something bigger — a manageable index people can look at, think about and use to benchmark value in a much bigger marketplace that would otherwise be difficult or impossible to think about.

The RTB 500, which is powered by OwnerIQ, has been running live for more than a year, and when I began previewing it to agencies and trading desks as we got close to launching it publicly, I learned some things about the way they trade.

“When we set up a trade, we try to organize two things,” said one Madison Avenue trader. “We organize our own goals -- our budget, our data, the audience we are targeting and the objectives we want to achieve. Then we look for something to benchmark the marketplace.” That’s what we want the RTB 500 to be. Where it goes is up to you. Just like Wall Street’s composite indexes, it fundamentally comes down to belief. You either believe something represents a benchmark for something greater, or you don’t.

How should you use the RTB 500? Anyway you want.

We’re going to publish it, and we’re going to try and write stories based on what the data says about the marketplace. To that end, we could use some help. My main goal in creating it was to have a tool that journalists covering the media marketplace could use to objectively talk about the supply-and-demand behavior of Madison Avenue. I wanted that, because after decades of covering a marketplace based on spin, off-the-record estimates from anonymous sources, or crudely concocted syndicated data based on “rate card” pricing, I am simply looking for truth.

And the truth is, the open RTB marketplace is as pure as Madison Avenue can get, because it’s a 100% auction-based system of “askers” and “bidders” in which the “win” goes to the best bid. Tell us of something better, or suggest a better approach, and we will try and develop that. In the meantime, think about what the RTB 500 shows, and help us find meaning in the data ,so we can report more accurately on the supply and demand of Madison Avenue. By that, I mean become the ad industries “equities analysts,” because they are another crucial part of what makes Wall Street work so well. It is the combination of public trading data, the financial press and equities researchers and analysts that create meaning and structure on Wall Street.

We need to develop the same kind of credible market analysts on Madison Avenue, so if you have some thoughts or opinions to share, please let me know at

One last thing: A note on the sub-category indices. When I began developing the concept of the RTB 500 with OwnerIQ cofounder and CEO Jay Habegger more than a year ago, we decided to breakout subs-categories, just like the S&P 500 does. But instead of representing different industrial sectors, the RTB 500’s sub-categories represent different media. It occurred to us that within the 500, there were companies that could be grouped as newspapers, magazines, TV networks, etc.

In fact, the only two major media not represented in the index are radio and out-of-home. We hope to eventually include those media, or develop other indexes to represent them. Till then, we’re breaking out sub-indices for the media we can track, because, well, we can. We’re not saying a category like “network TV” is truly representative of the overall supply and demand of the network TV advertising marketplace, even though the companies in it include CBS, NBC and Fox. It’s only the portion of their digital inventory that they make available for bidding through exchanges.

But it is indicative of something, and over time, I believe more of their total inventory — maybe even significant portions of their “linear” or “analogue” audience impressions — will find their way onto exchanges. If and when that happens, we’ll try to incorporate it into the RTB 500 or create another index to mirror it. Because our role is simply to shed light on marketplace behavior so that the people who make decisions on whether to invest in media have some objective way of thinking about it. You know, transparency.


9 comments about "The RTB 500: What It Is, Why We Created It, How You Should Use It".
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  1. Barbara Lippert from, June 12, 2014 at 10:59 a.m.

    You "didn't invent " it, but you built it! Congrats!

  2. sebastien robin from havas media, June 12, 2014 at 11:56 a.m.

    quick question is the top 500 on madison..ok..but are these only top500 US sites or top 500 gobal publishers..same for it top500 US buyers or top500 global buyers ?

  3. James Nail from Forrester Research, June 12, 2014 at 12:55 p.m.

    Very cool, but I'm not sure how to use it as a "benchmark" for planning or buying. Ie, I don't buy shares of IBM because the Dow goes up or down..maybe if I sense a trend in the index I modify my portfolio allocation between equity and bonds. Maybe a publisher uses this to allocate inventory direct vs exchange?

    Also, can you derive trading volume? That is one of the most common questions I get: how fast is programmatic growing?

  4. Joe Mandese from MediaPost, June 12, 2014 at 1:04 p.m.

    @Sebastien: They are not ranked based on specific volume criteria, but were selected by MediaPost and Owner IQ to be representative of the major publishers big brands and agencies buy. Some of the publishers are highlighted at the top of each sub-category index. The goal isn't to shed light on the performance of individual publishers so much as to have an overall benchmark.

    @Jim Nail:Different traders and investors utilize composite indexes differently on Wall Street. I'm not sure anyone makes them based solely on them (unless it's an index trade). We're not sure what the practical application of this will be for Madison Avenue traders, but we think some kind of benchmark is better than none. Would appreciate any thought you have for improving it, or doing something different or better.

  5. Joe Mandese from MediaPost, June 13, 2014 at 7:41 a.m.

    @Mike: Doesn't look very accurate as compared with what? There's never been a composite like this to compare actual market behavior with. What are you basing your comparison on? The data comes from viewing actual bids and wins in the RTB bidstream through the exchanges. There are some pronounced ups and downs in the overall index and we're trying to understand what they represent and that will be part of the job we do reporting on it going forward. I don't observe the drop-off you see in April. The most pronounced drop-off occurs in January, but that makes sense given the ad industry's heavy demand in the fourth-quarter through the holiday marketing season.

  6. Ed Papazian from Media Dynamics Inc, June 13, 2014 at 10:45 a.m.

    A very interesting concept, Joe. I assume that as time develops, you will be turning out long term trending and other relevant analysis and, of course, make additional refinements. Are you considering the inclusion of advertiser product class or types of targeting breakdowns?

  7. Joe Mandese from MediaPost, June 13, 2014 at 11:25 a.m.

    Ed: The RTB 500 launched with a full-year worth of data that can be looked at by hitting various tab views or toggling the bar at the bottom of the index. In terms finding meaning from those trends and other relevant analysis, we will do the best we can as journalists, but we're hoping smart thinkers like you can help us out too -- we need good market analysts to give meaning to what the market data actually shows. Reporting the data is the first part. In terms of reporting more granualar data about product class, or target types, it isn't likely that we will do that with the RTB 500 for a number of reasons. Mainly, because it is not intended to do that. It's just a composite index designed to be an objective benchmark about the RTB marketplace. We do have sub-categories to look at and compare how verticals within that are trending, and I think analysts could reasonably infer something about the supply and demand of audience targets (or even advertiser/product classes) by using them as a proxy. Over time, we'd like help develop other market indices that might get more detailed on those elements. Open to suggestions from anyone about that. It is part of our mission.

  8. Joe Mandese from MediaPost, June 15, 2014 at 8:32 a.m.

    @Mike: One of the things we are hoping for is that publishing an open, market-based composite might have a positive impact on market behavior. I'm not sure what cyclical charts of programmatic cost/revenue you have been looking at, but we have also seen -- and published -- quite a bit of aggregate data over the past couple of years from good sources (Rubicon, Accordant, Casale, Pubmatic, OpenX, etc.). There are many things that might influence the aggregate view of supply and demand (including expanding supply from publishers), which is one of the reasons we are using a composite to provide a controlled view of a stable base of 500 leading publishers. Again, the idea is to provide an independent benchmark like Wall Street's S&P 500. That's all. We hope it will provide perspective and add value to traders. Lastly, with regard to the phenomenon of pricing increases throughout a quarter, we have also begun to look into that. I'm told it's because of the way advertisers and media buyers budget, and the fact that they tend to have surplus quarterly budgets to spend at the end of quarterly cycles, and are simply "dumping" what they have left over at the end of quarters, thus tightening the marketplace at the end of a quarter and driving bids up. I'm not in a position to comment on whether that is a rationale marketplace behavior. We're just journalists who want to shed light on what the behavior is so the marketplace is aware of them. If you or anyone else have some point of view on why that happens, I think it would be a good starting point to cover some of what's been observed to date. Please share any other market insights, rules of thumbs, patterns, etc., and especially when they are at odds with what we find in the RTB 500 composite index. Thank you or sharing this. -- Joe

  9. Dezeree Christman from Southwest Media Group, June 17, 2014 at 11:34 a.m.

    Hi Joe,

    Where can I find a list of the sites that make up the RTB 500?

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