Commentary

Programmatic Traders Getting Social

Machine-based ad trading is leading to fewer human interactions, but that hasn’t stopped marketers from getting social.

A new report notes that social ad buys represent nearly 30% of all exchange-based traffic.

The data comes from Neustar’s January 2015 media intelligence report, which analyzes over 121 billion ad impressions.

The report notes that social demonstrated the best “cost efficiency” -- cost to reach the desired audience -- among all channels, checking in 60% below the industry average. However, Neustar reported that it became 10% more costly to reach the intended audience via social last quarter.

“As advertisers increased their buys into News Feed inventory, we saw exchanges absorb most of this demand,” wrote Neustar.

Ad exchanges absorbed that demand because they were the second most cost-efficient channel, per the report. Exchanges began 2014 as the cheapest, and midway through the year were relatively even with social in terms of cost to reach the desired audience. In the back half of 2014, social overtook exchanges as the most cost-efficient way to reach intended audiences.

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Neustar wrote that video spend was about 8% of all digital ad spend last quarter, and added that it drove “significant user engagement across all channels.” The report notes that video -- unsurprisingly -- drove the bulk of branding activity, and that digital video spend continues to grow.

However, Neustar says it saw most video ad placements via portals and individual publishers, not exchanges or networks. “These results are consistent with the prevalent view that programmatic video inventory is still very scarce,” wrote Neustar, adding that it “expect[s] to see more inventory access over time as a result of industry consolidation.”

The full report can be found here.

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