Ad Tech Revenue To Grow To $100 Billion By 2020

Advertising technology revenue is set to grow over 300% by 2020 -- up from $30 billion in 2015 to $100 billion by 2020 -- according to a new “Ad Tech Vendor Benchmark” report from Technology Business Research (TBR), a technology market research and consulting firm.

The growth will be spurred by advertisers’ continued shift toward digital formats and the rise of self-serve platform offerings, per TBR. “End users are ramping up ad tech investments,” TBR wrote in a release.

“Marketers and agencies are shifting to ad tech to plan, execute and optimize multichannel digital campaigns,” stated Seth Ulinski, senior analyst at TBR. “Increased digital ad spending, programmatic technologies and SaaS fuel ad tech market growth.”

The $100 billion estimates look at the ad tech ecosystem from the macro level. In other words, TBR projects all ad tech vendors to have a combined net revenue of $100 billion by 2020. But TBR also studied 20 “key vendors” to set benchmarks for individual companies.

“We had to start somewhere,” expressed Ulinski to Real-Time Daily. “There are so many vendors in the market. We had to create a taxonomy and some segments.”

TBR decided to create four segments: demand-side platforms (DSPs), ad exchanges, data management platforms (DMPs) and hybrid platforms. Vendors studied include Adobe, AppNexus, Criteo, Turn, Google and Rubicon Project.

TBR then looked at some basic company indicators, such as net revenue, head count and office locations. For the private companies, Ulinski said TBR did “a lot of modeling to figure out who was doing what.”

“In a nutshell, we looked at the business metrics behind all these vendors,” remarked Ulinski. “How are they making money? Is it a managed service model, self-service model, or both? Any component of arbitrage? We also looked at geographic footprint, and headcount and revenues in those different regions.”

Moving forward, Ulinski said TBR plans to release ad tech vendor studies twice a year, beginning in a few months with a look at the first half of 2015. The research and consulting firm is also looking into adding benchmarks for ad tech’s cousin -- marketing technology, i.e. enterprise marketing systems.

Next story loading loading..