Survey Finds Global Brands Are Consolidating Ad Servers

A new survey finds that global brands are consolidating their roster of ad-serving companies, with the average number of partners dropping by one-third in the last two years. Most marketers now work with three ad-serving companies compared to 4.5 in 2014, according to the survey by the World Federation of Advertisers (WFA) and Ebiquity.


The findings point to consolidation in the ad-tech space, along with technology advancements that enable marketers to obtain global scale with fewer suppliers. They also indicate a frustration among marketers that many industry observers say is the result of having to integrate and manage too many vendors.

In addition, the WFA said that marketers seek more aim to reduce costs, which can account for more than 10% of net digital media spend in some cases, depending on format, with video costing significantly more.

Tools that offer frequency and sequencing control, viewability and verification, programmatic integrations, and dynamic creative optimization were all used by at least 60% of respondents.

According to the study, in 2014, around 16% of respondents worked with more than nine ad servers, while in 2016 only 3% are working with seven or eight -- and just 10% with five or six different companies.

The most common way for advertisers to work with ad servers such as Atlas, DoubleClick, Sizmek, and Adform was for the contract to be owned and operated by media agencies, an arrangement found in 70% of cases. However, outsourcing to agencies can lead to a loss of control and visibility on pricing, as well as challenges in data access and reporting.

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Some 30% of respondents now have a direct relationship with an ad server but allow the agency to run it. In addition, 13% of marketers  own and operate ad-serving relationships themselves. The WFA said that the data adds up to more than 100% because brands can use multiple models even in the same market.

The survey also found differences both in ad-serving cost and payment models. For example, ad serving can be charged for in various ways, but fixed CPM is the most common, used by almost 40% of respondents, while 25% have a variable CPM payment model, and another 11% use a percentage of net media spend model.

When the agency either owns and operates, or simply operates the relationship, the survey find that clients may also pay an additional fee, typically as a percentage of net media in the case of one in four respondents, or as a CPM fee in the case of 21%. However, some 21% of respondents reported that they didn’t pay a fee for this service.

“Getting better control of, and access to, ad serving offers opportunities to improve media performance and reporting. The range in costs associated with ad serving indicates that this is also one area of media transformation where brands can seek competitive advantage,” Matt Green, global media & digital marketing lead at the WFA, said in a statement.

The survey is based on responses from 30 companies in 14 sectors, with a total global media spend of more than $30 billion.

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