If there's one term that comes up frequently when talking about advertising technology, it's "confusion." The promise of investment has brought an influx of technology companies that claim to make business easier, but results in a fragmented, convoluted landscape.
With football season in full swing and the holidays just around the corner, I'd like to make a few predictions for the final quarter of 2013. Last year, real-time bidding was on the rise, with spending under $2 billion. But this year, it's estimated that U.S. advertisers will spend more than $3.36 billion on RTB, according to eMarketer. While the rapid growth will likely slow down a bit as the programmatic buying industry matures, it's predicted that RTB will account for more than 29% of all digital display spending by 2017.
As an industry, we spend every day opining on the value of Deal ID, the nomenclature of programmatic direct versus premium programmatic, the power of "Big Data" and the march towards all things that can be programmatic actually being programmatic. We pass inventory back and forth, applying our own secret sauce to make impressions more valuable. Along the way, we learn a little bit more about our counter-party in each transaction.
"And brands have had little use for programmatic buying and ad tech in general since it's all been primarily geared for direct-response sellers," according to a recent article. That may be true today, but it probably won't be for long. Sure, programmatic may have been created with DR in mind, but that doesn't mean it can't work for brands. Erin Matts, CMO of Annalect, points to Kellogg's, a brand reaping the benefits of (and evangelizing) programmatic.
Trading desk giant Xaxis announced recently that it is taking a multiplatform approach to programmatic display ad buying. This is a powerful signal that the approach is prevailing over the single-platform alternative. But what does multiplatform mean -- and if it so advantageous for clients, why aren't more agencies doing it right now?
When the news broke about NewsCorp.'s announcement that it would no longer be releasing inventory to the ad nets, commentary from the industry got heated. Would this move dramatically affect the media business?Were networks and exchanges suddenly relegated to the sidelines and forced to compete for heaps of low-quality inventory? Or was this actually a change for the better, something networks and exchanges have been pushing for? A world where publishers would take the high road, selling fewer, premium ads at a higher CPM?
Everyone knows that ad technology is a remarkably fragmented and complex industry. As the Lumascape shows, the ecosystem is filled with small companies focused on dominating niche categories and new business models. So conventional wisdom (and the prediction of every analyst) is that consolidation is coming soon. According to this viewpoint, consolidation will be good for marketers, who are looking for simplicity that rivals TV ads. And the consolidation will supposedly be good for publishers, who are frustrated by the number of middlemen in between their inventory and the marketer's money. Despite this conventional wisdom, consolidation is neither inevitable nor ...
You know those rumors you keep hearing about RTB, that 85% to 95% of all ads will be bought and sold programmatically by 2018? If the rate at which programmatic is growing this year is indication, those rumors may actually be accurate. As I shared in my recent presentation at OMMA RTB, while only 17% of ads among the top 1.000 brands were placed programmatically this past September, today that number has risen to 23%, and 70% of the top 1,000 advertisers are participating in programmatic. Let's be optimistic and hope that's indicative of more efficient trading in the years ...
As Gabe Gottlieb from Adomic pointed out a few weeks back, even the brand advertisers working in programmatic today are leveraging it for direct-response campaigns. "We're still seeing advertisers concentrating their RTB budgets on lower funnel and more transactional goals, while reserving their brand spending for traditional direct channels," he'd said, noting that most of the inventory sold programmatically consisted of IAB legacy banners and buttons.
Mario Diez rejoined PointRoll earlier this year as CEO, after growing the New York market for the company nearly a decade ago. The man has a pretty informed perspective of the premium market, not only through his role at PointRoll, but also because Quadrant One, his previous employer, was among the first premium private exchanges. Yet, to his mind, the definition of premium RTB continues to evolve. "It is becoming less about the inventory and more about intelligence," he comments. "Advertisers will always be willing to pay more for ads that do more."