Top 7 Events For Online Advertising Professionals in 2016

 

The advertising industry is rapidly changing with the evolution of programmatic advertising, augmented reality, hyper-targeting and other technological advancements. In order to stay relevant, it’s important to keep up to date on trends and future predictions – and there is no better way to do that than by attending a conference.

A quick Internet search reveals dozens, if not hundreds, of conferences in the advertising industry. Unfortunately, not all of them are all they are cracked up to be, and many of them invested more in their marketing campaigns than the quality of their speakers and panels. When examining trade conferences, it is important to study the conference agenda, consider the conference attendees and their qualifications and ensure you have the relevant background knowledge in order to get the most out of your conference experience

Even among the interesting ones, not all are relevant for digital advertising professionals. That is why we compiled a list of the top 7 digital advertising conferences for Q3 and Q4 of 2016.

LeadsCon – August 22-24, 2016, New York

LeadsCon has established itself as one of the leading performance marketing conferences, and for good reason.  LeadsCon focuses on lead generation tactics and direct response marketing and draws in international leaders in digital advertising.  The 2016 LeadsCon New York will take place alongside B2B LeadsCon, the only summit geared exclusively towards B2B lead generation, lead acquisition, nurturing and conversion. The two conferences together make it the place to be for digital advertisers this upcoming August.

 

Why should you attend? Not only are these two stellar conferences taking place in one convenient location, this year will also feature a pre-event summit by Path2Conversion that will offer critical tools to optimizing advertising campaigns and improving strategies.  If you’re in the business of digital advertising, and care about converting leads (and don’t we all!), you won’t want to miss LeadsCon.

DMEXCO – September 14th and 15th, Cologne, Germany

Another ‘must attend events’ for digital advertising professionals is the 2016 Digital Marketing Exposition and Conference (or DMEXCO).  For years DMEXCO has established itself as one of the leading conferences for digital marketers interested in global connectivity and innovation. The conference, which drew in over 43,000 attendees, 881 exhibitors and 500 speakers in 2015, is a keynote place to explore the latest disruptive trends in digital advertising.

The 2016 conference is right around the corner and the anticipation of digital marketers is steadily increasing. Jack Dorsey, CEO of Twitter, Sridhar Ramaswamy, SVP Ads and Commerce at Google and Chris Cox, CPO of Facebook are just a few of the speakers that will attend the conference and share their insight on upcoming digital marketing trends, new disruptive technologies to consider and other advancements in the digital marketing world.

So why should you attend? If you are looking to retain market share or grow in your industry, you need to know what trends to follow and what disruptive technology you will need to adapt. Attending the 2016 DMEXCO is a great way to get all of that information sooner rather than later. Plus, Adclarity, one of the leading Media Intelligence Solutions available for digital marketers, will be attending the conference (and we hear they give great perks for conference attendees).

Interested to Know more about your Online Advertising Competitors – Book a Meeting with Adclarity Team during the DMEXCO conference 

RACE Expo, October 7th, Moscow

The 2016 Fifth International Affiliate meet up is shaping up to be one of the most interesting places for digital advertisers to be in 2016. The conference will serve as a hub for digital marketing experts, particularly those in the affiliate marketing world. Whether in the financial trading industry, online gaming, marketing automation or lead generation, this conference is on route towards becoming one of the most appealing ones, particularly for digital advertisers who are results oriented and focus on conversions, CPA’s and CPL’s.

Why attend Race? Race will bring together affiliate program owners and partners alongside digital advertisers, media planners and account managers from large agencies and production studios that are actively seeking tools that will help optimize and atomize digital advertising campaigns in order to increase effectiveness and share their knowledge in a welcoming environment.

PubCon, October 11-13, Las Vegas

PubCon, named as one of the top conferences for growing businesses and must-attend conferences by Forbes, earned it’s place at the list of conferences digital advertisers must attend in 2016.

PubCon is a digital marketing conference focusing on digital advertising with outlook to future trends. PubCon has long established itself as a leader in cutting-edge discussion with provocative topics and world famous keynote speakers which this year include Debra Jasper, Scott Stratten, Gary Illyes and more.

So why should you attend PubCon? In addition to featuring dynamic speakers and showcasing the latest technological trends, PubCo has serves as the launching ground for many products by international enterprises such as Google, Microsoft, Twitter and more, making it all the more exciting to attend (you never know what product or new tool you’ll get to hear about first!)

New Video Frontiers – October 19-20, London

The New Video Frontier conference earns a respectable place in our list of top digital advertising conferences to attend because this is the place to be for all things video (and we all know that video advertising is the hottest thing right now in digital advertising).

The New Video Frontiers conference brought over 500 industry leaders from around the world in 2015, and it is expected to shatter those numbers in 2016 thanks to the rise of dependency on video advertising across social media and search engines. The 2016 conference will focus on programmatic TV and monetization of mobile advertising as well as outsteam opportunities and virtual reality – all hot topics for anyone in digital advertising.

So why should you attend? Because video advertising is on the rise, and if you want to continue to hold your market share or grow your business, you will have to get on the video advertising bandwagon.

Casual Connect – November 1-3, Tel Aviv

Casual Connect, the annual Casual Games Association conference, is going to take place this year in the bustling heart of Tel Aviv. The conference, which takes place 4 times a year (in San Francisco, Amsterdam and Singapore) is geared towards leaders in the gaming industry and draws in over 1600 participants from over 35 countries to each event.  The Tel Aviv conference will focus on the interconnectivity of new media and business, making the center of the Start-Up Nation the perfect place to host the meeting.

Why should you attend? Aside from taking place in a hot location (Tel Aviv tops travel lists almost every year), the 2016 Casual Connect meet up will include over 700 companies and over 100 international speakers including Robert Antokol (Founder and CEO of Playtika, Diamond sponsor of the conference), Sean Ryan (VP Platform Partnerships at Facebook), Iky Sandor (Partner Development Manager at Google Play) and many others.

Affiliate World Conferences – December 5-6, 2016, Bangkok

The Affiliate World Conferences Asia is one of the premium digital advertising conferences, bringing visionaries and global leaders in affiliate marketing together under one roof. This year keynote speakers Christian Rudder (Founder and President of OkCupid) and Alexander Willemsen (Affiliate Expert and Founder of Scito Media) will focus on new trends in digital marketing and the direction affiliate marketing and advertising is going in.

Why should you attend? Aside from visiting Bangkok in December, the Affiliate World Conference will be a great opportunity to explore trends and advertising in affiliate marketing from global affiliate leaders, discover new tools and gain insight into future trends.

 

Did Mobile Advertising Kill the Retail Star?

Since the introduction of credit cards in the 1950’s and through the rapid development of the World Wide Web, the retail industry has always had to adapt first to new technologies and digital advancements.

The retail industry is one that relies heavily on psychological factors and the ability of marketing executives to convince consumers they require products they never even knew existed. With the need to stay current and always appeal to consumers, it’s no wonder that the retail industry has been most directly impacted by the digital advertising revolution than almost any other industry.

The first recorded retail transaction on the web was in 1994 and soon after that companies such as Amazon and eBay popped up offering digital marketplaces for mass consumers.  When smartphones penetrated the market and effectively demolished any other type of mobile phones, retailers knew they needed to move – and quickly – or perish.

Following the Money Trail

The retail industry isn’t chasing mobile because it wants to; retailers are chasing mobile because they have to. The future of money has been altered in the mobile age and consumers are connected to mobile phones around the clock, forcing the retail industry to adapt accordingly.

According to a recent eMarketer report on mobile payments, “nearly one in five smartphone users will use mobile payments” in 2016. This astonishing number jut accentuates what any smartphone owner already knows – mobile is where the money is.

More and more people are making the switch to smartphones, and the integration of smartphones into the lives of kids is reaching new levels, leading all experts to believe that this trend will only rise. Consumers are increasingly trusting of their mobile devices and the security features promised by all, resulting in a growth of 210% in 2016 on mobile payment transactions.

Consider these numbers: In 2015 mobile payments accounted for $8.71 billion in the U.S alone. In 2016 that number is expected to reach $27.05 billion.

These numbers, coupled with predictions from major Credit Card companies that smart devices are on the fast track to eradicating cash from consumers hands, means that retail industries that want to stay relevant will find themselves spending more and more time on smaller and stronger screens.

Advertising on a Small Screen

Adapting a payment-processing page on a mobile device is easy – the hard part is driving consumers to reach the payment page (preferably with a heavily loaded cart ready for checkout).

Retailers have had to reinvent the virtual wheel where advertising is concerned, devising new ways to draw consumers to their websites, mobile apps and other social accounts.

Advertising today is based on the ability of a brand to relay a massive message in a small space with few words. To continue driving conversions, marketing executives have increased the dependency on powerful call-to-action buttons in the hopes of pushing consumers in the direction they want them to go. Retail companies that recognized the benefit of the mobile devices early on have been able to respond to consumer demands while integrating the latest technologies such as video, social activism and more.

We Have What You Want – On our App

The first thing retailers must realize is that consumers today want more of one thing – information. The digital revolution has educated consumers that knowledge is always at their fingertips. In an effort to control the knowledge about a product, retail advertisers have developed brand-specific mobile apps that connect consumers, offering more information accessed from the palm of their hands.

Mobile apps for retailers have the ability to provide information as well as push products, unveil new products and more. The struggle of retailers falls then on their ability to drive consumers to download the apps.

Driving consumers to download an all also enables the company to maximize their branding with constant push notifications, reminders and of course, access to information given during the signup process.

How to retailers push consumers to download their app? With freebies. Retailer mobile apps are always free for consumers to download and tend to offer more discounts, shipping specials etc.  As a result, more retail mobile advertisements rely on variations of the CTA “download our app for a special offer.”

Sure, there is little room for imagination here considering the fact that most advertisers are using social media and in-app campaigns for advertisements, but that doesn’t mean it doesn’t work.

Get More of What You Want if You Bring Your Friends

Another strategy retail advertisers brought to the mobile world relies on the basic idea of word-of-mouth.

In addition to wanting information about products prior to making purchases, consumers seek validation of products from their peers prior to purchase.  Since word of mouth in the digital age is based on rewarding the referrer and referee, digital advertisers in the retail industry have incorporated the rewards system to smartphones and use it to attract consumers though mobile display campaigns.

Referral programs that reward consumers for bringing friends have gained tremendous success, particularly with the development of mobile advertisement and the incorporation of social media advertisements. The ease of sharing links, track-able apps etc through social channels has led mobile advertisers to push referral and loyalty programs directly in their mobile display campaigns and this is seen from the terminology used on banners that drive consumers to websites and to download apps.

The Art of Accepting Limitations

Part of the struggle mobile advertisers have had to deal with in recent years is understanding the limitations of mobile phones and working within those limitations in order to run effective campaigns.

Successful retail marketers operating in the mobile world have had to master the art of working within the limitations of smartphone devices.

Consider the demise of flash; when the first iPhone penetrated the market, Adobe Flash was the undisputed king of the internet. Whatever conspiracy theory you may or may not believe, one thing is undisputed – the lack of Flash integration in the first smartphone was the start of the end for them. When Adobe announced in 2011 that they abandoned all development of Flash for mobile devices, many retail advertisers were in a frenzy, unsure how they would be able to effectively market to their consumers without the flash technology they relied on so heavily until then.

Fast forward to 2016 and, while flash is still dead, animated mobile advertisements are not.

Mobile advertisers, specifically in the retail industry, have found a way to work around the limitations of mobile devices while still retaining their ability to creatively promote their products. Today the use of GIF in mobile display advertising has brought back animation to mobile campaigns, giving mobile retail advertisers more freedom to creatively convince consumers to get things they never knew they needed (but somehow cant live without).

Who is Afraid of a Little Digital Revolution?

2016 is turning out to be one of the most interesting years for mobile advertising as a whole, and specifically for the retail industry. With more purchases being made on mobile devices, hypertargeted campaigns being shown to consumers on all screens and competition being fiercer than ever, retail brands are in a sink-or-swim situation they must overcome if they hope to be around in the future.

As companies adapt their marketing strategies to stay in line with the latest trend, the best thing companies can do is look to their competitors to see what they are doing (and perhaps get an idea of what works and what doesn’t). Examining media and publishing tactics through the use of big data tools such as Ad-Clarity can provide retail marketers with even more insight on the leading trends in the mobile advertising world.

The good news for retail companies is that if they recognize the trends, learn from competition and adapt their mobile display advertising strategy in order to work within the limitations of mobile devices, then mobile won’t be able to kill the retail star.

You read it on our LinkedIn back in 2016; reading all day intent on learning the best trends.

Mobile can’t kill the retail star.

Oh Oh.

The Programmatic Revolution: How Programmatic Made the World Flat

 

When digital advertising first appeared, the media buying and selling ecosystem was very different than the one we witness today. I’m not just talking about the tedious and manual processes that had to take place in order for inventory to be bought and sold; I’m not dismissing these issues at all as these were catalysts for the change that occurred. Rather, I’m approaching the environment through a more…let’s say socio-economic perspective.

Let me start off with an historical analogy.

The year is 1789. We’re in France. The economy is a mess and King Louis XVI keeps making all the wrong moves.

oh louis

There is a huge disparity between the nobility class and everyone else; and everyone else is not happy about the privileges that they are not entitled to. So a revolution to overthrow the monarchy is in order. And it works! And a long history where only the nobles had a voice and everyone else didn’t collapsed. And things became much more equal.

There’s a point to that story.

You see, when we talk about the traditional days of digital advertising, we’re looking at a world which was very similar to that of France before 1789. A place where the selected few publishers were the ones with all the power and the rest…forgotten about. And these selected publishers, known as premium publishers, were all advertisers cared about.

And at that time, this frame of mind made sense. The customer wasn’t king yet and consumer behavior and retargeting wasn’t in the picture. So of course advertisers would always prefer to buy on premium sites. And because of this, the majority of all ad spend was going to the premium publishers. No one had any interest in working with the middle or long-tailed sites. But this all changed with programmatic.

Viva la revolución

To be honest, I don’t know which prompted what first. Was it the introduction of programmatic that gave brands the ability to access their audience virtually anywhere? Or had the power already shifted from brands to consumers, so the media buying and selling industry had to adjust quickly to keep up with the changes?

Regardless, it is indisputable that programmatic and the power of the consumer went hand in hand.

sweetart

And as this power shift from brands to consumers occurred, brands began to also shift their perspective from a publisher dominating world to a consumer one. Because at the end of the day, brands realized that it really didn’t matter how good their placement was on the most premium site if the right people weren’t seeing it. All they cared about was reaching the right person at the right place at the right time… and publishers couldn’t provide this.

The outcomes

Because advertisers cared more about where their users were actually surfing the web than the status of a publisher, middle and long-tailed publishers began to rise in importance; of course, with the help of programmatic.

Through retargeting and automated targeting methods, advertisers could now target their users on any site, no matter where it stood on the totem pole. Suddenly, publishers that were being ignored would be flooded with bid requests due to the consumer’s presence on their site. And the number of publishers that advertisers were working with grew tremendously.

For the first time in digital advertising, the disparities between the big and medium-small publishers are decreasing. This is absolutely phenomenal and could only bring benefits to the ecosystem.

 

 

Transparency in Programmatic – Do we need it?

Programmatic buying: you’ve heard the term, you know its trendy, but you don’t know what it is, and you certainly don’t know why it needs to be (even though you know transparency is always important).

We’re here to help you understand programmatic buying and the importance of transparency when automating media buys.

Programmatic buying is simply the shift companies are taking from manually managing media buys to automating the whole process.

As automation tools are integrated into media buys, companies are able to optimize campaigns immediately and without human involvement, based solely on aggregated data that is analyzed and optimized based on the real time results. Programmatic buying is heavily based on tracking cookies, making the mobile world slightly unfazed by this trend due to tracking limitations on mobile

If you’re thinking about the Faceook Ads API or the Google Display Network, you’re on the right track. These tools, and many others, let companies enjoy automated optimization with the belief that the multi-sourced data signaling by the programmatic buying tool will save the company money in the long run.

According to eMarketer, programmatic buying accounts for $14.88 billion of the total money spend on digital advertising (approximately $58.6 billion) and based on the fact that an increase of almost 50% was seen from 2014 to 2015, experts anticipate the reliance on programmatic advertising to increase in 2016.

So why is transparency important?

While programmatic buying enables advertisers to hypertarget their audience based on additional information collected about them, the dependency on automated processes has led many to have a false sense of trust. Advertisers as a result are often forced to pay higher CPM rates due to the inflated inventory value by the publisher and the unknown fees tacked on.

This means an advertiser could purchase ad space with a quoted value of $8 CPM without knowledge of how this valuation was achieved or, what the publisher’s value of the CPM is or, even worse, without knowing what intermediary commissions and fees the publishers bundled into the CPM price

Creating a more transparent bidding process for programmatic buying involves true transparency on where the advertisements will be placed (direct URL’s), who the intended audience is, how valuation is achieved and what commission is added on to the overall media buying fee.

How to gain this transparency    

Using digital ad intelligence solutions such as AdClarity will help you gain the transparency you need to optimize your digital advertising strategies. For example, AdClarity can give you an overview of the digital advertising trends within any industry you are interested in. Additionally, it can provide you with the most granular details for each individual campaign, including its deployment chain of ad platforms, creatives, total impressions, total ad spend, and more.

About AdClarity

AdClarity is an Ad Intelligence tool which provides online marketers with actionable insights about their competitors’ advertising activities. Driven by big data and proprietary behavioral content discovery technology, AdClarity unveils brands’ campaigns, ad creatives, impressions, and spend data across multiple channels, including Display, Mobile Web, Mobile Apps and Video. Data is collected across 20 geographies and covers over 50M URLs daily while discovering over 40K new campaigns every day. The AdClarity product suite is used by over 7,000 media and advertising professionals globally in Fortune 500 Brands, Agencies, Ad Networks, and Publishers.

Get a LIVE DEMO of AdClarity.

The Evolution of Programmatic Buying: Marketing Intelligence

I could not conclude this series without essential tips and tricks as to how you can enhance your media buying strategies in regards to programmatic buying. And the key to programmatic buying lies in Marketing Intelligence.

What is Marketing Intelligence?

Marketing Intelligence is the process of gathering all the world’s online media data and presenting it in a useful and accessible way to allow for better decision making.

Marketing Intelligence for Media Buyers

I am about to show you exactly how you can use Marketing Intelligence to overcome your programmatic buying challenges as an Advertiser or Agency.

In the next few examples, I will be presenting several different brands from different industries in order to demonstrate the broad range of advertising information that you can extract from AdClarity, the essential tool for digital advertisers and media buyers.

Challenge 1: Discover the Most Successful Publisher Sites to Advertise With

In this scenario, let us assume that we are  a mid-size advertiser in the travel industry. If I want to make sure I am targeting the right publishers, I can do so by monitoring my competitors and top influencers in the industry to find out what works best for them.

As an advertiser within the travel industry, I will use AdClarity to look up TripAdvisor, my industry leader and uncover their online marketing strategies and advertising tactics to create my own successful banner ad campaigns.

programmatic93

In addition to seeing which publisher sites TripAdvisor is advertising with, I can filter the sites according to “highest share of voice” to see which publishers they are working the most with and therefore spending most of their display ad budget with. I can also assume that the most invested sites are deemed to bring in the best results because TripAdvisor is not likely to be wasting such a huge amount of their budget on sites that they know are not working for them.

The search results here bring up a long list of successful publisher sites who are pursuing the same target audience as I am. Therefore I can guarantee that there are several sites on this list which I haven’t even thought about advertising with, and now I can expand my reach to find new target audiences.

Challenge 2: Optimize Your Banner Creatives and Campaign Messaging

None of the above matters if you’re not able to speak to your audience. And the way you speak to your audience is through designing a creative that communicates, resonates, and interacts well with your target audience. But which creative is guaranteed to work?

In order to get an idea of what kind of creative design and messaging you should be using, take a look at what is working (and what is not working) for your competitors and industry leaders.

This time I am in the financial industry and I need to figure out what kind of call-to-action, banner ads and landing page design my creative needs to have in order to generate the highest conversion rates.

All I need to do is uncover American Express’ online advertising tactics to see which creatives are most successful for them and build off of their campaigns to create my own ultimate campaigns.

programmatic94

Challenge 3: Finding the Most Relevant Ad Exchanges, Ad Networks, Ad Servers, DSPs, and SSPs that will lead you back to your favorite publishers and other similar publishers who target your ideal audience.

In this scenario, let us assume that we are a brand in the automotive industry who wants to advertise on turbododge.com, an online publisher site that deals with the automotive industry.

By using AdClarity to discover which mediators (ad exchanges, ad servers, ad networks, SSPs, and DSPs) turbododge.com is working with, I am able to know who I need to out to in order to advertise with them.

programmatic91

 

Additionally, I can assume that publishers in the same industry as turbododge.com are most likely using the same SSPs. I should therefore make sure that the ad exchange I am working with works with that specific SSP or that I’m using the SSPs that are most relevant for me.

I can also use AdClarity to figure out which DSP I should be working with. By using Marketing Intelligence to uncover which SSPs and ad exchanges a DSP is working with, I can see which DSPs have access to premium inventory and if other advertisers they are working with are in the same industry as me.

programmatic92

 

If I want to dig a little deeper into that last step, I can use AdClarity API to evaluate the ad spend of my competitors and what they’re bidding for inventory on a publisher site I’m interested in. In order to get the ad spend, I calculate all the publishers they are working with, how many impressions they bought from each publisher, and what the CPM is of each of these publishers.

Marketing Intelligence for Media Sellers

In the next few examples, I will be using several different companies from different industries in order to show you the broad range of information that AdClarity has access to.

Challenge 1: Finding the relevant ad networks, DSPs, and SSPs that will lead you back to your favorite advertisers and other relevant advertisers in order to maximize your advertising revenue and access thousands of advertisers that wouldn’t have bought directly from you.

In this scenario, we are a publisher who wants to work with Travelzoo.

By using AdClarity to discover which mediators (ad exchanges, ad servers, ad networks, SSPs, and DSPs) Travelzoo is working with, I am able to know which mediator I need to be in contact with in order to work with them.

programmatic95

Additionally, I can assume that advertisers in the same industry as Travelzoo are most likely using the same DSPs. I should therefore make sure that the ad exchange I am working with works with that specific DSP or that I’m working with the DSPs that are most relevant for me. This will help me find advertisers that will yield results from my site and will continue running their ads with me.

programmatic96

I can also use AdClarity to figure out which SSP and ad exchange I should be working with. By using Marketing Intelligence to uncover which DSPs and ad exchanges an SSP is working with, I can see which SSPs have access to premium advertisers and if other publishers they are working with are in the same industry as me. By making sure I have access to top of the line advertisers, I can maximize my revenue by knowing that premium advertisers are trying to outbid each other for my premium inventory.

Additionally, AdClarity shows me the eCPM of my competitors so that I can see what my inventory is really worth and whether my price floor is too high or too low.  If it’s too high, I’ll know to lower it so that I won’t be missing out on advertisers. And if it’s too low, then I can raise it and maximize revenue.

programmatic97

In conclusion, Marketing Intelligence lets you gain complete visibility and transparency onto your competitors advertising tactics and monitor your entire ecosystem to build on their success and avoid their failures.

Your competitors have spent an exorbitant amount of their budget on testing and trying to figure out what brings them the best results and these insights will allow you to easily work off their successes.

 

About AdClarity

AdClarity is a Marketing Intelligence tool which provides online marketers with actionable insights about their competitors’ advertising activities. Driven by big data and proprietary behavioral content discovery technology, AdClarity unveils brands’ campaigns, ad creatives, impressions, and spend data across multiple channels, including Display, Mobile Web, Mobile Apps and Video. Data is collected across 20 geographies and covers over 50M URLs daily while discovering over 40K new campaigns every day. The AdClarity product suite is used by over 7,000 media and advertising professionals globally in Fortune 500 Brands, Agencies, Ad Networks, and Publishers.

 

Request a guided tour of AdClarity.

The Evolution of Programmatic Buying: The Challenges

Everything in life has a yin and yang, and this includes programmatic. Yes, programmatic has made some revolutionary changes in the way media buying is done that benefits the entire online advertising ecosystem. But with it also comes a new type of black market where nefarious people take advantage of human error, the rise of automation, and the decline in human to human communication.

The most common type of fraud, and often synonymous with the term, is non-human traffic aka bots. We will definitely be focusing on that in this post, but I will also take note of some less popular fraud types which are also extremely detrimental to honest players and the integrity of the industry.

Non-Human Traffic & Bots (Click Fraud)

It’s easy to understand why non-human traffic (from this point on we’ll call bots) tops the list of concerns for advertisers and brands; they currently account for 90% of all fraud in the online advertising industry.  Advertisers are paying and expecting that their ads will be viewed by actual people who might potentially buy their product. However, this isn’t always the case as bots account for about 11% of all display ad views.[1]

Bots are computer software applications driven by code which impersonate human behavior. They are pretty advanced and can be very hard to detect, especially as they have become better at mimicking user behavior throughout the years.

The type of fraud that bots engage in is called click fraud, which occurs when the bot clicks on an advertisement to drive up costs for the advertiser without ever having the intention of conducting business with them.[2] Keep in mind that bots aren’t humans- they can run forever and at an extremely high pace.

There are different types of bots such as PhantomBots, which travel around the web viewing and clicking ads, DeceptiBots, which can mimic a human’s behavior, and VaderBots.[3]

VaderBots are the most intrusive to users because they corrupt PCs and infect them with a malware which conducts click fraud based on the user’s behavior. There is a really great infographic that the iab made which shows just how easy it is to become a victim of traffic fraud[4]:

iabclick

Source: iab

Ad Injections    

Ad Injections have a very interesting story.

You know when you download some file or app off the web and it makes you “run” and “install” about a million pop-ups and have you “read” their novel on terms and conditions (which we never do)?

Well, often times when you download apps off the internet, they will bundle themselves into an installer which will persuade you to install additional programs onto your computer. This is where not reading the terms and conditions or the pop-ups and just clicking “next” “next” “next” come in. So really, when you think you’re getting what you were looking for, you are… but you’re also getting much more than you expected.

I don’t know if you’ve hear of this little bastard, but I’m talking about ad injectors.

ad injections

Source: www.benedelman.org

You see that ad on Dell’s site that’s outlined in red. Take a moment and think about it. Do you really think that Dell acts as a publisher? Would Nike host ads from retailers on its site? Or Apple? I think not.

This is what ad injectors do; they inject ads onto sites without permission and without the publisher ever knowing. And therefore, without ever paying the publisher.

Another example

So let’s say you’re searching for boots on Google.

boots1

Instantly, Google will come back with results. But in even less time, the ad injector will push forth its own ads and replace those that paid for Google.

booots2

Ok, so who gets paid here?

Normally, the money would go to Google, right? But Google isn’t making any money here. Why? Because the ads were never put up by Google in the first place. The ads belong to an entirely independent third party service who hijacked the Google search page and placed their own ads as a way of making money. So let’s reiterate this- the ads on Google have not actually been placed there by Google!

Why do advertisers do this?

Well, this is a very attractive scheme to advertisers because now they are being offered inventory in places they would have never been offered before! For example, not too long ago, a Target ad actually showed up on Walmart’s homepage. If that’s not a shocker, then I don’t know what is.

Why do Ad Injectors do this?

On one hand, ad injectors could sell inventory directly to the publishers. In fact. If the price is good enough, advertisers may even say yes. It would indeed be more appealing to advertisers as these ad injectors would be able to offer up space that would otherwise be impossible to attain i.e. Walmart or Wikipedia. Additionally, the spots on the page (above the fold, main banner) would definitely be an attractive aspect to advertisers.

But this isn’t what ad injectors do at all. Rather, they work through an intricate and complex web of ad networks, exchanges and other mediators. There are many benefits to these mediators, the strongest being the ability to increase efficiency. However, because these webs are so complex, the advertiser may be going through 3 or 4 mediators before getting to their publisher. The advertiser may never even suspect that they are going through an ad injector!

Impression Fraud (Ad stacking, Ad Stuffing)

Ad stacking is another very common form of fraud. It occurs when publishers stack ads on top of one another, and even though only the top ad is shown to the user, advertisers think that their ads are also getting shown. The image below shows an example of an ad blocker showing how many ads are being served on the page or being attempted to being served on the page.

adblock

They do this by placing ads in invisible iframes with zero to zero pixels and zero visibility. This way they can load lots and lots of ads on the page. Furthermore, publishers can use bots to load the pages so that the ads get “viewed”, costing advertisers for each impression “viewed.”

This enables publishers to sell a huge amount of inventory on ad exchanges, which are sold but never seen.

Fake Sites & Domains

This one is pretty basic and is exactly what it sounds like. These are fake websites built just for advertising which offer no content that anyone is interested in. They usually are integrated into a complex web of other sites and are part of a larger network so that they don’t rouse suspicion.  And just like impression fraud, they can use bots to load and reload the page, making it look like they have traffic and costing the advertisers money for useless impressions.

Ad Viewability

This isn’t a type of fraud. Rather, I see it more as a challenge that is currently being acknowledged by key players in the industry.

In the past few years, statistics about display advertising have been a hot topic. Why? Because the figures are shocking. For example, did you know that you’re more likely to survive a plane crash than click on a banner ad? Or that you’re more likely to get into MIT or Harvard than click on a banner ad? Eeek! For someone who lives and breathes the digital advertising world, these are horrifying statistics. But what I think is even more daunting is that while global display ad spend is expected to reach over $70 billion in 2016, over 56% of all ads served are not actually viewable!

So what makes an ad viewable?

According to the IAB, at least 50% of an ad must appear in the user’s browser window for at least 1 second, and in the case for videos, at least 2 seconds.[5] That means if your ad shows up on someone’s browser, but is placed below the fold, and the user hasn’t scrolled, there is no ad viewability. To put it simply, just because an ad is served doesn’t mean it’s viewed.

So what can you do?

In the following infographic, you’ll see exactly what factors affect the chance of your ad getting viewed.

Ad_Viewability

Although all of these challenges did exist in the pre-programmatic era, they have been exacerbated by the current conditions of the industry, specifically the decline in human to human contact. Fraudsters can easily hide their identities and motives to remain undetected by brands and ad exchange. In order for programmatic to overcome fraud, an audit trail must be incorporated in the supply chain. There must be more transparency in the system and a way to recognize if players participating in the programmatic game should be there in the first place.

 

About AdClarity

AdClarity is a Marketing Intelligence tool which provides online marketers with actionable insights about their competitors’ advertising activities. Driven by big data and proprietary behavioral content discovery technology, AdClarity unveils brands’ campaigns, ad creatives, impressions, and spend data across multiple channels, including Display, Mobile Web, Mobile Apps and Video. Data is collected across 20 geographies and covers over 50M URLs daily while discovering over 40K new campaigns every day. The AdClarity product suite is used by over 7,000 media and advertising professionals globally in Fortune 500 Brands, Agencies, Ad Networks, and Publishers.

 

Request a guided tour of AdClarity.

 

[1] http://www.adweek.com/news/technology/7-things-you-need-know-about-bots-are-threatening-ad-industry-161849

[2] https://econsultancy.com/blog/63818-what-is-click-fraud-and-how-can-you-prevent-it/

[3] https://www.exchangewire.com/blog/2014/05/29/the-truth-about-online-ad-fraud/

[4] http://www.iab.net/media/file/IABDigitalSimplifiedUnderstandingOnlineTrafficFraud.pdf

[5] http://www.iab.net/iablog/2014/03/viewability-has-arrived-what-you-need-to-know-to-see-through-this-sea-change.html

The Evolution of Programmatic Buying: The Mobile Industry

There is no way I couldn’t include a chapter about what’s going on in the mobile world. Unless you live under a rock, you must be aware of how big mobile advertising is becoming. Here are just a few statistics from around the web to demonstrate my point:

  • According to Forrester Research, mobile display advertising will account for nearly 40% of all online display ad spending by 2019, up from 24.4% in 2014[1]
  • By 2018, it is predicted that 2.7bn people on this earth will have smartphones. Take this into consideration with the fact that last year, 60% of time spent on the internet was spent via smartphones (and time spent on desktops declined by 20%)[2]
  • By the end of 2015, mobile advertising in the U.S. will bring in $400bn compared to $139bn in 2012[3]

Okay, so I don’t need to keep reiterating the importance of mobile marketing. We all get it. But because we’re focusing on programmatic buying, I’m going to shove one more statistic in your face.

It is predicted that by the end of this year, mobile will surpass desktop display ad spending in terms of programmatic ad expenditure. To be more precise, or as precise as I can be in regards to forecasting, mobile will account for 56.2% of the total programmatic digital display ad spending by the end of 2015.[4]

The concept of programmatic buying, as we learned in previous chapters, is pretty much the same for the mobile world. Ad exchanges, SSPs, DSPs, etc. are all playing the same role, except that they’re focused on mobile, and the types of programmatic that are applicable for desktop display are still relevant for mobile.

With that being said, there are a few key distinctions that must be made in regards to the mobile ecosystem.

  • Programmatic in the mobile world is still relatively novice. It sort of looks like what the desktop display advertising industry was 10 years ago.
  • In the mobile landscape you have the options of choosing in-app inventory, video inventory, or web browser inventory. Although video is a huge deal, I’m going to focus on the two main types: in-app and web browser
  • Native Advertising is a must.
  • When it comes to mobile, apps win.
  • When it comes to apps, Facebook wins. Big time.
  • Google and Facebook together make up almost 70% of the mobile ad market.
  • The cookie problem. Most mobile web browsers do accept first party cookies. However, different browsers behave differently with third party cookies, and, most importantly, cookies don’t exist in the app world.
  • Last, but certainly not least, is data. The types of data available on mobile are quite different from desktop data, enabling mobile marketers to try new targeting and optimization methods.

Alright, let’s get started.

Mobile marketers have two main ways to advertise: mobile apps and mobile web.

Mobile Apps

Just to give you an idea of the significance of mobile apps, in 2013, 80% of the time spent on mobile devices was spent on mobile apps. In 2014, this number increased to 86%, while mobile web browsing fell to 14%![5] And I’ll give you one guess as to who is dominating the mobile app industry (hint: it’s number 5).

That’s right.

Currently, Facebook is the most downloaded app in the entire world, and touts its 1.9bn monthly active users, which continues to grow each month.

So why is this interesting to us?

Because in 2012, when Facebook first launched its mobile ad business, it made close to nothing. Yet, in 2014 it made over $12.47bn in revenue, and 69% of that revenue was attributed to mobile.[6]  And even more interesting is the fact that during the final few months of 2014, they served 65% LESS ads than the previous year… but the average costs of those ads was 335% higher.[7] Pretty much the underlying rules for neoclassical economics. Cut supply down, demand goes soaring, prices fly through the roof.

How did they become so successful?

There are many factors to take into consideration when it comes down to understanding why Facebook is doing so damn well on mobile. But, in my opinion, I think the two top contributors are native mobile advertising and Facebook’s retargeting capabilities.

I’ll explain both of these in a little bit. Right now, we’re going to spend a moment talking about mobile web.

Mobile Web

The mobile web is pretty much like browsing the web on your desktop, just on your mobile. It’s just much smaller, needs to be mobile responsive, and is usually touch-screen sensitive. It has quite a bit of convenient features that enable users to perform an action in a touch of a button (placing an order, dialing a phone number, etc.). Usually, companies always go for the mobile website first because it doesn’t require building an app, builds up web presence, is instantly available, is compatible with almost every mobile device, and is just much easier to manage and maintain.

In regards to the mobile web industry, Google wins by far. However, although Google’s mobile search ad spending as around 65% (2014), it has been on a constant decline when compared to its 2012 figures of 83%.[8]

The reason for this is as discussed before- more and more people are going to their mobile apps over web browsers. Google stays pretty private regarding their mobile share and revenue, but what we do know is that they are aware of this decline and probably have some tricks up their sleeve, such as potentially acquiring InMobi, one of the biggest mobile ad networks in the world.

The Cookie Problem

Sounds like an oxymoron, huh?

Cookies are very important in the world of advertising, especially when it comes to retargeting. And although cookies work wonders when it comes to desktop, it’s a little bit of a different story in the mobile world.

iab

Source: iab

Mobile Web Cookies

In the mobile world, cookies exist ONLY on the mobile web and their reach is very limited. And when it comes to accepting third party cookies, every browser behaves differently.  I mean, Safari doesn’t even accept third party cookies and it’s one of the most used smartphone browsers. Two more big issues? Browsers don’t share cookies with each other and they reset every time you close the app session. Eeek.

Mobile App Tracking

I’m going to start off with an analogy before I start explaining the mess with mobile app tracking.

Imagine there is a kingdom- one ruler to rule them all. There are tons of people living in the village who follow and report to the rules of the monarch. Things are in order. People may be living their own lives and doing their own thing, but in regards to the important stuff (food, income, taxes, etc.), everything is tracked, reported, and standardized. Things function.

mobile1

This analogy represents cookies and tracking in the browser world.

Now imagine the same kingdom, but this time all the villagers also play the role of monarchs. Now there is one piece of land with hundreds of monarchs, each setting their own rules and regulations within their own castle and property. There is no one ruler to rule them all in this scenario- it’s literally a case where everyone makes the rules for themselves. And because this is the case, no one is collaborating with other rulers or giving them inside information on what’s going on in their kingdom.

mobile2

And this is what tracking looks like in the mobile app world.

There is no such thing as industry standards in regards to mobile app tracking so every app is in charge of figuring it out in their own way. Additionally, apps cannot share their tracking data with other apps so their information stays siloed within their own app. You can imagine how difficult this must be for advertisers when they’re trying to track their users across different apps in order to do proper ad targeting.

Notice that I haven’t used the word cookies yet when talking about mobile app tracking. This is because cookies don’t really exist in the app world. Rather, there are alternate tracking methods used such as device fingerprinting, MAC addresses, Open Device Identifier Numbers, Apple IFA and IVA, and Android Referrer. I’m not going to get into all of these tracking methods, but here is a really great article from Search Engine Watch that talks about the pros and cons of each of them.

Okay, so you get the issue. Tracking is super inconsistent in the mobile world and makes it very hard for advertisers to do ad retargeting. Marketers must figure out a way to integrate all of these identifiers in order to have one major identifier they can use across all channels.

But of course, there are exceptions to this problem: Facebook & Google.

Google

I don’t have much to say about Google that isn’t already known. They own everything. And because they own everything (like DoubleClick and Android), they have special benefits that allow them to overcome the technical challenges that many others face in the industry.

Facebook

Remember when I said that the two biggest contributors to helping Facebook conquer the mobile app landscape are native advertising and retargeting capabilities? This is where we get to it.

Website Custom Audience (WCA)

Do not get this confused with FBX. I don’t care about FBX and it’s not relevant for the mobile world at all.

What WCA does is that it allows marketers to target their audience through Facebook ads based on their own data which could have been taken from their CRM, first party data, email database, etc. This means that you can target people who have been on your website but aren’t your Facebook fans or other offline customers through Facebook.

So pretty much, you take your list of customers, potential customers, and anyone who visited your website and got cookied and upload it into Facebook. You can segment your visitors based on which pages they visited, what section of the website they were on, and so forth in order to show them highly relevant ads. Facebook creates your audience based on your list, and voila, you are able to do ad retargeting in the most extreme and precise manner without bombarding users with emails.

And as you know, relevancy is the key to positive ROI on Facebook. The more relevant the ad is to the user in their buying lifecycle, the more likely they will buy!

Am I the only one flipping out about this?

This is incredible! Facebook has more data than any other data platform in existence. It seriously knows EVERYTHING about you (probably more than you know about yourself) and to allow advertisers to have access to this data through retargeting is just something else.

I think you’re starting to understand why I believe that retargeting is such a crucial component to the success of Facebook’s mobile domination.

Native advertising is pretty easy to understand and if you really want, I don’t mind writing about it more in detail. But all you need to know is that native advertising is really, really big (like $8bn big), and that Facebook is really, really good at it. And once again, you shouldn’t be surprised. Because Facebook has the data to know exactly what they should be recommending and when they should be recommending it.

Data

You have a general idea by now of how and where data is gathered from. But before we finish today’s post, I’d like to mention one more very important characteristic unique to mobile, and that’s location-based data.

People go with their mobile devices everywhere, and that’s something advertisers can leverage big time. If you combine location-based data with other types of data (such as behavioral), advertisers can send even more hyper-targeted ads to their consumers that offer the right product at the right place at the right time.

For example, a retailer can combine a user’s purchase history with their location and send them personalized offers whenever a customer walks into a store.[9]

It’s the ideal situation for brands that want to be involved in their customer’s and prospect’s buyer journey.

Conclusion

Okay, so we understood that programmatic is pretty much the same when it comes to mobile, albeit in a much less mature stage. What really shakes things up is the uniqueness of the mobile advertising industry in and of itself. The technological limitations that mobile sets for itself makes it difficult for programmatic to function as it does in the desktop world.

We saw that mobile browsers and mobile apps are completely separate in terms of data, tracking, really, anything. We know that retargeting is something that is very rare in the mobile world, unless you’re Google or Facebook. And we know that programmatic won’t reach its full potential unless things change.

Luckily, ad networks and other platforms are aware of this and are beginning to develop technologies which enable them to track users from app to app, collecting data and tracking information along the way.

And hopefully, they will be able to catch up soon. Because at the rate mobile is growing, players can’t afford to take their time.

 

 

About AdClarity

AdClarity is a Marketing Intelligence tool which provides online marketers with actionable insights about their competitors’ advertising activities. Driven by big data and proprietary behavioral content discovery technology, AdClarity unveils brands’ campaigns, ad creatives, impressions, and spend data across multiple channels, including Display, Mobile Web, Mobile Apps and Video. Data is collected across 20 geographies and covers over 50M URLs daily while discovering over 40K new campaigns every day. The AdClarity product suite is used by over 7,000 media and advertising professionals globally in Fortune 500 Brands, Agencies, Ad Networks, and Publishers.

 

Request a guided tour of AdClarity.

 

 

[1] http://blogs.wsj.com/cmo/2014/10/06/forrester-us-online-display-ad-spending-will-nearly-double-by-2019/

[2] https://econsultancy.com/blog/66202-more-reasons-why-marketers-must-move-to-a-mobile-first-ad-strategy/

[3] http://www.highervisibility.com/12-mobile-statistics-to-get-you-amped-for-2015/

[4] http://www.emarketer.com/Article/US-Programmatic-Ad-Spend-Tops-10-Billion-This-Year-Double-by-2016/1011312

[5] http://www.forbes.com/sites/niallmccarthy/2014/10/29/mobile-app-usage-by-the-numbers-infographic/

[6] http://www.adweek.com/socialtimes/facebooks-q4-2014-mobile-is-now-69-of-ad-revenue/613826

[7] http://adage.com/article/digital/facebook-s-mobile-revenue-hits-2-5-billion-prices-soar/296869/

[8] http://finance.yahoo.com/news/why-google-losing-mobile-search-130007811.html

[9] http://searchcrm.techtarget.com/feature/Location-based-apps-present-opportunities-and-data-challenges

The Evolution of Programmatic Buying: Programmatic Direct

In the last blog, we covered real-time bidding (RTB) and what programmatic buying is. In today’s blog, we will be discussing another type of programmatic buying that doesn’t involve real-time auctions, which is called programmatic direct.

You may have heard nuances of this term: programmatic direct, programmatic premium, premium direct, automated guaranteed, programmatic guaranteed, programmatic reserved, etc. They all mean the same thing, but for our sake, we will stay with the term programmatic direct.

We have understood that with RTB, there is no guarantee that you will get the ad spot of your choice. And we have also understood that there is no direct relationship between the advertiser and the publisher; they are always meeting through an ad exchange or some other mediator, sometimes multiple mediators. Something that I didn’t mention in the last blog was that even though the RTB ecosystem provides transparency into the media buying ecosystem, it didn’t provide publishers with the visibility they needed to understand why advertisers were buying their inventory. It also didn’t provide advertisers with the actual site their ad appeared on—only the category.

And we’ve also seen that in the reality of it all, although I argued that RTB is actually really beneficial for middle and long tailed publishers, it sort of screws premium publishers.

And the publishers are fully aware of this.

A few years ago, OpenX published a piece that included a section about how fair programmatic buying really is. They asked some leading publishers what they thought and most of them came to the same conclusion: advertisers have the advantage when it comes to programmatic.

In fact, here are some direct quotes from this paper regarding the issue:

“As a premium publisher [I believe] the advantage goes to the advertisers that are buying our inventory at below market rates. Until the eCPM starts climbing to match direct sales eCPM, the advantage will never be to the seller.”

Buyers are “calling the shots on price, and you play the game or don’t get the volume. Buyers are biased too much towards audience and not enough towards context.”

Buyers benefit more because programmatic “allows them to use their first-party data to identify valuable audience and buy it cheaply, because the seller does not know the value.”

“Buyers are benefiting more, as they are able to get massive reach on top sites for bottom dollar. Meanwhile, publishers are playing catch up, and struggling to optimize the balance between direct sales and programmatic buying in their yield strategies, and in particular trying to limit CPM erosion.”

And of course, the advertisers had their version, but to sum it up, they feel that the publisher side isn’t doing enough to fully maximize the potential of real-time bidding.

So we see that although RTB is a stellar technology, it still has some faults and room for improvement. And we also have to remember that RTB is not the only way brands buy media. A lot of the top advertisers still prefer to buy directly from their premium publishers to guarantee their spot.

But if we remember from the first in this series, the traditional direct media buying process is lengthy, tedious, and completely inefficient.

And this is where programmatic direct comes in.

So what is programmatic direct?

Programmatic direct is the automated process of direct media buying- where the advertiser still buys directly from the publisher, but without the need for insertion orders AND giving them the transparency and insights they need to constantly optimize their campaigns in real-time. This type of programmatic means that when the advertiser buys inventory from the publisher, they are guaranteed that spot (unlike RTB which has no guarantee at all). And because it is programmatic and still involved in the programmatic world, DMPs still play a huge role in providing advertisers and publishers with the first, second, and third-party data they need to enhance their targeting capabilities.

So now, publishers are able to work directly with advertisers and see exactly what they are looking for and why they are purchasing their inventory. This allows for publishers to find relevant advertisers, provide more relevant packages, and promote their own premium inventory. It’s as if to say that now that the advertisers know exactly what they want, publishers can provide those wants with more guaranteed inventory than they would get in the auction place. Providing, of course, that the advertiser is willing to pay for it.

Another common notion is that programmatic direct is only about premium spots. But, something I strongly believe in is that premium is in the eye of the beholder. What may be trash to one buyer may be premium to another. It really depends on what the buyer is looking for and what they need. So really, in programmatic direct, there is a premium for everyone.

Let me try to break it down in simpler terms.

RTB had not yet managed to surpass the process of direct buying and selling of inventory. Why? Because larger brands still want guaranteed access to their premium inventory, and, well, RTB just can’t guarantee that. So let’s say an advertiser finds the perfect customer but loses the auction to someone who bid higher. It’s not the end of the world- they advertiser can easily track the user to find them again. But this time, they may not choose to go through an auction but rather do a guaranteed buy so that they can make sure to reach them.

Additionally, when it comes down to RTB, the most important factor for the buyer isn’t the publisher or the content on their site, it’s the audience, pure and simple. All they care about is that they are targeting the right audience, hopefully in a relevant manner, but not always promised.

With programmatic direct, the main factor is the actual site. Buyers want to know that the premium inventory they are buying ad space on is quality. Don’t get me wrong- the audience is still an extremely significant player in the decision factor. However, programmatic direct provides the buyer with the possibility of providing their end user with an ad that is contextually more relevant. As an added bonus, buyers also get much more transparency and inventory control over their purchases. And of course, publishers are able to set their own prices, albeit much higher than RTB prices, and make a better profit for their premium goods. They’re also saving a ton of money on using an automated system over manual sales work. Look, at the end of the day, you pretty much get what you pay for.

In my opinion, programmatic direct is primarily for brands, not performance based advertising. It’s large brands and agencies who care about where their ads are seen. You can’t have a company like Nike showing up on a download or porn site just because the user they wanted is there. They have a reputation to uphold!

So how does it work?

All programmatic direct is, is literally the automated process of traditional direct media buying.

The advertiser works with a publisher to buy a packaged deal of premium spots and sites and all the IO’s, requests, briefs, etc. are done automatically via the platform. Don’t get this confused with an ad network, which packages inventory from multiple publishers. Rather, on a programmatic direct platform you choose the publisher you want to buy the inventory from. The publisher provides the advertiser with a package of inventory only from their sites based on the general targeting attributes that the advertiser has requested. And, most importantly, remember that this kind of buy isn’t user based. It’s like the old ways where an ad space bought shows up everywhere to everyone who opens the site. However, in this case, the advertiser has limited targeting capabilities (like 30-45 year old men, only on sports sites, etc.). So if a brand bought inventory from Yahoo, via programmatic direct, and made a request that it would show only to women between the ages of 20-45 and only in the fashion category, it would show the ad to all women who fit that description in any fashion domain or subdomain of Yahoo.

Another thing that a lot of these publishers do with programmatic direct is offer a sort of one-stop marketing shop to the advertisers. Along with buying inventory for their ads, they also offer packages which include partnerships, sponsored posts, newsletter promotions, etc. If you are a large brand who is working with CNN or the Huffington Post, this is obviously a very appealing selling point. And of course, publishers can make a whole lot of money from offering these solutions.

Okay. So we understood what programmatic direct is, how it works, and why the advertisers and publishers both benefit from it.

What now?

I have an idea. How about understanding programmatic buying in the mobile ecosystem?

Stay tuned for the next blog that will explain how the mobile world has adapted to programmatic and what it will take for them to conquer it.

 

About AdClarity

AdClarity is a Marketing Intelligence tool which provides online marketers with actionable insights about their competitors’ advertising activities. Driven by big data and proprietary behavioral content discovery technology, AdClarity unveils brands’ campaigns, ad creatives, impressions, and spend data across multiple channels, including Display, Mobile Web, Mobile Apps and Video. Data is collected across 20 geographies and covers over 50M URLs daily while discovering over 40K new campaigns every day. The AdClarity product suite is used by over 7,000 media and advertising professionals globally in Fortune 500 Brands, Agencies, Ad Networks, and Publishers.

 

Request a guided tour of AdClarity.

The Evolution of Programmatic Buying: RTB

Finally! After torturing all of you for so long, the time has come to discuss what you came here for: Programmatic Buying!

We established that in traditional media buying, the buying and selling process was tedious, time consuming, inefficient, not promising, and didn’t necessarily yield maximum results for either the publisher or advertiser. And of course, everything was and is done manually.

All programmatic buying is, is the buying and selling of display ads in an automated manner using the technology that we covered in the previous sections. That’s literally all it is- making media buying an automated and much more efficient process. It’s a concept– an umbrella term that encompasses a whole world beneath it.

You may be super confused right now and think that there is much more to programmatic buying, which there is, but what you need to understand that the actual definition of programmatic buying is simple. I can’t reiterate that enough. The automated process of media buying. Period.

That being said, there are different types of programmatic buying, such as real-time bidding, or RTB, which I’m sure you’ve all heard of. We’ll get to this in a moment, but I’m going to drive you crazy and say this one more time:

PROGRAMMATIC BUYING IS THE AUTOMATED PROCESS OF MEDIA BUYING USING TECHNOLOGY.

Good. Now that we have that settled, let’s begin.

People often say that programmatic buying is a synonym for RTB. And now that you know the definition of programmatic, I am certain that you will be more than willing to understand that it’s not–real-time bidding is a TYPE of programmatic buying.

So what the hell is RTB?

Real-time bidding is the buying and selling of ad space (per impression) in real-time through auctions held in ad exchanges, DSPs, or SSPs. RTB is not its own platform- it’s a type of technology that ad exchanges, DSPs, and SSPs integrate in order to perform these auctions.

Okay… so how does it work?

I’m going to give you the simplest version of how the RTB works. And keep in mind, this entire process takes less than 80 milliseconds, about 4 times faster than it takes to blink your eye.

It all starts with the publisher. The publisher chooses an SSP to work with, such as Pubmatic, and places a tag in the ad space, or inventory, they want them to be in charge of.

A user goes to that publisher’s site and before the page even finishes loading, the request to fill that vacant as space has been sent to the SSP. The SSP finds out information about the user through its DMP. It gathers generic information such a demographics, time of day, day of the week, and so forth. Once all of this information is gathered, the SSP sends the request to the ad networks, ad exchanges, and/or DSPs it is working with.

The SSPs can distribute this request in 2 ways- Round Robin or simultaneously.

If you look at the infographic below, you’ll see how the SSP has connections with multiple platforms (DSPs, ad networks (AN), and ad exchanges (AE))

rtb

If the SSP decides to send the request in a round robin manner, that means that each of these entities will have a ranking based on priority. For example, the SSP could send the request to DSP1 and if the bid falls through, they’ll send it to AN1—it really depends on what their order of preference is.

Or they can send out the request to all of their partners simultaneously.

It’s important to note this because if you are an advertiser and you are working with a certain platform who works with a specific SSP that has traffic you want, you need to make sure that you are not on the bottom of their list in case they do a round robin. You need to be working with the highest ranking DSP, ad exchange, or ad network in the eyes of the SSP.

So the SSP sends the request over to its partners. And don’t forget, if they send it over to an ad exchange, the ad exchange could be working with several DSPs simultaneously.

Each player on the buying side evaluates the bid according to their own algorithms and targeting parameters that the advertiser set previously. For example, the advertiser may have wanted to target men between the ages of 30-47 who have a high income. Or maybe, the advertiser only wanted to target people who surfed on luxury watch websites. Or maybe, the advertiser only wants to target people who were shopping on their site earlier. The possibilities can go on forever.

So if you remember, the DMPs are what provide the DSPs with behavioral data about a consumer. The DSPs are what make the decisions. So after the ad exchange sends the bid request to the DSP, the DSP makes a decision based on complex algorithms which decide if this user is relevant for the advertiser.  If it is, then the DSP places a bid on the ad space (the maximum bid amount is set previously), and whichever advertisers places the highest bid wins the ad space. (It is important to note that not every bid is created equally. Sometimes, an advertiser will pay more for a bid when they know that the user is extremely relevant for them.) Then, the winner sends instructions on how to retrieve the creative to the ad exchange, which then sends it to the SSP, which then sends it to the publisher. And finally, the ad is shown to the user.

Benefits of RTB

There is absolutely no dispute- RTB is a much more efficient way of buying and selling media when compared to traditional media buying.

Advertisers no longer have to work directly with publishers and negotiate. They no longer have to buy bundled packages with irrelevant impressions which lead to wasted impressions. With RTB, they are able to have enhanced targeting capabilities, minimize wasted ad impressions, increase their reach and frequency, have transparency to gain the insights they need to constantly optimize their campaigns, and choose each impression they want to buy.

Publishers have the same deal. They don’t have to waste time and energy trying to contact and manage negotiations with advertisers. They have access to a much larger audience of potential buyers. They have a higher likelihood to sell more of their inventory. And, most importantly, because advertisers bid on inventory, the publisher is receiving the maximum market value per impression.

That being said, like all things great and small, there are no ups without the downs. But I guess that also depends on whether the glass is half empty or half full.

So here’s the deal.

Before programmatic came around, advertisers cared about publishers. They cared about the publishers name, reputation, size, etc. Advertisers wanted to buy inventory space because of the publisher. And because of this, the majority of all ad spend was going to the premium publishers. No one had any interest in working with middle or long tailed sites.

But all of this changed with programmatic.

Rather than obsessing over the status of a publisher, buyers began to shift their focus to the audience; and this was a hard hit for premium publishers. You see, buyers realized that it didn’t matter if they were buying premium spots of premium sites if the user wasn’t relevant for them. All they cared about was reaching the right user at the right place at the right time, and buying from premium publishers just wasn’t enough.

A few things happened because of this.

First, premium publishers began to lower their inventory cost because they couldn’t compete with natural changes. However, because the amount of internet users increased exponentially, it sort of weighed out the situation. Their costs may have decreased slightly, but quantity increased immensely.

Secondly, because buyers cared about the audience, this gave a chance for the middle and long tailed publishers.

How? Through retargeting.

Buyers could now target their exact users on any site, no matter where it stood on the totem pole, through retargeting tactics. Their specific method of doing this is a little controversial, but it’s also pretty damn smart. It’s called data leakage. What buyers would do is this: they would buy ad impressions on premium sites (they would set their bid ceiling very high so they could win). And because the ad was being served through a third party platform, the buyer could drop a tracking code on their creative to cookie the user (without the publisher knowing). Once the lead was being tracked, they pretty much had no use for the premium publisher because they didn’t matter anymore. What mattered was where the user was going, and often times they were going to middle or long tailed sites. So the advertiser would stop working with that premium publisher because they got the information they need and then they would immediately launch an RTB campaign that would look for the users with the cookies through various ad exchanges, DSPs, and ad networks. And once they found them, they could place a much lower bid (because it wasn’t a premium publisher) to reach them.

So on the one hand, there is a huge debate on whether RTB is hurting or benefitting the publishers, but I strongly believe it is the latter. Yes, premium publishers have to lower their costs and deal with data leakage. However, with the growing number of users on the internet, they’re actually still making a profit.

Additionally, RTB sort of leveled out the playing field. It gave a chance for the smaller publishers, who no one would have even thought of before. The fact that the disparities between the big and medium-small publishers is decreasing is absolutely phenomenal and could only bring benefits to the ecosystem.

I want to also note that I gave you one example of how RTB can work. It can work in multiple ways and I have no problem introducing you to some of these variations if you’re interested.

But for now, I think you’ve acquired the foundation to understanding what RTB is and how it works.

Stay tuned for the next blog to see another type of programmatic buying—programmatic direct.

Hope you enjoyed and would love any feedback!

 

About AdClarity

AdClarity is a Marketing Intelligence tool which provides online marketers with actionable insights about their competitors’ advertising activities. Driven by big data and proprietary behavioral content discovery technology, AdClarity unveils brands’ campaigns, ad creatives, impressions, and spend data across multiple channels, including Display, Mobile Web, Mobile Apps and Video. Data is collected across 20 geographies and covers over 50M URLs daily while discovering over 40K new campaigns every day. The AdClarity product suite is used by over 7,000 media and advertising professionals globally in Fortune 500 Brands, Agencies, Ad Networks, and Publishers.

 

Request a guided tour of AdClarity.

 

The Evolution of Programmatic Buying: Ad Exchanges

If you remember from the first article, I touched on what an ad exchange is and how it came to be. In today’s blog, we will be covering this topic a little more in depth, starting with the ad network and the renaissance of media buying, which began with the ad exchange.

Ad Networks

We already know how and why the ad network came to be. In short, there were so many advertisers and publishers in the ecosystem, it was impossible for advertisers to handle the direct media buying process and it was impossible for publishers to sell most of their inventory. So the ad network came to be.

For advertisers, this was very good because it enabled them to extend their reach and reach a larger number of publishers through one platform. For small and medium publishers, this was also very good. This was because these publishers had a very hard time selling their inventory to advertisers and now they were able to sell their inventory as part of a larger package on behalf of the ad network.

Ok, so how does an ad network actually work?

Firstly, the ad network needed access to a huge audience. This audience was brought by the publishers, and along with it, an abundance of consumer behavior data. Next, the ad network would look at all the inventory they had aggregated and they would use an algorithm to forecast how much of this inventory would be available in the following months per each publisher. Next, they would aggregate this data based on segments, which they are able to do with the use of the consumer behavior data. They would then package this segmented data (based on things such as age, gender, demographics, etc.), mark them up, and sell them to advertisers.

It sounds fine…so what’s the problem?

Let’s start with the advertisers. First of all, most ad networks don’t want advertisers to know where their ads are getting published. This is for several reasons, the most important being that if you, as an advertiser, knew which publishers your ad network was working with, you would be able to pass the ad network and work directly with those publishers, eliminating the need for the ad network. Because of this, advertisers can’t identify which inventory works best for them. Next, because advertisers buy inventory in packages, and these packages often include both remnant inventory and premium inventory, advertisers can’t really know what the value of any single impression is and can’t really obtain too many insights. Additionally, because there is almost no transparency and advertisers don’t know what sites their ads are running on, they could be taking the risk that it is showing up on a nefarious site.

Publishers didn’t have it much better. The lack of transparency also ran on the side of the publishers. They were unable to identify which advertisers were bringing in the best results and had to take the chance that the ad network would bring in very low quality ads, which could in turn lower the reputation of the publisher’s site, decrease any likelihood of conversions, and so forth. Because publishers were working with multiple ad networks at once, they had to constantly be evaluating with ad network was bringing them the best results—this was a manual and time consuming process. And most importantly, ad networks, more often than not, were also working with a chain of other ad networks, buying and selling inventory from one another. Each one of these took a cut from the publisher leading the publisher to receive lower and lower revenue.

And let’s not forget the challenges the ad networks themselves had. Although their plan seemed to be seamless, let’s remember that there is no such thing as concrete forecasting. It is a prediction, not an accurate science. So of course, forecasting publisher inventory was often faulty. And because of this instability, their packages were inconsistent and they were either overselling or underselling inventory.

So you see the problem. What started off as a solution turned out to be a little more detrimental to its key players than intended. And this is where ad exchanges came into the picture.

Ad Exchanges

An ad exchange is a platform which facilitates the buying and selling of inventory through real-time auctions.  Unlike ad networks, which don’t work in real-time and sell inventory by the bulk, ad exchanges buy and sell per impression. This gives the advertiser complete control over each ad- they have specific criteria they specify ahead of time so that each impression is bought with a real purpose. It eliminates the traditional methods that provoked wasted impressions. Now, they are able to choose exactly who would see their ad, where they would see it, how they would see it, and when they would see it. So not only would they get to choose each and every impression they are buying, but they also decide how much they want to pay for each impression and only pay for the impressions that they want.

Ad exchanges conduct auctions for every single impression and just like in real life, the highest bidder wins the prize. So now, rather than the publisher selling 10,000 impressions in one bulk package and not necessarily getting the best bang for their buck, each impression is auctioned off to the highest bidder, which ensures that the publisher is getting the maximum profit based on market values.

The key differences between ad exchanges and ad networks

Although I assume most of you are starting to understand the key differences between ad networks and ad exchanges, it won’t hurt to reiterate them in this section.

  • Because each impression is sold to the highest bidder, there is high competition between the advertisers. If they know they want it they will try to outbid each other, raising the CPM for publishers.
  • Advertisers can now buy only the impressions that they are interested in. Rather than buying in bulk from ad networks, they have complete control over their impression buys which allows them to buy at a much higher price.
  • Transparency for all! Because ad exchanges provide both the advertisers and publishers with transparency and visibility, advertisers are now able to gain insights as to which were the best performing sites and help them optimize for future campaigns. Publishers are able to see which advertisers are driving the highest eCPM to their sites, giving them the insights they need to make better decisions regarding which advertisers they want to encourage on their site.
  • If you remember, when I introduced the ad exchanges, I said that they are a direct connection between advertisers and publishers. Ad networks, on the other hand, can work with multiple intermediaries, causing the distance between the advertiser and publisher to grow. The problem with that scenario is that each middleman takes a cut of the profit, lowering the revenue left for the publisher. So with ad exchanges create an environment for a more efficient relationship, enabling the publisher to make more money.

Ok, so how do ad exchanges work?

Lucky for you, this is the part where we talk about what programmatic is and how RTB works. Stay tuned for the next blog and get ready to put the pieces together.

 

About AdClarity

AdClarity is a Marketing Intelligence tool which provides online marketers with actionable insights about their competitors’ advertising activities. Driven by big data and proprietary behavioral content discovery technology, AdClarity unveils brands’ campaigns, ad creatives, impressions, and spend data across multiple channels, including Display, Mobile Web, Mobile Apps and Video. Data is collected across 20 geographies and covers over 50M URLs daily while discovering over 40K new campaigns every day. The AdClarity product suite is used by over 7,000 media and advertising professionals globally in Fortune 500 Brands, Agencies, Ad Networks, and Publishers.

 

Request a guided tour of AdClarity.