The real-time revolution
Tom Jenen, EMEA commercial director at AdMeld, explains why real-time bidding will be big news in 2011: “It promises better performance for online advertisers, greater efficiency for agencies and improved returns for publishers”…
After years of hype surrounding ad exchanges, media space has finally becoming a tradable item. Using Real-Time Bidding (RTB), online and mobile display ads can be transacted in an automated and precisely planned fashion.
Initially the move towards RTB was driven by the need to make buying individual display impressions as easy as buying search. Having that level of granularity enables buyers to increase targeting and get higher returns on their budgets.
Much of the basic “piping” to do this started in late 2009 with the creation of agency trading desks, sophisticated buyers called Demand Side Platforms and the integration of RTB into various Sell Side Platforms.
With this infrastructure in place, the global agency holding companies have started shifted budgets into buying by audiences in real time, which has essentially caused the rest of the digital advertising landscape, including publishers, to respond.
By the second quarter of 2010, RTB demand in the UK had started to grow quickly but was still a minor part of the trading picture. In fact, last year RTB represented less than 1% of the volume of display inventory in the UK. This year it will likely be in the 30% range or more. Although Europe is behind the US, it is rapidly catching up.
Today AdMeld processes more than 40 billion ads every month for clients including the Daily Mail, The Independent, Future Publishing, and more than 500 others worldwide, and RTB represents a large and growing portion of that volume.
RTB brings multiple benefits for all parties involved. It enables agencies and advertisers to instantly identify and buy ads targeted at their specific audiences. It also gives publishers more granular control over how they sell their inventory, and much greater visibility into what their audience is worth, and who is buying it.
Publishers have always been fantastic at creating great content based on a deep understanding of their audiences’ interests. RTB enables them to learn things about their audience they may never have known previously, and then convert that information into revenue. For instance, if you run a gadget site, you may find that some impressions are worth more to an advertiser like Toyota than they are to an electronics maker like Samsung.
With the right technology, such as that provided by AdMeld, you can see Toyota bidding on distinct portions of your audience as defined by your own data and data sourced from a variety of third parties. The power of this is that you can now identify and aggregate those high-value users, package them into custom segments, and either sell them via RTB (with rules you define), or pass them to your direct sales team so they can call up car manufacturers.
You can even find lookalikes of these high-value users on other sites, enabling you to expand your monetisable inventory beyond your properties alone. These capabilities simply weren’t possible before sophisticated sell-side technologies emerged.
The old adage that there are analogue pounds and digital pennies was true in part because many publishers sold much of their “remnant” inventory blindly and without controls. But the move to RTB and audience selling is changing all that. With the right tools and information, publishers can generate significant incremental revenue. As the space continues to evolve, the savviest publishers are working on strategies and solutions that will continue to keep them ahead of the curve.
AdMeld is holding its second annual Partner Forum exploring the evolution of the digital display market on February 10. For a full speaker list and agenda click here.