With so many players entering the programmatic space it is often difficult for buyers to navigate the layers of complexity and buy with confidence. These complexities have greatly contributed to the lack of brand safety in bid environments for advertisers and dissatisfaction with programmatic efficiencies.
By John Stoneman, VP EMEA
As programmatic advertising continues to grow globally, its growth in many markets is partially fueled by the rise of private marketplaces. In its early years, the word “programmatic” solely meant the buying and selling of advertising inventory in a real-time open auction. Recently, however, we have witnessed the rise of invitation-only programmatic marketplaces called private marketplaces. These private marketplaces (PMPs) provide publishers with the ability to designate certain parts of their advertising inventory to a select buyer or group of buyers, which differs from the open auction where the advertising inventory is open to all bidders.
In the U.S., the market where programmatic got its start, private marketplaces have grown massively in popularity. PMP is projected to account for 28% of an $11.8 billion programmatic market by 2016 up from just 2.0% in 2013, according to eMarketer.
Here are three reasons why PMPs have become a favorite of so many buyers and premium publishers.
PMPs allow publishers to determine the buyers or advertisers that will be allowed to bid on certain parts of their inventory. This control often means that publishers feel more comfortable about selling their premium inventory programmatically, since they have selected the advertisers that they are offering it to. It’s the type of control that buyers and publishers have always had during the traditional direct sales process and PMP can bring it to programmatic.
PMPs provide buyers with added inventory transparency as being part of a PMP means they will have already identified a publisher they are comfortable buying from. PMPs also provide buyers with access to some types of premium inventory that may not be available in open auction. Finally, PMPs provide premium publishers with an extra level of confidence about the creative that will appear on their digital properties, helping to address any concerns they have around brand safety.
PMPs offer the superior workflow automation that is the hallmark of programmatic advertising when compared with traditional direct sales. Both publishers and buyers benefit by significantly reducing the traditionally time-consuming process required to execute traditional direct sales.
PMPs allow publishers and buyers to extend an existing direct relationship into programmatic. As more inventory is bought programmatically, PMP is an easy way for both buyers and sellers to maintain the rewards of an existing direct sales relationship whilst at the same time benefiting from the efficiency and effectiveness of programmatic execution.
Programmatic is exploding globally, estimated to reach 48% of all global digital display spending this year. As that growth continues, PMPs will play a significant role as buyers and publishers seek to take advantage of its benefits as we move further into the age of programmatic.
There may be no bigger hot button issue in digital advertising right now than ad viewability. Every industry event seems to have at least one panel discussion focused on the topic and there’s been an endless stream of commentary on the issue in the media. Yet for a subject that receives so much attention there’s still a great deal of confusion surrounding it.
That’s why we put together a “cheat sheet” for everything you need to know—but might’ve been afraid to ask–about viewability.
What is viewability?
“Viewability” is an online advertising metric that tracks only impressions actually seen by users. For example, if an ad is loaded at the bottom of a webpage but a user doesn’t scroll down far enough to see it, that impression is not considered viewable.
Is there an agreed upon definition of viewable?
There are two main governing bodies pushing for a standardized definition of viewability: the Interactive Advertising Bureau (IAB) and the Media Rating Council (MRC). Digital media differs from other forms of media in that ad effectiveness is measured on an impression-by-impression basis. Traditional media such as TV commercials use measurement based on averages, such as how often a commercial is played on TV. Because digital media is measured on an impression-by-impression basis, it is not enough to serve the ad for it to be considered effective. The ads must also be seen.
For display ads, the IAB and MRC define a “viewable” impression as one that is at least 50 percent visible for a minimum of one continuous second. For video ads, it is defined as 50 percent visible for at least two seconds. “50 percent visible” means that 50 percent of the ad’s pixels appear above the fold.
Are there other standards of viewability?
Viewability is a growing concern among advertisers because non-viewable impressions can be considered an ineffective use of budgets. A survey conducted by Integral Ad Science (IAS) in December 2014 showed that 78 percent of advertisers surveyed felt that the IAB and MRC standards for viewability were not strict enough. In the case of video, for example, the IAB and MRC standards do not take into account whether the sound is on for an ad, which can detract from the ad’s effectiveness. Many advertisers have therefore begun implementing their own metrics for viewability.
How much of a problem are non-viewable impressions in the industry?
Even using IAB’s and MRC’s current standards, eMarketer estimates that only 50 percent of ads served on desktop are considered viewable. Mobile performs better by consistently achieving 70 percent or higher in viewable ads, but viewability remains a hot button issue in part because so few marketers agree on or even know what current viewability standards are. Recent research from Econsultancy found that 43 percent of senior marketers in the US and UK use viewability to determine the success of their programmatic ad campaigns, while research by firm SQAD found that nearly half of the marketers it surveyed thought that the minimum amount of time a video should be displayed for it to be considered viewable was five seconds or more—over twice the current standard.
What is PubMatic’s approach to viewability?
At PubMatic we have decided to tackle the viewability issue head-on in a transparent way we believe will help both buyers and publishers. We recently signed an agreement with Integral Ad Science (IAS) that will allow us to provide viewability metrics to both our publishers and demand partners.
Today, many of PubMatic’s demand partners already use a third-party tool to help measure viewability. What makes PubMatic different is that we plan to have IAS scores passed on to the publishers—not just media buyers. Our publishers will be able to use this data to create Private Marketplace offerings for their most viewable ad inventory, for example. Since viewable ads help marketers achieve their campaign goals by showing ads to audiences, they’re frequently willing to offer a higher bid for viewable inventory. Offering packages of their most viewable inventory is a great way for publishers to maximize the value of their digital assets. It also provides buyers transparency into inventory that they haven’t had to this point.
To learn more about PubMatic’s Brand Shield solutions click here.
By Rob Jonas, Global Chief Revenue Officer
As the real-time ad sales market continues its evolution, many technology players have built platforms and tools that are designed to offer market participants open access to the vast pools of demand and ad inventory that exist across the entire ad sales ecosystem. This approach views the real-time ad sales market as essentially one market. The companies that subscribe to this approach want to provide buyers and publishers with a complete and unbiased view into a fast growing and dynamic market where they can interact with one another with as little friction as possible.
Yet there are other platforms and media owners in the programmatic space that have adopted a less open approach. They have built their technology around the premise of a closed ecosystem. In this model, buyers and sellers interact in a closed environment. Much like life inside an exclusive gated community, everything is seamless and pleasant—as long as you are living inside the community. However, imagine if you were encouraged never to leave this gated community. Sure, the golf course, shopping mall and spa are great, but there’s also a whole world outside the community that you should visit and keep tabs on.
In some cases, a closed platform can bias buyers towards the ad inventory of media properties owed by that platform. In other cases, the closed technology is designed as part of an effort to create a sort of “uber exchange” that generates friction with buyers and sellers operating outside the platform. Here the goal seems to be to nudge those players operating outside the ecosystem into the closed environment in hopes of building market share.
Beyond the fact that closed environments only seem to benefit the entity that owns and controls that environment, there are clear reasons why an open ecosystem make sense for both publishers and buyers. As programmatic buying continues to skyrocket in popularity, more buyers and more ad inventory are added to the market daily. Magna Global estimates that global programmatic buying reached $21 billion in 2014 climbing by 52%, with no significant slowdown in sight. Indeed as new players join the market, we are seeing more complexity overall and a general fragmentation of buying. Integrating these new demand and supply sources is easier for everyone in an open environment.
We speak to publishers every day and they ask us for recommendations on whom they should work with, often touching on the perceived benefits of closed ecosystems. Our view is that demand is hyper-fragmented and becoming more so. Discounting part of the buyer ecosystem by working with a subset of its players limits your opportunity to maximize the value of your inventory.
Buyers and sellers should ask their technology partners what their stance is on open environments vs. closed environments. Do they offer demand and supply from across the entire market or are they building a (closed) network that creates friction when a buyer or publisher wants to transact with a party outside the ecosystem?
PubMatic is dedicated to offering our publishers demand from any and all sources across the ad sales market. We have also designed our platform so that buyers can transact in whichever way they feel best suits their needs; whether Open RTB, Private Marketplace or Automated Guaranteed, and across desktop, mobile, video and native, as programmatic continues its assault on traditional advertising. Not only are we dedicated to the open ecosystem ideal – PubMatic was founded on it. That is because we believe that an open ecosystem benefits both buyers and publishers. You know, the people the technology is supposed to be helping in the first place.
To learn more about Programmatic Direct and other Programmatic topics check out PubMatic’s 2015 Programmatic Outlook Report. Download your copy.
By Justin Re, Director Product Management, PubMatic
For many in the digital advertising world, the term “programmatic” is synonymous with “Real-Time Bidding,” or “RTB.” But as the industry has evolved, it becomes increasingly important to make the distinction between the two. Simply put, RTB does not equal programmatic. RTB is a technology protocol, and just one of many approaches to programmatic.
We are witnessing an explosion of new buying channels that better connect buyers and sellers, all with the aim of moving ad inventory higher up the value chain and replicating the traditional direct buying process without the legacy inefficiencies that go along with it.
There are six major types of programmatic deal types, although we have yet to see industry-wide consensus on how each is defined or the appropriate goals and strategies that accompany them. Here’s a short cheat sheet of each of the six major deal types that hopefully decodes some of the complexity around the many flavors or programmatic.
Open Marketplace RTB
Real-time bidding (RTB) is a technology that enables the buying and selling of digital ad impressions through instantaneous auctions, facilitated by ad exchanges or demand- and supply-side platforms. In the open marketplace, RTB impressions are available to all bidders.
Private Marketplace (PMP)
These are customized, invitation-only marketplaces that provide publishers with the ability to set aside certain ad inventory packages and sell it to a select buyer or group of buyers with an emphasis on margin management for the seller. Unlike a direct buy, which can be quite labor-intensive, buyers in a Private Marketplace use programmatic methods to purchase from publishers.
Private Marketplace Guaranteed (PMPG)
Similar to Private Marketplaces, a PMP Guaranteed deal is also a customized, invitation-only marketplace, however it is one in which a single premium publisher makes inventory and audiences available to a single buyer, thus guaranteeing a total spend and audience. This effectively guarantees the delivery of the impressions to the buyer.
Automated Guaranteed (AG)
The automation of traditional digital direct sales often of publishers’ most highly valued (e.g. premium) inventory. In Automated Guaranteed deals, the RFP and campaign trafficking processes are automated, inventory and pricing are guaranteed, deals are negotiated directly between sellers and buyers and facilitated by a technology platform. Direct integration with publishers’ ad servers allow for real-time availability of impressions and direct line item insertion for trafficking.
Automated Performance (AP)
This is workflow automation, similar to Automated Guaranteed, but for these deals campaign performance is guaranteed, rather than impressions. The two main performance metrics for these deals are cost-per-click (CPC) or cost-per-install (CPI).
Spot Buying transactions exist within an exchange environment with pre-negotiated, fixed pricing (on things like CPM or CPC). Typically, these are given a higher priority in the ad server than open marketplace or PMP transactions. These types of deals are the result of advertiser demand for a more predictable offering within the exchange space.
This post is adapted from an essay found in PubMatic’s 2015 Programmatic Outlook Report. Download your copy.
To publishers and advertisers, the Apple Watch must seem like the latest in a never-ending proliferation of media screens. And if past is prologue, with each screen comes new opportunities for advertisers and publishers.
However, at the risk of stating the obvious this latest screen is on a watch. And watch displays are really small. And even if that wasn’t true, are people really ready to see an ad appear on a device that is strapped to their wrist?
Needless to say, it is very early days for both the watch and tech wearables generally. But that doesn’t mean it’s too early to start trying to predict the impact of this latest flavor of media consumption on the advertising space. So let me try by outlining three of the implications for advertising that I see arising from the watch.
1) The watch will be an accessory to advertising not an advertising platform.
In the beginning, the watch will feed data about the wearer back to the iPhone and that could allow Apple to make better recommendations in the App store or iTunes based on that data. I suspect Apple will guard the data and real estate on the Apple Watch screen very closely, so those opportunities will be closed off to rest of the media ecosystem.
However, once there is wider adoption of watches and wearable’s in more open ecosystems – like Android – there will likely be more opportunities for advertisers and publishers. So this is really just opening the door to wearables and initially we should expect them to serve more as a potential input device for data that can inform advertising on other screens rather than a screen for displaying advertising.
2) Publisher and Advertisers Will Need Some Time To Figure it Out
Publishers and advertiser absolutely need to be thinking about how the Apple Watch will impact their ability to reach consumers but they won’t figure that out tomorrow. Therefore, I don’t think they need to scramble quite yet but they need to start to consider the watch as part of the overall consumer media experience.
So if you’re a publisher or an advertiser you should go out and buy a bunch of Apple Watches for the people in your organization and road test them over the next few months. You can then match your experience with the watch experience against how the market is adopting the device. You’ll want to see how it’s changing consumer behavior and how you need to evolve your consumer engagement strategy as a result.
3) Don’t Confuse More Screens With More Time or Permission
The Apple Watch is one more screen competing for the consumer’s attention. If you’re looking at your watch then you’re not looking at your phone. And since the its clear that Apple sees the watch as a device that will receive push notifications, the watch may actually reduce the amount of times that users pick up their phones during the day.
That would make the times when people are using their phones more valuable. So advertisers need to ensure that they are delivering the best mobile experience possible by matching the right creative with the right context and data. And advertisers shouldn’t be afraid to pay top dollar for this opportunity to reach the consumer because although the number of screens may be proliferating the chances to reach the consumer may not be.
Additionally, the watch will be an even more personal device, and it’s likely that consumers will resist the intrusion of ad, even native ads on that so small screen. The expectations of highly relevant messages and an understanding of a consumer in context will be the new standard.
In short, I am excited about this new technology. I think there will be a myriad of innovative ways that publishers and advertisers will eventually learn to leverage it. In the meantime, I am looking forward to seeing how my personal interactions and my content consumption change with it.
If you’re not familiar with the popular icebreaker game “Two Truths and a Lie” here’s how it works: each person within a group of relative strangers introduces himself and then proceeds to provide the group with three statements about himself. Two of the statements are true and one is a lie. The rest of the group then tries to guess which of the statements is the lie.
We recently asked Graham Mosley, Senior Director, Native at PubMatic to play Two Truths and a Lie. However, instead of focusing our game on statements about Graham, we decided to focus this round on his area of knowledge expertise, native advertising. We thought it would be a fun way to examine this topic.
Over the past 12-16 months, there has been a lot of attention on native advertising among publishers and advertisers. There’s even some uncertainty over exactly what constitutes a native ad and what function they serve. A December 2013 Interactive Advertising Bureau (IAB) report (link) attempted to sum up native with the statement: “it is clear that most advertisers and publishers aspire to deliver paid ads that are so cohesive with the page content, assimilated into the design, and consistent with the platform behavior that the viewer simply feels that they belong.”
Graham sees a lot momentum in the market around native but also a lot of confusion.
Here is Two Truths and a Lie for Native
Statement #1: There’s now a programmatic standard for native ads that will make it easier for both publishers and buyers to scale native.
Statement #2: Like the rest of the programmatic advertising ecosystem, native is expanding from a strong initial presence on desktop into mobile inventory.
Statement #3: Native is an ad format that’s often used for content marketing, but native is not just a new name for content marketing.
Before we reveal the lie, we wanted to point out that a key reason native has soared in popularity since that IAB report is because these types of ads are remarkably effective at driving consumer engagement.
Some data on consumer engagement:
- Native ads are 25% more viewable than standard ads (IPG Media Lab and Sharethrough)
- 52% of native clicks have higher purchase rate (IPG Media Lab and Sharethrough)
- Native ads generate 82% increase in brand lift (Nielson)
And Now . . . The Reveal
Statement #1: There’s now a programmatic standard for native ads that will make it easier for both publishers and buyers to scale native
True. There’s a relatively new programmatic IAB standard, which is designed to make it easier for publishers and buyers to scale native ads across the advertising ecosystem.
Graham Mosley: Until recently, native primarily lived inside walled gardens – especially social platforms – where a few players with scale could make the rules about how native worked within their closed environments. I believe we’re at the point where native is ready to go mainstream. The industry wants to see a large number of buyers and sellers transacting across an open and accessible environment. When the IAB recognized the need for a standard, it was a clear signal that native was poised for enormous growth. We were an integral part of the IAB Task Force that developed the standard, and built our solution from the ground up in accordance with this standard. Now that the rules of the road are in place, native programmatic can finally scale.
Another key reason we think that native is ready to scale in programmatic is that it will provide native buyers with actionable third party data. When native was primarily constrained to a closed environment, it didn’t provide the data to allow the buyer to make real-time decisions. That lack of real-time decision-making prevented key marketing techniques like creative optimization that is designed to better match the user experience or even the sequencing of messages. That ability is only available in programmatic, which is why we believe programmatic and native are a great fit.
Statement #2: Like the rest of the programmatic advertising ecosystem, native is expanding from a strong initial presence on desktop into mobile inventory.
False. To a significant degree, the momentum we’re now seeing behind native advertising began in mobile, and because native is fundamentally cross-platform, it is now extending to all screens.
GM: We are starting to see programmatic native, which was very much mobile focused, entering desktop as well. Part of the reason it’s been so mobile focused is because the components of native often fit perfectly into the visual snippets that work well within the mobile form factor. However, this way of displaying ad content is being adopted by premium publishers at scale. And buyers are getting serious about buying native programmatically on desktop. This year we will begin to see real spend by programmatic buyers on desktop native. So in a sense, native is doing the reverse of what we have seen in other parts of the programmatic advertising landscape, where things started in desktop and then migrated to mobile.
Statement #3: Native is an ad format that’s often used for content marketing, but native is not just a new name for content marketing.
True. Native is an ad format often used for content marketing.
GM: Some people believe strongly that in-feed native is a tool only for content marketing.
Content marketing is when brands create and distribute content to provide value and create a relationship with the consumer. The in-feed native unit is natural ad format to drive users to this content, because it gives the marketer a better opportunity to tell a story than a standard banner ad. Additionally, these placements normally blend into the user experience on a style level and matching the context. However, many marketers are also using in-feed native units for more traditional advertising.
At its core, native is another advertising format. While it is the best ad format for content marketing, it will be used for standard advertising as well. We continue to see premium publishers develop integrated content marketing solutions for advertisers that include in-feed native ad units. Now that we have turned the corner on standards, Native will grow significantly this year and into 2016, supporting all types of marketing.
PubMatic launched its new programmatic native advertising solution at Mobile World Congress 2015 in Barcelona. For more information see here (link).
A Conversation with Adrian Pang, PubMatic’s Senior Director of Product
There is a lot of recent discussion in the digital advertising space around the topic of “Programmatic Direct.” Throughout his career, Adrian Pang has led innovation in developing programmatic solutions. He is currently the product team lead developing PubMatic’s Programmatic Direct solution, which was released on Monday of last week.
Here’s a Q&A interview with Adrian in which brings some clarity to the confusion surrounding Programmatic Direct.
Q) There’s a lot of buzz around the term “Programmatic Direct” in the marketplace, but also a lot of confusion about what it really is. Can you define “Programmatic Direct” in the simplest possible way?
AP: Programmatic Direct is a term used to describe transaction workflows for direct sold media. Through programmatic direct, both buyers and sellers can leverage programmatic technology to create more seamless and automated transactions for both parties. This includes Automated Guaranteed deals as well as Private Marketplace (PMP) transactions, which are direct deals that give publishers the ability to designate certain inventory for a select buyer or group of buyers that utilizes Real-Time Bidding (RTB) technology..
If you think about the way that digital advertising inventory has traditionally been bought and sold, it often involves a buyer picking up a telephone to call a publisher – or even several publishers – to determine what packages are available at what prices. In recent years, this has changed to some degree, somewhat driven by the rapid adoption of RTB, which allows buyers and sellers to transact in a “real-time” auction environment. The success of the open market auction has provided a lot of learning that has now informed ways to improve the non-auction based direct buys, and auction based buys in which the buyer and seller are aware of each other.
Through Programmatic Direct, buyers can now use a digital interface to interact with a publisher and to discover and purchase inventory, standard packages, sponsorships, custom buys or other offers a publisher wants to make available.
Q) Is Programmatic Direct really going to improve media buying and selling? If so, how?
AP: Programmatic Direct should reduce the friction that exists within media transactions in a number of ways. First, it will provide buyers with vastly improved discoverability – in other words, the ability to know what a publisher offers and find other inventory availability. Buyers will be able to quickly and easily search, discover and transact on inventory through an interface, reducing the need to call their publishers for tactical information.
Another enormous benefit of Programmatic Direct is that it will automate the ad trafficking process. After an offer is accepted or placed inside of the interface, the buy will populate in your ad server of choice. This is significant as it reduces a lot of the possibility for human error, as the technical work that goes into setting-up a digital advertising campaign within an ad server will be done seamlessly. This is immediately a more efficient and effective way to source and place a campaign.
Q) The way you’re describing Programmatic Direct makes it sound a bit like technology is going to replace publishers’ sales and operations teams. Should they be worried?
AP: No, not at all. Think of this as real-time offers from a publisher. Sales and operations teams will remain critically important in this process, but much of the tactical workflow will be automated so they can spend their time being more strategic. With an independent, unified SSP, sales and operations teams now have an intelligent platform to tap into that will help drive better performance for customers and more revenue.
Q) As someone leading a team that’s developing a Programmatic Direct solution, what has been your approach to addressing this challenge?
AP: There has been so much hype and over promising in the area of Programmatic Direct that we felt it was important to get all the parts right for both our publishers and buyers. We put important products in market over the past 18 months anticipating the market maturation to this moment. Real-time analytics and a holistic one platform approach seem like critical prerequisites for an effective Programmatic Direct strategy. We’re honestly surprised that others have claimed to provide workflow solutions to publishers without the fundamental building block of real-time reporting and analytics that allow a publisher to create intelligent real-time offers. That’s why our approach has been to build our Programmatic Direct solution from the ground up. I think of it this way: if you wanted to build the best flying car, you wouldn’t buy a car, or two in some cases, and then try to make it fly. Instead, you’d rethink the idea of what makes a great car and what makes a great plane in order to redefine the concept. Then you’d build that.
Q) I keep hearing talk of Private Marketplaces and Automated Guaranteed, are they both components of Programmatic Direct?
AP: Yes, they are both part of Programmatic Direct. We believe the best approach is a unified approach to Private Marketplace and Automated Guaranteed, so our platform provides publishers with a single way to define their inventory, price and package it—all the while monetizing across different channels. And for buyers, they have many options for working with us on Programmatic Direct. They can access publisher inventory through tools they already use—such as Mediaocean, Kantar Media, and Adslot—or integrate on our APIs or they can access our media buyer portal. The key point is they don’t need multiple point solutions. Instead, we enable the transaction capability for Private Marketplace, Automated Guaranteed and Real Time Bidding all through one platform.
Q) According to last week’s announcement, PubMatic’s Programmatic Direct solution appears to incorporate a number of additional features. Can you explain that a bit?
AP: Of course. As I mentioned, PubMatic Programmatic Direct includes our Private Marketplace solution as well as Automated Guaranteed, which is workflow automation for direct buying and selling, but it also encompasses several other new and updated features. In addition to the Unified API for Private Marketplace and Automated Guaranteed, which we announced a few weeks ago, this new announcement is focused on the release of our dedicated buyer portal and new audience matching tools.
Q) What exactly are the audience matching tools you mentioned?
AP: So inside of this major product release, we have so many very special nuggets and our new audience matching feature is one of the brightest. Currently, programmatic buyers still face many challenges when it comes to buying audience-targeted impressions in an overly fragmented inventory supply. Buyers are not able to access as much of their desired audience-targeted inventory across the various sales channels they have to manage. With audience matching, buyers will share their own audience data and PubMatic will provide a report that identifies the publishers with the highest audience overlap. This is why we called the feature “audience matching”. Based on this information, when a buyer identifies a specific publisher they want to work with, PubMatic will facilitate the connection of the pipes between the publisher and the buyer in setting up a Private Marketplace or Automated Guaranteed deal. This approach supports the value of the analog relationships by making the technical connections seamless.
So with audience matching, the door is open to create new or strengthen existing Programmatic Direct relationships between publishers and buyers based on finding overlap between a buyer’s desired audience segments and a publisher’s inventory.