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+ STATE OF THE INDUSTRY Publisher Trends: Brand, Audience, and Real-Time Bidding Online Survey Conducted March, 2011 [Based on Presentation by Eric Klotz, VP Marketing, PubMatic Digital Publishing Summit, Park City, Utah, 03.28.11 ]

PubMatic Study March 2011

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Page 1: PubMatic Study March 2011

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STATE OF THE INDUSTRY Publisher Trends: Brand, Audience, and Real-Time Bidding Online Survey Conducted March, 2011

[Based on Presentation by Eric Klotz, VP Marketing, PubMatic Digital Publishing Summit, Park City, Utah, 03.28.11 ]

Page 2: PubMatic Study March 2011

DEMAND FOR AUDIENCE TARGETING HAS NEVER BEEN GREATER.

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Page 3: PubMatic Study March 2011

DEMAND FOR PREMIUM PUBLISHER BRANDS HAS NEVER WANED.

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Page 4: PubMatic Study March 2011

Premium Brand

Premium Audience

Years ago the two were synonymous

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Page 5: PubMatic Study March 2011

Premium Brand

Premium Audience

Over time they became disconnected

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Page 6: PubMatic Study March 2011

VS.!

AUDIENCE

Publisher Fears About Audience

•  Audience Targeting was historically publisher brand agnostic •  Advertiser demand for Audience Targeting is growing •  Some fear that Audience Targeting will diminish brand value

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Page 7: PubMatic Study March 2011

+!AUDIENCE

It’s Not Brand or Audience – It’s Both

•  Advertisers want better transparency (as do publishers) •  Premium brands will always prefer premium content •  Advertisers and publishers want trusted relationships

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Page 8: PubMatic Study March 2011

DESPITE CHANGES IN TECHNOLOGY AND PERCEPTION....

THERE IS ONE THING THAT ISN’T CHANGING SOON:

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ADVERTISERS STILL CONTROL THE BUDGETS.

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Finding the greatest demand for buying

Finding the greatest opportunities for selling

Study Objectives

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Page 11: PubMatic Study March 2011

The PubMatic + Digiday Study Survey Respondents: 644 Conducted Online March 2011

29% 71%

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Page 12: PubMatic Study March 2011

Buyers Were Broken Down By

Representing Single Advertiser

Representing Multiple Advertisers

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Page 13: PubMatic Study March 2011

Publishers Were Broken Down By

Currently opening inventory for RTB

Does not currently open up inventory to RTB

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Demand for Audience Targeted Campaigns Grow, and Definition of “Audience Targeting” Evolves

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Demand for Audience is Growing

will use audience targeting in 2011 97% will have more than 1/2 of their total online spend include audience targeting

47% ACROSS ALL ADVERTISER AND AGENCY

RESPONDENTS

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Page 17: PubMatic Study March 2011

Demand for Audience is Growing

will have inventory sold with audience targeting

(user level attributes)

87%

will have more than 1/4 of their inventory be audience targeted

48%

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Page 18: PubMatic Study March 2011

Right Content vs. Right Audience

If you can only pick one, which is most important?

72%

28%

Aud

ienc

e

Bra

nd

90

10

70

30

70

30

71

29

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Page 19: PubMatic Study March 2011

Missing Opportunities

have an increase in RFPs that include specific audience segment targeting

66%

of publishers have never seen any RFPs that include some audience segment targeting

3%

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Page 20: PubMatic Study March 2011

Missing Opportunities

have had to turn down RFPs due to inability to target the requested segment

47%

have not 30%

23% are unsure

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Page 21: PubMatic Study March 2011

AUDIENCE

Traditional Publisher Definition DSPs / Ad Nets Definition

Defining Audience Selling / Targeting

•  Publisher collected data •  Based on limited

information •  Not sold in real-time

•  Robust 3rd Party Data •  Enhanced targeting

mechanisms: creative optimization & 3rd party contextual targeting

•  Sold via Real-Time Bidding 21

Page 22: PubMatic Study March 2011

Defining Audience Selling / Targeting

of advertisers prefer to use DSPs and ad networks to target audience

74%

Today’s definition of audience targeting includes 3rd party data because that is what the advertisers want

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Page 23: PubMatic Study March 2011

It’s Not About Audience vs. Publisher Brand: Advertisers Want Both in a Single Campaign

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Brand Safe Environments

What is your preferred method for purchasing audience campaigns?

Response:

Direct from the Publisher

“Brand safety and relevant content alignment is of utmost importance to our clients.”

#1

Respondent quote from study

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Page 25: PubMatic Study March 2011

Publishers vs. Intermediaries

What are the benefits of working with a publisher vs. an ad net or DSP?

Respondent quote from study

“More transparency and more trustworthy partner. they have a vested interest in being truthful and keeping direct clients loyal.”

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Page 26: PubMatic Study March 2011

Combining Brand Value + Audience Targeting will Help Publishers to Meet Market Demand

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Page 27: PubMatic Study March 2011

Private Marketplaces

Premium Brand

Premium Audience

Making them synonymous again

Today’s definition

with 3rd party data

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Page 28: PubMatic Study March 2011

Breaking the Technology Barrier

They control RTB budgets

They want direct access

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Page 29: PubMatic Study March 2011

Private Marketplaces: Publisher Sold & Controlled RTB

Private Marketplaces

Two-way conversation Two-way transparency

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Page 30: PubMatic Study March 2011

Buyers Want Directly Sold RTB

If publishers could sell RTB directly, what would likely be your preferred method of buying audience targeted inventory? ACROSS ALL

ADVERTISER AND AGENCY

RESPONDENTS

RTB far outweighed Non-RTB for audience buying RTB from the publ isher received s ignificant ly more votes than any other method inc luding RTB from ad nets or DSPs

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Page 31: PubMatic Study March 2011

Advantage for Buyers

Biggest incentives to buy RTB campaigns direct from publisher vs. DSPs / Ad Nets

Least Important

Most Important

Brand Safe

Guaranteed Placement

Greater Transparency

ACROSS ALL ADVERTISER AND AGENCY

RESPONDENTS

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Would having direct access to RTB from a publisher likely increase your overall RTB budget?

72%

28%

Likely Not likely

74%

26%

62%

38%

Increasing RTB Spend

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Page 33: PubMatic Study March 2011

Increasing RTB Spend

Why would you increase RTB spend for publisher direct RTB campaigns?

“Having control of exactly which publisher I was running on - with the increased benefit of RTB allowing more efficiency with a quality audience”

Respondent quote from study

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Page 34: PubMatic Study March 2011

RTB is Still Very Young

Advertisers are adopting RTB faster than publishers

Supply vs. Demand 62% 20%

HAVE USED RTB OPEN INVENTORY TO RTB

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Page 35: PubMatic Study March 2011

Video Mobile Rich Media Online Standard Online

% of online budget across all buyers (Based on most popular responses)

None 1-10

11-20

21-30

Growth of RTB ad formats 2011

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Page 36: PubMatic Study March 2011

Growth of RTB ad formats

Video Mobile Rich Media Online Standard Online

2011

Ad format life stage

Not quite born Infant Toddler Early Teen

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Page 37: PubMatic Study March 2011

Lots of Opportunity for Publishers

•  OpenRTB (.info) creating standards across online, mobile, and video

•  Programmatic ad buying will increase especially as inventory grows

2011 2015 Majority of

standard units bought via RTB

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•  Demand for advanced audience targeting is growing

•  Advertisers want the best of both audience targeting and premium brand association

•  Publishers, now more than ever, have the ability to combine both to meet market demand

Get the first mover advantage now

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WE TAKE SIDES!

ADVERTISER! PUBLISHER!

Page 41: PubMatic Study March 2011

Contact Us: Phone: (646) 706-7171 Publishers contact: [email protected] Demand partners contact: [email protected] For General Information: [email protected] www.PubMatic.com California Office: 444 High St. Fourth Floor Palo Alto, CA 94301

New York Office: 100 Vandam St. Third Floor New York, NY 10013

Learn More About Private Marketplaces