Mixx2016_Alexei S. Archinov

Programmatic Today & TomorrowMay 2016

Alexei S. ArchinovHead of Global Partnerships RU, UA & CIS

Google Confidential & Proprietary2

Programmatic buying uses audience insights & technology to reach the right user at the right time with the right message

Google Confidential & Proprietary

Programmatic Today

3

Google Confidential & Proprietary4Google Confidential & Proprietary

$26.8B

Source:emarketer, 2015

2016 2017

$21.6B

The programmatic opportunity is growing


The biggest areas of growth are mobile & video

Source: *Sources: MAGNA GLOBAL Sept. 2015 Programmatic Forecast

3.5xGrowth in mobile & video impressions in DBM in 2015


Advertisers are transforming the way they secure media

2009

Programmatic for brand campaigns

20142

2018

Programmatic for all media planning & buying

2

Programmatic for performance campaigns

© Google Inc. 2016. All rights reserved.

GrowthWhy is programmatic growing so quickly?

Google Confidential & Proprietary8Google Confidential & ProprietaryGoogle Confidential & Proprietary

AdvertisersPublishers

Consumers

Programmatic benefits the entire digital advertising ecosystem:


Improves ROI and makes the buying process more efficient for advertisers


Provides revenue and operating efficiencies for agencies and publishers

Improves the digital ad experience that consumers engage with every day


Programmatic addresses key business challenges


Automation

Complexity

Integration Fragmentation and data loss

Data Personalization and relevancy

Scale Reach across screens and formats


DoubleClick’s Unique Integrated Approach to Programmatic

11


Advertiser Publisher

Organizeaudience data

Designcompelling creative

Executecampaigns across formats, channels, screens

Measure for impactFull-funnel unified reporting, Site analytics, Attribution

Reach audiences across formats, channels screens


Unified technology is the foundation

12


Gain Workflow

Efficiencies

Access Premium Inventory

Improve Campaign

Performance

Innovatewith a Market

Leader

Gain workflow efficiencies that drive time and cost savings

reduction in total campaign process time.

33%


Access the best inventory available, at scale

15

96%Reach

DBM drives approximately 14B daily impressions.


Drive performance with advanced targeting

16

Leverage the connectivity between DoubleClick, Google Search and YouTube and access intent based Google data, for free.

32% Reduction in average cost per action.

Source: BCG


Innovate with a market-leading technology partner

17

We have highly reliable technology and massive scale, combined with the simplicity you’ve come to expect from Google. We are constantly innovating and as a result, now work with:

80% of Ad age’s top 100 advertisers


DoubleClick’s Programmatic Vision for Tomorrow

18


VideoBrand Safety and Measurement

Programmatic Direct Mobile Programmati

c TV



Modern measurement is more than just collecting data

Validation

Action

Optimization

Simulation Analysis

Sharing

Measurement

Organization

Google Analytics 360 Suite


2016

A shift to transact all media buys through Programmatic pipes

Open auction

Private auction

Preferred deals

Guaranteed

Programmatic Direct deals

Hundreds of buyers competing

Invitation only auctions

Fixed price, one-to-one deals

Programmatic, guaranteed


90% of consumers switch devices throughout the day

has 7 properties with +1B users

*Gmail has 900M users. Source: Google data, 2015

Our cross-device graph ensures reach, accuracy and user privacy


Consumers connect with brands through video

High impact inventory39%

Ads are

more engaging when shown with online video vs. shown on TV

Source: Biometric


Programmatic TV to account for $10B of TV budgets by 2019

Other mediums to follow


Thank you




Structuring for success

28

While marketers become more savvy, they are evaluating how to best manage and execute their programmatic strategies

59%

41% Large marketers taking programmatic fully in house

Turned to an agency to help with programmatic strategy & execution

Source:emarketer, 2016


Advertisers are tired of wasting budgets on invalid traffic

29

The industry’s largest dedicated team of researchers and engineersReverse engineering and analyzing patterns to expose fraudstersLeading contributor to industry wide protection schemes and groups

A combination of automated and manual detection systems

Presentation Title | Subtitle if there is space

Further Down theProgrammatic PathPART 1


In July 2015 we launched report on programmatic for publishers

Study covered:

● Efficiency of programmatic ops

● Effectiveness of programmatic sales

We worked with 24 major digital publishers:

● Across 11 countries in North America, Europe and the Middle East

● In-depth operational workshops, interviews on revenue best practices and analytical deep-dives on specific revenue levers

Following the launch we presented at Google round-table events for publishers in 13 markets

Big opportunities to capture more value from programmatic

14

Publishers using a unified stack spent 30% less time on basic programmatic processes, had clearer visibility on inventory performance

and experienced 6x fewer discrepancies or better

Only 20% of time spent on programmatic activities truly creates value...

...due to inefficient processes, with 30+ pain points

participants use rigorous A/B testing to optimise yield and drive revenue

We identified four keys to unlock value ...

How has the industry responded?

Cross-channel data-driven

strategy

Match buyers with the audiences

they value

Strategic approach

to technology

Strong go-to-market & analytical

capabilities

Industry keys to unlock value

Increased integration in go to market channels

– Programmatic is mainstream– Lines blurring between programmatic and

direct models

This has implications on pricing, org & capabilities


strategy


they value

Strategic approach

to technology


capabilities

Example: Emerging Sales Org. Model

Head of digital revenue

Head of programmatic ops & analytics

Head ofdigital sales

Analytics & optimisation

Sales teams

Sell both direct and simple programmatic to account teams

at agencies & advertisers

Sell at agency-wide level and/ or to trading desks, DSPsDevelop new prog. offerings

Specialist supports for complex programmatic sales

Analytics provide data-driven leads

Yield optimisation, pricing analysis, data-driven product & lead generation

Monitoring and improvements of stack & site Implementing tech changes

Illustrative

Programmatic sales specialist(s)

Programmatic tech

Industry keys to unlock value

PMPs growing and Programmatic Guaranteed has arrived in mature markets (though still early days)

Highlights the need to understand what a buyer needs/wants and how best you can serve them

Many buyers more savvy about buying quality inventory (eg. viewable)


strategy


they value

Strategic approach

to technology


capabilities

Hot topics and emerging trends in the last 6-12 months

Header bidding increasingly prevalent as publishers seek to make the most of multiple demand sources

Can add complexity to the stack and page set-up, which has efficiency downsides


strategy


they value

Strategic approach

to technology


capabilities

Hot topics and emerging trends in the last 6-12 months

Clear need for "testing & learning", with specific capabilities to support this

Need direct sales force to be conversant in programmatic plus dedicated expertise to sell complex products


strategy


they value

Strategic approach

to technology


capabilities


Further Down theProgrammatic PathPART 2

Further Down the Programmatic Path

Building the next Digital Advertising Revolution


Programmatic will account for 70% of display spend in the UK this year, higher than the US

PROGRAMMATIC IS THE NEW NORMAL

Programmatic Display Spending as % Total Digital

2017201620152014

100%

0%

UKIsraelDenmarkFranceHungaryItalyNetherlandsRussiaPolandMENASpain

Source: eMarketer, ZenithOptimiedia, Dec2015


Brand spend drove programmatic growth in W.Europe throughout 2015


2016201520142013

% of Revenue by Buyer Type (Large W.European Publishers)

80%

0%

40%

% o

f Tot

al R

even

ue

Primarily CPC driven buyersPrimarily CPM driven buyers

CPM-based buying share grows and ‘battles’ with CPC share in 2015

CPM-based buying share persists from Sept.15 onward and reaches 57% share in Dec15

Source: Internal AdX data., Buyer Type excludes Apps, includes France, Germany,

Italy, Spain, UK


Programmatic mobile revenue on track to surpass desktop in 2016


% of Revenue by Platform, EMEA Publishers

80%

0%

40%

% HEM & Tablet% Desktop

20%

60%

07/14 10/14 01/15 04/15 07/15 10/15 01/16

Source: Internal AdX data., Buyer Type excludes Apps, includes France, Germany,

Italy, Spain, UK


Viewability, Ad Blocking, Smaller Screens shrink impression pool and increase pressure on monetizing high quality inventory

QUALITY INVENTORY IS GETTING SQUEEZED

49%Average publisher viewability

Source: DFP 7/22/15 to 7/29/15


Waterfall setups with multiple passbacks and Header Bidding address the same publisher need: Drive higher yield


Source: Examples from DFP inventory setups

Can AdX or SSP beat

Direct Ad?


Waterfalls and Header Bidding can drive higher yield, but introduce new risks


➔ Latency➔ Operational cost➔ Troubleshooting complexity➔ Bid fraud➔ Data leakage


Latency has a bigger effect on viewability than platform, page placement, and ad size combined


+147%Latency effect

+28% above the fold

+29% tall format


Our Vision: a new, sustainable ecosystem that scales efficiency together with open access

MOVING TOWARDS A MORE INTELLIGENT ECOSYSTEM

The efficiency of thesingle stack

➔ Low discrepancy

➔ Low latency

➔ Ease of use

➔ Control

The effectiveness ofan open system

➔ Multiple demand sources

➔ A single auction

➔ An intelligent platform


We are already building this ecosystem and many of its pieces are already in place today


Exchange Bidding in Dynamic Allocation

DFP First Look Audience Guaranteed

Machine-Learning Optimisations


The DoubleClick path ahead

Programmatic Guaranteed

➔ Rich Media support& QA process

➔ Sponsorships➔ 3rd Party buyer

support➔ Buyer user list

targeted campaigns ➔ API Support

DFP First look

➔ General Availability➔ Advanced

Forecasting

Exchange Bidding in Dynamic Allocation

➔ Alpha Phase➔ Open Beta➔ General Availability

Dates are directional and subject to change




Thank You!

Internet

Mixx2016_Alexei S. Archinov