Kicking Third-Party Cookies To The Curb: The Fallout For The Digital Ad Industry

With the latest announcement that Firefox is blocking the use of third-party cookies by default, marketers, ad technology companies and ad agencies have been forced to consider alternative strategies for reaching consumers with targeted advertising.

Safari was the first to move against third-party cookies, but the controversy heightened when other browsers followed suit. Even more troubling is that on mobile – the fastest growing Internet access method — iOS/Safari has over 60% market share.

Cookies are not used for insidious purposes. They are crucial to helping advertisers effectively track performance and targeting. They also benefit users who can dump them and begin anew. However, if cookies go away, it doesn’t mean that the ability to target and measure digital ads will go away as well. Digital advertising is a $40 billion industry in the U.S. alone, and about half of that spend requires using third-party cookies to locate and target relevant consumers. If all third-party cookies are banned, advertisers and the digital industry will simply be in a position to figure out other ways to reach consumers with relevant ad messages.

As traffic shifts more and more to mobile devices, the industry will need to devise various ways to identify each of these devices to anonymously target relevant users—like Apple’s proprietary version of the cookie: The Apple ID for Advertisers. Whatever this technology is, it will end up being adopted on “desktops” and all other devices that access the Internet, but it will be more difficult for the consumer to control.

Companies like Mozilla, Microsoft, and Apple are not, in fact, helping the user. With each browser setting different standards and approaches, combined with the growth of tablet and other smartphone usage, users will find themselves moving from a simple life where they knew what was going on and had control  in their hands, to having their control fractured into a myriad of inconsistent choices.

Read the full article from Marketing Land here!

Four Real-Time Questions About Real-Time Bidding

With the rise of the Facebook Exchange, and predictions of a 59% growth in RTB spend by 2016, real-time bidding continues to prove itself an important force in the advertising world. As inventory sources, audience data and creative opportunities expand, here are four most pressing questions facing RTB:

1.    How will RTB continue to grow over time? What are the contributing factors to growth?

In the future, almost all advertising buys will be contracted through exchanges, and ads will be delivered through an exchange platform. RTB provides scale, efficiency, and reliability at a lower cost and with fewer people involved than current methods. Additionally, RTB allows advertisers to control and monitor all the aspects of data across an entire buy. It’s largely due to the wide adoption of site and search retargeting that RTB has experienced and continues to experience such widespread growth.

2.    Are more branding dollars really moving into RTB territory, and why?

Although TV is still a much larger platform for brand advertisers, digital is the largest growing form of brand advertising. Digital dollars are moving to RTB because it provides a place for advertisers to experiment with data, test different strategies, gain audience insights, and see what works best for their campaigns.

3.    What does FBX mean for the future of biddable media?

One important benefit of FBX is the security that it offers advertisers of knowing exactly where their ad will run: on Facebook. In the future, however, when all digital media will be made available via exchanges, FBX will be just another player in the marketplace. FBX is a great example of how retargeting and RTB go hand in hand.

4.    Are private exchanges really beneficial for buyers and sellers?

Yes. The benefit of private exchanges is that both the buyer and seller know who they are working with. This allows the seller to maintain an “exclusive” element to his inventory because not everyone has access to it; in return, a direct relationship allows the buyer to know exactly where his ads are going to run.

Click here to read the full article from MediaPost.

Facebook’s New RTB Ad Format #LIKE

Facebook’s pending release of Exchange-delivered ads to its News Feed has certainly caught the attention of marketers. While the new biddable media offering is currently in testing mode, the product will certainly have a positive ripple-effect throughout the real-time bidding (RTB) market once released.

Previously, the social network’s exchange ads were only available on the right-hand side of a users’ page – allowing advertisers to buy inventory in real-time and to leverage strategies like site and search retargeting within the Facebook environment. Facebook’s new ad-targeting capability improves upon this model, and will offer a more premium type of real-estate and slightly better creative from within the News Feed sections of user’s pages. The premium position of what Facebook has previously called “sponsored stories” serves as a huge leap forward for RTB, which has struggled to uncouple itself from the connotation of “remnant inventory.” With such a prime placement on the page, brand marketers are bound to climb aboard the RTB train (finally!). By attracting a wider range of advertisers and moving beyond a solely direct-response focused arena, many expect to see an overall boost in spend in the RTB space.

LBi’s head of media innovation Andrew Girdwood said display has “found its wings” because of RTB. “Search saved display – all the innovators in the display space saw how the biddable landscape worked in search and moved it into display,” he said. “The fact that Facebook is using exchange technology to put ads in such a prominent position will only accelerate advertisers’ interest in biddable media and RTB in general,” he added.

So, how will the new technology affect the user experience? Girdwood believes the impact will be minimal, as users are accustomed to Facebook experimenting and changing features. However, the move into the Newsfeed allows marketers to enter a space that has traditionally been “content” or geared towards more sponsored ad placements. However, irrelevant ads appearing in a person’s newsfeed could quickly spoil their acceptance of the new offering. When integrating with the new targeting capability, advertisers should have strategic solutions in place to ensure reasonable frequency capping and relevancy of in-feed ads.

At Magnetic, we think that the smart use of data will be everything for the success of Facebook exchange and latest ad unit – it will determine whether marketers add value to the Facebook experience or do more harm than good with their consumers. Either way, it shows that Facebook is just beginning to build momentum within its exchange and we suspect this is just the first of many more announcements and features to come.

The aftermath of Facebook’s extension will also be a source of observation for many other publishers, with regard to their own product offerings. LBi’s Head of Display Adam Russell said, “You can be sure if this works for Facebook and it can get the scale and do this without cannibalizing too much on its revenues and deprecating their CPMs, then you can imagine there will be other publishers wanting to make a similar move.”

Stay tuned for more updates and case studies on FBX and how newer ad formats fit into RTB.

 

 

The Darker Side of Viewability

According to Magnetic CEO James Green, there are two sides to the issue of viewability that plagues marketers today. One side is the problem of viewability, which is relatively manageable, and the other is fraudulent activity, which is becoming an increasingly widespread issue.

The most common forums for fraudulent activity are ad exchanges, on the worst of which, up to a third of all ad impressions are not generated by people. Some exchanges are better than others, with ”suspicious traffic” below 5%. It is therefore important for marketers to avail themselves of the various tools and resources out there to research different exchanges.

There are some common tactics that marketers have fallen victim to when purchasing impressions on RTB:

1.    Purposely serving ads into a 1×1 pixel.

2.    Viruses that run on computers and open websites on hidden windows so that a real person appears to be visiting web pages and seeing ads.

3.    Bots that run on websites to mimic people – some bots also click on ads and show up on client sites. Examples can be seen by comparing large network volumes available by some players in RTB and cross-tabulating them with comScore metrics, whose panel’s population is 100% human.

In order to improve the situation then, marketers should focus on attribution, use viewability products, find and reward credible exchanges, and be suspicious of promises from exchanges that seem too good to be true.

Read the full article from MediaPost here!

Gartner Study Shows Positive Signs for Digital Ad Budgets

An interesting survey was recently released by research firm Gartner citing that digital advertising ranked as one of the top digital marketing tactics for success. Other findings within the report included that, on average, 28% of marketers have shifted some of the traditional ad budget to digital channels.

The survey polled over 200 marketers from companies with yearly revenue higher than $500 million. Within the participating companies, 70% noted have Chief Marketing Technologists. Digital advertising accounted for the largest share of the overall digital budget; showing that budgets allocated to online and digital advertising (12.5%) were higher than content creation (11.6%), search marketing (10.7%), email (9.6%), social (9.4%) and mobile (7.4%).

The fact that online advertising was higher than search shows strong signs for the future and overall growth of display. It could prove more interesting to look deeper into the online advertising category and the budget allocation across various strategies, such as search retargeting, site retargeting, sponsorship buys, etc.

You can read the full report from Gartner, here: http://www.gartner.com/technology/research/digital-marketing/digital-marketing-spend-report.jsp

 

 

 

ComScore Reports That 3 in 10 Ad Impressions Are Never Seen by Viewers

Out of the 5.3 trillion ad impressions served in the U.S., 3 in 10 are never actually shown in-view.

This statistic, among others, is delivered in ComScore’s Digital Future In Focus report for 2013. The report examines the role that current events, as well as the latest trends in social media, search, online video, digital advertising, mobile and e-commerce play in shaping the U.S. digital marketplace, and what they mean for the coming year.

Rendering ad impressions in-view is a persistent problem for the industry, and the report says we should “look for advertisers to demand more accountability and publishers to reconfigure their site design and ad inventory to improve performance in the coming year.” Large advertisers like AT&T, Microsoft, Experian, Verizone, and State Farm, are also using programmatic buying and improved targeting to avoid increasing their ad buying as much as in the past.

How else are advertisers staying current? Out of the 5.3 trillion ad impressions served, one in eight are “socially enabled,” meaning that they direct viewers to “Like” or “Follow” the advertiser.

For 2013, ComScore predicts that publishers will resist dropping CPMs (the amount paid per thousand ad impressions) caused by programmatic buying. To fight back, they’re putting their ad inventory in private exchanges, using data to prove ad viewability and engagement, and actively seeking to demonstrate that ads drive offline behavior (e.g. in-store sales). The use of “native” ads is also expected to increase as certain large, premium publishers “experiment with and implement native advertising based models to deliver unique branded content at scale”, following in the footsteps of Facebook and Twitter’s success with such ad units.

Facebook is clearly doing something right! The site was the top in time spent, accounting for a total of 10.8 percent of the minutes spent online, while Google had the most unique US visitors (191.4 million in December).

For more information about other findings in the report click here! 

 

A Look Into RTB’s Quality, Ad Impressions, Data & Future

Some call it real-time bidding (RTB) 2.0, and others simply believe that RTB has not yet reached a level of maturity satisfying for brands and agencies. In a recent panel at OMMA RTB in New York City, debates broke out over issues surrounding metrics, content, quality of inventory, and how the world of RTB has actually evolved.

With digital advertising’s adoption of audience targeting, it’s become common to hear the phrase, “reach the right audience, with the right message, at the right time and in the right place.” However, there has been a lot of debate over the value of “place” or “content and context” within RTB.  If you are reaching the right audience at an optimal time, does inventory matter? Does media placement make much of a difference in RTB — or is it just the data?

On the one hand, as long as agencies are meeting KPIs, they don’t care about controlling content, as long as it’s not anything offensive. On the flip side, many marketers disagree and say that the context of the placement and publisher that an agency works with is critical – but in a way where you can still pick the user. Rob Griffin, EVP/director of product development at Havas Media, and Joel Nierman, marketing and media director at Critical Mass, later noted that there really are no bad impressions, only bad valuations. You are either willing to pay a higher rate for selective content and/or you are willing to pay more on an RTB platform for a specific user.

Another hot-button topic for the panel was viewability. Anne Hunter, SVP advertising effectiveness at comScore, stated that the average percent of viewable ad impressions is between 60%-70% on premium inventory and 40%-50% on non-premium/exchange inventory. The problem here is that any ads that were not viewable by the user still placed an exposure pixel, even if the user never actually saw the ad. Thus, if that user proceeds to fill out a survey or buy a product, the non-viewable ad will appear to have had real business value for the brand and will be given credit, when in fact it was never seen by the user.

In order to get an accurate account of performance and set pricing according to market demands, marketers and publishers should focus on only counting ads that are seen. At the publisher level, the infinite amount of pixel dropping hurts a publisher’s price, since it shows a massive number of impressions available for cheap, making it harder to price the real quality inventory. Therefore, publishers providing quality inventory still might not look as if they’re performing.

Peter Naylor shared NBC Universal’s story of adapting to the viewable impression. As an early adopter, NBC Universal began making changes for viewability back in 2010. Initially, there was a 30% reduction in inventory, but also a substantial increase in ad effectiveness, which in turn led to higher pricing opportunities, according to Naylor.

For marketers, the viewability issue affects performance and spend. If a high percentage of ads are not even seen, then there’s a large amount of money spent on wasted impressions. Additionally, since agencies rely on what the conversion data tells them in order to determine what an impression is actually worth, they may be allocating money and optimizing to a bot vs. an actual end user.

The overall sentiment on OMMA’s panel was that issues of inventory quality, ad impressions and the use of data will remain top-of-mind for marketers. However, depending on a client’s goals, some will care more about some issues than others. As Griffin said, “History does repeat itself.” The reality is that we are now solving the next stage of challenges for RTB 2.0.

Originally published on MediaPost RTB Insider on 2/22/13

Attribution Revolution Roadshow Hits Chicago

Magnetic is bringing its Attribution Revolution Roadshow from the West Coast to Chicago! Join experts from Google, Adobe, C3 Metrics, and Adometry for cocktails, hors d’oeuvres, and a panel discussion about the important questions surrounding media measurement in today’s digital age.

Events for the evening will include:

6pm: Pre-panel cocktails & hors d’oeuvres
7:15pm: Panel discussion with industry experts
8:15pm: Post-panel cocktail hour at the ROOF lounge

When: Wednesday, March 20, 2013

Where: theWit Hotel
201 N. State St.
Chicago, IL 60601

Request an Invite Now >

And click here to check out the Attribution Revolution Roadshow’s visit to the West Coast!

The Road To Understanding Viewable Ad Impressions

According to a recent comScore study of a dozen major brands, including Allstate, Ford and Kellogg’s, 31 percent of online ads go unseen by consumers.

Recently, I moderated a panel of experts in the field, and they all said they’d seen typical rates of unseen ads coming in at over 50%, and, in the worst cases, up to 80% of ads are going unseen.

How can this be? Perhaps because of where an ad is placed (below the fold, in another window, etc.), page load times, or in the case of a few bad actors, downright fraud. Consequently, many of us in the industry are engaged in an ongoing debate about creating a new “viewable impression metric.”

What Exactly Is A Viewable Ad Impression?

If the entire page was only loaded for one-second before it was closed, can marketers claim the ad on the page was seen? If all of the ads are refreshed on a screen after inactivity for five minutes or more – were any users there to see them? If there are 20 ads on a page that was designed just to lure consumers to it – did visitors actually see an ad on that page?

While it remains clear that a viewable ad impression metric is needed within the industry – exactly what that means is still being debated.

Where Does Data Come Into Play?

Another factor that influences viewability, at least viewability by the right audience, is the accuracy of data — this is because viewability really only comes into play if you are buying ads in real time (RTB) or via aggregators/networks.

If you want to be sure your ad is seen, just buy from a site directly. Although even the biggest and best publishers are occasionally tricked by fraudsters, this is rare, and if you are buying a full-page take-over or other custom placement, according to experts I’ve talked to, it is very likely that your viewability rating will be in excess of 90%.

This approach will actually not work for most marketers because their budgets are not big enough to buy media in that way (it’s expensive to buy large custom units from big publishers), or because like so many people, the marketer is buying the ad placement because s/he has data on the person viewing the page – demographic, customer data, psychographic data or search history.

Some of this data is well known and verifiable – for example, if you are re-targeting people who have visited your site — but if you are buying third-party data, there’s lots of information around to suggest that much of it is inaccurate.

If so, how are you going to verify that you really reached the segment you were targeting? Put another way, if your ad was seen by someone outside your targeted segment, do you want to count it is seen or “viewed”?  So, just as we move forward with standards in viewability, we’re going to have to start thinking hard about standards for data, as well.

Will Viewability Affect The Value Of Display Ads?

The true evil of unseen ads is that they flood the market with inventory, thus lowering prices for publishers. Lower publisher prices means less investment in content, which inevitably means worse ad placement and thus, worse ad performance, which starts a downward spiral of lower quality and pricing for everyone.

Of course, it’s terrible that an advertiser pays for an ad that is never seen, but the effect on pricing in the ecosystem is potentially much worse and more dramatic.

Most People See Most Ads, Isn’t That Good Enough?

I’ve heard some digerati disparage the entire viewability debate by suggesting that we are being held to too high a standard. After all, we all know that not all 30-second spots are viewed on TV, and yet, that industry still dwarfs the digital world.

This is a spurious argument. Just because something is broken somewhere else doesn’t mean it should be broken in the digital world. We have the ability to know exactly who has seen what ad and where, and while an error rate of 5-10% is probably acceptable, anything much beyond that is not.

I don’t know about the rest of you, but I’m still striving to be the best I can be regardless of what everyone else is doing.

 

Ad Dollars Predicted to Shift to Digital Video

Leading media agency, ZenithOptimedia, has released a new report that predicts a shift of advertising dollars from traditional television ads to online video as a result of expanding media technologies. According to Zenith, retail, financial services, telecommunications and automotive are the leading categories for digital advertising. However, growth is predicted for other categories, as advertisers recognize that digital ads have the potential to reach a broader audience and the capacity to better follow the consumer.

Zenith forecasts that the percentage of American home broadband users will continue to grow from 69.6% in 2013 to 72.9% in 2015. Spending on Internet video/rich media is expected to rise to $5.2 billion in 2013 in 2013 to $8.2 billion in 2015.

“Video continues to be the fastest growing segment of digital advertising, with average CPMs hovering around $26.00. More advertisers are moving TV dollars over to online video as a way to expand the supply pool of video and contain TV CPMs,” ZenithOptimedia says in its New Media Forecasts report. “We expect this trend to continue as online video adoption continues to rise, fuelled by more content becoming available through more devices.”

Speaking of “more devices”, the agency sees smart phone penetration jumping from 42.4% in 2013 to 58.6% in 2015. For tablets, Zenith forecasts penetration growing to 19.4% in 2013 to 26.1% in 2015. The proliferation of these devices has piqued marketers’ interest in mobile advertising. In fact, Zenith predicts that mobile ad spending in the U.S. will be $1.8 billion in 2013, and soar to more than $4 billion in 2015.

Still, the future growth of mobile advertising is not without challenges. Rates for mobile advertising are low, averaging between $3.00 to $5.00. Media companies looking to attract more advertisers to this emerging digital platform can point to only a handful of brands that have been profitable in mobile, including Weather, ESPN, New York Times, and Pandora.

There may be other speed bumps in the future of digital advertising. According to rankings by Zenith, the U.S. is not the most advanced market when it comes to the adoption of new media technology. Out of 19 markets, ranked by absolute size and percent of total ad spend taken in by Internet expenditure, the U.S. ranked 12th, with an average penetration of 19.4%. Norway ranked as the top nation in 2012, with 38.8%. Zenith predicts that the Netherlands will be No. 1 in 2015, with 65.1% penetration. The U.S. average penetration is expected to grow from 19.4% to 30.8% by 2015, but at that point, the U.S. will have fallen to No. 14 in the rankings.

Despite the challenges it presents, digital advertising remains an important field for marketers, one that is becoming impossible to ignore.

For more information on the report, click here.

 


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