Online Video Ad Trends 2014: Shake-Up in Programmatic Trading

It’s been an explosive year of growth for the online video ad market with more than 42 million people across South East Asia now watching videos online according to ComScore. As 2013 comes to an end, it’s time for advertisers and publishers to turn their attention on some of the trends and issues that will impact the online video market in the next 12 months.

A shake-up of the programmatic trading industry

There’s no doubt that advertisers and publishers are reaping the benefits that programmatic trading brings to the online video market through transparency, insight, granularity and control. However, the pace at which the video market has grown in Asia Pacific has resulted in many new technology players emerging and redefining the rules on programmatic trading.

The boom in online video has resulted in video inventory that advertisers in Asia Pacific want becoming more scarce. This is driving the programmatic ecosystem back to the ghosts of the old “ad networks” where the transparency that once underpinned the growth of programmatic trading is diminishing. Even as the technology platform advances and now provides greater insights and control, many publishers and advertisers are unknowingly returning to a “middle man” model. The old rules at play are especially alarming for publishers who are just starting to dip their toes in programmatic trading.

Before partnering with a trading desk or DSP (demand side platform) in 2014, it will be increasingly important for both advertisers and publishers to understand the level of control and transparency each party has in the programmatic relationship.

Deal IDs will become more widely accepted in online video

The technology behind programmatic trading in online video will catch up with the growing acceptance of Deal IDs. These universal identifiers set the terms for a transaction between the advertiser and publisher. Deal IDs can include attributes such as price and impressions, ad placement and websites, all under a single parameter which is passed as part of the bidding process. In short, Deal IDs replace what insertion orders (IO) have been doing for media buyers and sellers over the past 15 years. It provides major efficiencies and benefits to both parties.

While Deal IDs have been used in display advertising for some time, we’ll start to see increasing adoption of Deal IDs within the video ecosystem in 2014. Publishers will increasingly flock towards Deal IDs because it allows them to set business rules for buyers based on inventory access, rate and priority. Deal IDs will give buyers the added advantage of accessing inventory historically only available through the upfront markets (ad networks or publisher direct) while leveraging the benefits of Real-Time Bidding.

Mobile online video advertising will continue to soar, but its effectiveness will be questioned

With the emergence of new mobile screens that are bigger and more interactive, mobile advertising is expected to continue to soar next year, but this growth will be tempered.

The is because we’re still lacking in standards that we can use to benchmark the effectiveness of mobile advertising that meets the expectations of advertisers. While industry groups such as the Internet Advertising Bureau (IAB) leading in the development of guidelines to measure the performance of mobile advertising, these standards are still evolving and not everyone plays by the same rules.

In order for mobile to capture its fair share of ad spend, publishers will need to offer advertisers the same level of sophisticated targeting that’s currently available in display or search advertising. However, privacy concerns are making it difficult for advertisers to effectively tap into the full potential of geo-targeting which has helped display and search prove its effectiveness to advertisers.

While mobile will remain high on everyone’s priority lists in 2014, there will be growing pressure from both brands and publishers to extract more value and accountability from mobile advertising.

mattvondermuhllBy Matt Von der Muhll, managing director at SpotXchange APAC

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