Advertisers spent over $350 million on real-time bidded inventory in the U.S. last year, but investment in the emerging practice will more than double in 2011 to reach $823 million, representing 8 percent of online display ad spend, according to Forrester research.
Commissioned by RTB platform provider Admeld, the market researcher issued a report today titled RTB Hits The Mainstream, which suggests 2011 will be a “banner year” for real time exchange-based buying following its “coming of age” in 2010.
The report predicts further growth in investment will be driven by increased participation from premium publishers, whose inventory is in increasing demand from media buyers. “Agencies and clients tell us that they’re looking to build bigger, deeper relationships with fewer partners,” it posits.
Forrester states the emergence of private exchanges, in which only selected parties will be invited to participate, will help aid that process. That trend could encourage an influx of premium inventory from publishers previously wary that their involvement may cannibalize their other sales channels such as direct relationships. The emergence of more premium inventory will also drive investment from major brand advertisers, the report predicts, helped by the continued rise of ad verification services promising to protect brands from buying inappropriate media placements.
Despite continued scrutiny from the FTC and Congress surrounding real-time bidding – more specifically the behavioral data collection that is associated with it – Forrester says the self-regulatory efforts currently being implemented by firms such as Evidon and TRUSTe will help assuage fears from regulators and consumers alike. Despite those efforts, however, browser manufacturers have recently begun rolling out privacy solutions of their own, which continue to threaten the future of real time bidding.
The report notes other hurdles that could hinder growth of the practice. For instance, in spite of the predicted involvement of more premium publishers, Forrester suggests many advertisers still perceive inventory on the exchanges to be of poor quality and potentially less “brand-safe” than other sources such as networks.
It also states the continued complexity of the real time bidding ecosystem is difficult for agencies and publishers to navigate, given the range of players in the market. “Advertisers and publishers must navigate a complex technology stack to participate,” it states.
It’s the combination of those technologies that some players, including Google, are attempting to streamline and package, lowering the bar for involvement from smaller agencies or advertisers. Its ownership of tools such as demand side platform Invite Media, and its DoubleClick ad exchange could eventually offer advertisers a one stop shop for real time media buying.
Speaking at an Advertising Week event in New York in September, Neal Mohan, Google’s VP of product management, said real-time transactions on the DoubleClick Exchange more than doubled in the twelve months prior, and predicted 50 percent of targeted ads will be bought using real-time bidding technologies by 2015.
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