The future of display buying
In 2012, about 10% of UK display buying was carried out through using some form of real time bidding (RTB). In 2013 this will double.
It would be very nice to be able to say that this is being driven primarily by better application of big data, leading to better ad campaign targeting, better ROI and therefore increased investment.
But this is not the case. Currently, it is being driven by the large margins that some agencies or vendors are applying to media bought through “trading desks” or being added to media bought for re-targeting ad campaigns.
It is very rare that an RTB campaign has any sort of custom attribution modelling run against it. In many cases suppliers are – unwittingly or not – merely gaming standard attribution methods – all of which still favour the last click to some degree. This can be achieved by overloading the bottom of the funnel with clicks.
At Essence, we pride ourselves on delivering the truth to clients about how much ad campaigns cost, and the truth about their effectiveness. Only then can proper, sustainable growth be delivered for all parties.
I believe that the growth in digital ad spend – RTB included – will accelerate if pricing structures are transparent and the beneﬁts of the efﬁciencies that RTB brings are passed onto clients and advertisers. This would encourage clients to maximise their investment, leading to more income for digital agencies and suppliers in the RTB space. The RTB environment could be highly beneficial to advertisers, but they need to be receiving the right advice from a trusted advisor to maximise the opportunity.
In the future, networks will become transparent supply side partners, or they will disappear. Retargeting vendors will have to make their products more transparent and controllable to demonstrate that they are adding real value to media schedules.
Well known media brands are already taking charge of their remnant inventory sales through private marketplace initiatives. Over time, they will also administer anything but the most bespoke of brand campaigns through RTB platforms. This will enable them to focus less on administration, and more on selling advertising and developing their propositions to advertisers.
Clients will gain from the ability to control and craft their communications across the breadth of their ad campaigns on a one to one basis and only buy the ads that they want to, delivered to the people they want to target.
Some of our clients at Essence are using RTB platforms as a secure way of sharing behavioural data with large vendors, to enable their partnership deals to be better targeted and more effective. RTB platforms provide great tools to do this, with much better data security than with the placement of many third party tracking pixels. There is typically no rational approach to this – just look at most of the top 50 websites in the UK, and see the jumble of tags that are placed on many of their homepages. There is very little thought for data security – and little evidence of a rational approach to the application of targeting using data.
The advertising industry is also struggling to play catch up with actual consumer behaviour around mobile usage, and those involved in the RTB space are no exception to this. However, once supply-side issues have been sorted out, and access to inventory sources has been rationalised across platforms, I think that real time bidding techniques will very quickly catch up with where consumers have been already for some time. Cross device measurement is probably still some way off, however.
There will be great power in the ability to apply real-time custom attribution models and apply this to bidding strategies in RTB. There are already suppliers from the US who have based their business models on such products, but they are all, again, black box solutions where large mark-ups are applied to the actual media buying costs. Custom attribution models and custom bidding models will come into their own when run at scale across a whole campaign, and in real time. Opaque systems and their mark-ups destroy value for clients, and will inhibit the growth of RTB.
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