Martin Stockfleth Larsen, CMO, Adform, looks at how real-time bidding is shaking up the world of display advertising.
The hot topic of digital advertising in recent months has undoubtedly been real-time bidding. Facebook, Microsoft, Google, Yahoo- there’s talk of everyone’s role in real-time action. But does the industry at present fully understand its capabilities? What’s more, is it fully accessible to all? Even if the answers to these questions remain unclear, it is clear that the technology will be the golden ticket for advertisers over the next year.
Automate to Communicate
Even though online display is a digital channel, the buying part of the media planning process has always been manual and extremely time-consuming. If you, as an advertiser, want to buy impressions from the publisher, you always need to commit to a large amount of impressions, historically making display a marketing channel for the big brands and not the long tail, as you see with adwords.
Real-time bidding has turned the buying part upside-down, automating everything on both the demand and supply side. Every single impression can now be bought in real time on an impression-by-impression level, which suddenly opens up the channel for the whole market including the long tail. Sounds like the dream technology for advertisers, right? This is exactly why every advertiser wants to deliver every impression through real-time bidding – it serves the most relevant ad to the most relevant consumer, exponentially increasing click through rate, conversion rate or any other key marketing KPI.
The accuracy has gone far beyond the old practice of retargeting when a sale on men’s clothing at Debenhams could be shown to a woman who has recently browsed the Debenhams website. Now the technology can serve the same woman an ad about a sale on Debenhams swimwear, a product range she was looking at online, on relevant holiday websites. With personalisation, relevancy and time-optimisation key for engaging easily-distracted consumers, the technology simply supports interested buyers through brands’ conversion funnels.
Not only are campaigns more accurate in their targeting by using real time data, but advertisers benefit from the time-saving aspects it has to offer. By implementing personalised ads to campaigns, real time data can be used to both predict product or topic interest and show exactly what is the most relevant to the visitor based on their history and behaviour, as well as localising campaigns for different markets.
Increase the Inventory
However, the technology is yet to gain full traction outside of the US and Europe needs to think fast to keep up in the race. The major players, such as Facebook, Microsoft and Google have, of course, stepped up to the plate, not only offering the technology but also successfully reducing human involvement in negotiating and trading inventory. But there is still more to be done on the publishing side.
Despite the major players offering the technology, the amount of inventory on offer is still not enough to slake advertisers’ thirst. This is because it is not yet readily available with a certain lack of premium and video inventory. Many of the bigger brands are therefore yet to see its full potential because without the availability of the inventory, they can’t meet the reach set out in their marketing KPIs.
So the ball is in the publisher’s court. Once they’ve moved away from manually trading inventory and let automation take over, we’ll see wide-scale adoption from brand advertisers in line with the hype built around Facebook and Google. Advertisers are clamouring for a share of voice on both of these platforms precisely because they provide the technology and have the inventory. They therefore offer better targeting and higher efficiency because all media sales are automated and increase performance, efficiency and transparency for both the advertiser and the publisher.
Once publishers give way to the technology revolution, we should see all online ads becoming more personalised, targeted and more measurable for advertisers because of RTB. And with the online display advertising set to make up about two-thirds of the total online advertising market this year, RTB is the technology advertisers need to know about in 2012.
By Martin Stockfleth Larsen
CMO
Adform