Nov 30, 2017 by AirpushMobile advertising can be a bit of a minefield. Getting your ads out there is one thing, but making sure they’re where y...
Before delving into mobile RTB itself, let’s take a step back and define some of the alphabet soup of specialized acronyms and terms associated with this space and briefly discuss what’s led mobile RTB to become the white hot growth area within digital advertising.
Take the example of a sports brand looking to advertise to male sports enthusiasts who like to be on the cutting edge with their sports footwear purchases. In the past advertisers and their agencies would define an audience they were looking to reach, for instance, Male, 24-36, sports enthusiasts living in urban areas, with college educations, and a household income of $50,000 or more. Next a media budget would be allocated and a media planner would develop a media plan by talking to a large number of media outlets: television stations, radio stations, magazine publishers, billboard companies, online web sites, and more recently mobile app publishers or mobile ad networks, etc. The media planner would need to understand which media outlets were targeted to their desired audience as well as the cost, usually in Cost per Mille (CPM- cost per thousand impressions), of taking out advertising space in these media outlets. The media planner would divide up the budget for the media plan among the media outlets they thought would be most successful in reaching the desired audience and sign insertion orders (IOs) to buy media from the media outlets. Hopefully from the brief outline of this process in the paragraph above, it’s become clear that this is an incredibly inefficient process.
Over the past 8 years media buyers have looked to become more efficient, at least with their purchases of online media through RTB. Web site publishers now “broadcast” the availability of eyeballs (impressions) looking at their web site in real time and conduct auctions on exchanges (not dissimilar from stock exchanges such as the NYSE) for media buyers to buy this media in real time via cloud-based software that is programmed to “listen” for these impressions (Demand Side Platforms or “DSPs”). In some cases the publisher will identify the name of the web site associated with the impression, such as Sports Illustrated or ESPN (in our example above), but in other cases they will not identify the name of the web site and instead append information about the audience looking at their web site in the bid request that is sent to auction on the exchange. Trading desks within advertising agencies program their DSPs to “listen” for desired impressions and make decisions in real time based on their media budgets at any given time and metrics about how many conversion events such as clicks on a web site banner ad or online purchases are taking place as a result of the auctions they are winning.
With the huge growth in adoption of smartphones and tablets over the past few years, there’s been an enormous shift in how digital content is viewed. Consumers who previously performed searches and browsed the web on their PCs are now doing 20-50% of this activity on their mobile phones or tablets, even when their PCs are close by! Tablets are now outselling PCs. Because of this shift, web site publishers are seeing declines in their online advertising and scrambling to sell more mobile and tablet advertising to make up for their losses from desktop web advertising revenue. Even giant Google, announced as part of their earnings announcement earlier this month, that they are susceptible to this trend. Meanwhile advertisers who’ve observed the same trend are eager to reach their target audience on their smartphone or tablet screens. This creates the perfect storm for Mobile RTB.
Some of the companies who accurately predicted this shift in content viewing and put themselves in a great place to be at the eye of the storm with their mobile exchanges include AppNexus, Inneractive, Mobclix, MoPub, Nexage, Pubmatic, Rubicon Project, Samsung, and Smaato. They did so by aggregating a large number of mobile app and mobile web site publishers and making their ad impressions available for RTB on their mobile exchanges. Recently Millennial Media and Flurry, and most recently Mojiva, have announced that they will soon be launching mobile exchanges of their own. Here at Airpush we’re also working in partnership with OpenX to make our mobile ad inventory available programmatically via our own private exchange we expect to launch in the Fall.
On July 1st at Airpush we launched AirDSP which allows media buyers to use the user interface on our web site to target very specific audiences on their mobile devices both through the Airpush network as well as the leading mobile exchanges. This past February Millennial Media purchased mobile DSP, Meta Resolver, and two weeks ago, online DSP X+1 purchased the mobile specialist agency/DSP, WDA, in order to accelerate their ability to execute programmatic buys on mobile. Additional consolidation by online DSPs buying up successful mobile DSPs is likely. Mobile RTB is sure to remain a rapidly growing area in the next few years and we look forward to discussing future industry trends as well as our own experiences and new products on this blog in the near future.
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