Audience Selling for Publishers: Part 1
Transcript of Audience Selling for Publishers: Part 1
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PART ONE OF A TWO PART SERIES:
REAL-TIME BIDDING & THE
INDIRECT SALES CHANNEL
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Advertising aintwhat it used to be,Anonymous Andy.
Advertisers and agencies are evolving theirstrategies to reach their target audience based on their
interests, because in a world where ads are everywhere,
individually tailored ones are the most effective.
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True that.
Audiences are comprised of individuals with a uniqueset of interests, and online publishers have the greatest
advantage of any advertising medium to deliver individually
tailored, interest-based advertising.
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86% of agencies intend toleverage audience targeting
in 2011.Better targeting of ads is the#1 incentive for advertisers toincrease online ad spending.
If agencies and advertisers areinterested in audience buying,publishers should be thinkingabout audience selling.
AUDIENCE SELLING FOR PUBLISHERS Part 1: RTB & The Indirect Sales Channel
PubMatic + Digiday Study 2010, Forrester
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Audience Selling Augments thePublisher's Existing Selling Strategy
The Holistic Publisher Selling Strategy
DIRECT[ With Sell-Side
Platform Support ]
RTB Sold by the Publisher
Audience Packagingwith 3rd Party Data
INDIRECT[ With Sell-Side
Platform Support ]
RTB Sold byDSPs and Ad Nets
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DIRECT[ Independent ]
Premium Sponsorships
Custom Campaigns
Non-Standard Ad Units
Guaranteed Placement
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Two Sales Channels, Two WhitePapers, One Holistic Publisher
Selling Strategy
Q1 2011
THE INDIRECT SALES CHANNEL
Q2 2011
THE DIRECT SALES CHANNEL
These white papers can be downloaded at PubMatic.com/AudienceSelling.
Hard copies can be requested by contacting us directly at [email protected].
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User Opinions onAudience-Based
Advertising
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Privacy issues have been part of the discussion at nearly every conference in the
online advertising space for the better part of two years. Most of us that work in online
advertising have our own personal opinions about how audience data is collected for the
purpose of advertising. And while every person that works in the online advertising space
is also an Internet user, it is fair to say no matter where you fall on the user privacy
advocacy scale that individual opinions from people that work in online advertising do
not represent the majority of the population. Clearly, if you work in online advertising, you
know more about how online advertising works than the general population.
User privacy is paramount, no doubt, but despite all the discussion about privacy in our
industry, at universities and now on Capitol Hill, little public data currently exists about
what the U.S. general population actually understands about how online advertising
works and how users feel about it.
To be sure, studies do exist, but until now, there havent been any studies that ask
Internet users what they know about online tracking and how they feel about it across
three critical stages: Before they know how it works, after they know how it works, and
after they know how it works and with an understanding of the value-trade offs.
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AUDIENCE SELLING FOR PUBLISHERS Part 1: RTB & The Indirect Sales Channel
Audience Selling is the act of publishers leveraging advanced audience targeting data, either
directly through their sales forces or indirectly via intermediaries such as ad networks and Demand
Side Platforms (DSPs), in order to sell and deliver relevant advertising based on individual interests.
Traditionally, publishers have sold advertising largely based on contextual relevance and limited
information about their audience by way of surveys and sparse registration information. With
superior audience insights that combine contextual data with anonymous demographic and
behavioral data from 3rd parties, publishers can exponentially expand the number of ways their
audience can be targeted, which in turn, increases the number of advertisers to sell to.
Just because a member of a publishers audience is reading about sports, doesnt mean that
audience members only interest is sports. That audience member may very well be in the market
for a new car, computer, or perhaps looking to make home improvements. That audience member
is valuable to a wide variety of advertisers, and advertisers will pay a premium to reach them if they
know it is their target audience.
Leveraging robust anonymous audience data, publishers can see their audience in new ways,
have a better understanding of their interests, and deliver advertising that is more relevant to their
audience.
The result is a better user experience for the audience, better performing campaigns for the
advertiser, and new monetization opportunities with greater ad revenue for the publisher.
Audience-Based Advertising isInterest-BasedAdvertising
DEMOGRAPHIC + +CONTEXTUAL BEHAVIORAL
[ 3RD PARTY ANONYMOUS DATA ]
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Q: How do users feel about havinganonymous data collected aboutthem in order to deliver interest-based, relevant advertising?
A: It depends on how muchinformation they have.
Semantics matter, especially when every word is a keyword. If someone asked you if youd rather be
tracked or have anonymous data collected about your browsing behavior, what do you think youd
choose? Perhaps one sounds better to than the other, but one thing is clear - it is impossible to make an
informed decision about either one without having a clear understanding of what tracked and anonymous
data collected about your browsing behavior means.
As an industry, we make a lot of assumptions about how Internet users feel about anonymous online
behavioral tracking without anybody really asking them how they feel. During the course of creating this
white paper, we were unable to fi nd even one study that asked Internet users how they felt about havingsome of their anonymous online behavior collected for the purpose of advertising, while also asking if they
understood what that same tracking meant.
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Understanding of TwoTypes of Data
INFERRED DECLARED
+ No PII (Personally Identifi ableInformation) such as ones name,address, etc.
+ Based on anonymous onlinebrowsing behavior
+ The user actively and knowinglydeclares information about oneself
+ This data is NOT passed forthe purpose of interest-basedadvertising
With the limited number of studies that exist on user
opinions about interest-based advertising
It isnt clear that users understand different types of data and
how it is collected
It isnt clear that users understand that behavioral tracking is
based on inferred (anonymous) data
It isnt clear that users understand the benefi ts of inferred
(anonymous) data collection.
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Survey of U.S. Internet UsersThe Internet user, the online publisher audience, is the center of our data-driven advertising
ecosystem and their privacy is paramount. Whether through self-regulation or Congressional
legislation, Internet users should be able to choose what data collected about them can be
used for the purpose of online advertising. The outstanding question is, when Internet users arepresented with the option of deciding what type of data collection they support or do not support,
do they have enough information to make a decision that is best for them? And will their opinion
change depending on the amount of information they have?
In order to fi nd out the answer to those questions, PubMatic commissioned an independent online
research fi rm, Knowledge Networks, to conduct a survey of 500 U.S. Internet users.
The study was conducted in early 2011 and included a representative, random sample of
individuals that categorized themselves as Internet users.
User Opinions on
Audience-BasedAdvertising
+
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Key Takeaway #1
Users don't understand that the 3rd party data used forinterest-based advertising is anonymous.
When the survey participants were asked if they knew that some
of their online behavior might be tracked about them for the
purpose of advertising, 71% ACKNOWLEDGED THEY KNEW.
When the survey participants were asked if they knew the online
data collected about them for the purpose of advertising was
anonymous, ONLY 40% UNDERSTOOD IT WAS ANONYMOUS.
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Key Takeaway #2
Users are far more accepting of interest-basedadvertising when they understand that the 3rd party data
used is anonymous.
When asked without an understanding that only anonymous
data is used for interest-based advertising,64% DISAPPROVED.
When asked after understanding that only anonymous data
is used for interest-based advertising, 40% OF THOSE WHO HAD
DISAPPROVED CHANGED THEIR MIND AND APPROVED.
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Key Takeaway #3
The more users understand the benefi ts associated withinterest-based advertising, the more they are supportive of it.
When the survey participants were asked how they felt about
having online data collected about them - without understanding
it is anonymous data - for interest-based advertising,
When the survey participants understood that the data collection
was anonymous and they understood that one of the benefi ts
was more relevant advertising,40% CHANGED THEIR MINDS
AND APPROVED.
When the survey participants understood that the data collection
was anonymous and they understood the benefi ts included
more relevant advertising AND that it helped subsidize free
content, 53% CHANGED THEIR MINDS AND APPROVED.
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64% DISAPPROVED.
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Knowing the "How" and"Why" Changes Everything
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The majority of Internet userssay they dont like having theirbrowsing behavior tracked
until they understand the datacollected is anonymous and thebenefi ts are explained.
AUDIENCE SELLING FOR PUBLISHERS Part 1: RTB & The Indirect Sales Channel
Privacy is paramount for Internet users. And it is fair to say that sentiment is echoed by the vast majority
of companies that work within our ecosystem including advertisers, data providers, DSPs / ad networks,
SSPs, and publishers because at the end of the day, the people that make up our industry are Internet
users too. The vast majority of companies in the online advertising ecosystem, including PubMatic, adhere
to strict policies that our industry has proactively created to protect the rights of the user.
The PubMatic / Knowledge Networks study was not about whether or not legislation should be passed
about tracking browsing behavior, because Internet users deserve to choose what information about them
is tracked, regardless of whether or not the data collected is anonymous. Internet users should have the
ability to easily activate a do not track solution. However, the question that has not been adequately
answered in previous studies is that when Internet users are given a choice about whether or not they
support anonymous online behavioral tracking, will the users be given enough information for them to make
a well-informed decision?
U.S. Internet users, at present time, do not understand the difference between inferred (anonymous)
data and declared (actively given) data, and how those different types of data are used for
interest-based advertising.
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Conclusion
The PubMatic / Knowledge Networks study concluded that the overwhelming majority of Internet users do
not understand how online advertising works, specifi cally interest-based advertising. U.S. Internet users do
not clearly understand the difference between inferred data and declared data and how that data is used
for advertising. While 71% of the respondents understood that information about them might be tracked
online for advertising purposes, 40% did not understand that online browsing behavior used for online
advertising targeting is anonymous.
U.S Internet users do not consider the benefi ts they receive from having anonymous data collected,
including more relevant advertising and access to free content, when simply asked how they feel about
anonymous tracking.
Content doesnt pay for itself, advertising does. And even in the minority of cases where there is a fee toaccess content, it doesnt guarantee the advertising goes away. If online content gets to a point where
most publishers have to charge a fee to access it, that doesnt mean ads will disappear. There would
likely be content pricing wars where publishers have to charge the minimum amount possible to stay
competitive, and they will still have to subsidize lower content fees with irrelevant advertising.
According to the PubMatic / Knowledge Networks study, when U.S. Internet users understand the value
trade-offs for anonymous browsing behavior tracking specifi cally more relevant advertising and access to
free content - they are much more supportive of it Not all Internet users are opposed to anonymous data
collection, and during the course of the study, more than half of Internet users that understood the value
trade-offs changed their minds and were, in fact, supportive of anonymous data collection.
It all comes down to understanding
Whether it is through self-regulation or legislation, when given a choice about anonymous tracking, Internet
users deserve to have all the facts about how it works and the benefi ts they derive from it before making
a decision. Once they are appropriately armed with this information, they should have the means at their
disposal to easily implement a do-not-track option if they prefer, or not to.
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The Publisher
Audience Selling
Opportunity
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Meet Anonymous Andy
He represents a member of your Websites audience. Hisreal name probably isnt Andy. You dont know his real name
or any personally identifi able information (PII) and you dont
want to unless he has actively chosen to give it to you.
The icons represent
Anonymous Andy's
inferred interests
based on 3rd party
anonymous data.
Hundreds of brands
that may want to reach
Anonymous Andy based
on his inferred interests,
if they knew what those
interests were.
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Unlock Your Audience Selling Potential
Publishers that previously only sold to advertisers thatmatched their content can now exponentially expand
their advertiser prospects.
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Illustrat
iveSam
pleof
Brands
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Different Advertiser Categories Want to Reach Anonymous
Andy Based on His Different Inferred Interests
A travel company or airline may want to show Anonymous
Andy the latest travel deals because he travels frequently.
RETAIL
FOOD &DINING
AIRLINE
HEALTH &FITNESS
EDUCATION
GAMING
HOME &GARDEN
AUTO
PETS
PARENTING &FAMILY
SHOPPING
MUSIC
ELECTRONICS
GREENLIFESTYLE
SPORTS
TRAVEL
REAL ESTATE
WOMEN'SINTERESTS
INSURANCE
FINANCE
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DEMOGRAPHIC + +CONTEXTUAL BEHAVIORAL
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Because Anonymous Andy appears to be interested in
purchasing electronics and MP3s, some electronics companies,
watch brands, music labels, and shoe companies are interested
in reaching him.
DEMOGRAPHIC + +CONTEXTUAL BEHAVIORAL
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RETAIL
FOOD &DINING
AIRLINE
HEALTH &FITNESS
EDUCATION
GAMING
HOME &GARDEN
AUTO
PETS
PARENTING &FAMILY
SHOPPING
MUSIC
ELECTRONICS
GREENLIFESTYLE
SPORTS
TRAVEL
REAL ESTATE
WOMEN'SINTERESTS
INSURANCE
FINANCE
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Auto and insurance companies want to
reach Anonymous Andy because he has been
looking into purchasing a new automobile.
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DEMOGRAPHIC + +CONTEXTUAL BEHAVIORAL
AUDIENCE SELLING FOR PUBLISHERS Part 1: RTB & The Indirect Sales Channel
RETAIL
FOOD &DINING
AIRLINE
HEALTH &FITNESS
EDUCATION
GAMING
HOME &GARDEN
AUTO
PETS
PARENTING &FAMILY
SHOPPING
MUSIC
ELECTRONICS
GREENLIFESTYLE
SPORTS
TRAVEL
REAL ESTATE
WOMEN'SINTERESTS
INSURANCE
FINANCE
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Insight Into Inferred Interests Expands the Number
of Advertiser Categories that Want to Reach Your
Anonymous Audience
DEMOGRAPHIC + +CONTEXTUAL BEHAVIORAL
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RETAIL
FOOD &DINING
AIRLINE
HEALTH &FITNESS
GAMING
HOME &GARDEN
AUTO
PETS
PARENTING &FAMILY
SHOPPING
MUSIC
ELECTRONICS
GREENLIFESTYLE
SPORTS
TRAVEL
REAL ESTATE
INSURANCE
FINANCEEDUCATION
WOMEN'SINTERESTS
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CONTEXTUAL
ONLY
Similar to demographic data, contextual data is a
core part of interest-based advertising. Publishers
often use 3rd party companies to improve the
accuracy of their contextual targeting, but as a
stand alone method, contextual targeting does not
take into consideration an audiences demographics
or interests. As a result, contextual targeting only
can provide advertisers with the ability to target
relevant content but without knowing anything
about the user. In this graphic, the user is on a
sports-related website, and the advertiser has no
insight into his interests, other than sports.
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Determining the Value of Data
Recency and Frequency are important indicators for purchase intent.
Below are two anonymous users that have inferred interest in travel. The one on the left has visited
two travel Websites in the past three months. The one on the right has visited four in the past week.
Advertisers are willing to pay more to reach the anonymous user on the right as the anonymous user
on the right is more likely to purchase travel tickets sooner.
Anonymous behavioral information helps advertisers
determine where the user is in the purchase funnel
THE FURTHERDOWN THE FUNNEL,
THE HIGHER THE
PRICE PAID TO
REACH THEM
$
$ $ $
TRAVEL
PURCHASE INTENTTRAVEL
INTEREST
AWARENESS
INTEREST
INTENT
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RTB for Publisher
Audience Selling
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Audience-based advertising using 3rd party anonymous data can be sold without
leveraging Real-Time Bidding (RTB), but RTB is more effi cient and provides publisherswith signifi cantly greater revenue than non-RTB audience-based campaigns.
Unlike non-RTB audience-based campaigns, RTB offers impression-level optimization
with unique bidding precision for every ad impression. RTB can also include real-time
creative optimization, which is a major contributor to improved campaign performance.
The improved targeting capabilities that RTB provides allows advertisers to pay exactly
what they believe the combination of media and audience is worth, resulting in greater
ROI for the advertiser. In September 2010, PubMatic conducted a multi-party case
study with four leading DSPs that revealed advertiser ROI for RTB campaigns was 101%
improved on average, as compared to the non-RTB campaigns that were monitored
during the course of the study.
The most commonly recognized publisher benefi t of RTB is signifi cantly increased revenue
for unsold ad inventory. Very simply, RTB campaigns perform better and provide a clear
and measurably higher return on investment for advertisers than non-RTB campaigns due
to their greater effi ciency and more precise targeting capabilities.
RTB has leapfrogged what was previously considered remnant inventory on the CPM
value chain PubMatic's data shows that over 10% of RTB bids are over $10 CPM. As
a result, RTB is becoming a major part of premium publishers overall revenue strategy.
Even some publishers that were vocal critics of ad networks in the past are showing
interest and enthusiasm for an RTB-only solution.
While the benefi ts of RTB are clear, it is not a perfect solution. Publisher concerns about
RTB are generally formed around the possible negative impact that RTB will have on
their direct sales efforts over the long-term including channel confl ict and data leakage.With technology advancement and improved processes, the risk for publishers using RTB
is rapidly shrinking.
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Unique bidding/pricing precision
Audience attributes
Ad impression attributes(ad tag type, atf/btf, etc.)
Site awareness/context relevance
Real-time creative optimization
X
X
X
RTB vs. Non-RTB
AUDIENCE TARGETING WITH RTB
AUDIENCE TARGETING (NON-RTB)
SITE BASED TARGETING (CONTEXTUAL)
AUDIENCEEXPERIENCE
Based on More
Relevant Advertising
PUBLISHERREVENUE
Based on Higher
Priced Campaigns
ADVERTISERSATISFACTION
Based on Improved
Campaign Performance
Unique bidding/pricing precision
Audience attributes
Ad impression attributes(ad tag type, atf/btf, etc.)
Site awareness/context relevance
Real-time creative optimization
X
X
X
XX
Unique bidding/pricing precision
Audience attributes
Ad impression attributes(ad tag type, atf/btf, etc.)
Site awareness/context relevance
Real-time creative optimization
X
X
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RTB Growth is Unprecedented
0%
50%
20%
5%
1.5%
Key Drivers:
Effective: RTB signifi cancy improves revenue for publishersand campaign performance
Effi cient: Programmatic ad buying is more automated
than manual and reduces media waste
In Demand: Agencies have organized Trading Desks toleverage it, RTB will move into the direct sales channel
*Based on industry market projections and PubMatic internal growth data
*$5B+
2008 2009 2010 20112015
% of Non-
Guaranteed
Ad Spend
(via RTB)
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eCPMIndex
PubMatic (with RTB)
PubMatic (without RTB)
eCPMIndex
PubMatic (with RTB)
PubMatic (without RTB)
RTB Increases Publisher RevenueAcross All Verticals
PubMatics Ad Revenue Report from October 2010 included the fi rst ever case study that revealed solid
evidence that RTB performs better for advertisers than non-RTB campaigns across several advertising
verticals. Similarly, the study results concluded that RTB provides consistently higher CPMs for publishers
than non-RTB campaigns, across multiple publisher verticals. During the course of four different ad
campaigns run by four different DSPs, PubMatic publishers saw aggregate revenue lift of 64% over
non-RTB inventory purchased for the same campaigns.
The charts below provide further evidence that RTB consistently delivers higher CPMs for publishers
across multiple verticals. The data in the charts represent aggregate RTB vs. Non-RTB eCPM byPubMatic publisher vertical during the months of June through December 2010.
Two Week Intervals: June - December 2010
NEWS &REFERENCE
WOMEN'S
INTERESTS
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eCPMIndex
PubMatic (with RTB)
PubMatic (without RTB)
eCPMIndex
PubMatic (with RTB)
PubMatic (without RTB)
eCPMIndex
PubMatic (with RTB)
PubMatic (without RTB)
Two Week Intervals: June - December 2010
GAMING
TRAVEL
ECOMMERCE
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2011 RTB
vs. Non-RTB
2015 RTB
vs. Non-RTB (Projected)
2011 Rich Media RTB
vs. Standard Display RTB
2012 Rich Media RTB
vs. Standard Display RTB
(Projected)
RTB Trends
Sources: PubMatic proprietary data, PubMatic + Digiday Study 2010, Google, ComScore, Mobclix
Percentage of Online
Inventory Purchased
via RTB
Percentage of
Online Inventory
Purchased via RTB
that is Rich Media
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RTB Trends
Percentage of
PubMatic Publishers
Opted in for RTB
Campaigns
Percentage of Publisher
Revenue Flowing
Through PubMatic's
Sell-Side Platform
2011 Mobile RTB
vs. Mobile Non-RTB
Percentage of
Mobile Inventory
Purchasedvia RTB
Standards for RTB
A growing group of companies are working together to
improve standardization under the auspices of the OpenRTB
group. OpenRTB was founded in 2010 and has a mission
of providing open industry standards for communication
between buyers of RTB advertising and sellers of publisher
inventory. Initial publisher focused objectives include creating
a method for automatically retrieving a list of publisher
restrictions for each advertiser and RTB request standards
for publisher creative restrictions. To learn more about Open
RTB, visit http://www.OpenRTB.info.
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PREMIUM
PUBLISHER
+ Facilitates RTB transaction
+ Ensures highest payer gets
ad space
+ Ensures against channel
confl ict
+ Ensures data safety
+ Ensures brand protection
+ Gets relevant advertising
+ Has better user experience
+ Receives premium pricing
+ Has creative controls in
place and monitored
+ Gets comprehensive
analytics from campaign
from PubMatic
PREMIUM
PUBLISHER
AUDIENCE
SELL-SIDE
PLATFORM
(SSP)
For Publishers:Single Audience
Sales Access Point
For Demand
Partners:
Main Conduit to
Access Premium
Inventory (on behalf
of advertisers and
agencies)
SELL SIDE
PREMIUM
PUBLISHER
PREMIUM
PUBLISHER
PREMIUM
PUBLISHER
PREMIUM
PUBLISHER
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As the number of publishers that open up their inventory for RTB grows, and the overall
scale of available RTB inventory grows, publishers need the highest levels of protection
to ensure that RTB is working for them as part of a holistic selling strategy. While it isdiffi cult to dispute that RTB improves publisher revenue at least in the short-term -
cautious publishers have voiced concern over the lack of control that RTB may present.
Specifi cally, some publishers fear that RTB could possibly have a negative impact on their
direct sales efforts because of channel confl ict, transparency, and excessive pixeling that
could lead to data leakage and slow ad loading speed.
While publisher concerns about RTB are valid, recent technology advancements have
been made that will allow publishers to have much greater transparency and control over
RTB campaigns.
One of the most anticipated breakthroughs for publishers in order to help them better
control the pricing of RTB campaigns is the introduction of Dynamic Pricing Floors.
Dynamic Pricing Floors will allow publishers to adjust their selling price during the course
of a campaign in order to encourage bidders to offer fair media value for their inventory,
while making sure that the fi ll rate is optimal.
Publishers can exercise additional control in an RTB environment by choosing to make
their web site URL transparent or not in the bidding process. By making their URL
transparent, publishers can ensure the highest value advertising for their premium brand.
However, some publishers are concerned about creating channel confl ict for their direct
sales forces. In this case, publishers can go beyond restrictive blocklists by obscuring
their URL in the bidding process so that advertisers cannot know where their ads will
show up. By using 3rd party content verifi cation solutions, advertisers can ensure that
they are transacting within a safe environment.
Other recent technology advancements to help publishers gain greater control over RTBcampaigns include automated blocklist management, ad loading speed monitoring, and
data leakage protection to help to ensure that publishers are getting a fair value trade-off
from pixel droppers on their site.
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Channel Confl ict Management& Creative Controls
Having advanced brand control tools in place are critical to ensure that publishers achieve the maximum
benefi ts of RTB without having creative violations or creating channel confl ict with their direct sales forces.
A robust Sell Side Platform (SSP) should scan every RTB ad to ensure compliance, and should provide
publishers a full suite of controls to ensure the publisher is protected. These are the control tools PubMatic
provides to publishers:
Automated Blocklist Manager:
Allows publishers to manage blocklists in one simple to use interface
Automatically scans every ad tag in real-time
Checks both the click-through URL and redirected landing page URL for every ad
Blocks ads that violate the blocklist from being shown to the user
Live Creative Monitor:
Allows publisher ad operations teams to view creative as they appear on the publishers site
Allows ad operations teams to view creative from around the globe
Alerts PubMatic service team for immediate action where necessary
Creative Violations Report:
Allows publishers to view a summary of the ad violations that PubMatic has proactively detected and
block from the publishers site
Ad Inspector Browser Plug-In:
Gathers information on all text, image, and video ads on the publishers site
Allows publishers ad operations teams to mouse-over any ad and instantly determine which ad network
or DSP served the ad and at what price
Alerts PubMatic service team for immediate action where necessary with the ability to easily screenshot
and email debugging information
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Brand & Pricing Protection
Malware Detector:
Protects against the threat of malware
Automatically scans for malware across thousands of ad tags
Alerts PubMatic service team for immediate action where necessary
Global Ad Speed Monitor:
Monitors global ad-tags for performance and latency
Suspends ad networks if latency crosses pre-determined thresholds
Alerts PubMatic service team for immediate action where necessary
Dynamic Pricing Floors:
In the coming months, Dynamic Pricing Floors for publishers will be one of the most signifi cant
milestones to date in the evolution of RTB. With Dynamic Pricing Floors, publishers will have the
opportunity to get closer than ever to capturing the fair media value of each ad impression.
While RTB acquired inventory generally does demand a higher price than non-RTB inventory, the
companies that represent advertisers and specialize in RTB are continually evaluating and refi ning their
bidding strategies in order to reach their audience at a price that maximizes their ROI. Publishers should
have the ability to evaluate and refi ne their selling price dynamically, by adjusting fl oors at the ad tag,
user, and advertiser level, which will enable them to set the highest bid levels possible while maintaining
optimal fi ll rate.
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Protection Against Data Leakage
Publishers work hard to create premium audiences, so why should any 3rd party be able to identify and
use it without giving the publishers what they deserve?
PubMatic estimates that data leakage costs publishers $1B per year. Data leakage occurs when 3rd
parties capture a publishers audience data and then use that data to target users outside of the site from
which the data was taken, without an appropriate economic interchange. That leads to direct revenue
loss for the publisher. This is a problem that has grown considerably in the past two years along with the
increasing advertiser demand for audience-based advertising.
The practice of dropping pixels is a core component of the data-driven advertising ecosystem that we are
a part of, and many publishers have fi nancially benefi ted from the practice especially because publishers
have, until very recently, lacked the ability to monetize their audience as well as 3rd parties. In the majority
of cases, the publisher receives revenue either directly or indirectly - from the 3rd party pixel droppers,
but publishers should have extra protection to ensure they know who is dropping pixels on their site, how
often, and what the revenue return is.
Data Firewall 2.0: Audience Data Transparency Technology with Expert Guidance for a Better
Understanding
PubMatics Data Firewall is the only technology that helps publishers protect against data leakage by
providing them with transparency and fi nancial insight into third party pixeling. Data Firewall 2.0 gives
publishers deeper insight into who is dropping pixels on a global level, so they can take action to prevent
unfavorable pixeling.
1. White Lists for Pixel Droppers
Not all pixel dropping is for collecting audience data. Publishers understand that pixels are dropped for a
multitude of reasons including frequency capping, ad delivery confi rmation, content verifi cation, and more.
Publishers need to be able to mark known and legitimate pixel droppers as safe or white-listed.
2. Protection for International Audience Data
Pixel droppers are not restricted to any specifi c geo location. PubMatic understands this and has
expanded its pixel scanning service across the globe. With additional geo locations, the publisher is betterprotected against pixels dropped on their international visitors.
3. Expansive Pixel Droppers Database
PubMatic continues to provide publishers a comprehensive understanding of pixel droppers, how they
function, and how publishers can best prevent data leakage. With this release, Data Firewall can now track
more than 300 unique pixel droppers.
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RTB Campaign Flow forthe Indirect Sales Channel
[Detailed View]
WEB
MOBILEVIDEO
PUBLISHER
1. Page request and ad call
request goes to PubMatic
4. Dynamic fl oor pricing is
activated - only demand
partners bidding above
fl oor price minimum
proceed into competition
5. Publisher brand
controls activated
+ Blocklist Manager
+ Ad Speed Assurance
+ Malware Detector
7. Winning demand partner
serves ad to publisher
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DEMAND PARTNERS
WITH ADVERTISER
CAMPAIGNSIN WAITING +
AUDIENCE DATA
2. PubMatic sendsad request to RTB
demand partner pool
3. Demand partners
return bids in real-time
6. Notifi cation sent
to highest paying
demand partner
meeting pricing
and brand control
requirements
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The Two ChannelAudience Selling
Strategy
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Until very recently, publishers generally have not leveraged 3rd party audience data to
increase the value of their ad space for direct sales. The reasons publishers have not
taken advantage of 3rd party data include not understanding the value of the data and
the process and technology challenges of using 3rd party data. Demand-Side Platforms
(DSPs) have exploded in popularity and scale specifi cally because of their ability to utilize
3rd party audience data effi ciently and effectively. Through the indirect sales channel,
DSPs and advanced ad networks are becoming a key component of the publishers
overall ad revenue strategy.
Today, publishers do have the ability to sell media layered with 3rd party data, and with
audience-based campaigns in high demand from advertisers, publishers need a two-channel audience selling strategy. Each sales channel has its own benefi ts, so publishers
should understand those benefi ts and use that insight to create a holistic selling strategy.
Publishers can take advantage of RTB for audience-based advertising as demand for
RTB campaigns from advertisers levering the indirect sales channel continues to grow.
According to Google, half of all non-guaranteed ad inventory will be purchased via RTB
in 2015, and because of the large inventory scale that the indirect channel provides for
advertisers and the proven success of RTB campaigns, the number of advertisers that
leverage the indirect sales channel for RTB will increase for many years to come.
In 2011, publishers have more choices for selling audience based campaigns, including
through the direct sales channel. Leveraging SSPs, publishers can now set up private
marketplaces, which will enable them to sell RTB campaigns directly to agency trading
desks and advertisers - all with greater control over those RTB campaigns. Through
SSPs, publishers can also have easy access to 3rd party audience data that they can
apply to their media and sell directly.
As the opportunities for publishers to sell true audience-based advertising increase and
improve, publishers should have a strategy for balancing the two sales channels that will
allow them to take advantage of the benefi ts that both sales channels deliver.
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The Two Channel AudienceSelling Balance [Illustrative]
Direct
DirectIndirect
Indirect
Direct sold campaigns will always fetch higher CPMs than ones sold through the indirect sales channel
because of their guaranteed placement and no ad networks or DSPs taking a percentage of the revenue.
RTB will be the preferred method to acquire publisher audience specifi c inventory. RTB campaigns will be
routinely sold by the publisher's direct sales force. Additionally, audience extension will allow publishers to
sell RTB campaigns directly for campaigns that run on their site and other sites giving advertisers the scale
they need for highly targeted campaigns.
These factors will increase the overall revenue contribution from audience-based campaigns signifi cantly.
AD REVENUE PER IMPRESSION FOR PUBLISHERS
OVERALL REVENUE CONTRIBUTION FOR PUBLISHERS
2015
Audience-Based
Campaigns
with 3rd PartyAnonymous Data
Audience-Based
Campaigns
with 3rd Party
Anonymous Data
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Publisher Ad Revenue FromAudience-Based Campaigns
2011
$2.2B*
Direct Indirect
2015$5.2B*
Direct Indirect
Ad Spendby Year
Publisher Ad Revenue Ratio From AudienceBy Sales Channel [Illustrative]
Example scenarios based on published growth numbers of:
Non-Guaranteed ad revenue & RTB
Audience targeting demand
Revenue opportunity & scale for direct audience selling
*eMarketing and Jordan Edmiston Group
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Conclusion
For the fi rst time in a decade, online advertising is on the brink of becoming a sellers market. RTB and
programmatic ad buying is improving effi ciency for advertisers and publishers alike. More importantly, sell
side technology is fi nally catching up to the sophistication of the demand side, allowing publishers to take
advantage of new selling opportunities and grow their business. As opportunities for publishers increase
and improve, publishers will need to rethink their sales strategy.
Specifi cally, as demand for audience-based advertising continues to grow at a rapid rate, publishers must
develop a holistic sales strategy that includes the use of audience data for both the direct and indirect
sales channels. By utilizing a combination of anonymous contextual, demographic, and behavioral data,
publishers can achieve several key objectives:
Level the playing fi eld with advertiser intermediaries to achieve fair market value for their inventory and
signifi cantly increase their revenue
Attract a broader array of advertisers that can be sold to via both the direct and indirect sales channels
Protect the users privacy and deliver more relevant and interesting advertisements at the same time
Its clear that expertise in audience selling will be a critical part of the publisher revenue strategy in the near
future. Publishers must adopt newly created technology to protect their brands from unwarranted risk and
take advantage of the new opportunities that lay ahead.
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MOREREVENUE
BETTEREXPERIENCE
MORECONTROL
About PubMatic
One Holistic Selling Platform to Protect Publishersand Increase Online and Mobile Ad Sales
The PubMatic SellSide Platform forPremium Publishers
More Revenue
RTB for Direct &Indirect Sales
Dynamic Pricing Floors
Audience Dataon Demand forDirect Sales
More Control
Publisher ControlledRTB Campaigns
Creative Control Suite
Data LeakagePrevention& Education
Better Experience
High-Touch ExpertGuidance
Trusted DemandPartners
True Innovation &Thought Leadership
Some of the most respected online publishers have chosen to work with PubMatic,
including the Huffi ngton Post, McGraw Hill, eBay, United Online, TV Guide, MSNBC,
Scribd, and the majority of the ComScore Top 10.
Contact Us
Publishers interested in working with PubMatic should contact [email protected]
Demand Partners interested in working with PubMatic should contact [email protected]
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ADVERTISER
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WE TAKE SIDES
PUBLISHER
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Empowering PublishersContact Us:
Phone: (646) 706-7171
Publishers contact: [email protected]
Ad Networks contact: [email protected]
For General Information: [email protected]
www.PubMatic.com