Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43%...

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Digital Landscape Report Issue 81: October 2015

Transcript of Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43%...

Page 1: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Digital Landscape Report

Issue 81: October 2015

Page 2: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Key ContributorsThe AOP gratefully acknowledges the help provided by the contributors on this page in compiling this Digital Landscape Report. Throughout the report all content is sourced and for further details relating to any content in this report please contact the relevant provider through the links on this page (in slide show view).

www.hitwise.co.uk

For further information email [email protected]

www.comscore.com

www.emarketer.com

econsultancy.com

www.brandrepublic.com

Key ContributorsThe AOP gratefully acknowledges the help provided by the contributors on this page in compiling this Digital Landscape Report. Throughout the report all content is sourced and for further details relating to any content in this report please contact the relevant provider through the links on this page (in slide show view).

Page 3: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Content

• Forecasts and Ad issues• In this section – Ad spend - UK, UK Digital, UK Mobile, Bellwether, EU Programmatic Mobile Ad spend,

EU Programmatic Video Ad spend and US Programmatic Ad spend

• Online Audience Trends• In this section – UK PC and Multi-Platform (M-P) universe, audience trend, devices access and audience

‘engagement’

• Media Category Analysis• In this section – UK internet visits to key media categories

• Trends in key interest areas• In this section – 1st Party Data, Media Time, Audience, Video, Ad blocking, Marketers Priorities,

Programmatic, Ad Fraud, Round up

Page 4: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

AOP CommentWe seem to have reached that point in the year where we reflect on 2015 and start to make revenue forecasts for the year ahead.

The good news, from the Advertising Association and WARC, is that 2015 will close 5.8% up on last year and 2016 will bring a further 5.3% growth.

TV (spot, and more spectacularly VOD), Radio, Out of Home, Cinema and to a lesser extent Direct Mail are all forecast to grow. In the Internet space expect double digit growth (+10.6%) overall, with the main driver being spend within mobile platforms, a huge +36.7%.

The less rosy forecasts are for National and Regional newsbrands predicted to decline by around 3% and 2% respectively. These declines will be offset to some extent by growth in the digital assets of the newsbrands, but volumes here won’t be enough to compensate the declines in the physical editions.

The magazine brands are predicted to follow a similar pattern, but should fare slightly better as digital already represents a larger component of their current make up.

Over at IAB there is some comfort, and perhaps the basis of a digital strategy for publishers, in their reporting that Native increased by 50% in the first half of 2015 to now represent 25% of display revenues.

Video ad spend was also reported to have grown by 56% over the same half year period and now accounted for 22% of display. The video space was also identified within the AOP’s most recent Census report as an opportunity for publishers if enough content/inventory could be produced.

Rounding off the future gazing, eMarketer expect mobile ad spend to overtake Print by the end of this year and of course many are claiming that programmatic will be at the heart of this and future growth.

What has also been interesting from Hitwise this month is the dramatic rise in usage of social networks, whilst we know their usage is always high, a monthly increase of 23.5% is unusual. This is probably driven by events, for example RWC, but it does lend support to the idea of truly integrating content around social media rather than having it as a bolt on, it seems a relatively easy win in driving usage and those precious ad impressions.

Scott Fleming, AOP Digital Research

Follow AOP at @ukaop

Page 5: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Executive Summary (1)UK ad spend grew to reach a record high of £9,424m in the first half of 2015

Adspend

• UK ad spend grew 5.8% to reach a record high of £9,424m in the first half of 2015 (WARC/AA, October 2015)

– internet spend increasing 13.3% to £3,975m, with mobile accounting for 79% of this growth

• Within display, video ad spend grew 56% to £292 million, Social media spend rose 51% to £574 million and native/content grew 50% to £325 million (PWC/IAB, October 2015)

• For the first time, mobile advertising expenditure in the UK will overtake spend on print advertising (eMarketer, October 2015)

• Mobile programmatic display ad spend to eclipse desktop as automation grows (eMarketer, October 2015)

• Europe's Programmatic Video Ad Revenues Will Near €2 Billion in 2020 (eMarketer, October 2015)

• U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015)

Almost three quarters of users are accessing the internet from multiple devicesAudience

• The Multi-Platform universe remains steady at just under 48 million unique users, compared to 45 million PC users (comScore, September data)

• Almost three quarters of users are accessing the internet from multiple devices (72%) and this multiple device usage is resulting in significantly higher composition – 58% more pages viewed, the equivalent of an extra day and a quarter online and 50% more pages per visitor (comScore, September data)

• Magazine style content various considerably from the internet norm with third of it’s audience accessing exclusively from mobile or tablet devices, this content actually also has low multiple device access, perhaps reflecting access from a PC at work and switching to mobile or tablets elsewhere (comScore, September data)

• Reach for newspapers on mobile and tablet is typically double that of PC, views per visit are roughly the same and dwell time various by title reflecting the publishing layout or depth of content (comScore, September data)

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Executive Summary (2)Online video traffic grows almost 10%

Media Category Analysis

• Online video continued its recent upward trajectory growing 8.5% month on month and now attracts 11% more visitors than at this point in 2014 (Hitwise, September ‘15)

• The broader News and Media experienced a slight slowdown (-2.1% month on month) but still stands over 20% up on last year, whilst the actual Print sector performed well increasing monthly traffic by 2.5% to deliver an impressive 25% grow on 2014 (Hitwise, September ‘15)

• Social Networks has a strong monthly performance and surpassed News & Media, possibly driven by events such as Rugby World Cup. Traffic into News and Media also saw a significant spike from search engines in addition to Social Networks – again probably linked to events (Hitwise, September ‘15)

• Traffic to Print titles experienced the same upturn with the main referrer growth coming from search (Hitwise, September ‘15)

UK online ad viewability rises above 50%Key Trends

• 1St Party data– First-party data could prove to be the future of online display advertising, 38% say the ability to use third-party data to instantly create custom segments would be highly valuable (eConsultancy,

October ‘15)

• Media Time– Digital set to take majority share in UK time spent with media in 2016, mobile will account for 25% of time spent with media in the UK this year (eMarketer, October ‘15)

• Audience– More than 70% of advertisers worldwide are at least somewhat likely to include audience extension in ad campaigns…but audience extension does not appear equally important on the

publisher side of the equation (eMarketer, October ‘15)

• Video– Video behaviors shift as multiscreen usage progresses - video habits steadily moving to mobile (eMarketer, October ‘15)

• Ad Blocking– Two thirds of UK publishers named ad blocking as a significant threat (AOP, October ‘15)

– 15% of British adults use ad blocking software - men and 18-34s most likely to block ads (IAB, October ‘15)

– Ad blocking grew by 41% globally in the last 12 months (eConsultancy, October ‘15)

• Ad Fraud– Big publishers’ fraud rate is 2.8%, wider web’s is 11% (WSJ, October ‘15)

• Round Up– 22% of people use more than one ad-avoidance technique on mobile (eConsultancy, October ‘15)

– 100% of 15-34 year olds in the UK use YouTube every month (eConsultancy, October ‘15)

– UK online ad viewability rises above 50% (eConsultancy, October ‘15)

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Forecasts & Ad RevenuesIn this section – Ad spend - UK, UK Digital, UK Mobile, Bellwether, EU Programmatic Mobile Ad spend, EU

Programmatic Video Ad spend and US Programmatic Ad spend

Adspend and Forecasts

Key findings

• UK ad spend grew 5.8% to reach a record high of £9,424m in the first half of 2015 (WARC/AA, October 2015)

– internet spend increasing 13.3% to £3,975m, with mobile accounting for 79% of this growth

• Within display, video ad spend grew 56% to £292 million, Social media spend rose 51% to £574 million and native/content grew 50% to £325 million (PWC/IAB, October 2015)

• For the first time, mobile advertising expenditure in the UK will overtake spend on print advertising (eMarketer, October 2015)

• Mobile programmatic display ad spend to eclipse desktop as automation grows (eMarketer, October 2015)

• Europe's Programmatic Video Ad Revenues Will Near €2 Billion in 2020 (eMarketer, October 2015)

• U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015)

Page 8: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

UK Adspend

UK adspend hits record high

The latest Advertising Association and Warc Expenditure Report has revealed that UK adspend grew 5.8% to reach a record high of £9,424m in the first half of 2015.

Adspend growth continues to be driven by a strong performance in digital channels - with internet spend increasing 13.3% to £3,975m, with mobile accounting for 79% of this growth.

Mobile adspend grew 52.1% to break the billion pound barrier in a half-year period for the first time (£1,079m).

Steady growth was also reported in the first half for radio (+2.9%), out-of-home (+2.3%), cinema (+2.7%) and direct mail (+4.5%). TV spot advertising performed especially well, increasing 7.1% year-on-year.

"Advertising's resilience points to the strength of the broader economy in the first half," said Tim Lefroy, chief executive at the Advertising Association.

"The UK leads the world in e-commerce and the trend to mobile means serving the public better - ads in the right place at the right time.“

Advertising spend is predicted to break the £20bn barrier in 2016, with a 5.8% rise in 2015 and a 5.3% rise in 2016.

Source: WARC / AA, October 2015

Ad Spend2014 (£m)

Forecast 2015

Forecast 2016

TV 4,911 7.1% 5.4%

of which is spot advertising

4,463 6.7% 4.7%

of which is broadcasting VOD

145 17.2% 20.6%

Radio 575 2.3% 5.2%

Out of Home 1,019 3.8% 4.8%

National Newsbrands 1,370 -7.7% -3.2%

of which digital 214 8.7% 10.2%

Regional Newsbrands 1,253 -4.2% -3.1%

of which digital 174 20.4% 14.1%

Magazine Brands 993 -5.0% -2.1%

of which digital 267 6.7% 6.3%

Cinema 203 5.1% 2.3%

Internet 7,223 12.8% 10.6%

of which mobile 1,625 47.2% 36.7%

Direct Mail 1,835 2.9% 0.8%

Total UK Adspend 18,584 5.8% 5.3%

Page 9: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Ad Spend- UK DigitalUK digital display advertising revenues rise 27.5%

Total digital ad spend grows 13.4% to touch £4bn in first half of 2015 whilst mobile spend is up 51%, accounting for nearly 80% of the rise in digital ad revenues. This is despite challenges from ad blocking

Advertisers spent a record £3.98 billion on digital advertising in the first half of 2015 – up 13.4%¹ year-on-year – according to the latest Internet Advertising Bureau UK Digital Adspend report, conducted by PwC

Display advertising revenues grew at more than twice the overall digital rate (27.5%) to hit £1.31 billion – 33% of total digital ad spend, its largest-ever share. Within display, video ad spend grew 56% to £292 million – accounting for 22% of display revenue. Social media spend rose 51% to £574 million while native/content² grew 50% to £325 million – accounting for 25% of display revenue. Tablet-dedicated³ ad spend grew 115% to £68 million

“Recently, a lot of the attention on digital advertising has been around the challenges, such as ad blocking,” says Tim Elkington, Chief Strategy Officer, IAB UK “However, it's clear to see the UK digital advertising industry is maintaining its strong revenue growth at a much greater rate than the overall economy. The fact remains, as consumers spend more time on connected devices, advertisers must increasingly direct their attention and budgets there.”

Mobile ad spend up 51%; accounts for nearly 80% of the rise in digital ad revenuesAd spend on mobiles increased 51% to £1.08 billion in the first half of 2015. The actual increase of £370 million year-on-year accounts for 79% of the rise in digital ad revenues

Over a quarter (27%) of all digital advertising spend now comes from mobile, compared to 20% a year earlier. Mobile accounts for 39% of display spend, 43% of video spend, 63% of social media spend and 74% of native/content ad spend.“Mobile is unquestionably the engine of digital growth, with mobile display spend up 63% on the back of mobile video spend more than doubling,” says Dan Bunyan, Senior Manager at PwC. “However, there’s plenty of room to grow, as mobile accounts for 40% of internet time⁴ but only 27% of ad spend. Marketers are realising this is out-of-kilter, hence mobile is likely to continue gaining share at pace.”

Travel/transport overtakes consumer goods as biggest display advertiserThe biggest spending sector on display ads in the first half of 2015 was travel/transport (16.8% share) – overtaking consumer goods (16.1%). Finance was third (13.4%), just ahead of retail (13.3%).Paid-for search marketing increased 8.4% to £2.07 billion in the first half of 2015. Classifieds including recruitment, property and automotive listings, grew 6.6% to £547 million – accounting for 14% of digital ad spend

¹All growth rates except video and social media advertising are a like-for-like basis, i.e. only companies that submitted in H1 2014 and H1 2015 have been included in year-on-year growth calculations.²Content marketing = paid for sponsorship, advertisement features, in-feed & native distribution tools.³Tablet-specific advertising only (i.e. not including internet advertising displayed on a tablet by default).

⁴IAB/UKOM/comScore: Digital Time Spent Study (H1 2015)Source: IAB/PWC, October 2015

Page 10: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Mobile Ad Spend- UK

Mobile Ad Spending to Overtake Print in the UK

Mobile will account for 20% of UK total media ad spending this year

For the first time this year, mobile advertising expenditure in the UK will overtake spend on print advertising, according to the latest forecasts from eMarketer. Mobile ad spending has shown significant growth in recent years and is expected to rise 45% this year to over£3 billion ($4.94 billion) and will account for 20% of total media spending in the country

By comparison, spending on print will reach £2.67 billion ($4.40 billion), or 16.4% of total UK media spending in 2015

Mobile will continue to make gains on other formats across the forecast period and will soon rival spending on TV. By 2016, one yearafter mobile passes print spending, TV's share of UK total media ad spending will fall to 24.8% as mobile increases its portion to 25.5%

The following year, mobile will become the single largest ad channel in the UK market

Continued robust growth in the mobile channel is driving the bulk of digital ad growth in the UK. eMarketer estimates that mobile will account for 40% of all digital ad spending this year, with this figure rising to almost half by 2016

Page 11: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

BellwetherMarketing budgets continue to rise but waning confidence slows growth

Marketing budgets are set to rise for the tenth consecutive quarter but to the weakest degree, driven by mounting worries about the global economy as marketers demand greater accountability, according to the latest IPA Bellwether Report

Ad spend increases were claimed by 4.4% of companies surveyed in the third quarter, a sharp drop on the 12.2% jump posted in the second quarter

It’s reflective of a bumpy financial period for businesses, with many failing to hit top line growth and instead cut costs to hit the bottom line. Consequently, companies' hopes for better financial prospects plummeted to a nine-quarter low of 6.9%, compared to the previous quarter’s 13%. This wavering confidence spread to marketers, with a net balance of 22.4% compared to 25.3% in the second quarter, marking a two-and-a-half-year low

As noted in the previous survey, confidence in the financial and economic outlook was already falling. Since then, UK growth has eased, according to the report’s author and senior economist at Markit Paul Smith, while marketers factor in the impact of the wider global economy.

Growth was stunted in most of the report’s categories, though budgets were expanded for Internet marketing, events and main media.

Internet was the top-performing category in the period, up to 7.8% from 6.8%. A further breakdown of the medium saw a marginal uplift for search (0.6%), which was noticeably lower than the 6.5% posted in the previous quarter. Events also clocked a marginal gain with 2.8%, while main media was at 0.5%.

Commenting on the continued growth of digital, Anthony Rhind, strategy chief at ad tech firm Adform, and ex-digital head at Carat, stressed the need for digital media firms to demonstrate the ROI they provide in order to continue winning ad budgets.

He added: “The Bellwether report highlights continued digital growth, against a backdrop of business uncertainty related to both the UK & global marketplaces. We should anticipate that the environment of uncertainty will prompt ever greater emphasis on the analysis of business outcomes directly attributed to media investment.

“Digital has always proved a safe area to prioritise media allocation when hard decisions are being taken. But we must not be complacent, digital doesn’t exist in a vacuum & our industry must strive to develop better attribution solutions that more effectively account for all media. Such a broad perspective if also supported by connected digital data & forensic analysis of the impact of each digital consumer connection should ensure a healthier integrated marketing sector."

PR (5.8 per cent) and market research (4.7%) experienced the biggest drops in the period, followed by sales promotion (3.4%), direct marketing (2.7%) and ‘other’ (1.1%).Paul Bainsfair, IPA director general, said: “As predicted by Bellwether, upward revisions to marketing budgets and confidence are easing. However the important point is they are still positive. More specifically, there are upwards revisions to Internet, events and main media advertising budgets in Q3. We are seeing marketers demanding greater accountability, physical presence and share of mind in their planned marketing spend.” Source: Bellwether reported by The Drum, October 2015

Page 12: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Programmatic Mobile Ad Spend- EuropeMobile Programmatic Display Ad Spend to Eclipse Desktop as Automation Grows

Moving past the experimental stage

Programmatic advertising, the use of technology to automate the buying, selling or fulfillment of ads, is becoming the standard for marketers looking to simplify the media buying process

The new eMarketer report, “Mobile Programmatic Advertising: Grabbing the Vast Majority of US Display Ad Dollars by 2017,” explores that while programmatic was originally used to effectively buy desktop banners, the process has naturally expanded to mobile. Moreover, eMarketer forecasts US mobile programmatic ad spending will reach $9.33 billion this year and account for 60.5% of total US programmatic display ad spending

Mobile might be newer to the programmatic game, but marketers have high expectations for it. A February 2015 survey conducted by RBC Capital Markets and Advertising Age found that the biggest portion of US marketers cited mobile as the channel or format expected to have the most opportunity for programmatic buying. And with many of the other cited areas—such as social, video and native—increasingly intertwined with mobile, such an opportunity is only growing

“A year ago, clients were only doing science experiments in mobile programmatic,” said Craig Palli, chief strategy officer at mobile marketing firm Fiksu. “They were checking ‘test mobile’ off of their to-do list. This year, we’re seeing the larger brands come in with millions of dollars, because they now realize that if they’re not reaching their consumers on mobile, they’re ripe for disruption for competitors.”

Facebook is playing a substantial role in mobile’s programmatic growth. With Facebook considered a largely programmatic platform and its US mobile revenues expected to total $5.89 billion this year and reach $10.32 billion by 2017, its direct contribution to total US mobile programmatic digital display ad spending will be significant. However, eMarketer also anticipates that Facebook will play a secondary role in fuelling the growth of mobile programmatic ad spending as both mobile web and app publishers increasingly look to redesign their sites in the style of Facebook’s popular in-feed units

Another key aspect to mobile programmatic’s advancement is video, which will exhibit swift growth over the next 24 months, albeit starting from a small base of just $1.14 billion, or 12.2% of total US mobile programmatic display ad spending. By 2017, that number will reach $3.79 billion, but its share will still remain small, at 18.5%

Though these numbers may seem extremely conservative to the many who are bullish on mobile video growth, it’s important to note that eMarketer’s definition of digital video only includes in-stream video ads (pre-, mid- or post-roll) and does not include many of the fast-growing a types often lumped into the digital video ad category, such as native video or in-feed video

Page 13: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Programmatic Video Ad Spend- EuropeEurope's Programmatic Video Ad Revenues Will Near €2 Billion in 2020

Media owners projected to see revenues up 39% each year

Revenues from programmatic video ads are set to rocket in Europe during the next five years, according to a new report, "Video Advertising in Europe: The Road to Programmatic Ubiquity." Conducted by IHS for the video inventory management firm SpotX (formerly SpotXchange), the study followed initial research two years ago. Where the earlier survey covered just the EU-5—France, Germany, Italy, Spain and the UK—the 2015 edition was extended to several other markets, including the Nordics, Switzerland, and Central and Eastern Europe (excluding Russia)

Because the study focuses on media owners' revenue from programmatic video advertising, not on demand-side spending, it sizes national markets by net income after costs and fees. IHS interviewed media owners, industry bodies, agencies, technology companies, advertisers and other players, combining those insights with information from its proprietary database and third-party sources to produce forecasts through 2020

According to those estimates, programmatic video ad revenues in Europe will reach €375 million ($498 million) in 2015 and rise to €1.967 billion ($2.610 billion) by 2020—an average annual growth rate of 39.3%. This year, programmatic is expected to account for 16.8% of all video ad income in the region. In 2020, an estimated 51.4% of video ad revenues will be generated programmatically

Of all the countries IHS investigated, the Netherlands was most advanced, in terms of the share of video ad revenues produced via programmatic; that proportion will reach 34.2% this year. The UK and France ranked second and third by that measure, with 22.8% and 18.6%, respectively, of revenues from video ads expected to come from programmatic sales in 2015

The UK is by far the largest market, though—with net programmatic video ad revenues heading for €135 million ($179 million) this year. No other regional market will be worth more than €67 million ($89 million), the study concluded

About the UK's leading position in the region, the report commented: "Many UK publishers have been early in building digital business models and possess strong in-house skills. ... The majority of growth in the next five years will come from broadcaster video moving to programmatic. ...Alongside this, further growth [will come] from a changing structure in the programmatic market towards private marketplaces and programmatic direct deals.

The combination of strong technological literacy, a large presence of players and a lot of premium inventory means that the UK will lead the development in Europe to a diversified portfolio of programmatic transaction types. We expect the UK to slowly close the gap [with] the US, where programmatic video will exceed 60% of the video market by 2019, compared to 2020 in the UK."

eMarketer has also predicted an explosion of programmatic ad activity in the UK—though that analysis looks at advertiser outlays, not media owners' revenues. According to our first-ever forecast for UK programmatic digital display ad spending, advertisers there will invest £1.80 billion ($2.96 billion) in such ads this year—66.2% more than in 2014—and that sum will rise to £2.46 billion ($4.05 billion) in 2016

Page 14: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Programmatic Ad Spend- USU.S. spending will rise by 43% this year, to $7.7 billion

When Interpublic Group announced an ambitious plan to automate at least half of its ad buying by 2016, many in media rolled their eyes. It was 2013, and automated buying had not yet been widely embraced. Many people didn’t evenunderstand the term programmatic

But fast-forward to the present day, and IPG’s goal no longer appears out of reach. Automated buying has caught on more quickly than anyone imagined, and it will define the coming years of media buying, saving clients and agencies money as more and more tasks once handled by people get turned over to machines

Indeed, the newest forecast for programmatic spending, defined as all automated ad buying, is quite rosy

Magna Global predicts that U.S. programmatic spending on digital advertising will soar by 43% this year, to $7.7 billion, accounting for more than half of global programmatic dollars

That includes a 104% increase for mobile, with about a third of all programmatic dollars going there

The majority of this spending, about 80%, will be allocated to real-time bidding, where buyers can use an auction to bid on pricing for an impression. The highest bidder wins, and there’s no personal interaction between buyer and seller

This method of buying has obvious benefits for agencies. It’s cost-effective because buyers spend less time negotiating deals, freeing them up for other things

But as you might expect, some buyers have objected to the loss of the personal touch they consider vital to the art of media

Still, there’s no question programmatic is the future of media buying, and not just in digital. It’s being used more widely across all media, including TV, radio and even print

Right now, it accounts for about a third of all display and video spending, but by 2019 it will make up more than half

Source: MediaLife, October 2015

Page 15: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Online Audience Trends In this section – UK PC and Multi-Platform (M-P) universe, audience trend, devices access and audience

‘engagement’

Key findings

• The Multi-Platform universe remains steady at just under 48 million unique users, compared to 45 million PC users

• Almost three quarters of users are accessing the internet from multiple devices (72%) and this multiple device usage is resulting in significantly higher composition – 58% more pages viewed, the equivalent of an extra day and a quarter online and 50% more pages per visitor

• Magazine style content various considerably from the internet norm with third of it’s audience accessing exclusively from mobile or tablet devices, this content actually also has low multiple device access, perhaps reflecting access from a PC at work and switching to mobile or tablets elsewhere

• Reach for newspapers on mobile and tablet is typically double that of PC, views per visit are roughly the same and dwell time various by title reflecting the publishing layout or depth of content

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UK Online UniverseTotal UK PC Internet Audience – September 2015

45.4 million 34.0 million 124 billion 30.1 hours 2,735 pages 69.0 visitsTotal Unique

VisitorsAverage Daily

Visitors Total Pages Viewed Average Hours per

VisitorAverage Pages per

VisitorAverage Visits per

Visitor

47.9 millionTotal Unique

Visitors

Total UK Multi-Platform Internet Audience – September 2015

195.4 billionTotal Views

Source: comScore MMX Multi-Platform, October (September data) 2015, UK, PC 6+ and Mobile 13+*MMX MP includes PC browsing, PC video streams, mobile browsing & apps (on-network only for untagged apps), tablet browsing & apps for tagged sites & apps.

4,077 pagesAverage views per

Visitor

89.5 hoursAverage Hours per

Visitor

Note: January saw a change in methodology for mobile measurement which filters through to Multi-Platform

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UK Online Universe

30,000

32,000

34,000

36,000

38,000

40,000

42,000

44,000

46,000

48,000

50,000

Un

iqu

e v

isit

ors

(0

00

s)

MB/TB Only PC Only Multi-Platform

Non PC traffic adds, on average across period, around 3m unique users to site audience

Source: comScore MMX Multi-Platform, October (September data) 2015, UK, PC 6+ and Mobile 13+*MMX MP includes PC browsing, PC video streams, mobile browsing & apps (on-network only for untagged apps), tablet browsing & apps for tagged sites & apps.

Methodology break(GSMA MMM to MoMX)**

**more information on MoMX can be found at comScore.com in their insights, press release section

Page 18: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Device contribution to audience categoryAugust MMX Multi-Platform

52.2

52.9

36.2

5.2

12

15

39.9

72

35.7

32.1

23.9

22.8

Lifestyle - home

Lifestyle - beauty/fashion/style

Newspapers

Total Internet

PC Only PC/MB/TB MB/TB Only

%

Source: comScore MMX Multi-Platform, October (September data) 2015, UK, PC 6+ and Mobile 13+*MMX MP includes PC browsing, PC video streams, mobile browsing & apps (on-network only for untagged apps), tablet browsing & apps for tagged sites & apps.

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47.2

6.2

13.1

13.7

19.3

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

0.0 2.0 4.0 6.0 8.0

reac

h %

average views per visit

Site audience by engagement (selected sites)

September MMX Multi-Platform

Bubble size represents average minutes per visitorEntities used; mail online (p), mirror online (m), the guardian (p), thetelegraph.co.uk (m), the sun online (m)

Source: comScore MMX Multi-Platform, October (September data) 2015, UK, PC 6+ and Mobile 13+*MMX MP includes PC browsing, PC video streams, mobile browsing & apps (on-network only for untagged apps), tablet browsing & apps for tagged sites & apps.

45.1

8.318.3

9

21.4

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0

reac

h %

average views per visit

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Media Category Analysis

In this section – UK internet visits to key media categories

Key findings

• Online video continued its recent upward trajectory growing 8.5% month on month and now attracts 11% more visitors than at this point in 2014

• The broader News and Media experienced a slight slowdown (-2.1% month on month) but still stands over 20% up on last year, whilst the actual Print sector performed well increasing monthly traffic by 2.5% to deliver an impressive 25% grow on 2014

• Social Networks has a strong monthly performance and surpassed News & Media, possibly driven by events such as Rugby World Cup. Traffic into News and Media also saw a significant spike from search engines in addition to Social Networks – again probably linked to events

• Traffic to Print titles experienced the same upturn with the main referrer growth coming from search

Page 21: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

UK internet visits to key media categoriesbased on market share of all UK online visits

UK Internet visits to key media categories

Source: Experian Hitwise UK, September ‘14 – September ‘15

Category Sep-15 Aug-15Monthly

changeSep-14 Yearly Change

News and Media 10.35% 10.57% -2.1% 8.43% 22.8%

Community Directories and Guides 0.30% 0.30% -2.3% 0.24% 25.8%

Online Video 3.37% 3.11% 8.5% 3.04% 10.9%

Social Networking & Forums 10.72% 8.68% 23.5% 10.30% 4.1%

Print 4.47% 4.37% 2.5% 3.56% 25.6%

Blogs and personal websites 1.29% 1.56% -17.4% 1.19% 8.3%

Page 22: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Growth of UK visits to News & Media, Social Networking and Blog Sites

Source: Experian Hitwise UK, September ‘14 – September ‘15

Page 23: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

UK traffic to and from News & Media from Search, Social Networks and other News & Media sites

Categories delivering traffic to News and Media

Categories receiving traffic from News and Media

Source: Experian Hitwise UK, September ‘14 – September ‘15

Page 24: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

UK Traffic to Print websites

UK Traffic to Broadcasters websites

UK traffic to Print and Broadcaster sites from Search, Social Networks and News & Media sites

Source: Experian Hitwise UK, September ‘14 – September ‘15

Page 25: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Trends in Key Interest AreasIn this section - 1st Party Data, Media Time, Audience, Video, Ad blocking, Marketers

Priorities, Programmatic, Ad Fraud, Round up

Key findings

• 1St Party data– First-party data could prove to be the future of online display advertising, 38% say the ability to use third-party data to instantly create custom

segments would be highly valuable (eConsultancy, October ‘15)

• Media Time– Digital set to take majority share in UK time spent with media in 2016, mobile will account for 25% of time spent with media in the UK this year

(eMarketer, October ‘15)

• Audience– More than 70% of advertisers worldwide are at least somewhat likely to include audience extension in ad campaigns…but audience extension

does not appear equally important on the publisher side of the equation (eMarketer, October ‘15)

• Video– Video behaviors shift as multiscreen usage progresses - video habits steadily moving to mobile (eMarketer, October ‘15)

• Ad Blocking– Two thirds of UK publishers named ad blocking as a significant threat (AOP, October ‘15)

– 15% of British adults use ad blocking software - men and 18-34s most likely to block ads (IAB, October ‘15)

– Ad blocking grew by 41% globally in the last 12 months (eConsultancy, October ‘15)

• Ad Fraud– Big publishers’ fraud rate is 2.8%, wider web’s is 11% (WSJ, October ‘15)

• Round Up– 22% of people use more than one ad-avoidance technique on mobile (eConsultancy, October ‘15)

– 100% of 15-34 year olds in the UK use YouTube every month (eConsultancy, October ‘15)

– UK online ad viewability rises above 50% (eConsultancy, October ‘15)

Page 26: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

1st Party DataFirst-party data could prove to be the future of online display advertising, according to our new report Digital Publishing: Increasing Advertiser Value Through Data and Identity

The scenario describes what happens when advertiser first-party data is used to build custom segments, allowing advertising that is specifically matched to the customer and their situation.

Example: An airline sharing CRM data on loyalty program members, enabling publishers to target customers browsing competitor brands with re-engagement ads

As you can see, 38% of respondents say the ability to use third-party data to instantly create custom segments would be highly valuable, while 39% say it would be quite valuable and 16% somewhat valuable

This scenario explores the possibilities that could arise if first-party data was rapidly on boarded. The advertiser’s data identifies in-market customers while the publisher’s reach ensures the conversation continues

Example: An automaker collecting live intent data through the behaviour or attributes of a customer designing a car on its website, then instantly uploading that data to an automotive publisher to target those shoppers with special promotions

38% of respondents say this ability would be highly valuable, 35% quite valuable, and 23% somewhat valuable

This scenario looks at how independent publishers can pool their knowledge and give advertisers the addressable audiences and scale they demand

Example: Multiple travel-related publishers partnering and sharing real-time data, allowing them all to better target the wider travel market

39% of respondents say this would be highly valuable, another 39% say it would be quite valuable, and 14% somewhat valuable.

Creating custom segmentsScenario: If you were able to on board first-party data from advertisers or partners to

instantly build out custom segments of known customers and then distribute tailored

advertising to DSP, SSP, ad exchanges or other media endpoints, would that be valuable?

Rapid On boardingScenario: If you were able to offer advertisers the ability to identify customers and real-time signals that they are ‘in-market’ right now, and activate media within minutes of recognition,

would that be valuable?

Pooling KnowledgeScenario: If you and trusted publishers/partners

were able to securely share 'in-market' addressable audience segments to significantly

increase the share of available and known customers, would that be valuable?

Page 27: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Media TimeDigital Set to Take Majority Share in UK Time Spent with Media in 2016

Mobile will account for 25% of time spent with media in the UK this year

The amount of time UK adults spend with digital devices and platforms continues to grow rapidly, with UK consumers spending an extra half hour every day on such devices this year compared to last year, according to eMarketer's latest estimates of media consumption in the country. In 2015, total media consumption time in the UK is expected to reach 9 hours and 31 minutes, with digital accounting for a 48.7% share. This figure is set to increase to 51.5% next year

Consumers in the UK have been quick to take their media consumption habits onto digital platforms and channels—and increasingly to mobile ones. This rapid increase of digital has been chiefly the result of a surge in time spent with various mobile devices among UK adults. While time spent online via desktop or laptop computers has risen minimally over the past several years—and is expected to see year-over-year growth of just 3 minutes for 2015—growth in time spent with mobile devices has been much more vigorous

“UK consumers already have a pretty packed media day, but mobile use is clearly filling in any gaps,” said Bill Fisher, analyst at eMarketer. “The rapid rise in time spent with mobile comes as no surprise. With each new smartphone or tablet release, the computing capabilities of these mobile devices improves, and consumers are clearly putting them to good use.”

eMarketer estimates UK adults' average total daily mobile time will reach 2 hours 24 minutes this year, up 27 minutes from 2014 and an almost fivefold increase from 2011, when that figure stood at just 31 minutes. As a result, total time spent on non-voice mobile activities will surpass time spent on desktop or laptop computers by 10 minutes, the first time mobile will have overtaken PC use by this metric

Within the mobile category, smartphones continue to account for the largest share of time spent. As a proportion of UK adults' total media time in 2015, smartphoneswill account for 16.5%, or 1 hour 34 minutes

Time spent with tablets will continue to lag time spent with smartphones. In 2014, tablets accounted for 6.6% of UK adults' total media time—half the proportion for smartphones. eMarketer estimates that tablet time will stand at 7.7% in 2015— 8.8% behind smartphones' 16.5 % share

Tablets' rising prominence will also be reflected in growth figures for average time spent. This year, the amount of time UK adults spend with tablets will expand 22.3% over 2014, eMarketer estimates. This will be slower than the growth in smartphone time spent 26.6%, due to the growth in smartphone screen size, prevalence in 4G availability and consumer adoption of media suitable for more smartphone usage. This will also mark a slowdown in the emphatic tablet time growth seen over the past four years, reflecting maturation in tablet penetration

Page 28: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

AudienceAre Publishers Missing Out on Audience Extension?

A change in platform usage may be in order

More than 70% of advertisers worldwide are at least somewhat likely to include audience extension in ad campaigns, according to August 2015 research from Digiday and Rocket Fuel. But audience extension does not appear equally important on the publisher side of the equation

According to the Digiday and Rocketfuel polling, 47% of advertisers devote somewhere between 1% and 25% of their advertising spending to audience extension. Nine percent spend 26% to 50%, and 14% spend 51% to 75%

However, only 47% of publishers derive revenue from plans involving audience extension, and of those that do, the majority only realize 1% to 20% of their total revenue from the channel. And given that 94% of advertisers spend money on audience extension, it's notable that 53% of publishers gain no revenue from it

All three of the most common platforms used—in-house networks, integration with ad servers, and third-party ad networks—display a shared pattern: decline

While third-party ad networks have declined most rapidly, from 57% used in 2013 to 25% in 2015, in-house networks have also dipped from 39% to 31%, and ad server integration has shrunk from 38% to 31%

And 2016 provides an even bleaker outlook for these platforms: Only 18% of respondents said they would use an in-house network

The report pointed out that publisher abandonment of these platforms could lead to a window for greater adoption of demand-side platforms and data management platforms, both of which could help publishers realize more of the ad dollars going into audience extension.

Page 29: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

VideoVideo behaviors shift as multiscreen usage progresses - video habits steadily moving to mobile

Time spent watching video on TV is still greater than on other devices. However, with the proliferation of mobile devices entering the market and multiscreen usage growing, video habits are shifting

Millward Brown, which surveyed—via smartphone or tablet—more than 13,500 16- to 45-year-old multiscreen users across 42 countries, found that half of all video viewing happens on TV sets—split between live TV and on-demand TV. The other half comprises mainly mobile devices, which includes smartphones and tablets. Smartphones take the largest digital share, encompassing 22% of total daily time spent viewing video

Breaking it down by age, daily time spent viewing video via a TV set is greatest among 33- to 45-year-olds. Smartphones, on the other hand, are the primary video viewing channel among 16- to-24-year-olds. Although this is their core video platform, this group also watches a lot of video on live TV, on demand TV and via their laptops

The rise in mobile video viewing is part of a larger transition to multiscreen usage. In fact, mobile users worldwide spend 52% of their daily internet and viewing video time on mobile phones. To compare, the share of daily time spent with computers makes up 21%, while TV accounts for 27%

Because a majority of video content out there is free, video advertising comes with the territory. And, unsurprisingly, mobile users are not very receptive to it. In the US, only 19% said they are open to digital video ads. Hence, there is work to be done to enhance the video experience. More than a third of mobile users worldwide said they would be less likely to skip digital video ads and pay more attention to them if they were funny or humorous. Other top reasons included watching an ad if it was in a category they were interested in, if it gave them something in return or if it was for a brand they were interested in

User attitudes toward video advertising are a hurdle marketers need to overcome. A separate July 2015 study from Unruly found that 81.4% of US internet users muted digital video ads. Clearly users are not fond of them, but marketers must look at ways to have users pay attention, whether by making it appealing or throughan incentive

Page 30: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Ad BlockingUK Publishers Feel Threatened by Ad Blocking - and the threat is growing

Internet users often complain about online advertising, and many have turned to ad blockers in order to do away with pop-up and banner advertising. Digital publishers, unsurprisingly, feel differently.

According to August 2015 research by the UK’s Association of Online Publishers, UK publishers are deeply concerned about ad blocking as a threat to their business

Almost two-thirds—65%—of those surveyed named ad blockers as the most significant business threat currently faced. There are other area of concern for publishers: 35% cited ad fraud, and another 35% expressed their worry about brands and agencies creating content. But with such a strong response to the threat of ad blocking, it’s worth exploring their attitudes in-depth

Not only do UK publishers worry about ad blocking, but they’re thinking about ways to counter it. With 35% seeing ad blocking as a growing threat that impacts business, another 27% are considering tactics like paywalls and registration. Another 23% see ad blockers as at least a minor challenge, so it’s clear that ad blocking is on the minds of many publishers

On the positive side for publishers, ad blocking is less popular in the UK than many other European countries—though it’s also more widespread there than in the US

With the advent of ad blockers and consumers’ wide embrace of them, publishers and advertisers alike will have to come up with solutions or workarounds while retaining their audiences

Page 31: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Ad BlockingInternet users in the US block ads less than in Western Europe - younger internet users more likely to block ads worldwide

Ad blocking is a headache for just about all the players in the digital media ecosystem. The issue has risen to the forefront of many analysts’ mind due to iOS 9 making ad blocking available on many mobile devices for the first time, but US publishers and advertisers can perhaps take comfort: The country has among the lowest ad blocking rates in the world

comScore and Sourcepoint found in June 2015 that desktop internet users in France were more likely to use ad blocking software than those in any other country studied, at 27%. Germany was No. 2 in ad blocking, at 24% of unique desktop site visitors, and Canada came in third at 16%. The US was at the bottom of the list, with just 9% of unique visitors blocking ads

The low US rate of ad blocking held true across age groups, as well—as did most other rankings. In all countries studied, 18- to 24-year-olds were more likely to block ads than any other group. In the US, the proportion of ad blockers rose to 16.2% among this cohort, less than half the rate in France or Germany

The US was also least likely among countries studied in July to block ads on mobile devices. A tiny 0.1% of total page views on smartphones and tablets in the US blocked ads. Mobile ad blocking rates were low in Western Europe as well. Mobile internet users in India and China were far more likely to block ads—though it was still rare

The US was also least likely among countries studied in July to block ads on mobile devices. A tiny 0.1% of total page views on smartphones and tablets in the US blocked ads. Mobile ad blocking rates were low in Western Europe as well. Mobile internet users in India and China were far more likely to block ads—though it was still rare

Q1 2015 research from GlobalWebIndex also found higher rates of ad blocking in Europe. Among internet users ages 16 to 64, 29% had blocked ads on their main PC over the past month. That compared with 27% in Asia-Pacific and 26% in North America

In June 2015 research covering the EU-5, Adobe and PageFair found that Germany had the highest rates, at 25.3% of internet users, followed by the UK, at 21.1%. That research put France at the bottom of the pile, with a comparatively low 10.3% of internet users blocking ads

Like comScore and Sourcepoint, GlobalWebIndex found significant variation in ad blocking depending on the age of the internet user. In Q2, GlobalWebIndex also found that male internet users were 8 percentage points more likely than females to block ads

While some patterns seem to hold true, like higher rates of ad blocking among younger users, differences in methodology make it difficult to determine which specific markets have higher or lower rates of ad blocking—though Europe does appear above average in this department

Page 32: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Ad Blocking – round up15% of British adults use ad blocking software

Almost one in seven British adults are currently using ad blocking software, according to the Internet Advertising Bureau (IAB) UK Ad Blocking Report conducted by YouGov

The main reason cited for blocking ads was that people found them interruptive or annoying

Men and 18-34s most likely to block ads

The IAB report also found that men were twice as likely to block ads as women: 22% of men vs. only 9% of women

34% of 18-24 year olds say they block ads vs. only 19% for 25-34 year olds. Regionally, people in Scotland and the north of England (both 19%) are most likely to be blocking ads

Only half of ad blockers do so to block all ads

Despite these high figures, the IAB report found that only around half (52%) of those who use ad blockers do so to prevent all ads from showing

12% say they use the software to block certain types of ads, while 11% only use it to block ads from certain websites

Less than half of British adults aware that ads fund free content

Only 44% of British adults online are aware that most websites are free thanks to advertising revenue, according to the IAB report

Men (52%) are more likely to be aware of this than women (36%), and 18-24 year olds (59%) more so than people over 55 (36%)

Two thirds (66%) of respondents would still prefer to access free content and have no ads, while just one in five (21%) prefers free content in return for having ads

Source: IAB as reported by eConsultancy, October 2015

Page 33: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Ad Blocking – round upAd blocking estimated to cost publishers nearly $22bn globally in 2015A joint report by PageFair and Adobe, titled 'The cost of ad blocking', found that the rise of this type of software costs the worldwide publishing industry nearly $22bn every year in lost revenue

Ad blocking grew by 41% globally in the last 12 monthsIn terms of ad blocking growth, the same study from PageFair and Adobe found the following:

• UK ad blocking grew by 82% to reach 12m active users in 12 months up to June 2015• In Europe it grew by 35%, increasing to 77m monthly active users• In the US it grew by 48% increasing to 45m active users

Austria and Hungary the most prolific ad blockersClarityRay audited more than 100m impressions across several top-tier publishers in the US and Europe to assess the pervasiveness of ad blocking softwareKey findings include:

• On average, 9.26% of impressions were found to be ad-blocked, with some sites reaching as high as 50%• Tech sites average at 17.79%, followed by news (15.58%) and culture (9.94%). Business, real estate and travel sites average lower• Ad blocking is higher in the US and EU: top countries are Austria (22.50%), Hungary (21.52%) and Germany (19.44%). Average in the US is 8.72%• Blocking rate is found to be highest among Firefox users (17.81%), followed by Safari (11.30%) and Chrome (10.06%). Explorer averages at 3.86%• Linux users have a staggering 29.04% blocking rate, compared with 12.95% for Mac users, and 9.25% for Windows users• Mobile blocking is gaining popularity: Android shows a 2.24% blocking rate, and iOS 1.33%

Blocking ads improves mobile site performanceThe New York Times recently ran tests on iPhones using three different ad blockers, and reported that for sites containing mobile ads with a lot of data the load times accelerated significantly with ad blockers turned on

Blocking ads also improves mobile battery lifeThe same study by The New York Times also found that battery life on the iPhone improved significantly with ad blocking software enabled

Source: Various sources as reported by eConsultancy, October 2015

Page 34: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Marketers PrioritiesWhich three channels are the biggest priorities for marketers?

More than half (57%) of marketers say their company website is the most important marketing channel, closely followed by email, with 48%.

As spending on traditional print media declines, marketers are increasing their investment in digital channels. Digital media spend is expected to account for almost a quarter (24%) of worldwide advertising by 2016

It is hardly surprising that website and email are still such a high priority for marketers given that these channels have historically been fundamental to any digital marketing strategy

But social media marketing wasn't too far behind with 42%, showing just how significant this channel has become. Even more interesting is the fact that respondents rated social media as offering the greatest opportunities over the coming year

Website - The increasing importance of mobile-optimised websites has led many brands to revisit their desktop site to see how it works as part of a coordinated multichannel strategy

Marketers recognise that they’re building more than just a website. They have to think about the entire customer experience and make sure the website content is useful and consistent with the wider brand, as well as being properly search-optimised.Not only that, but the website is often the first experience a consumer will have with a brand, so it needs to provide a coherent customer journey from the start. Bearing all this in mind, website management is clearly an ongoing process with multiple factors involved. It therefore makes sense that marketers would cite this as their biggest priority

Email - Despite the growth of social media and instant messaging platforms, email continues to thrive. The number of worldwide email users is approximately2.6bn and is expected to grow to over 2.9bn by 2019.When managed effectively, email represents one of the most direct and personalised ways to communicate with existing and potential customers.Another Econsultancy report found that 66% of companies rate email as either ‘excellent’ or ‘good’ in terms of return on investment.

Social media - While our survey respondents cited social media as the third most important channel, it was rated number one in terms of channels thatoffered the greatest opportunities over the next year.Website and email came joint second on this question, with 37% each, while traditional media channels such as TV, direct mail and newspapers were virtually ignored

Clearly marketers continue to view social media as an excellent channel through which to engage with consumers.

And with figures from Statista predicting the number of social media users will rise from 1.79bn to 2.44bn globally by 2018, this channel’s importance is sure to keep growing

Q: Which three marketing channels are the biggest priorities for your organisation over the next year?

Q: Which three marketing channels offer the greatest opportunities over the next year?

Page 35: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

ProgrammaticPublishers That Say No to Automated Ad Sales

Some websites believe they can make more money on their own and reduce annoyance

Justin Stefano and Philippe von Borries, founders of fashion and lifestyle site Refinery29, are among a growing band of Web publishing rebels—not because of any edgy or controversial content they produce, but because of how they sell ads

Almost every publisher on the Web now teams up with “ad tech” firms, specialists in software that automates ad sales. Most media industry executives consider it a must to employ such brokers, the “networks” and “exchanges” that serve as middlemen in the roughly $60bn online advertising marketplace

But Refinery29 and a host of other new-media companies—among them, Vice Media, Vox Media, BuzzFeed and Mic—are bucking that approach, arguing that automated ad technologies are to blame for overrunning the Internet with too many ads and obnoxious tracking mechanisms

“Consumers are tiring of disruptive ad experiences across the board,” Refinery29’s Mr. Stefano said. “The way people use ad tech is very toxic for a user.” Thesepublishers are opting to build their own technology to sell ads directly rather than employing third-party ad tech firms

Mic, a youth-focused politics and culture site, offers its own customized formats like oversize banner ads and “sponsored content” created for brands. With 12 people on its sales staff, the firm has generated about $10mn in ad revenue since it began selling ads last year, said a person familiar with the matter

Of course, in doing this, publishers risk missing out on revenue, particularly as big marketers shift more of their spending to automated ad placement. “At some point all these publishers will capitulate to ad tech or they will not have ads,” said Jonathan Mendez, founder of Yieldbot, which helps publishers manage data

But advocates for eschewing ad-tech partners point out that they don’t have to share the proceeds or give others access to their audience data. Some 55% of such “programmatic” ad spending in the U.S. in 2014 went to middlemen, not publishers, according to the Interactive Advertising Bureau

“We looked at what ad tech looked like three years ago or so, and we saw that the experience was bad for users and didn’t look like it worked well for advertisers anyway,” said Chris Altchek, Mic co-founder. “Even if you do it and did it really well, you still don’t make a lot of money.”

Generally, ad-tech companies offer a range of services that fall under the umbrella of programmatic ad technology. Ad exchanges such as OpenX and SpotX use computer algorithms to buy and sell Internet ad space in milliseconds, while firms like AppNexus and Rubicon Project give publishers electronic tools to sell ads and manage inventory

Ad-tech firms say they have made the process of buying online advertising more efficient and precise. Brands can place orders with fewer meetings and phone calls, and target specific Web surfers. Spending on such automated display ads in the U.S. is projected to jump 37% next year to more than $20 billion, according to eMarketer

Mr. Stefano at Refinery29 acknowledges that some level of advertising technology is vital for a Web publisher because “you can’t hand craft ads onto 100 million Web pages.” But he is hesitant to put the company’s ad space and consumer data into the hands of third parties. Refinery29 instead focuses on curating its advertising, selling ads directly to big brands like Macy’s

Source: WSJ, October 2015

Page 36: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Ad FraudBig Publishers’ Fraud Rate is 2.8%, Wider Web’s is 11%, Studies Say

Fraudulent traffic is a problem that continues to plague the digital advertising industry, particularly with ads purchased from online advertising networks or automated ad exchanges, buyers say

As a result, well-known media companies are eager to distance themselves from the issue, and to use the relative lack of fraud on their sites to help differentiate their ad offerings in the market

To evaluate the quality of traffic to its members’ properties, online publishing trade group Digital Content Next commissioned ad fraud detection firm White Ops to study 32 of its members’ sites for 53 days, from June 22 through August 14. DCN participants included Conde Nast, ESPN, Vox Media, CBS Interactive, NBC Universal, the New York Times and more

The goal was to compare fraudulent traffic to its members’ sites with that present in the wider online ad ecosystem, which was last year examined by a separate White Ops study

According to DCN’s study, “sophisticated bots” accounted for an average of 2.8% of traffic to display ads across its members’ properties, and 2.5% of traffic to video ads

Bots are computer programs used to simulate real users. They are sometimes used by fraudsters to trigger ads illegitimately for a profit

By comparison, the ANA’s study found bots accounted for an average of 11% of traffic to display ads in participating advertisers’ campaigns, and 23% of video ads

In other words, traffic to DCN’S member sites is relatively “fraud-free” compared with the overall online ad market, the White Ops reports found.

“The difference in levels was significant,” said Jason Kint, DCN’s chief executive. “From our perspective it backs up the definition of premium, and the importance of the policies and practices of our members.”

The two studies were conducted months apart, but White Ops CEO Michael Tiffany said he believes they still offer an “apples-to-apples” comparison, and therefore expose a material difference in traffic quality between “premium” sites and the bulk of the sites across which most advertisers now buy advertising inventory

“It’s interesting that these guys are now trying to define ‘premium’ as a category as ‘bot-free,’” Mr. Tiffany said. “That’s the world we’re living in; it’s a selling point.”

Despite the results of the DCN study, Mr. Kint said he’s urging his member organizations not to get complacent. “The results are compelling, but this is not the finish line,” he said. “The trust that [member publishers] have in their brands and what defines premium is something they earn every day.”The study found that bot rates for individual DCN member sites ranged from 1.6% to 6.9%

Source: WSJ, October 2015

Page 37: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Round Up22% of people use more than one ad-avoidance technique on mobileA new report from BuzzCity has highlighted attitudes towards ads and ad blocking techniques across various different mediums.

36% of people say there are too many ads while 30% complain about seeing the same ads too often.Key findings include:• 30% changing channels on the TV or radio to minimise exposure to ads.• More than a quarter (28%), pay to avoid ads, subscribing to Pay TV or Video on-demand services.• 26% use browser pop-up blockers when online.• Internet ad-blocking software is used by 26% of respondents when online.• Direct mail is discarded by 24%

100% of 15-34 year olds in the UK use YouTube every monthThis is according to the latest Comscore Mediametrix report. And here are more of the latest YouTube stats:• Watch time in the UK is growing at 60% year-on-year (Source: Google Internal Data).• More than a quarter of YouTube viewers say that researching a product to purchase is a trigger for going to the site (Source MTM: UK YouTube Audience Report 2015).• Approximately 30% of the parent brands that bought Google Preferred in the UK were new to YouTube (Source: Google Internal Data).• For our top 100 advertisers in the UK, spend per advertiser on YouTube Video is up more than 60% from 2014 (excludes Q3 '15 data)

Instagram growing rapidly, but interaction rates droppingQuintly has just released its Instagram Study Q2 report, highlighting some interesting stats about usage habits on the site between the first and second quarters of 2015.Key findings include:Post frequency: grew from an average 0.89 to 1.11 times per day.Audience growth rate: 17.7% during Q2.Interaction rate: dropped considerably on Instagram.Video/image distribution: videos rose during Q2 to 10.23%, which is a growth of more than four percentage points

UK online ad viewability rises above 50%The level of online ad viewability in the UK rose from 49% in Q2 to 52% in Q3, according to a new report from European ad verification company Meetrics.

In Q3 2015, 52% of online ads served in the UK met the IAB and Media Ratings Council’s recommendation that an ad is considered viewable if 50% of it is in view for at least one second.Viewability in the UK is still well below that of Germany (even though levels there dropped from 64% to 61%) and France (with a huge rise from 62% to 69%)

Page 38: Digital Landscape Report - AOP · 2019-02-12 · • U.S. programmatic spending will rise by 43% this year, to $7.7 billion (MediaLife, October 2015) Almost three quarters of users

Round UpIAB To Offer Publishers New Tools Against Ad Blockers

The Interactive Advertising Bureau will offer small publishers new tools that could help them combat ad blocking, the organization said on Tuesday

The mechanisms aim to help publishers determine whether their visitors are using ad blockers, and if so, send those people messages related to ad blocking and its effect on publishers

"What we're saying to publishers is experiment. We're not backing any one solution," Scott Cunningham, IAB senior vice president for technology and ad operations told reporters on Tuesday

One possibility is that publishers could ask visitors to turn off ad blockers in exchange for content. A study conducted by the IAB last year found that 60% of the people who use ad blockers would turn them off in order to access content

Not all publishers say they agree with this approach. Rick Jaworski -- who is proprietor of the site JoyOfBaking.com and a member of the IAB's "Long-Tail Alliance" of small online publishers -- said on Tuesday that he hasn't yet decided whether to send messages about ad blockers to visitors who use them

Jaworski estimates that 10% of the visitors to JoyOfBaking.com do so. A recent study by Adobe and PageFair (which says it can help publishers "restore blocked ad inventory") found that 45 million U.S. Web users, representing 15% of Web users in the country, now deploy an ad blocker

The IAB's new offerings for small publishers are part of a larger industry initiative against ad blocking. Other components include a call to reduce clutter and use "nondisruptive" and "noninvasive" ad formats. The IAB also unveiled a new Web site section, www.iab.net/adblocking, dedicated to its efforts against ad blocking.

"The IAB strongly opposes ad blocking," says Cunningham, who characterizes the battle between publishers and ad-blocking companies as a "war between engineers."Cunningham says the IAB is still considering legal options against ad blockers, but hasn't yet reached any decisions