Digital Transformation or Disruption? - DSPs, Digital Advertising, and the Changing Role of the...
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Digital Transformation or Disruption?DSPs, Digital Advertising, and the Changing Role of
the Agency
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© 2010 DataXu, Inc. Privileged & Confidential
Agenda
• Introductions• Industry Overview• DSP Learnings & Key Requirements• RTB & Premium Inventory• Branding vs Performance • Success Stories• Q&A with panelists
2
© 2010 DataXu, Inc. Privileged & Confidential
Participants
3
Mike Baker, CEO
Michael Jenkins, Sr. Communication Strategist
Steve Weeks, Sr. Manager of WW Advertising
Ben Trenda, VP of REVV Marketplace Development
© 2010 DataXu, Inc. Privileged & Confidential
Agenda
• Introductions• Industry Overview• DSP Learnings & Key Requirements
4
Mike Baker, CEO
The Evolution of Online Media Buying
Direct from Publishers
1996
Ad Networks
1998
Ad Exchanges
2005
DSPs2009
© 2010 DataXu, Inc. Privileged & Confidential
Demand Side Platforms
What is a DSP?
DSPs are media buying tools that help buyers aggregate, bid on, and optimize digital inventory across ad exchanges and yield management platforms.
Advertiser Benefits:
Improves display ROI
Reduces display cost
Generates data-driven consumer insights
© 2010 DataXu, Inc. Privileged & Confidential
The Role of a DSP
Advertiser
Ads Placements
PublisherAgency
Consumer data aggregators
Audience
Online videoexchanges
Online displayexchanges
Mobileexchanges
© 2010 DataXu, Inc. Privileged & Confidential
DSPs
© 2010 DataXu, Inc. Privileged & Confidential
Your buyers are moving targets
YESTERDAY’S CONSUMERS…
• Passive media consumers• Static in place and time• Analog and settled
YOU NEED TO…
• Go where your audiences go• Break through scale limitations• Span display, mobile, and video
TODAY’S CONSUMERS…
• Active content co-creators• Fragmented in space and time• Digital and nomadic
© 2010 DataXu, Inc. Privileged & Confidential
1st generation DSPs were a step in right direction
AUDIENCE BUYING
RETARGETING
BENEFITS:•Better ROAS•More control•More efficient•Represent buy-side interest
LIMITATIONS:•Fixed rule buying•Poor scalability of retargetingand audience buying•Cost effectiveness
© 2010 DataXu, Inc. Privileged & Confidential
AUDIENCE BUYING
RETARGETING
The biggest problem with 1st gen DSPs: SCALE
LIMITED by the number of cookies you can buy
LIMITED by the number of people who come to your site
AUDIENCE DISCOVERY
REACHES ALL CONSUMERSUse insights from your own data to scale across display, mobile and video
© 2010 DataXu, Inc. Privileged & Confidential
sd
DataXu’s Next Generation Platform
1.LEARNS FROM WHAT’S WORKING2.
BUYSMEDIA ACROSSCHANNELS AND FORMATS 4.
DECIDESWHAT CONSUMERS, CONTEXTS, CREATIVES, AND PRICE3.
MEASURES CONSUMER BEHAVIOR
Why Dynamic Decisioning Matters
© 2010 DataXu, Inc. Privileged & Confidential
Learning: Price Volatility Favors Dynamic Bidders
Results:Persistent price volatility is enabling advertisers to capture high value at low cost. Over 100% volatility --10 times higher than NASDAQ’s
Conclusion:Dynamic decision systems that adjust in real time can boost performance
Challenge:Decide, in real-time what ads to buy, adjusting to extreme price variation
© 2010 DataXu, Inc. Privileged & Confidential
Learning: Creative Optimization is Key
Challenge:Maximize campaign performance, targeting across Creative, Consumer and Context
Results:Deciding on right creative for each ad was most important on 48% of the campaigns
Yet, on a significant number of campaigns, it was either Context or Consumer
Conclusions:Best approach is to use the data, and automatically adapt
One-size-fits-all, rigid approaches are always doomed A global optimization approach balances all three domains
at once
© 2010 DataXu, Inc. Privileged & Confidential
© 2010 DataXu, Inc. Privileged & Confidential 15
Learning: Optimization offers efficiency at scale
Challenge:Optimize media buys to find the right media at the right price
Results:The cost of media for Audience Targeting is 3X more expensive than ROE• But effectiveness as measured by CPA was 2.7X
better for Optimized ROE than for Audience Targeting
Conclusions:Optimized Run-of-Exchange campaigns have a much lower cost of media• Audience Targeting leads to multiple buyers bidding for a relatively small number of
impressions• Retargeting lists are limited in size and unable to scale
© 2010 DataXu, Inc. Privileged & Confidential 16
Learning: Effective Campaigns are built on “Brand Genomes”
Challenge:Build a campaign that is “brand unique” instead of “industry unique”
Results:The “brand genome” campaign drove conversion rates 2-3X higher than traditional campaign strategies• Using a competitor’s genome did
little to increase conversions
Conclusions:To drive optimal campaign performance, your media strategy should be as unique as your brand
© 2010 DataXu, Inc. Privileged & Confidential
Agenda
• Introductions• Industry Overview• DSP Learnings & Key Requirements• RTB & Premium Inventory
17
Ben Trenda, VP of REVV Marketplace Development
© 2010 DataXu, Inc. Privileged & Confidential
What’s the Rubicon Project?the Rubicon Project is leading a revolution of the online advertising ecosystem through the innovation of a next-generation infrastructure and a powerful, open marketplace.
Leading Yield Optimization Platform
o Trusted by 350 Premium Publishers
- 33% of comScore 100 (U.S.)
- 88 of comScore 500 (Global)
- 12 of Top 15 Newspapers in the U.S.o REVV processes more than 60 billion ad
transactions per month (1 trillion+ to date)
o *Per Quantcast (#1 Rank)o 550M+ global uniqueso 600+ ad networks, exchanges, DSPso Non-Competitive (no advertiser access)o Transparent (not "black box")
Largest* Display Advertising Marketplace
Fastest growing advertising tech company:o Founded by ad server
pioneers in 2007− 250 employees− $60M funding− More than 1 trillion ads
served
o Key Acquisitions:- Fox Audience Network - OthersOnline: audience
affinity analytics - SiteScout: ad security
o Most Innovative Company, American Business Awards 2010
© 2010 DataXu, Inc. Privileged & Confidential
REVV & Publishersthe Rubicon Project has engineered a technology platform and marketplace to enable publishers to more effectively compete in today's highly-competitive market.
to access all demand
to yield optimize all inventory
Increased Revenueo Manage all sources of demando Yield optimize for highest revenue
− across all sources of demand, including RTB
o More effectively compete:- massive network effect vs. silo
Reduced Costso Eliminate unnecessary overhead:
trafficking, ad quality, management, reporting, billing, collections
Total Brand Protectiono Protect your user experienceo Protect direct sales pricing
ONE PLATFORM
ONE MARKETPLACE
© 2010 DataXu, Inc. Privileged & Confidential
RTB & Publishers
o Advertising revenue moving from offline to onlineo 2/3 of online display impressions sold on a non-guaranteed basiso RTB is nascent (“industry beta”): limited inventory, today small (but
fast-growing!) % of total spend
Notable drivers on the BUY side:
o 4 agency holding companies control > 50% of US ad spend Each has created a trading desk to fix the problems inherent in the
buying of digital media (duplication, opacity, quality, efficiency) Agencies working to move spend to trading desks Trading desks want to spend via RTB Trading desks limiting ad network access to this spend DSPs aggregating agency, advertiser & network demand
K E Y T R E N D S
© 2010 DataXu, Inc. Privileged & Confidential
RTB & Publishers
K E Y T R E N D S Notable drivers on the PUBLISHER side:
o It’s tough being a publisher today… Inventory volume is up, CPMs are down Advertisers want to buy audience, not just inventory 2 million active advertisers (how to reach them all!?) 2/3 inventory sold on a non-guaranteed basis (via ad networks,
exchanges, DSPs) – how to optimize all those sales channels?
o So publishers are watching the media buying landscape carefully:
Programmatic buying will be increasingly important Agency-originated non-guaranteed spending starting to become
concentrated within trading desks— can’t afford to ignore Advertisers/agencies asking for access to publisher non-guaranteed
inventory within programmatic environments
© 2010 DataXu, Inc. Privileged & Confidential
RTB & Publishers
O P P O R T U N I T I E S & R I S K S
RTB can give publishers…
o Revenue - new source of demand
o Quality - high quality brand campaigns not always
available through ad networks
o Efficiency – the right ad to the right user at the right time,
at the highest possible price
o 360° Yield Optimization – RTB within the context of total
demand access can drive overall yield
But it can take away, too…o User Experience Issueso Direct Sales Revenue/Channel Conflicto Data Leakage
© 2010 DataXu, Inc. Privileged & Confidential
Questions Publishers Ask
1. Pricingo How do I leverage RTB to protect & build my pricing (not erode it)?
2. Control:o How can I control global sales rights management on my inventory?o Who should have access to my inventory? When? Where?o How should I manage my advertiser & agency relationships?
3. Flexibility:o Is there technology that will enable me to offer priority access to
inventory (non-guaranteed) to certain partners on the fly?
4. Visibilityo What inventory should I make available for RTB? (sites, zones, ad sizes, user
sessions, etc.)o How can I get the same insight into my inventory, audience and revenue
that the buy-side has?
5. Data and Safety o Do you have the right technology and contractual controls to protect my
inventory, sales and data assets?
I N S I G H T & C H A L L E N G E S
© 2010 DataXu, Inc. Privileged & Confidential
What’s Next: RTB in 2011
o Private Marketplaces
o Preferred Price Floors
o First Look/Right of Refusal
C O N T R O L , V I S I B I L I T Y A N D F L E X I B I L I T Y
To achieve publisher goals, RTB needs to deliver both significant revenue impact alongside transparent controls that ensure publishers and critically, their advertisers, garner real ROI.
© 2010 DataXu, Inc. Privileged & Confidential
What’s Next: RTB in 2011
P r o t e c t e d R T B : I T ’ S A L L A B O U T C O N T R O L Protected RTB optimizes real-time bids for inventory alongside all sources of demand, ensuring that every impression is sold for the highest possible price, regardless of the buying mode of the sales channel, all with critical protections in place to ensure user experience, direct sales and data are protected.
These tools can be used ininnumerable ways to buildstronger and more direct,programmatic relationshipswith advertisers.
© 2010 DataXu, Inc. Privileged & Confidential
The Results To Date
publisher A
Total revenue lift before RTB
publisher A
Total revenue lift after RTB
C P M 20% CPM
INCREASERTB alone drives immediate lift (3–5x CPM) while protecting publisher revenue against channel conflict, pricing arbitrage & data leakage…
…and additional yield growth of 20% across ALL non-guaranteed inventory when Protected RTB is enabled in concert with all optimization sources
© 2010 DataXu, Inc. Privileged & Confidential
Agenda
• Introductions• Industry Overview• DSP Learnings & Key Requirements• RTB & Premium Inventory• Branding vs Performance • Success Stories
27
Michael Jenkins, Sr. Communication Strategist
Steve Weeks, Sr. Manager of WW Advertising
Operating in silos: The Past
• Raise awareness
• Site direct buys focused on high target audience composition
• Premium rates
• Messaging focused on product benefits
• “Learn More”
• Sell product
• Network buys focused on increasing campaign reach
• Remnant inventory
• Messaging focused on product features
• Drive to “Try/Buy now”
© 2010 DataXu, Inc. Privileged & Confidential
“Brand” Efforts “Response” Efforts
Few opportunities to apply cross-
campaign insights in real-time
Cross-campaign interaction: The Present
© 2010 DataXu, Inc. Privileged & Confidential
Adobe.com
Interests
Actions
Purchase Process
Community
Leverage data to deliver relevant, timely messages
to in-market consumers
Brand Efforts Response Efforts
Excite, engage & entice. Grow marketable universe.
Case Study: Adobe Creative Suite 5 Launch
© 2010 DataXu, Inc. Privileged & Confidential
The Goal:
Raise awareness, pique interest and drive revenue of CS5 – all starting on Day 1 of launch.
The Strategy:
• Create a variety of unique media touch points to surround target and drive users to site in our branding efforts
• Tag Adobe.com to track interest and consideration or consumers.
• Utilize site/user data to deliver relevant messages at scale in response efforts
© 2010 DataXu, Inc. Privileged & Confidential
Brand efforts drive interest and traffic…
31
Adobe.com
Interests
Actions
Purchase Process
Community
Brand Campaign
The site and it’s content, in addition to banners, are the canvas
Foster community through social enablement (not just social media)
Consider all media – not just digital – and it’s ability to drive consumers to the web
Excite, Engage & Entice
…and response efforts will capitalize on insights.
© 2010 DataXu, Inc. Privileged & Confidential 32
Purchase process messaging
(i.e. offers for trialists)
Matching product to sub-targets
(i.e. After Effects for video enthusiasts)
Broad, efficient media +
granular targets & messages
Leverage site data to develop relevancy
Incentivize when necessary
Deliver relevant, timely messages
Adobe.com
Interests
Actions
Purchase Process
Community
Response Campaign
© 2010 DataXu, Inc. Privileged & Confidential
CTRs averaging 0.7%; as high as
9.3%
14% of response campaign
impressions utilize remessaging
Remessaging drives 41% of
response campaign trials and 59% of
purchases
The Results
Adobe.com
Interests
Actions
Purchase Process
CommunityResponse
CampaignsBrand
Campaigns
© 2010 DataXu, Inc. Privileged & Confidential
Agenda
• Introductions• Industry Overview• DSP Learnings & Key Requirements• RTB & Premium Inventory• Branding vs Performance • Success Stories• Q&A with panelists
34
• Educational Webinars (Virtual) – Mobile Campaign Measurement – Your Questions Answered
Wednesday, January 12, 2010 Noon EST
• Professional Development Classes (NYC)– IAB Classes on Professional Presentations, and the Digital
Ecosystem starting mid-January… stay tuned!
• IAB Annual Leadership Meeting – Palm Springs, California February 27 – March 1, 2011
IAB Updates: www.iab.net
Credits, Future Webinars
Earn Credits for attending IAB WebinarsIndividuals earn one (1) hour credit for each webinar attended through the IAB. For further information on the IAB Digital Advertising Certificate, please visit: www.iab.net/events_training/certificate
Member Led Seminar SubmissionsIf you are a member of the IAB, we encourage you to submit proposals for
future webinars. There is no cost to members for these sessions, and we hope they will provide a valuable forum for members to showcase their latest insights, research, and technologies.
To submit a webinar proposal, email [email protected], or visit www.iab.net/member_webinar_submission
Q&A
• Please type your questions into the Questions tab on the right hand side of your screen