Automated ad buying and selling tools are increasingly driving digital ad sales in the U.S. That means less human-mediated, manual sales, and more opportunities for ad tech specialists to gain a share of ad spend.
A new report from BI Intelligence finds that mobile and video will see the biggest growth in spending. By 2017, more money will be spent buying mobile and video ads via real-time bidding than will be spent on desktop display real-time bidding ad inventory.
Here are some of the key takeaways from the report:
- Programmatic and real-time bidding (RTB) ad spend is growing fast. RTB will account for over $18.2 billion or 33% of U.S. digital ad sales in 2018, up from just $3.1 billion in 2013, growing at a compound annual growth rate of 42%. Programmatic will be 50% in 2018.
- Mobile and video ads will be a major driver of this growth, with RTB sales for these formats topping $6.8 billion and $3.9 billion in 2018, respectively.
A number of companies are already cashing in on the growing programmatic market. Top programmatic ad companies include Criteo, Rocket Fuel, the Rubicon Project, and AOL. These four companies pulled in more than $1.5 billion in combined global ad revenue in 2013, accounting for more than one-tenth of global programmatic ad dollars.
- Prices for programmatic ads are increasing for almost all ad types, as demand outpaces supply. The effective cost per thousand impressions (eCPM) for social ads was up by 64% between January through April 2014, compared to the same time period one year earlier, according to Turn.
- There are still a number of barriers to adoption. Top barriers include brand worries that they will lose control over where their ads will appear, internal resistance at ad agencies, and lack of transparency in the industry over methods and results.
Amazon is set to launch a free, ad-supported video service separate from its $99 Prime Instant Video offering, according to the New York Post. In case you’re having deja vu, the WSJ reported exactly the same thing back in March and Amazon firmly denied it. However, the Post confidently said that the offering is now a definite “go.” One of its sources for the rumor is a potential advertiser, which said Amazon would unveil the service in order to increase its video share against arch-rival Netflix — and ultimately tempt users into Prime memberships.
Amazon (sort of) offers limited ad-supported streaming now, by letting non-Prime users watch a limited selection of shows with commercial breaks. If the Post’s report proves accurate, the launch of a full-bore streaming service with ads may indicate that the current version enticed Amazon customers to buy Prime. Amazon recently scored a deal to stream classic HBO programs like The Sopranos and Six Feet Under in a minor coup over Netflix. But it still has less than a tenth of its competitor’s size — so if the rumor is true, an ad-supported service looks like it wants to change that ratio.
Source: New York Post
Aereo, a startup that raised ~$100 million in venture funding, has filed for bankruptcy.
The company’s plan was to change the way we watch TV. It was delivering broadcast TV through the internet. To do this without permission from TV companies, it thought it found a legal loophole that involved using antennas.
It turns out, Aereo had no legal loophole. The Supreme Court said the company was operating illegally.
Aereo’s CEO had repeatedly said there was no plan B for the company. It was either going to win its legal fight with the Supreme Court and grow into a massively successful business, or it was going to lose and the money would essentially go up in flames.
A little over three years ago, the team at Aereo set out to build a better television experience for the consumer. We began this journey because we were frustrated with a system that we believed was broken and no longer served the consumer. When it came to watching live television, the options were few, the products available were cumbersome and didn’t fit our increasingly mobile lifestyle, and costs were unreasonably high and rising.
With that in mind, we put our collective engineering power to work to create an online technology that was simple, useful, and compelling, and provided consumers with a true alternative to how they watch local live TV. That’s how Aereo came to life.
Until now, the Billboard 200 chart has been ranked based on albums sales, but that’s about to change. On November 30th, that list will expand its criteria to include sales of a record’s individual tracks and streaming plays for the chart that’ll post on December 4th. Ten tracks sold will equal one album, while 1,500 spins via the likes of Spotify, Rdio or Beats Music from the same title will count as one sale, too. “Now we have the ability to look at that engagement and gauge the popularity of an album over time,” Billboard’s director of charts Silvio Pietroluongo told The New York Times. As you might expect, pop stars stand to benefit most.
For example, Ariana Grande’s “My Everything” was number 36 last week after amassing 10,000 sales, but with the new numbers added in, it jumps to ninth. This will also offer a boost to popular new artists, who usually stream way more than they sell, offering those acts a chance to earn a spot on the list. Of course, this means Ms. Swift will get improved sales numbers from streaming services should she choose to make future releases available there.
[Photo credit: Trae Patton/NBC/NBCU Photo Bank via Getty Images]
drag2share: THE SOCIAL-COMMERCE REPORT: Social Networks Are Driving More Online Sales And Influencing Offline Purchases
There’s been a lot of hype surrounding social commerce — the idea that posts and ads on sites like Facebook and Pinterest would generate lots of immediate sales on e-commerce sites.
Today only a fraction of retailer’s online sales are actually generated directly through a referral from a social network. But the volume of social commerce is growing quickly, in the triple digits in many cases. Overall, social commerce sales grew at three times the rate of overall e-commerce last year.
In a new report from BI Intelligence we break down how social media is impacting retail sales throughout the purchase process — whether a social media user clicks directly from a retailer’s Facebook ad to make a purchase, or sees a pin on Pinterest and ends up buying the product in-store a week later. We look at the varied metrics that underscore social commerce performance at the different networks, including conversion rates, average ! order va lue, and revenue generated by shares, likes, and tweets. We also outline the latest commerce efforts by leading social networks.
It’s been a tense week for Uber, the dominant car-hailing service, which came under fire on Tuesday after the company’s SVP of business suggested his company spend millions of dollars to hire people to investigate the private lives of its vocal critics in the media. And though the tech scene is up in arms about the off-the-record comments, many of the people we spoke to say they haven’t deleted the app or their Uber accounts.
So while people might be upset at Uber’s PR right now, there’s no data to suggest Uber is in trouble: the company is leagues ahead of its competitors — both in number of weekly rides facilitated by the service, and the number of payment cards on file. Based on leaked company data charted for us by BI Intelligence, Uber had north of 11.8 million payment cards on file as of last December, and considering the company’s upward trajectory, the company is likely far beyond the 12-million cards mark. Comparatively, Hailo and Lyft, two Uber rivals, had only 4.4 million and 781,000 payment cards on file.
Notes: Americans spent almost 3 hours per day with mobile apps and the mobile web during Q3 2014, reports Flurry, up by 15 minutes a day from Q1. Increasing time spent with mobile apps (155 minutes in Q3, up from 139 in Q1) accounted for all of the growth in time spent with mobile, as mobile web consumption was flat. Interestingly, the data indicates that time spent with the top 25 apps (ranked by time spent according to comScore) was flat, and it was the “torso & tail” apps (those below the top 25) that were responsible for the increase in app time. In fact, during Q3, mobile users spent more daily time with ! torso & tail” apps (85 minutes) than with the top 25 (70 minutes).
Notes: The largest pay-TV providers – representing about 95% of the market – shed roughly 150,000 subscribers in Q3, up from a loss of ab! out 25,0 00 in Q3 2013. By contrast, the largest broadband providers – representing about 94% of the market – gained more than 700,000 high-speed subscribers, up 35% from last year. For the time being, the top pay-TV providers continue to have a larger subscriber base (95.3 million) than the top broadband providers (86.6 million), though that gap is steadily closing.
More than 9 in 10 senior technology marketers believe that it’s critical or very important that their media partners deliver on promises (92%) and demonstrate reach into key targets (91%), according to a new study from IDG Research Services. Beyond those top values, tech marketers are also looking for competitive pricing and demonstrated ROI (86%) as well as high quality premium audiences (84%). These attributes reflect the priorities of tech marketers today, as detailed in the study. › Continue reading
Banners, takeovers, pop-unders, interstitials — there’s no understating how important/valuable they are financially, but ads are still basically the bane of the modern internet. That’s why it’s a little heartening to see Google, a company that made a whopping $15 billion in ad revenue alone last quarter, is giving content creators another way to go. It’s called Contributor, and the name really says it all: users can pay certain sites between $1 and $3 per month to be able to surf around without any of Google’s ads blasting them in the face.
Right now the program’s firmly in beta, but Google’s already roped in some big names for its little experiment: Imgur, The Onion, Mashable and Urban Dictionary have all entered the crowdfunding fray, with more surely in the works. And what is it like to actually look at a Contributor-ified page? Well, those bits of screen real estate where the ads used to exist don’t appear blank like they would if you were using an ad-blocker. Instead, you’ll get either a grayscale pixel pattern or a “thank you” message to go with the overwhelming sense of pride welling up in you because you know you’re helping one of your favorite sites more directly. There’s still no word on how that monthly donation gets split up between Google and the site participating in the program though, but it’s sure to strike a chord with, say, those of us who donate to perpetually broke public radio stations.
Source: Google Contributor
Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.
Collaborators – Digital Profs
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