When it does, the industry will be no different than where
we were before RTB. (To clarify, I’m talking about the Real Time Bidding only
and not programmatic buying or “Programmatic Direct”.)
RTB is still growing at a fascinating pace, even from the
inception of about five to six years ago, which is a lifetime in this space. eMarketer reports that RTB growth is to account for 29% of all display spend by 2017. But when will it really peak? We all know
that it will not take nearly 100% of the market, because there are certain ad
placements that are too unique to be put in a biddable format. Native ads, rich
media and premium guaranteed spots that are sold in blocks are here to stay.
And even if they could be a part of RTB, publishers wouldn’t subject these
placements to the volatility RTB has.
Where does that leave us? For example, say it reaches even 50% of
the market and peaks there. With RTB technology now commonplace, everyone has a
bidding platform of their own or has multiple
partners with the ability to buy / sell in an RTB format.
For the sell side, a publisher is selling in all three top
SSPs (yes this happens), five networks and direct to agencies that they’ve set
up in their private exchange. On top of that, their direct sales team has
guaranteed buys and native placements plugged into their ad server.
On the buy side, there are agencies with a trade desk buying
in five DSPs (yes, this happens), vertical and horizontal ad networks, private
exchanges and direct buys with publishers.
I’ve oversimplified the scenarios above. It is way more
complicated than that. In the beginning of RTB, the pitch of any DSP or SSP was
to manage “everything non-direct” in a clean biddable format. Massive audience
reach for the buyers and a funnel of demand for the publishers, one tag to rule
them all.
But what we’ve got is hardly that scenario, it isn’t any
different from 2006 with 50 networks in the space. Remember the network pitch
ten years ago? “Massive audience reach in
one buy and for the publishers, a single stream of demand”. The only thing
different is the method in which the impression is bought and sold. At the end
of the day, the marketer and publisher look at the average CPM. I mean that
literally. At the end of 24 hours of RTB, we still look at the average CPM and
which provider provides the best yield. We do this because we need context
around the pricing or otherwise it is impossible to compare.
So where does that leave us? Is it any more efficient for
the buy or sell side? Many argue it is more efficient in the ROI on spending,
bringing down CPMs, but this is a can of worms we’ll not focus on here. For
operations teams, it is not any more efficient. Maybe in the beginning of the
trend, when a pub or buyer would use one RTB partner and funnel everything
through it, did they see their operations teams breathe some sigh of relief.
But quickly, with the technology being so readily available, an ops team is
convinced to make another line item, just to test and presto - we’re in the
same situation.
Are we already at this point with the majority of the
market? RTB is still growing, but publishers and marketers are using the same
amount of partners along with thousands of ad tags. To make their ROI and yield
decisions, they are still using excel spreadsheets to collect and analyze the
data. This is hardly programmatic, even though the pitch from partners is
always that it will be taken care of.
It takes hard work, will and perseverance to manage the
above and it always will. When new tools come out to handle it all, take
advantage of them quickly to keep up with the industry, so you aren’t left out.
Just know that it always continues and the next deal you make that promises
consolidation, may very well provide the ROI and yield, it will not be the one
to rule them all.
