A HISTORY OF PROGRAMMATIC MEDIA
I. Programmatic Evolution
II. How Programmatic Works
Table of Contents
2	
  
PR OGRAMMATIC E VO LU TIO N
RTB GOES
MAINSTREAM
1994 1996 2005 2007 20112000
DIGITAL AD EVOLUTION
DSPs
LAUNCH
AD
EXCHANGES
LAUNCH
ADWORDS
LAUNCH
(SEAR...
Advertiser and Publisher negotiate CPM and budget to show
an ad for a given period of time
Advertiser
Publisher
5	
  
IN T...
AdvertiserPublishers
More parties to deal with / Higher cost to attain reach / Higher overhead
	
  
6	
  
BUT IT BECAME EX...
MARKET OPPORTUNITIES DEVELOPED
•  Inventory centralization
•  Reduced overhead
•  Scale at lower costs
•  Automation
•  Sm...
Pros:
Advertisers: Centralized
buy; lower cost
Publishers: Helped sell
inventory at scale
Networks aggregate site inventor...
A marketplace to make real-time bids for ad inventory (like search)
Pros:
Advertiser: Greater site
flexibility and lower c...
-Focuses on the audience rather than the site
-Centralizes point of access for inventory
-Access to robust data for smarte...
PROGRAMMATIC FLIPPING THE MARKET
11	
  
0%	
  
20%	
  
40%	
  
60%	
  
80%	
  
100%	
  
2011	
   2012	
   2013	
   2014	
 ...
HO W
PROGR AMMATIC
WORKS
Definition
(IAB)
Publisher
Advertiser
Programmatic
Guaranteed
(Premium, Direct)
Private Exchange
(Invite-Only
Auction)
RTB...
Definition
(IAB)
Publisher
Advertiser
Programmatic
Guaranteed
(Premium, Direct)
Private Exchange
(Invite-Only
Auction)
RTB...
PROGRAMMATIC	
  
RTB	
  
PROGRAMMATIC RTB IN LUMASCAPE
15	
  
•  Traders (trading desks): the people
•  Demand Side Platform (DSP): trading desk tool
•  Data Management Platform (DMP):...
2. Publisher
reaches out to SSP
to sell inventory
DMP	
  
3. SSP sends
bid request with
audience data
(DMP) to DSPsPublish...
•  The people (RTB buyers)
•  An organization that manages programmatic
media typically using DSPs and other audience
buyi...
•  Trading initially very complicated, requiring
specialized expertise from traders
•  Technology has evolved, making
prog...
•  Tool for trading desk (advertiser)
•  A piece of software used by traders (advertisers) to buy advertising
placements w...
Targeting Control
Audience
•  Demographic
•  Interests/Behavior
Ø  First Party
Ø  Third Party
•  Geography
Site
•  List
...
•  Data for both advertisers and publishers
•  A data warehouse that houses information and spits
it out in a way that’s u...
•  Tool for publishers
•  A piece of software used by publishers to sell advertising in
an automated fashion
•  Benefits o...
•  Companies cross lines
–  Rubicon (SSP + Exchange): Advertising Automation Cloud
–  AppNexus (DSP + SSP): Flexible Techn...
TACTI CS AND
STRATEG IES
Prospecting
•  Targeting ads using audience or site data
•  Scale new customers
•  Learn about audience
Retargeting
•  Tar...
Control Parameters (Campaign)
Budget: $1,000/day
Max CPM: $10
Frequency: 4/day
Brand Safety: No Sexual Content
Targeting R...
28	
  
PROSPECTING TARGETS
Demographic
s
Social Media Users
Very Highly Engaged
Social Media Users
Very Highly Engaged
Soc...
Target 1:
Fine Jewelry
Target 2:
Luxury Retailers
Target 3:
Luxury Accessories
Low CPA
Low Cost
High Volume
High CPA
High ...
NEED PRODUCT DATA 30	
  
RETARGETING STRATEGIES
iPad Page
(no purchase)
Retarget with
iPad Ads
General
Sequential
Messagin...
PROGR AMMATIC
VIS ION
The majority of media will be bought programmatically through self-
service platforms, which makes media buying more trans...
THA NK
YOU
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A History of Programmatic Media

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This presentation shares the evolution of programmatic media and how programmatic media works.

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A History of Programmatic Media

  1. 1. A HISTORY OF PROGRAMMATIC MEDIA
  2. 2. I. Programmatic Evolution II. How Programmatic Works Table of Contents 2  
  3. 3. PR OGRAMMATIC E VO LU TIO N
  4. 4. RTB GOES MAINSTREAM 1994 1996 2005 2007 20112000 DIGITAL AD EVOLUTION DSPs LAUNCH AD EXCHANGES LAUNCH ADWORDS LAUNCH (SEARCH) AD NETWORKS LAUNCH DIGITAL ADS LAUNCH 4   2008 MDC LAUNCHES VMM
  5. 5. Advertiser and Publisher negotiate CPM and budget to show an ad for a given period of time Advertiser Publisher 5   IN THE BEGINNING… DIGITAL AD BUYING WAS RELATIVELY SIMPLE
  6. 6. AdvertiserPublishers More parties to deal with / Higher cost to attain reach / Higher overhead   6   BUT IT BECAME EXPONENTIALLY COMPLEX Publishers
  7. 7. MARKET OPPORTUNITIES DEVELOPED •  Inventory centralization •  Reduced overhead •  Scale at lower costs •  Automation •  Smarter targeting •  More data 7  
  8. 8. Pros: Advertisers: Centralized buy; lower cost Publishers: Helped sell inventory at scale Networks aggregate site inventory into single package Cons: Advertisers: less transparency and precision with pubs and audience Publishers: Still a large amount of unsold inventory Tremor Network Reuters Men’s Fitness Food Network Sports Illustrated AOL Network VH1 USA Today Ellen Comedy Central 8   NETWORKS SIMPLIFIED THE PROCESS
  9. 9. A marketplace to make real-time bids for ad inventory (like search) Pros: Advertiser: Greater site flexibility and lower costs Publisher: Sell larger amounts of ad space Cons: Advertiser: Need technology to manage multiple exchanges and hit audience Publisher: Difficult to maximize profitability Google (ADX) Exchange Yahoo Exchange NetworksNetworks 9   EXCHANGES ADDED SCALE Publishers Publishers
  10. 10. -Focuses on the audience rather than the site -Centralizes point of access for inventory -Access to robust data for smarter decisions Programmatic Exchange Network Publishers 10   PROGRAMMATIC EMPOWERED WITH CONTROL Programmatic uses intelligent software to purchase digital advertising
  11. 11. PROGRAMMATIC FLIPPING THE MARKET 11   0%   20%   40%   60%   80%   100%   2011   2012   2013   2014   2015   2016   2017   Programma3c   Non-­‐Programma3c   eMarketer: “US Display Ad Spending Share, by Type” 2013
  12. 12. HO W PROGR AMMATIC WORKS
  13. 13. Definition (IAB) Publisher Advertiser Programmatic Guaranteed (Premium, Direct) Private Exchange (Invite-Only Auction) RTB (Open Auction) TYPES OF PROGRAMMATIC BUYING 13   Purchase of ads through real-time auctions Publisher restricts auction to select buyers/advertisers Resembles traditional direct sales; differentiated by automation of RFP, IO, trafficking for publisher
  14. 14. Definition (IAB) Publisher Advertiser Programmatic Guaranteed (Premium, Direct) Private Exchange (Invite-Only Auction) RTB (Open Auction) TYPES OF PROGRAMMATIC BUYING 14   Purchase of ads through real-time auctions Publisher restricts auction to select buyers/advertisers Resembles traditional direct sales; differentiated by automation of RFP, IO, trafficking for publisher
  15. 15. PROGRAMMATIC   RTB   PROGRAMMATIC RTB IN LUMASCAPE 15  
  16. 16. •  Traders (trading desks): the people •  Demand Side Platform (DSP): trading desk tool •  Data Management Platform (DMP): data •  Supply Side Platform: publisher tool COMPONENTS OF PROGRAMMATIC RTB 16  
  17. 17. 2. Publisher reaches out to SSP to sell inventory DMP   3. SSP sends bid request with audience data (DMP) to DSPsPublisher Traders Advertisers $2.00 CPM $1.50 CPM 5. SSP chooses winner; advertiser pays $0.01 more than competitor $1.00 CPM 4. Traders send bids to show ad for audience (DMP) to DSP Winner $1.51 CPM Programmatic Programmatic SSP   1. User lands on publisher site PROGRAMMATIC RTB FLOW DMP   DSP   DMP   DSP   DMP   DSP  
  18. 18. •  The people (RTB buyers) •  An organization that manages programmatic media typically using DSPs and other audience buying technologies –  Place ads based on target audience –  Manage bids, placements, and targets TRADERS 18  
  19. 19. •  Trading initially very complicated, requiring specialized expertise from traders •  Technology has evolved, making programmatic buying more intuitive •  New technology empowers agencies and brands to take back control of programmatic buys with in-house traders or search teams EVOLUTION OF TRADERS 19  
  20. 20. •  Tool for trading desk (advertiser) •  A piece of software used by traders (advertisers) to buy advertising placements with real-time bids •  Benefit of DSP for Advertisers –  Central access to publishers, networks, exchanges, SSPs –  Targeting/control options –  Robust reporting –  Automated optimizers (targeting/ads) –  Brand protection (white list, content, viewability) DEMAND SIDE PLATFORM (DSP) 20  
  21. 21. Targeting Control Audience •  Demographic •  Interests/Behavior Ø  First Party Ø  Third Party •  Geography Site •  List •  Category •  Content •  Budget •  Bids •  Day Part •  Frequency •  Brand Protection 21   DSP LEVERS
  22. 22. •  Data for both advertisers and publishers •  A data warehouse that houses information and spits it out in a way that’s useful for marketers and publishers •  Benefit of DMP for Advertisers –  Data to develop and target specific targets –  Target specifications applied across large source DATA MANAGEMENT PLATFORM (DMP) 22  
  23. 23. •  Tool for publishers •  A piece of software used by publishers to sell advertising in an automated fashion •  Benefits of SSP for Publisher –  Access to advertisers, networks, ad exchanges, DSPs –  Automated yield management –  Robust reporting –  Block advertisers –  Price floors SUPPLY SIDE PLATFORM (SSP) 23  
  24. 24. •  Companies cross lines –  Rubicon (SSP + Exchange): Advertising Automation Cloud –  AppNexus (DSP + SSP): Flexible Technology –  Google (DSP + Exchange + SSP): Internet Monopoly •  Issues –  Market confusion –  Who is more important? Advertiser or Publisher? •  Bottom Line for Advertisers: Does it work? 24   BLURRED LINES
  25. 25. TACTI CS AND STRATEG IES
  26. 26. Prospecting •  Targeting ads using audience or site data •  Scale new customers •  Learn about audience Retargeting •  Targeting ads based on users’ past site visitation •  Convert intent into sale •  Overlay prospecting strategies 26   TACTICS
  27. 27. Control Parameters (Campaign) Budget: $1,000/day Max CPM: $10 Frequency: 4/day Brand Safety: No Sexual Content Targeting Requirements Geo: NY/NJ Day Part: Weekends Demographics < User Age < 36-45 Demographics < HHI $150k-250k •  Jewelry brand •  Goal: Drive qualified traffic and revenue 27   PROSPECTING EXAMPLE
  28. 28. 28   PROSPECTING TARGETS Demographic s Social Media Users Very Highly Engaged Social Media Users Very Highly Engaged Social Media Users Very Highly Engaged Interest Fashion and Style Attitudes: Timeless fashion Fashion and Style Attitudes: Timeless fashion Fashion and Style Attitudes: Timeless fashion In-Market Women’s Fashion and Apparel Fine Jewelry Apparel & Accessories Luxury Retailers Clothing & Accessories Luxury Accessories Target 1 Target 2 Target 3
  29. 29. Target 1: Fine Jewelry Target 2: Luxury Retailers Target 3: Luxury Accessories Low CPA Low Cost High Volume High CPA High Cost High Volume Low CPA Low Cost Low Volume Metrics Optimization Increase daily budget Pause Increase CPM or frequency Test without ‘Timeless Fashion’ 29   PROSPECTING OPTIMIZATION
  30. 30. NEED PRODUCT DATA 30   RETARGETING STRATEGIES iPad Page (no purchase) Retarget with iPad Ads General Sequential Messaging Last Page Visited Search Apple Page (no purchase) Retarget with iPad Ads Second Ad: iPad Sizes (DR) First Ad: Lifestyle Ad (TV) Upsell Search for ‘tablet’ Retarget with iPad Ads Bought iPad Retarget with iPad Cases
  31. 31. PROGR AMMATIC VIS ION
  32. 32. The majority of media will be bought programmatically through self- service platforms, which makes media buying more transparent, flexible, and efficient. But this technology requires a new type of media professional. With insight into this evolution, The Media Kitchen has developed the Programmatic Media Team. The Programmatic Media Team will oversee 3 major areas: •  Programmatic RTB (includes banners, video, and mobile) •  Programmatic Direct (includes banners, video, and mobile) •  Paid Search (e.g. Google and Bing) •  Paid Social Media (e.g. Facebook, Twitter, LinkedIn) 32   PROGRAMMATIC MEDIA TEAM
  33. 33. THA NK YOU
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