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IAB Europe Virtual Programmatic Day H2 2018 Slides

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IAB Europe Virtual Programmatic Day H2 2018 Slides

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IAB Europe Virtual Programmatic Day H2 2018 Slides

  1. 1. VIRTUAL PROGRAMMATIC DAY H2 2018 #IABEUVPD 14 November 2018
  2. 2. Clementina Piazza Programmatic Director EMEA, Integral Ad Science Welcome
  3. 3. #IABEUVPD Today’s agenda 10.35-11.10 (CET) 09.35-10.10 (GMT) The Size and Growth of Programmatic in Europe 11.10-11.50 (CET) 10.10-10.50 (GMT) Attitudes to Programmatic Advertising 11.50-12.05 (CET) 10.50-11.05 (GMT) Transparency and Trust in Digital Advertising – where are we now? 12.05-12.35 (CET) 11.05-11.35 (GMT) GDPR 6 Months on – the Impact on the Programmatic Advertising Ecosystem 12.35-12.40 (CET) 11.35-11.40 (GMT) Summary and close
  4. 4. Daniel Knapp Executive Director TMT IHS Markit The Size and Growth of Programmatic in Europe
  5. 5. Advertising spend that is generated through transactional or workflow automation mechanisms embedded in an infrastructure that relies on a set of rules applied by software and algorithms that draw on data, commonly known as ‘ad tech’. Following the IAB’s proposed taxonomy, ‘programmatic’ here is an aggregate category that is composed of four discrete transactional models, each of which we consider a sub-set: 1. Automated Guaranteed 2. Unreserved Fixed Rate 3. Invitation-Only Auction 4. Open Auction. Advertising spend is recognised as ‘programmatic’ whenever any of those mechanisms applies, irrespective of the inventory owner’s awareness of their involvement. This means that revenue is also considered programmatic if inventory that is originally sold to an intermediary through non-programmatic means (e.g. agency bulk buying) is re-sold to an end-buyer programmatically. Revenue is recognized as programmatic irrespective of whether the inventory owner acts directly or indirectly via an intermediary. Market totals and definitions adhere to the IAB Europe Adex Benchmark, our annual study of overall digital ad spend, in order to ensure like-for-like comparability. All spend is recorded as gross (after discounts, before agency commission). Data includes spend in Europe both on local/national media owner properties, and on global players like Facebook and Google. DEFININGPROGRAMMATIC #IABEUVPD
  6. 6. Market coverage Source: IAB Europe & IHS Markit • Austria • Belgium • Belarus • Bulgaria • Czech Republic • Croatia • Denmark • Finland • France • Germany • Greece • Hungary • Ireland • Italy • Netherlands • Norway • Poland • Russia • Romania • Serbia • Slovakia • Slovenia • Spain • Sweden • Switzerland • Turkey • UK
  7. 7. 2,263 3,881 6,607 9,426 11,984 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 2013 2014 2015 2016 2017 Europe: Programmatic Ad Spend (€m) European programmatic advertising is a €12bn market Source: IAB Europe & IHS Markit
  8. 8. Growth still double-digit but slowing as programmatic rapidly matures Source: IAB Europe & IHS Markit 71.5% 70.3% 42.7% 27.1% 0% 10% 20% 30% 40% 50% 60% 70% 80% 2013 2014 2015 2016 2017 Europe: Programmatic Ad Spend YoY Growth
  9. 9. Traditional vs programmatic ad spend Source: IAB Europe & IHS Markit 20.7% 30.8% 44.8% 56.0% 62.0% 79.3% 69.2% 55.2% 44.0% 38.0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013 2014 2015 2016 2017 Europe: Digital Ad Spend by Transaction Mechanism programmatic traditional
  10. 10. Programmatic direct attracts the most programmatic spend Source: IAB Europe & IHS Markit 8.0% 13.8% 22.3% 28.9% 33.0%12.7% 17.0% 22.5% 27.1% 28.9% 79.3% 69.2% 55.2% 44.0% 38.0% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2013 2014 2015 2016 2017 Europe: Digital Ad Spend by Transaction Mechanism - Detail programmatic direct programmatic indirect non-programmatic
  11. 11. Programmatic drives the video ad market in Europe, which is now programmatic-first Source: IAB Europe & IHS Markit 236 477 931 2,374 3,907 1,392 1,793 2,204 1,536 1,365 0 1,000 2,000 3,000 4,000 5,000 6,000 2013 2014 2015 2016 2017 Video: Programmatic vs Traditional Ad Spend (€m) video programmatic video traditional
  12. 12. 1/3 of programmatic ad spend is video Source: IAB Europe & IHS Markit 10.4% 89.6% 2013 video non-video 32.6% 67.4% 2017 video non-video
  13. 13. Programmatic video is a €4bn market, growing 4.5x faster than banner in 2017 Source: IAB Europe & IHS Markit 102.2% 95.3% 155.1% 64.6%67.9% 66.8% 24.2% 14.5% 0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 2014 2015 2016 2017 YoY Growth in Programmatic: Video vs Banner video banner 236 477 931 2,374 3,907 2,027 3,404 5,676 7,052 8,077 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 2013 2014 2015 2016 2017 Programmatic Spend: Video vs Banner video banner
  14. 14. Programmatic dominates the mobile ad market Source: IAB Europe & IHS Markit 281 754 2,355 4,422 6,776 1,075 1,582 1,405 1,343 1,356 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 2013 2014 2015 2016 2017 Mobile: programmatic vs traditional ad spend(€m) mobile programmatic mobile traditional
  15. 15. Rapid change: more than half of programmatic spend is now mobile Source: IAB Europe & IHS Markit 12.4% 87.6% 2013 mobile desktop 56.5% 43.5% 2017 mobile desktop
  16. 16. €6.7bn of programmatic spend is mobile, desktop growth nearly flat Source: IAB Europe & IHS Markit 168.9% 212.2% 87.8% 53.2%57.7% 36.0% 17.7% 4.1%0% 50% 100% 150% 200% 250% 2014 2015 2016 2017 YoY growth in programmatic: mobile vs desktop mobile desktop 281 754 2,355 4,422 6,776 1,982 3,126 4,252 5,004 5,208 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 2013 2014 2015 2016 2017 Programmatic spend: mobile vs desktop mobile desktop
  17. 17. Programmatic trends between Western and Central & Eastern Europe Source: IAB Europe & IHS Markit 94.5% 92.5% 93.0% 92.5% 90.2% 5.5% 7.5% 7.0% 7.5% 9.8% 0% 20% 40% 60% 80% 100% 2013 2014 2015 2016 2017 Share of programmatic by region WE CEE 24.0% 65.0% 0% 20% 40% 60% 80% 100% 120% 140% 2014 2015 2016 2017 Growth of programmatic by region WE CEE
  18. 18. #IABEUVPD PANEL The Size and Growth of Programmatic in Europe MODERATOR Clementina Piazza Programmatic Director EMEA Integral Ad Science Daniel Knapp Executive Director TMT, IHS Markit James Prudhomme Head of International, Index Exchange Joanna Burton VP European Strategy, SpotX Simon Halstead Chair, IAB Europe Programmatic Trading Committee and Head of Open Demand International, Oath Bill Krumperman Senior Business Adviso, Marketplaces Advertising Platform, Schibsted
  19. 19. David Goddard Vice President, Global Programmatic Strategy, BBC Attitudes to Programmatic Advertising
  20. 20. AREWEATA TURNINGPOINT?@iabeurope Marketing Week, Sept 2017 Digiday, Jan 2018 AdWeek, Feb 2018 Econsultancy, Oct 2016 #IABEUVPD
  21. 21. Supply chain transparency • Advertisers – 35% • Agencies – 56% • Publishers - 41% Increased / granular control of media • Advertisers – 24% • Agencies – 50% • Publishers - 34% Brand safety • Advertisers – 24% • Agencies – 49% Fraud • Advertisers – 30% • Agencies – 32% Hiring people with the right skill set • Advertisers – 32% • Agencies – 29% • Publishers - 46% @iabeurope AREWEATA TURNINGPOINT? #IABEUVPD
  22. 22. 0% 9% 9% 14% 46% 23% 0% 3% 8% 16% 35% 38% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Utilisation of a consultancy Outsourced to an independent trading desk Outsourced to a DSP Hybrid model (more than one of the above) Outsourced to an agency In-house operations 2017 2018 EVOLUTIONOF PARTNERSHIPS Advertisers @iabeurope #IABEUVPD
  23. 23. 9% 12% 26% 54% 6% 9% 24% 62% 0% 10% 20% 30% 40% 50% 60% 70% Outsourced to an independent trading desk Outsourced to a DSP Hybrid model (more than one of the above) In-house agency trading desk 2017 2018 Agencies @iabeurope EVOLUTIONOF PARTNERSHIPS #IABEUVPD
  24. 24. 8% 8% 40% 44% 9% 13% 29% 50% 0% 10% 20% 30% 40% 50% 60% Outsourced to a third-party network Outsourced to an SSP Hybrid model (more than one of the above) In-house operations 2017 2018 Publishers EVOLUTIONOF PARTNERSHIPS@iabeurope #IABEUVPD
  25. 25. Advertisers Agencies Publishers Gain greater transparency on where campaigns run 56% Increase operational control 75% Better monetisation of inventory 81% Reduce agency costs 56% Better ability to access audience insight 54% Benefit from a more efficient sales and ad operations process 52% Keep first party data under control 44% Better understanding of the consumer pathway 46% Better integration of audience data into trading processes 43% DRIVENBY…@iabeurope #IABEUVPD
  26. 26. METRICSCONTINUE TOEVOLVE Advertisers Agencies Publishers Sales KPIs 48% Sales KPIs 63% Cost per mille (CPM) 48% Brand awareness 29% Targeting accuracy 38% Brand awareness 32% Purchase intent / Cost per mille (CPM) / Viewability 26% Reach and frequency 27% Sales KPIs / Viewability 29% @iabeurope
  27. 27. DATA,DATA,DATA… 79% 84% 81% 70% 82% 84% 72% 79% 73% 43% 50% 42% 48% 53% 66% 27% 31% 27% 44% 69% 52% 69% 77% 87% 40% 46% 45% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2016 2017 2018 2016 2017 2018 2016 2017 2018 Advertiser Agency Publisher First party data Second party data Third party data Type of audience data used @iabeurope
  28. 28. THEFUTURE… 90%+ of advertisers, agencies and publishers expect their programmatic investment to increase over the next 12 months. @iabeurope
  29. 29. #IABEUVPD PANEL Attitudes to Programmatic Advertising MODERATOR David Goddard Vice President Global Programmatic Strategy, BBC Ash Grant Display Lead, HSBC Rick Jones Senior Vice President, Global Revenue Development, Adform Sandra Yassaka Vice President, Demand Products and Partnerships, Improve Digital Ed Weatherall VP Partnership Markets EMEA, Sizmek Lisa Kalyuzhny Director Advertiser Solutions, PubMatic
  30. 30. Oliver Gertz Managing Director Interaction, EMEA Mediacom Worldwide Transparency and Trust in Digital Advertising Where are we now?
  31. 31. #IABEUVPD What does Transparency mean? Understand Outcomes Understand, where my Money & Data goes Where does my ad appear? Is it viewable, brand-safe and fraud-free? What impact does it have? Reporting How does the ecosystem function? How do intermediaries earn money? Who is using my data for which purpose? Ad Verification Measure- ment
  32. 32. #IABEUVPD Where does the advertisers’ money go? Brand Agency DSP SSP Publisher “Only 40ct in the $ reach the consumer” WFA, 2014 WFA, 2014: https://www.wfanet.org/app/uploads/2017/04/programmatic.pdf
  33. 33. #IABEUVPD The IAB Europe Transparency Guide https://prezi.com/view/mYGLuF1JP2CUgJu7bFBZ/
  34. 34. #IABEUVPD Transparency is based on asking questions Data Cost / fees Inventor y Sources https://prezi.com/view/mYGLuF1JP2CUgJu7bFBZ/
  35. 35. #IABEUVPD Advertisers ask: “Where does €100 of my spend go?” 100.000 € -12.000 € -.6000 € -8.000 € -6.000 € -15.000 € -59.000 € Advertiser Agency Ad… DSP SSP Data Publisher Ideal Setup Buy side: ~20% Sell side: ~80% ~10%~15% ~10% Source: Market evaluation by Oliver Gertz • Data is a “working” ingredient, just like media, and monetised by publishers • Cost basis for many % fees is not the €100 client budget • ~80% of the budget is reaching the sell-side • There is no “ad-tech tax” • Advertisers use agencies and DSPs if they add more value than they cost • Publishers use SSPs and data market-places to earn more
  36. 36. #IABEUVPD Does Blockchain bring value chain transparency? My definition of Blockchain: distributed and encrypted ledger to document all transactions between parties that don’t know or trust each other
  37. 37. #IABEUVPD Does Blockchain bring value chain transparency? Brand If you believe the programmatic market is and will be a black-box: You see many intermediaries that may not be trusted: Blockchain may be solution Transparency & Trust through direct relationships Agency DSP SSP Brand Publisher Publisher If you believe that the value chain should be as short as possible between trusted partners: Vendor 1 Vendor 2 Vendor 3 Vendor 4 Vendor … Vendor n
  38. 38. #IABEUVPD IAB drives Industry Standards Ads.txt RTB 3.0 Ads.cert Bad actors are not able to insert themselves into the value chain for much longer
  39. 39. #IABEUVPD Understand Costs to recognise Value Understanding costs in the value chain is important. More important is to understand the Value created for Advertisers & Publishers
  40. 40. #IABEUVPD From cheaper impressions to the Quality Impression Quality CPM = COST Quality Impressions viewable & ad fraud free & brand safe ad fraud free viewable brand safe QUALITY
  41. 41. #IABEUVPD Premium inventory may have lower Quality CPM 100 118 141 168 At least 50% At least 55% At least 65% At least 70% Ad viewability has non-linear effect on sales lift Impact of Viewability on Index of Sales Lift Source: Using Data to Drive Solutions to IVT, Viewability and Ad Blocking, Comscore, July 27, 2016 124 100 Open Exchange Premium Deals Index QCPM Quality measured: 100% in view for >5s OR 80% >30s AND Fraud Free AND Brand Safe Source: GroupM Newsworks, Quality Media Study across 84 campaigns, June 2018. Premium Inventory has 24% lower QCPM
  42. 42. #IABEUVPD Focus on cost per Outcome Cost per Impression Cost per Engagement Cost per Action Cost per Business Outcome
  43. 43. #IABEUVPD Transparency means asking questions Understand Outcomes Understand, where my Money & Data goes IAB Europe Brand Advertising Framework IAB Europe Transparency Guide IAB Europe Transparency and Consent Framework Continue the dialogue: Oliver.Gertz@Mediacom.com
  44. 44. #IABEUVPD PANEL GDPR 6 Months on – the Impact on the Programmatic Advertising Ecosystem MODERATOR Lindsay Rowntree Head of Content, Exchange Wire Andrew Buckman Managing Director EMEA, Sublime Yu-Hsuan Lin (SAM) Head of Programmatic, Zenith UK Thomas Adhumeau Senior Associate General Counsel, Commercial & Privacy, AppNexus Nicola Rovario Head of EMEA Data Protection and Privacy Specialists, Google
  45. 45. Clementina Piazza Programmatic Director EMEA, Integral Ad Science Summary & Close
  46. 46. Get involved Marie-Clare Puffett Business Programmes Manager puffett@iabeurope.eu @iabeurope /iab-europe www.iabeurope.eu

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