The document discusses the evolution of digital media buying over the past 15 years. It describes how buyers have gone from manually purchasing sites to now having millions of sites to choose from. This has increased reliance on networks but reduced visibility. New platforms like exchanges and demand side platforms are bringing more transparency around pricing, granularity in purchasing impressions, and control and insights for buyers. However, change is difficult and old habits die hard. Ultimately, specialization, centralization of buying technology, and leveraging data will be required for success in the future of digital media buying.

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2. The Future of Digital Media Buying
Joanna O’Connell, Senior Analyst
November 7, 2011
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2011

3. It’s more than an evolution in media
buying. It must be a revolution.
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4. Digital media buyers have faced unprecedented
change over the last 15 years
Mid-1990’s Early-2000’s Mid-2000’s
• Small handful of sites • Thousands of sites to • Millions of sites to
to choose from choose from choose from
• Manual, site level • Manual site level • Increased reliance on
negotiation, buying and growing number of
management, management undifferentiated
optimization, and continues but… networks for reach and
reporting efficiency
• …supplemental reach
• Focus on content- and efficiency found • Lack of visibility and
based buying as a through ad networks insight frustrates
proxy to reach buyers and their
desired audience • Continued reliance on clients
content as proxy for
audience though • Increase in audience
remarketing is a sign targeting options;
of a changing tide interest in audience
buying grows
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5. Thank you, RMX & MediaMath, for opening my eyes
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6. Exchanges and DSPs illuminated issues we didn’t
even know existed
• Opaque Pricing– undisclosed
margins (differential between price
paid to publisher and charged to
• Price Transparency – auction based
buyer) leaving buyers in the dark as
media pricing model increases
to “real” impression value
impression-level price transparency
• Media bundling – impressions
• Granularity– cherry picking impressions
typically sold packaged in bundles
allows buyers to choose only those
of 1000, limiting buyer’s ability to
desired impressions and bid at the
pick and choose only desired
impression level, de-averaging pricing
impressions
based on expected return
• Lack of placement level
• Control – buyer can sit “in the driver’s
transparency – site lists often
seat”, making the buying decisions,
provided, but no guarantee of
pulling the optimization levers
placement on any given site, or site
level reporting
• Insight – more transparent buying,
optimization and reporting means
• Black box optimization –optimization
deeper insights and the knowledge
methods largely opaque to end
needed to make repeatable decisions
buyer; little insight into what drove
performance and why
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7. Transparency
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8. Granularity
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9. Control
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10. Insight
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11. Buyers and sellers alike are trying to figure it all out
Trading Desk
SSPs
DSPs
Ad Networks
Publisher
Agency
Client
Exchanges
Data Providers
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Data

12. Entrenchment remains an issue
The three martini lunch model has a strong legacy
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13. And buyers have been taught to haggle on price
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14. The old skills don’t necessarily translate in this new
world
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15. Change is painful and happens slowly
Media Partner Flight Placements CPM Monthly Spend Total Spend Total Impressions
Publisher 1 Jan 1 - March 31 ROS $ 10.00 $ 35,000.00 $ 105,000.00 10,500,000
Publisher 2 Jan 1 - March 31 ROS $ 8.00 $ 25,000.00 $ 75,000.00 9,375,000
Publisher 3 Jan 1 - March 31 ROS $ 12.00 $ 45,000.00 $ 135,000.00 11,250,000
Ad Network 1 Jan 1 - March 31 RON $ 0.75 $ 50,000.00 $ 150,000.00 200,000,000
Ad Network 2 Jan 1 - March 31 RON $ 1.00 $ 50,000.00 $ 150,000.00 150,000,000
Ad Network 3 Jan 1 - March 31 RON $ 1.15 $ 50,000.00 $ 150,000.00 130,434,783
Ad Network 4 Jan 1 - March 31 RON $ 0.85 $ 50,000.00 $ 150,000.00 176,470,588
Ad Network 5 Jan 1 - March 31 RON $ 1.00 $ 50,000.00 $ 150,000.00 150,000,000
Ad Network 6 Jan 1 - March 31 RON $ 1.25 $ 50,000.00 $ 150,000.00 120,000,000
Ad Network 7 Jan 1 - March 31 RON $ 3.00 $ 50,000.00 $ 150,000.00 50,000,000
Ad Network 8 Jan 1 - March 31 RON $ 2.25 $ 50,000.00 $ 150,000.00 66,666,667
Ad Network 9 Jan 1 - March 31 RON $ 1.25 $ 50,000.00 $ 150,000.00 120,000,000
Ad Network 10 Jan 1 - March 31 RON $ 1.00 $ 50,000.00 $ 150,000.00 150,000,000
DSP Jan 1 - March 31 RON $ 0.75 $ 50,000.00 $ 150,000.00 200,000,000
Total $ 1,965,000.00 1,544,697,038
Loss of Frequency Control
Overlap Waste
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16. In the long term, media buyers must specialize
Strategy
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17. Specialization, centralization, and data will rule
In-house Trading Desk
Data Management and Analytics Platform
Centralized Media Buying Platform
Online Video
Trading Desk
Independent
Mobile Search
Real Time Biddable Supply Sources
Addressable TV
Client
Display
Programmatic
Buyers
Publisher
Direct
Party Data
1st and 3rd
Experience
Buyers
Brand
Publisher
Direct
Publisher
Direct
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18. The best thing you can do is educate yourself
RTB ATD
DSP
Data Exchange
SSP DMP
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19. And if you’re a client, understand how your money is
being spent
Media Partner Flight Placements CPM Monthly Spend Total Spend Total Impressions
Publisher 1 Jan 1 - March 31 ROS $ 10.00 $ 35,000.00 $ 105,000.00 10,500,000
Publisher 2 Jan 1 - March 31 ROS $ 8.00 $ 25,000.00 $ 75,000.00 9,375,000
Publisher 3 Jan 1 - March 31 ROS $ 12.00 $ 45,000.00 $ 135,000.00 11,250,000
Ad Network 1 Jan 1 - March 31 RON $ 0.75 $ 50,000.00 $ 150,000.00 200,000,000
?
Ad Network 2 Jan 1 - March 31 RON $ 1.00 $ 50,000.00 $ 150,000.00 150,000,000
Ad Network 3 Jan 1 - March 31 RON $ 1.15 $ 50,000.00 $ 150,000.00 130,434,783
Ad Network 4 Jan 1 - March 31 RON $ 0.85 $ 50,000.00 $ 150,000.00 176,470,588
Ad Network 5 Jan 1 - March 31 RON $ 1.00 $ 50,000.00 $ 150,000.00 150,000,000
Ad Network 6 Jan 1 - March 31 RON $ 1.25 $ 50,000.00 $ 150,000.00 120,000,000
Ad Network 7 Jan 1 - March 31 RON $ 3.00 $ 50,000.00 $ 150,000.00 50,000,000
Ad Network 8 Jan 1 - March 31 RON $ 2.25 $ 50,000.00 $ 150,000.00 66,666,667
Ad Network 9 Jan 1 - March 31 RON $ 1.25 $ 50,000.00 $ 150,000.00 120,000,000
Ad Network 10 Jan 1 - March 31 RON $ 1.00 $ 50,000.00 $ 150,000.00 150,000,000
DSP Jan 1 - March 31 RON $ 0.75 $ 50,000.00 $ 150,000.00 200,000,000
Total $ 1,965,000.00 1,544,697,038
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21. Thank you
Joanna O’Connell
+1 212.857.0718
joconnell@forrester.com
www.forrester.com
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