The document provides an overview of display advertising, focusing on market trends, targeting tactics, and various ad inventory sources, including publisher direct, ad networks, and exchanges. It underscores the importance of choosing the right inventory source for campaign objectives and highlights challenges such as audience overlap and data integration. Additionally, it addresses consumer attitudes towards online behavioral advertising and the significance of transparency in the advertising process.

1. A U G U S T 2 5, 2 0 1 1Buying Display Ad InventorySponsored by:David HallermanPrincipal Analyst

2. What we’ll look at today…Display ad market trends: spending and attitudes

3. Targeting tactics: audience vs. content (context)

4. Range of inventory sources: benefits and caveats

5. Publisher direct: finding brand value with premium inventory

6. Ad networks: ways to use inventory aggregation

7. Ad exchanges: including influx of private exchanges

8. DSPs: including growth of agency trading desks

9. Real-time bidding: how it fits into several inventory channels

10. Integrating ad inventory: blending sources and dataTwitter – #eMwebinar

11. Display Ad Overview(Spending and Attitudes)

12. Rapid changes in online display ad inventory emphasize the need to sharpen spending decisions

13. Display ad spending includes:• banners• rich media• sponsorship• video

14. How marketers would hope their target audience views their display ads

15. How most audience members actually view online display advertising

16. Marketing that US consumers trust: Display formats at bottom

17. Ridiculously low click rates on banners partially reflect that missing trustTwitter – #eMwebinar

18. Audience vs. Content Targeting(New vs. Traditional)

19. One crucial reason most people never click on banners:The ads are rarely relevant to them

20. More targeting has produced more relevancy,but stillmore is needed

21. 30% of marketers or less cite content targeting as most important vs. at least 70% who favor audience targeting

22. Traditional advertising looks for content that aligns with brand goals and image

23. 57% of advertisers and 53% of agencies said 2 or 3 targeting segments are optimal

24. Limits of audience data—and therefore targeting—will be shaped increasingly by the types of info that users will NOT share

25. Audience targeting tends to diminish transparency for media buyers

26. Online advertising transparency can be defined in several waysDetails about inventory and data sources

27. Recency or frequency of audience intent data (aka “freshness”)

28. Where an advertiser’s message ran

29. Basic understanding of the algorithms used used to identify targets

30. Identification of any behavioral data usedTwitter – #eMwebinar

31. Ad Inventory Sources and Methods(Reach vs. Overlap)

32. Ad inventory options, sources and methodsPublisher direct (premium)

33. Ad networks

34. Ad exchanges

35. Private exchanges

36. Demand-side platforms (DSPs)

37. Agency trading desks

38. Real-time bidding (RTB)Twitter – #eMwebinar

39. Publishers and networks (branding) vs. exchanges, DSPs, RTB (direct response)

40. The thing about ad inventory sources: Each has its place, depending on goals

41. Onil Gunawardana, executive director, AT&T Interactive“Buying ad inventory is a lot like flying a plane.”

42. Display advertising technologylandscape, from Luma Partners

43. Newer ad inventory sources look to solve three basic requirementsAudience reach and scale: Sources such as ad exchanges and DSPs offer more audience reach, but that’s typically achieved through inventory aggregation. As a result, multiple sources offer duplicate inventory and impressions.

44. Cost-efficiency: Demand for cheaper inventory is a key catalyst for the growth of ad exchanges, DSPs and agency trading desks. Rather than committing to up-front buys, advertisers purchase inventory by the impression, often at low margins and using RTB.

45. Audience-efficiency: An influx of data-management platforms and third-party data providers look to better define and locate audiences. Media buyers use robust audience data, in combination with ad exchanges and DSPs, to better ensure that each impression reaches the right audience at the right time at the right price.Twitter – #eMwebinar

46. Multiple ad sources too often result in duplicateinventory,which is inefficient and wastes money

47. Top 10 ad networks each have about 70% or higher reach,makingaudience overlap very likely

48. Largest portion of media buyers use only a few exchanges,somewhat more use networks, and still more use publishers

49. Publisher Direct(Premium Inventory)

50. What is publisher direct inventory?Bought directly from publisher, typically via sales team rather than automated methods

51. Maximum transparency of placement, such as above-the-fold

52. Maximum control over details of placements

53. Ability to create custom ad packages, and sometimes wrap a brand’s message into site content through sponsorships of articles, features and moreTwitter – #eMwebinar

54. Direct purchase most satisfying way of buying display ad inventory

55. Brand marketers appreciate how high-quality content helps them stand out

56. Brands not yet spending for digital video ads would most likely buy inventory directly from publishers or on networks

57. Similarly, SMBs prefer publisher direct and networks for ad buys, but are shying away from ad exchanges and DSPs

58. In some ways, content-targeted ad buys offer a captive audience

59. Brand marketers looking to broadly disseminate their message would be wise to leverage large ad properties

60. Publisher direct (premium):Benefits and CaveatsBenefit:context really matters, so leading brands require premium inventory

61. Caveat: typically higher price tags than any other inventory source

62. Benefit: useful for brand marketers looking to broadly disseminate their message; especially large ad properties such as Facebook and Yahoo!

63. Caveat: audience reach for video ads pales compared with banners

64. Benefit: offers media buyers the most brand control against poor-quality placements or inappropriate content

65. Caveat: Facebook’s audience will likely overlap with other publishers’

66. Benefit: best for finding particular audiences (but doesn’t really scale)

67. Caveat: programmatic buying treats editorial quality as an added cost

68. Benefit: greatest transparency of placement, audience, results

69. Caveat: “you get what you pay for” is often a basic truth hereTwitter – #eMwebinar

70. Ad Networks(Inventory Aggregators)

71. What is an ad network?Aggregates ad inventory from multiple publishers and matches it with advertiser demand

72. Typically groups ad inventory by categories or demographics

73. Often sells remnant inventory or from small publishers

74. Comes in both horizontal and vertical varietiesTwitter – #eMwebinar

75. Rough estimates indicate over 300 ad networks, both horizontal and vertical

76. Nearly ¾ of agencies use ad networks to buy online ads, with traditional media company websites close behind

77. Onil Gunawardana, executive director, AT&T Interactive“Ad networks provide a service layer that allows advertisers to buy everything from one place and takes the hassle out of needing to have relationships with multiple publishers.”

78. Far more marketers put greater share of ad budgets on ad networks and publisher direct (but beware rear-view mirror effect)

79. Dave Marsey, SVP and group media director, Digitas“Some ad networks will purchase additional inventory through other, smaller ad networks. It’shard to protect the integrity of where your ad appears when the network is essentially ‘outsourcing’ part of the buy.”

80. Ad networks:Benefits and CaveatsBenefit: tend to offer more robust targeting than publisher direct

81. Caveat: may provide only a small audience eligible for retargeting

82. Benefit: better reach, lower costs than publisher direct

83. Caveat: don’t go live as fast as ad exchange purchases

84. Benefit: offer brand control against poor placements or unsuitable content

85. Caveat: often cannot specify publisher sites where ads will run

86. Benefit: can often gain access to contextual placements and social network inventory not typically found on a DSP

87. Caveat: often lack the audience scale found with less-transparent providers like exchanges and DSPs

88. Benefit: various theme-specific networks, like luxury goods sites

89. Caveat: make sure network is open to third-party data providersTwitter – #eMwebinar

90. Ad Exchanges(Bidding for Inventory)

91. What is an ad exchange?A hub through which ad networks, and some large advertisers or agencies, can trade inventory within a single central marketplace