news - october 19, 2012

Real-Time Bidding, Data, and Multiple Devices to bring Lift to CPM

In a recent Ad Age article, it was announced that Forrester would be reducing its forecast for overall growth of the online display advertising market. However, they predicted that average CPMs will rise 76% to $4.68 by 2017 from $2.66 in 2012. Senior analyst Joanna O’Connell of Forrester predicts that the viewable impression standard will help bring about this lift, and we have some suggestions as well.

  • Reducing the number of ad units could change the dynamics of direct/premium buys and inventory available for non-premium outlets.
  • Consumption across multiple devices will have an impact on what ad units are used, and whether they’re viewable impressions.
  • As online content trends switch to other devices – mainly, mobile – the ad format supply will also change.
  • The increased availability of valuable data can help engagement rates by improving relevancy against target audiences.

Real-time bidding will also help increase CPMs, as Ms. O’Connell notes. RTB allows advertisers to make decisions in real time about the value of that impression for that advertiser. This increases CPMs as advertisers are willing to spend more to reach their target or predictive audience. Data can play a huge role in this, as well as quality and viewability of the media. Marketers and technology are becoming savvier, and people are willing to spend more while making sure they’re reaching the correct audience.

Video and mobile growth, to date, has been tremendous, and bringing RTB to those platforms as well as using data will only increase overall advertising spend.

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