What to Expect From the Next Generation of Digital Display

Friday, 08. 7. 2009  –  Category: Enversa Companies

A new generation of online-display advertising is beginning to emerge to match the needs and wishes of large publishers and publisher-side brokers, and advertising networks are concentrating on brand safety and targeting.

Here are some other factors that affect what happens with digital display advertising:

• Ad exchanges have progressed from bid-matching to allocation.
• Many agencies are now aggregating data and impressions for themselves and their clients.
• Data exchanges now separate data-about-impressions from those impressions, adding to their significance and value.
• None of their competitors, including Google, seem capable of standing alone above all others.

Although signs of contention are there, publishers are starting to resemble networks, and networks have taken on some of the characteristics of publishers. The efforts of prominent publishers have become more advanced, and advertisers are adjusting to the concept of buying impressions from three distinct sources—publishers’ core properties, advertising networks, and their content partners. As vertical ad networks evolve, many are creating their own content, and others are trying to add new importance to impressions that are bundled by category.

For many years, the larger ad networks have continued to profit from remnant inventory (distinct from home-page and premium sections), while smaller networks tried to advance their position with a vertical focus, additional data-based targeting, and partnering in numerous buy-and-sell based exchanges. Some are concentrating on providing an improved brand-friendly environment, and Undertone is a network that guarantees a refund of $50,000 if the quality of their impressions deteriorates.

Data and efficiency are actually the key elements here; as opposed to the inefficiency that has always been part of the display market.  According to Michael Walrath, a senior Yahoo vice-president, the key is to ease the tension between networks, exchanges, and premium publishers and blend open, viable exchange marketplaces with proprietary innovation. Along with automation, or perhaps because of it, he feels that the industry must “work within a set or rules people understand.”

The traditional guidelines of advertising networks—to form a market by combining vast amounts of impressions—are definitely being challenged today. There are far more impressions than anyone could ever use, and exchanges can match buyers with sellers more clearly and efficiently than the older “black box” marketplaces, and the middle-man is gradually disappearing. As they mature, the online ad and media industries will need to come to a better understanding of their sales-channel mix in order to be successful by managing both direct sales and channel sales. The retail industry, which is much older, has already accomplished this.

Today, both the agencies and publishers involved in the display industry are making their presence known. Ad brokers are now helping publishers to boost their bottom line, and new networks are asserting their power in a similar fashion. Separating trash from treasure has become the new task in media buying, and algorithms, data mining, and related factors are its key components.

Media planners and buyers will always generate the “big ideas’ in the industry, but with the change in emphasis, they are now working in tandem with yield analysts and traders. A slow-down in the economy may have toned down the trend towards greater inefficiency, but it also seems to be inevitable and worthwhile.

Marc Pickren is the President of Enversa- a performance-based marketing agency.

Tags: ad buying, Ad exchanges, agency, digital display, Marc Pickren, online-display advertising