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Industry Research

What you need to know about digital video advertising in 7 charts

December 5, 2016 Michelle Manafy, Editorial Director – DCN

Okay, let’s start off with an obvious—but critical—fact: Just about everybody’s watching digital video. According to comScore, almost every demographic watches some form of digital video each month.

That said, it is clear from the comScore chart that there are segments that are consuming more than others. And, According to Defy Media, consumers aged 13-24 watch 12.1 hours of video per week on YouTube, social media and other free online sources, and another 8.8 hours weekly on Netflix and other subscription-video services. (That’s more than two and a half times the 8.2 hours weekly they spend watching television.)

While few of these younger viewers adore advertising, they are much more amenable to a brief sponsorship announcement or product integration is than the traditional preroll.

In its 2016 Digital Ad Spend Study, the International Advertising Bureau (IAB) reported that Digital Video and Original Digital Video budget allocations resulting from the NewFronts event have steadily increased over the last 3 years. Their research finds that ad spending on original digital video programming has increased 114% since 2014 and, on average, marketers and advertisers are spending more than $10 million annually on Digital Video, representing an 85% increase from 2 years ago.

According to Statista, there’s still plenty of room for growth, though. Statista analysts expect the digital ad market to grow at an average rate of 10.9% over the next five years, with social media and video advertising outpacing the overall market’s growth. And while search marketing is forecast to remain the largest share of digital advertising, it is predicted to rise about 57% whereas video is expected to experience an 80% increase.

While marketers find video to be among the most effective content type used in content marketing initiatives, they also rank creating it as among the most difficult, according to a report from Ascend2 and its Research Partners. Customer testimonials, explainer/tutorial videos and demonstration videos are ranked as the most effective types of video content marketing, per Ascend2’s research.

Time of viewing affects ad effectiveness. Online video advertising seems be most effective between the hours of 3 a.m. and 12 p.m., according to a study from cross-platform video advertising firm YuMe. They saw this trend across all age groups including millennials, Generation X, and baby boomers.

Mobile will be the biggest driver of digital-video ad spend over the next few years according to BI Intelligence. They found that US digital-video advertising revenue from PC- and mobile-based video ads will top nearly $5 billion this year, and grow at a five-year compound annual growth rate (CAGR) of 21.9%.

Industry-Research

Social media is a daily touchpoint for most Americans

November 29, 2016 DCN

Social media is part of Americans every day routine with a majority stating that they get their news through social media. In fact, half of the Americans turned to social media to learn about the 2016 presidential election reports Pew Research Center’s Social Media Update 2016, which was based on a national survey of over 1,500 adults.

The present state of the social media landscape includes 79% of Americans using Facebook, more than double the number of its nearest competitor, Instagram (32%). Other top social media platforms includes 31% of Americans use Pinterest, LinkedIn (29%) and Twitter (24%). In terms of reflecting the total U.S. population (including those consumers who do not use the internet), 68% of all U.S. adults are Facebook users, 28% use Instagram, 26% use Pinterest, 25% use LinkedIn and 21% use Twitter.

Facebook clearly remains the most dominant social media platform out there. It is the strongest social platform of the five included in this study among online young adults, Eighty-eight percent of adults 18-29 use Facebook; followed by Instagram at 59%, Pinterest and Twitter at 36%, each, and Linkedin at 34%. Facebook is also gaining traction among older adults, ages 65+. Close to two-thirds of adults ages 65 plus now use Facebook.

Facebook is a daily habit for most of its users with 76% visiting the site daily and of the daily visitors, 55% visiting multiple times a day. Interestingly, 56% of online adults use more than one of the five social media platforms included in this study with the highest duplication of usage on Facebook. This means that 95% of Instagram users, 93% Twitter, 92% Pinterest also use Facebook.

Social media apps are also popular among close to three-quarters of Americans (72%) using smartphones. Twenty-nine percent of smartphone owners use general-purpose messaging apps such as WhatsApp or Kik. Almost one-fifth (24%) use messaging apps that automatically delete sent messages, such as Snapchat or Wickr, and 5% use apps that allow people to anonymously chat or post comments, like YikYak or Whisper.

Users are often motivated to use social media platforms for their communal and social offerings. Social platforms easily remove communication and interaction barriers and allow users to communicate and share news with like-minded people. The social networks do even more to attract and engage users in these areas such as new in-app search functions, embedded content and live streaming video. These features (as well as an ever-expanding menu of new ones, along with an emphasis on the mobile experience are important as key platform differentiators in the marketplace.

Industry-Research | Perspectives

Mobile marketing is huge. But how are marketers supposed to make it work?

November 28, 2016 DCN

In the wake of this year’s U.S. presidential election, it’s admittedly difficult to place a whole lot of confidence in data of any kind (regardless of which side of the political isle you reside). Fortunately for us digital marketers, one or two percentage points don’t often have monumental effects on our campaigns. More often than not, we pursue initiatives knowing that online is still an emerging channel, and—warts and all—is still more effective than its offline counterparts, even considering its weakness when it comes to reporting and performance data. Indeed, no matter the not insignificant margins-of-error we digital marketers know to be real and plan for, we also know that online channels provide us with superior insights and performance causality as compared to their offline brethren.

And it’s with these realities top-of-mind that we delve into this issue of Industry Research, where we examine the 2016 Global Mobile Trends Report, produced by Kantar Millward Brown and the Mobile Marketing Association (MMA). These organizations undertook the research, which encompassed MMA’s Global Smarties and Cannes Mobile Lions finalists, to identify mobile marketing trends, and understand the business impact of a winning mobile campaign.

Marketers of every stripe know that mobile-related activity on the internet exceeded desktop sometime around 2014, and has been on an upward trajectory ever since. Yet, though mobile has been a hot topic for several years, marketers continue to struggle to make it work successfully. And with good reason: The ecosystem is evolving at warp speed, so there are no absolute best practices to follow. The Kantar-MMA study provides tips and tricks for how to make the channel work for you. Here’s what you need to know.

Mobile Delivers on Branding Initiatives

Takeaway: Be open to using mobile platforms in new ways to renew your brand’s relevance among your target

Marketers flocked to the digital channel initially for its amazing tracking and conversion abilities. As the channel has evolved, stratification naturally occurred. Today, digital segments — organic search, paid search, display, email, etc. – have been defined and categorized for different jobs. And mobile, for the foreseeable future at least, is emerging as an effective branding tool.

Marketers Have Shifted Mobile Efforts from Sales to Equity & Engagement

Takeaway: Top performers consider deepening consumer engagement as important a mobile campaign objective as increasing sales

The study illustrates case studies from Samsung and Sony Pictures to show the impact that mobile techniques can deliver on mobile efforts aimed at getting consumers involved. Samsung used a campaign to get iPhone users to experience the Galaxy S6. Sony relied on mobile advertising to engage consumers about an upcoming movie (Goosebumps), which eventually landed in the #1 spot during opening weekend.

Mobile-First Campaigns Out-Perform Mobile Bolt-Ons

Takeaway: Mobile forms a creative cornerstone and can be bolstered by other channels

To say ‘great mobile campaigns put mobile as the cornerstone’ may seem redundant, obvious, or both. But mobile ads only accounted for about ⅓ of the U.S. marketplace last year. While mobile is growing faster than desktop (50%+ annually, versus ~5%), desktop will continue to be the majority digital advertising channel for at least a few more years.

So for all of the focus on mobile by Google and the other digital titans, mobile advertising is still adolescent and a needs to mature aggressively in order to evolve into a digital marketing best practice. In the meantime, sophisticated marketers who develop a genuine understanding f the channel will reap benefits until others catch up.

Tim Bourgeois (@ChiefDigOfficer) is a partner at East Coast Catalyst, a Boston-based digital consulting companyspecializing in strategic roadmaps, digital marketing audits, and online marketing optimization programs.

Industry-Research | Perspectives

Omni-channel marketing is a must this holiday season

November 22, 2016 DCN

Early holiday indicators demonstrate that marketing to the hyper-connected consumer is necessary. The bar is set high to deliver a compelling, contextual and consistent brand experience across all communication channels. Why is omni-channel marketing so critical this holiday season?

Compared to last year, 6 in 10 consumers report that they will shop only online this holiday season, two-thirds of consumers will shop both online and offline and only 34% will shop mostly in-stores reports Yahoo’s Holiday and Search Insights 2016 report. In all, 37% of consumers said they will shop more online this year than a year ago.

Key findings include:

Holiday shopping is an omni-channel experience

79% of consumers plan to purchase holiday gifts both in store and online

Shoppers are relying more and more on mobile as a “go-to” resource during the busy shopping season

On Black Friday, share of searches on mobile devices increased from 26% year-over-year

While Black Friday and Cyber Monday are the busiest shopping days of the year, many will not shop on these designated shopping days

29% of holiday shoppers plan to stay away from shopping during Thanksgiving Week

As brands look to create multichannel promotions, it’s important to maintain their brand authenticity. Brands should stay true to the consumer experience across the multiple marketing channels as a key differentiate in the holiday fury.

Industry-Research | Perspectives

Survey reveals how marketing pros make data-based decisions

November 22, 2016 DCN

Marketing has become a data-driven function and its success hinges on whether marketing managers can reliably measure the effectiveness of their marketing initiatives. The key to achieving this lies in our ability to collate and analyze diverse datasets so we can make informed decisions based on quantifiable information.

Success, among today’s marketing pros, means improving the bottom line and deepening customer relationships, while keeping teams in tune with an evolving marketplace.

A recent study by Ascend2 surveyed some 50,000 marketing professionals in an attempt to address the hot topic of marketing data management, revealing how marketers currently compile and reference their various data sets.

Most important data management goals

The three most important goals of marketing data management are:

improving ROI measurability
improving data quality
increase data use/accessibility

Data addresses many of the challenges facing marketers.

Crafting and adapting a marketing strategy to changing circumstances can be difficult with a lack of data. Predicting and preparing effectively for negative trends becomes much harder with poor insights. Even reporting to senior management or investors without sufficient data can create additional obstacles to gaining support for further campaigns.

This is where data can provide a lot of support. Ascend2’s research has found that 54% of professionals believe that data helps marketers arrive at “more accurate decisions.” Marketing data management can help managers guide their activities through real life decisions and marketing scenarios.

“I speak with marketers all the time who tell me the same thing – if you’re really going to be agile with your messaging and distribution strategies, then you need the ability to see what’s happening, across all channels, at a glance,” said Ben Carpel, CEO of Cyfe, a solution for creating performance monitoring dashboards.

Managing successful strategy
Managing strategy is directly connected to data management. More efficient use of data enables marketing managers to access it and make informed decisions based on it, quickly and easily.

Roughly 60% of the Ascend2 respondents reported that their use of data makes substantial contributions to the success of their overall marketing activities. In contrast, only 40% of companies and professionals rated their work “somewhat unsuccessful” or “very unsuccessful.”

“With data coming from so many different places, it can be difficult for a company to develop a consolidated view and an integrated approach to cross-channel marketing,” wrote Kerry Reilly, Adobe Campaign’s director of product marketing, in a recent op-ed. “It requires too much data maneuvering, the data’s not always in sync, and there’s lots of room for error.”

Outsourcing data management
Producing and managing this data can be a complex task, requiring highly skilled and analytical talent. Many companies don’t have this niche expertise inside of their organizations, leading to heavy reliance on SaaS, outsourcing to service providers or embarking on long-winded hiring processes.

Results from the Ascend2 study indicate that a lot of data management is provided by third-party organizations, while 64% of companies outsource all or part of their marketing data management. Only 36% of businesses manage their own marketing data in-house.

The modern marketing function is in a state of flux, and emerging data solutions put pressure on marketing leaders to constantly adapt to changing requirements. Despite this uncertainty, it is crucial that business units have a clear understanding of where the responsibility for data lies.

This is a fundamental imperative in day-to-day management activities, as 54% of businesses allocate data management and analysis to their marketing departments, whereas the other 42% share it between departments or even only with IT department.

Effective data and resources
Nearly all companies in the same study (97%) agreed that the effective use of marketing data is increasing. Marketing data management is a trending topic, and it’s constantly evolving.

In some cases, marketing data is being used to maximize profitability. Earlier this year, McKinsey demonstrated how tweaking prices by 1%, as informed by smart data modeling of marketing trends, has the power to boost operating profits by 8.7%.

There are many advances in the world of resources and tools within the data management space, allowing marketers to get closer to the data and deeper into its quality. Access to real-time and predictive data is currently a trending demand.

“Real-time data is critically important. Otherwise, business leaders may be making decisions off data that is no longer relevant,” notes Suzanne Mumford, head of marketing for the Google Analytics 360 Suite. “The business landscape changes so quickly, and stale data may inadvertently lead to the wrong decision.”

Data-driven marketing wins
Data-driven strategies are becoming more popular in the world of marketing, yielding campaigns that are more calculated and therefore primed to deliver effective, measurable results.

Relying on data for marketing decisions makes for superior visibility, more strategic planning and a better-equipped team, which is transforming the strategic marketers’ approach.

Joe Liebkind is a Berlin-based writer. He has worked with startups in sales and marketing roles in Berlin and New York. Find him on Twitter.

Advertising | Industry-Research

In-stream and Sidekick are preferred mobile ad formats

November 16, 2016 DCN

Each year the mobile ad industry introduces new creative formats. These formats, both new and old, play an important role in the user’s experience and impact advertising effectiveness. To understand each ad format effect, Kargo, a mobile advertising platform, partnered with MediaScience, a neuroscience research firm, to analyze consumers’ responses to four mobile ad formats through their eye movements, biometric responses and attitudinal changes.

The research found that bigger ad formats are not always better on mobile and In-Stream and Sidekick ad units offer both strong consumer appeal and higher ad effectiveness. Interestingly, while Interstitial ads appear to offer higher brand recognition than Adhesions and Sidekicks, they also over-indexed as disruptive, annoying and intrusive.

Key findings from the study also include:

Adhesion units (adheres to the bottom of the screen and stays with users as they scroll down the page) are viewed as the most common mobile ad unit, and are easily avoided by users. While Adhesions are perceived as less intrusive than Interstitials, they received much less visual attention than all other tested ad formats.
In-Stream units (appears within the stream of editorial content) provide users with the opportunity to focus on mobile ads at their own discretion. In-Stream units perform similarly to Interstitials in visual attention, but outperform them in visual retention. In-Stream units are not thought of as disruptive, annoying, or intrusive.
Interstitial ads (served between content pages) appear to have received the most negative biometric response and negative ad evaluations. They are viewed as disruptive, annoying, intrusive and not well-placed.
Kargo’s Sidekick unit (a silhouette appended to the side of the screen, provides continued visual attention) performed like the other ad formats in visual attention without annoying the user. The Sidekick ad unit, like In-Stream, ranked best among users in terms of overall liking of the ads.

Overall, results of this study suggest that In-Stream and Sidekick units may be the most effective for mobile advertising, among the four ad formats. Both ads hold visual attention and are memorable without the intrusiveness of Interstitials. It’s important to connect both the rational and emotional appeal so the ad attains positive attention and offers users the freedom of managing their environment.

Advertising | Industry-Research | Perspectives

Interstitial ads shown to alienate, not engage

November 15, 2016 DCN

More than 50 years later, the wisdom of Herbert Marshall McLuhan, the Canadian professor and philosopher who famously observed in 1964 that “the medium is the message,” continues to strike a chord, underlining the inextricable link between the mechanics of how companies deliver their message and the influence these messages have on customer behavior and brand perception.

It’s all about engaging in a way that adds value to the “conversation” — and the rules of engagement that held true for the delivery of more traditional content and communications go double for mobile. It’s a medium where evidence is mounting that advertising and marketing approaches that merely retrofit online display advertising to smaller screens are patently out of sync with the requirements of consumers in the “mobile moment.”

Consider the findings of a recent report published by PageFair, which documented the meteoric rise in the use of adblocking technology on mobile devices. Studies like this document a clear disconnect between what content companies want to deliver and what consumers are willing to accept. However, most studies, including the PageFair research, draw from empirical data, not user surveys, to explain people’s growing fatigue with mobile advertising. Until now precious few have dared to delve into the real and root cause of brand affinity, or frustration.

This is where a new report by neuromarketing companies True Impact and Neurons Inc., and commissioned by MediaBrix, an in-app mobile video advertising platform for brands, breaks new ground, documenting the “how” and “why” behind consumers’ negative response to interstitial ads.

The Brand Receptivity Neuro Lab Study, which was designed to help marketers understand how consumers react to and engage with different ad formats, relies on technology to monitor people’s neuro and biometric responses before, during and after the delivery of a mobile ad. Respondents were wired up to neurometric and physical eye-tracking devices, and each consumer was asked to complete a post-exposure interview and survey.

The aim was to explore how different methods of delivering the same ad inside a mobile app (also known as an in-app ad) impact respondents’ receptivity to advertising. To test this hypothesis researchers measured the emotional and physiological impact (heartbeat, attention and the feeling of “wanting” that drives urges and decision marking) messages from two brands, MillerCoors’ Smith and Forge Hard Cider and a popular CPG brand, had on respondents during their sessions on a gaming app.

Among the findings:

Viewers were twice as likely to have a negative emotional response to a full-page interstitial ad than to an embedded, opt-in ad format. Pupil dilation, heart rate and other biometric data revealed that full page video interstitial ads aroused the brain’s “fight-or-flight” center, which explains why interstitial ad viewers also focused 22% of the time they did spend looking at the ad searching for the “X” button to close down the ad altogether. In contrast, respondents “actually watch the embedded, opt-in units,” with close to 90% of viewers watching the full 30-second video, compared to only 25% of viewers watching an interstitial ad.
Embedded, opt-in ad viewers don’t just watch the ad; they also spend three times as much time fixated on the brand creative and they’re 8 times “more cognitively engaged” with ad message.
Overall, embedded, opt-in ad viewers spend 9.5 times more time “understanding/considering the embedded value exchange offered by the ad” than they do considering the interstitial ad unit. This deep engagement with embedded, opt-in ad units resulted in 70% of those viewers remembering the product and 73% understanding the brand offer. For viewers who experienced interstitial ads the results were 40% and 49% respectively.

Significantly, the study found that embedded, opt-in ad viewers are also more motivated. Motivation, which is a key brain imaging metric refers to the feeling of “wanting” that ultimately drives desire and decisions. High motivation levels in the brain therefore imply purchase intent and action.

“Those who experienced the contextual ad unit [embedded, opt-in ad unit] had four times a feeling of motivation according to neurometric measures,” the study concludes. In total 25% of embedded, opt-in ad viewers said the ads made them want to keep using the app.

This is a far cry from the “fight-or-flight” reaction triggered by full-page interstitial ads — and should send alarm bells ringing in board rooms everywhere on the planet, according to Richard Kosinski, MediaBrix President & Global CRO. “The key message is that the interstitial, the most common ad format, is also the format that users find most annoying and disruptive,” he explains. “Publishers need to consider formats that do not create a negative experience for their readership.”

He urges the industry to “rethink ad delivery and ad format” and remember the core importance of the user experience they deliver, not just the content.

The explosive growth of mobile apps — and the increase in the amount of time consumers spend on them daily — turns up the pressure on publishers to rethink mobile advertising and how they monetize their content. “Eyeballs have clearly shifted to mobile and mobile apps and publishers have to focus their efforts on creating a good user experience for their audience,” Kosinski says. “Our research shows that just running interstitials on mobile and in apps isn’t the way to achieve this.”

This dovetails with the 2016 U.S. Mobile App report released by audience measurement company comScore. It estimates that mobile now represents “almost two out of three digital media minutes.” As a result, mobile apps are approaching 60% of total digital time spent by consumers by platform.

Kosinski, a 25-year veteran in the media business who has held a variety of senior roles at brands including The Wall Street Journal, Yahoo!, CNET, Quantcast and Westwood One, advises content companies to rethink mobile ad creatives, not abandon them. The positive response by respondents to embedded, opt-in ad formats suggests that consumers might whole-heartedly embrace monetization models that reward them for watching a video, for example. “The result is a better experience for the consumer, who gets to read the article behind the pay wall, and higher engagement and higher CPMs for the publisher that enables this value exchange,” he says.

Opt-in ad experiences put consumers in control, but it’s not enough for publishers to change their creative message. They should also embrace the formats and delivery mechanisms proven to provide a positive user experience. This milestone study doesn’t just provide the industry with valuable blueprint to improve ad receptivity, human attention and brand recall. It bravely delves into the emotional and physiological traits and triggers publishers must understand to ensure their message (and marketing) is truly aligned with the mobile medium.

Peggy Anne Salz is the Content Marketing Strategist and Chief Analyst of Mobile Groove, a top 50 influential technology site providing custom research to the global mobile industry and consulting to tech startups. She is a frequent contributor to Forbes on the topic of mobile marketing, engagement and apps. Her work also regularly appears in a range of publications from Venture Beat to Harvard Business Review. Peggy is a top 30 Mobile Marketing influencer and a nine-time author based in Europe. Follow her @peggyanne.

Advertising | Industry-Research | Revenue

Mobile now accounts for almost half of all digital ad revenue

November 9, 2016 DCN

Digital advertising revenue increased to $32.7 billion in the first half of 2016, increasing 19% from the same time period a year ago, according to the Interactive Advertising Bureau’s Internet Advertising Revenue Report. The shift to mobile advertising was a key driver in the increase of digital ad spend. In fact, mobile advertising revenue totaled $1.6 billion, a 178% increase from the same period in 2015. Mobile advertising now account for 47% of all online ad revenues for the first half of 2016, up from 30% the prior year whereas desktop video ads remained the same at 13% of total revenue.

Among the key trends reported:

Display

Total display-related advertising (mobile + desktop) is up 26% to $13.9 billion and accounts for 43% of all internet ad revenue.
Display-dollars are also shifting to mobile: Mobile display is up 78% to $7.6 billion while desktop display is down 7% to $6.3 billion.

Video

Total digital video ad revenue (mobile + desktop) is up 51% to $3.9 billion.
Video now accounts for 12% of internet ad revenue for the first half of 2016, up from 9% in HY 2015.

Social media

Ad spend on a whole for social media increased to $7 billion, up 57% from one ago.

Other key findings

In terms of pricing models, performance-based pricing, defined as cost-per-click, sale, lead, acquisition, or application (e.g., credit card application) or straight revenue share (e.g., percentage of commission paid upon sale), continues to lead although slightly declined to 65% of total revenue in HY 2016.

CPM/impression-based pricing increased up to 34% of revenues in the first six months of 2016 from 32% in HY 2015.

Hybrid pricing, defined as any mix of impression-based pricing plus performance-based compensation within an ad campaign, declined to 1% of total revenues in HY 2016, down from the 2% reported in HY 2015.

The report also stated that digital ad spending is becoming more concentrated with the top 10 digital ad-selling companies accounting for 74% of online advertising revenues in Q2 2016. The 10 companies were not disclosed in the report.

Many are forecasting that digital advertising will continue to be a larger and larger share of overall revenue generation for businesses. The question is who is capturing the increased profits? In an article in the Financial Times, Anna Nicolaou notes that “Google and Facebook have capitalised on the rise of the smartphone, swallowing the lion’s share of digital advertising revenues. In the US, 85 cents of every new dollar spent on digital went to the two companies in the first quarter of 2016, according to Morgan Stanley.”

Peter Kafta of Recode also offered insight the companies capturing the profit margins. Kafta’s shared the individual analyses done by Jason Kint’s, CEO of Digital Content Next, and Brian Wieser’s, an analyst at Pivotal Research, each illustrating that Google and Facebook account for 85% and 90%, respectively, of every dollar spent on digital. Their analyses also indicated that while Google’s and Facebook’s captured significant growth of ad revenues, the rest of the digital marketplace is diminishing.

Industry-Research | Perspectives

Six things we now know about native advertising

November 2, 2016 DCN

It has been a few years that native advertising is being actively placed in the market. With the year-end approaching, it’s a good time to take stock of what we now know. At MediaRadar, we’re now not just tracking native ads, but also studying how native is bought & sold, and are coming to a view of what is best practice. Posted below are some of our key findings.

Native, a saturated market? Surprisingly the market is not yet saturated. Over Year 2016 we’ve tracked a median of 610 new advertisers buying native, for the first time ever. This is substantial. And we’re finding native ads across b2b, enthusiast, regional, and science media. Native is no longer for certain large consumer sites.

Renewal rates. To provide an average here would be misleading. In fact what we see is polarized renewal rates. Out of the ~1000 websites that sell native, most have low renewal rates, under 30%. This is going to make scaling up native advertising a significant challenge. In contrast, there are a few dozen firms that are very focused on client success. They enjoy renewal rates above 70%. This includes some of the best performers, including brands like Quartz (QZ.com).

Campaign packaging. We observe that it’s exceedingly rare to see native advertising running stand-alone. It’s much more common that native advertising runs as part of a broader campaign. The most common campaign is to run display for 30 days, then 30 days of both native and display, and then a final month of display.

Duration analysis. Across 16,998 brands that have placed native over the past 2 years, the most common is one month only. It’s surprisingly brief. Just under 20% of brands are running campaigns for six months.

Programmatic vs. Direct. In the past two years we’ve seen the rise of programmatic native – both display and in video. Without question, the product is marketing different than direct native. Programmatic native is display advertising that looks-and-feels like editorial. However, these ads don’t typically link to sponsored editorial. In contrast, direct native does. This is the kind of programming that Buzzfeed, Forbes, and Huffington Post are especially so well known for. Posted below is an overview of the massive growth we’re seeing from some of the leading programmatic native companies. This includes name native exchanges such as Nativo, TripleLift, Sharethrough, Bidtellect, Teads, Unruly, and Giant Media.

Recommendation. Native advertising renewal rates correlate tightly with campaign duration. Those winning six-month deals have the highest average renewal rates, with the lowest renewal rate variance. In surveying those most successful publishers we heard consistent feedback: Require clients to commit to longer term deals. This gives you, the publisher, more time to course-correct, to respond to client needs, adjust creative, adjust marketing support, to absolutely make sure that you’re helping the client meet their campaign objectives. This, more than anything, drives up renewal rates.

Number of programmatic advertisers placing in the year 2016

Todd Krizelman is Co-Founder and CEO of MediaRadar (@MediaRadar). Growing up near the epicenter of technological innovation in Palo Alto, California encouraged him to become an entrepreneur and co-found of one of the world’s first social media sites, theGlobe.com. Krizelman also held leadership positions at Bertelsmann’s Gruner + Jahr and Random House. With his expertise in ad sales and innovation, Krizelman joined veteran web architect, Jesse Keller, to found MediaRadar in 2007.

Industry-Research

The growing economy of web scraping

November 2, 2016 Lisa Sealey, SVP Marketing – DCN

Web scraping is a technique that allows people to easily extract large amounts of information from around the web – for legal and illegal uses. Distil Networks’ 2016 Economics of Web Scraping Report notes that bots, which make up approximately 46% of web traffic, often conduct the web scraping at a faster rate than humans. The Report found about two percent of online revenue is lost to web scraping.

Key findings also noted in Distil Networks Report:

38% of companies engaged in web scraping to take content.
Web scraping is inexpensive costing about $3.33 per hour.
The average web scraping project costs approximately $135.
Real estate sites are the #1 web scraping target.
The average web scraper salary ranges from $58,000 to $128,000 per year.

There are six primary reasons for web scraping:

Content scraping: stealing original content from one website and posting it on another website without the knowledge or permission from the publisher;
Research: gaining marketplace intelligence;
Contact scraping: acquiring customer emails and contact information for marketing and lead-generation;
Price comparison: competitors in the real estate and travel industries see a lot of this activity;
Weather data monitoring; and
Website change detection: notifying users about changes made to specific websites.

It’s important for publishers to understand the extensive web scraping economy so they can take steps to protect their proprietary information.

Advertising | Industry-Research

Programmatic versus publisher-direct online ad buying: What do the data say?

October 25, 2016 DCN

Anyone who’s been buying digital advertising for more than a minute has been faced with the daunting question from marketing and non-marketing executives alike: “So, how much of this advertising is actually legit, anyhow?”

The industry has been hounded by issues relating to viewability, engagement, and outright fraud for the past couple of years, and the general business press regularly covers the subject matter. So the very same executives who authorized TV, print and radio advertising budgets without raising question one only a few years ago – when the “half of my marketing budget is well-spent, but I’m not sure which half” maxim was fully embraced – now regularly engage in forensic assessments of ad buys. Such is the life of the digital marketer.

So it is helpful that companies like Integral Ad Science (though not an entirely objective player in the digital marketing ecosystem) working to keep track of developments via its bi-annual Media Quality Reports.

However, depending on one’s point-of-view, the data can be considered a sign of improving conditions, or confirmation that we marketers knowingly *throw away* 10% or more of our budgets to fraud, deception, and advertising malpractice.

Here’s a look at IAS’s most recent report, which offers an analysis of “hundreds of billions” online display and video ad impressions during the first half of this year:

Conditions Are Improving. Though there continues to be a good deal of waste in the system, the overall state of online advertising is showing signs of improvement. For example, the U.S. market saw a significant drop in “objectionable content” impressions during the first half of 2016 versus the previous period (9.5% versus 14.0%). Most industry experts agree this is due to more sophisticated tools and digital ad buying practices, as one would expect in a growing and evolving industry sector.

Buying Direct Has Its Benefits. The incidence of ad fraud when buying advertising direct from publishers is dramatically lower than when buying programmatically (2.2% versus 8.3% in the U.S.), though it’s also typically more expensive, making the equation palatable for most marketers.

Viewability & Clutter Are Continuing Concerns. Fewer than half of all display ads – regardless of how purchased – get viewed for more than five seconds, and more than 10% of ad impressions are jammed onto pages with more than four ads on the page. These issues are compounded via mobile devices, which we cited in a recent article on the pros and cons of programmatic as “just a messy consumer experience”.

Bigger & Vertical Are Better. Large format, vertically-oriented display ad formats (300×600, 300×1050, 160×600) all tend to have better viewability than their smaller, rectangular and square counterparts – being viewed for more than five seconds about half the time.

Global Video Ads Are Best Purchased Direct. Viewability of video via programmatic means are only viewable at a 3-in-10 ratio, versus nearly 7-in-10 via publisher direct. This metric constitutes the biggest relative weakness of programmatic in the study.

While IAS’s analysis of the first half of 2016 has many encouraging findings, it’s also clear that the programmatic marketing industry has plenty of opportunities for improvements in the coming months and years.

Tim Bourgeois (@ChiefDigOfficer) is a partner at East Coast Catalyst, a Boston-based digital consulting company specializing in strategic roadmaps, digital marketing audits, and online marketing optimization programs.

Industry-Research | Perspectives

Forrester Wave report dives deep into the marketing analytics market

October 19, 2016 DCN

To state that marketers continue to be challenged by the ever-expanding digital marketing ecosystem is neither pejorative nor insightful. Indeed, the marketplace is aggressively evolving, as evidenced by both the sector’s growth—20%+ growth last year (IAB) and its prediction to overcome TV advertising this year (eMarketer)—and the number of vendors rushing to get in on the action (the ad tech market increased to more than 3,500 in 2016 from about 2,000 the previous year, according to Scott Brinker at ChiefMarTech.com.

Marketers are spending more than ever on the digital channel, and there are a plethora of vendors competing to ostensibly help these marketers spend their budgets more efficiently. Thus, as the saying goes, “If you aren’t confused, you aren’t paying attention”.

But it’s the job of think tanks like Forrester Research to help their clients sort through marketplace complexities and make smart decisions to help their organizations succeed. And it’s with this goal in mind, the firm recently published “The Forrester Wave: Marketing Measurement & Optimization Solutions, Q4 2016”. Chock full of recommendations for B2C marketing professionals, who are seeking to stretch budgets to the limit and outmaneuver competitors, this study provides analysis of companies that provide analytics and measurement solutions. The report is based on an examination of 10 vendors and surveys with 77 marketing professionals.

Here are some key takeaways, organized into two groups of findings: undisputed and to be determined (TBD):

Undisputed: Consumers are interacting with brands in varied ways. The report emphasizes this new market reality by explaining “Empowered consumers easily absorb information from all forms of media and multiple devices, and hey comfortably straddle the digital/traditional media divide”. While this new reality presents marketers with many new channels to engage with prospects and customers—a good thing—it also makes performance tracking increasingly difficult—a big challenge.

Undisputed: Marketers are under more pressure than ever to be accountable for their budgets and demonstrate ROI. The rise of digital advertising, which will account for nearly 50% of total marketing budgets in a couple of years, has mostly been a boon for marketers, with one glaring exception: scrutiny. Since its very early days, major industry players have been touting digital marketing for its ability to be “100% trackable”. So it comes as no surprise that “today’s complex marketing environment challenges marketers to meet the C-suite’s demands for accountability.” And the right measurement solution can solve this potentially massive headache for CMOs.

Undisputed: Marketers require strategic advisory partners that can help them make sense of data and act upon the analysis in meaningful ways. Translation: while vendors need to be able to tout quality technology and toolkits, it’s more important for them to be able to offer consultative support, to help clients “interpret model results” and to “provide recommendations” based on the analysis.

To Be Determined: The Realistic Viability of Unified Marketing Impact Analytics (UMIA). The UMIA methodology—coined by Forrester in this study for the first time—involves combining traditional techniques such as marketing mix modeling and digital attribution into a single technique. While Forrester reports high customer satisfaction from this study’s survey respondents that manage such an environment (about 40 in total), we think the sample size is too small today to make a blanket judgment about the approach. Though the concept is certainly appealing, many industry experts consider it to be at best too raw, and at worst not applicable: “It’s like using the same assessment metrics to measure the performance of a jet plane versus a row boat…it just doesn’t make sense”.

To Be Determined: The Impact of New Entrants, Big Players & Market Consolidation. It’s notable that the only widely-known brands included in the Forrester study are the result of acquisitions: Google/Adometry and AOL/Converto. In the face of rapid growth over the past decade, brands have been racing to adopt and integrate the digital channel, not necessarily optimize its performance.The reality is that for all its real and perceived flaws, the digital channel remains more cost effective than alternatives in most industry sectors. As more and more dollars are allocated to digital, and more attention is given to performance optimization, it’s likely that new entrants will impact the sector—think Facebook, Adobe, etc.—and given the dearth of any category killers today, the marketplace could look very different in 24-36 months.