Mobile, video, and real-time bidding to catapult programmatic ad spend
A new report from Business Insider Intelligence finds that real-time bidding (RTB), a key piece of the programmatic ecosystem, will account for over $18.2 billion in US digital ad revenues in 2018, up from just $3.1 billion in 2013.
Programmatic platforms are on pace to fundamentally reshape the entire digital advertising landscape according to the report. These platforms are automating much of the ad buying and selling process and increasing the accuracy of execution. Programmatic technologies are helping ad buyers find the right audience at the right price at the right time.
In the report, BI Intelligence looks at the drivers of programmatic adoption, sizes up the programmatic market, and outlines the barriers that some advertisers and publishers face when adopting programmatic technologies. Here are some of the key takeaways from the report:
- Programmatic and real-time bidding (RTB) ad spend is growing fast. RTB will account for over $18.2 billion of U.S. digital ad sales in 2018, up from just $3.1 billion in 2013, growing at a compound annual growth rate of 42%.
- Mobile and video ads will be a major driver of this growth, with RTB sales for these formats topping $6.8 billion and $3.9 billion in 2018, respectively.
- A number of companies are already cashing in on the growing programmatic market. Top programmatic ad companies include Criteo, Rocket Fuel, the Rubicon Project, and AOL. These four companies pulled in more than $1.5 billion in combined global ad revenue in 2013, accounting for more than one-tenth of global programmatic ad dollars.
- Prices for programmatic ads are increasing for almost all ad types, as demand outpaces supply. The effective cost per thousand impressions (eCPM) for social ads was up by 64% between January through April 2014, compared to the same time period one year earlier, according to Turn.
- There are still a number of barriers to adoption. Top barriers include brand worries that they will lose control over where their ads will appear, internal resistance at ad agencies, and lack of transparency in the industry over methods and results.
