Will Mobile Advertising Go the Exchange Route?
The ad exchange model is spreading to mobile, and that trend is often pointed to as a sign of the increasing “maturity” of the mobile ad market. In reality, though, there’s no guarantee in this area like others that mobile will follow exactly in the footsteps of desktop — and there are major barriers to it happening.
One factor leading to programmatic buying on desktop that exists now in mobile is a supply-and-demand imbalance. There’s little doubt the huge increases in consumer attention on mobile hasn’t been matched by advertiser budgets.
And yet in other areas, there are big differences. Mobile has no cookie. That makes targeting hard to do, and the mobile exchange proposition somewhat different for advertisers as a result. Even simple retargeting campaigns — run-of-the-mill in the desktop space — are difficult to achieve in mobile.
“Data is very important, and access to mobile data is extremely difficult,” said Krishna Subramanian, CEO of Velti-owned exchange Mobclix. “There aren’t as many third-party data providers yet, and that’s what’s really going to matter: how advertisers can get access to more. The cookie challenge is definitely there, too. There’s still this question of how to build profiles across multiple applications.”
Mobile exchange operators argue that much of the data sloshing around online is basically not that important. Mobile, after all, brings other data, like location, that desktop doesn’t have.
“We’ve become glutted with data in the online space, so we’ve all tended to think of that level of insight as a minimum requirement”, said Ernie Cormier, CEO of RTB exchange provider Nexage. “I don’t think that’s true. We might not have access to all the psychographic data and other information on the buy-side in mobile, but there’s more than enough there to build an effective campaign.”
Then, of course, there’s the publisher piece. As they do their best to learn from mistakes that were made by many around desktop ads, some premium publishers are choosing to shun ad networks and exchanges completely, in the hope that selling through direct-sales channels only will help maintain price points.
“That only works for certain types of publishers,” Subramanian said. “You need your own sales force, and even if you do and you’re not selling out 100 percent, you need other channels to help sell the rest.”
That’s where publishers have historically turned to networks, and how companies such as Millennial Media, AdMob, and Jumptap have built their businesses. According to Cormier, exchanges can present a more effective alternative to networks, though, regardless of targeting and data limitations.
“There’s a different level of publisher control through an exchange, particularly with private exchanges,” he said, adding that there’s also the opportunity to layer exchanges on top of each other. An impression can first be made available in a private exchange, for example, then through a public exchange before it’s handed elsewhere.
Meanwhile, advertisers are also given greater visibility into what it is they’re actually buying than they might get with a network, which often sells inventory on a blind basis. “With networks advertisers are sometimes buying stuff they don’t want because it’s part of a package. That creates huge inefficiencies for them. Using an exchange, they can say no to buying impressions they don’t want,” suggested Nexage CMO Victor Milligan.
There’s no escaping the fact that exchanges can’t offer the same type of opportunities in mobile as they can for the desktop, but the appeal for both advertisers and publishers is still apparent, even just for the added transparency and efficiencies they can provide. Google thinks so, too, and began offering its AdMob publishers the opportunity to tip inventory into the DoubleClick Ad Exchange late last year, for example.
It’s still extremely early in the development of the mobile display ad channel, and there are still no guarantees at this point whether or not standard display ads will be the vehicle that ends up powering ad-supported mobile media. If they are, though, it seems exchanges can play a similar role for mobile as they are for desktop ads.
“It’s still early days, and you have to give mobile a bit of time,” Cormier said. “But it’s a step towards maturity that big brands familiar with private exchanges are now engaging in mobile, too.”
Coalition for Better Ads experiences European growing pains
The Coalition for Better Ads is putting more people on the ground in Europe to combat communication and resource issues.
The state of UK mobile ad spend in 5 charts
People are spending more time on mobile, so advertisers are following. In the first half of 2016, the U.K. saw mobile ad spend rocket to £1.7 billion ($2.1 billion), more than double the same total for 2015. According to the stats, search and video formats are behind the boom. But while desktop is on the way out, TV has a firmer grip on advertiser purse strings.
China’s Cheetah Mobile eyes U.S. for growth
App developer Cheetah Mobile is a global company with Chinese roots. It is focused on the global market because Alibaba, Tencent and Baidu are winning the speed-scale battle in China and copycat startups pop up overnight. The company started shifting its focus to the global mobile market with a focus on utility apps four years ago, and this year, it’s transitioning from utility to content apps.
SponsoredPublishers: Assessing risk and ensuring payments in times of crisis
Opinion: Ad blocking + telecoms = a match made at the bank
The battle for free, high-quality Internet content just got heated. Mobile operator Three has declared itself the second wireless service provider to integrate ad blocking at a network level, courtesy of ad blocking company Shine. It's being waged under the banner of “a better consumer experience,” on mobile devices, but I believe the debate is less about the consumer and much more about the money. Specifically, who’s going to make more of it.
Why Telefónica is getting brands to pay for its customers’ data plans
Spanish telecom giant Telefónica is betting on sponsored-data ad models as a key future revenue stream. The company, which is in the process of selling U.K. operator O2 to Hutchison Whaompa for £10.2 billion, has been testing several variations of sponsored-data packages for the last year and is now poised for a more widespread rollout, and it wants more advertiser partners. Telefónica's global ad director Dan Rosen spoke to Digiday about the benefits.