Real-time bidded (RTB) response rates in the UK are at an all time high, according to online display specialist Infectious Media’s third quarterly RTB Insight Report for the March to June period.
The company previously found that click through rate (CTR) doubled between November and February, but at that time it was unclear whether this was a sustainable increase or a seasonal jump.
Andy Cocker (pictured below), Infectious Media co-founder and COO, said, “It’s down to better optimisation. The more campaigns that run and the more data that is amassed, the more efficient the decision making becomes, which in most cases results in higher CTR… plus our algorithm has started to learn the type of inventory, targeting and data combinations that work.”
For the first time since the inception of the report, CPM for ad impressions in the UK are no longer the highest in Europe (see map below).
“It’s all to do with the balance of supply and demand,” said Cocker. “In the UK we’re starting to see more supply being made available so that has helped to stem the rapid CPM inflation we saw last quarter.”
Similarly, in some smaller markets like Italy, and also in Germany, demand is outstripping supply, which is resulting in higher prices as a result.
From a publisher’s perspective, the UK remains the largest European market for RTB spend, with 513% year on year growth, according to The Rubicon Project, which worked alongside Infectious on the publisher angle.
This growth is expected to continue, fuelled by an increase in publishers exposing first party data segements.
“Quite simply, the more first party data a publisher exposes, the higher the yield they will get for the ads they are selling because buyers will be willing to pay more if they understand more,” said Cocker.
Going forward, video and mobile are both going to be huge growth areas for RTB.
“A rich ad format such as video RTB opens up lots more brand-focused opportunities for advertisers and allows them to have more of a story telling approach,” he said.
“Video is very much upper funnel. It is a mechanism for pushing users lower down towards a conversion and RTB allows advertisers to understand that and target users with the right format and at the right funnel stage.”
Infectious Media is currently working on executing this strategy for a major UK advertiser, but at this stage Cocker couldn’t go into detail.
Mobile will also be a massive growth area, but tracking between online and mobile devices remains a huge challenge as it is difficult to understand the link if the same user is shown the same ad online and then on a mobile device.
“It’s a problem that hasn’t yet been solved, and it is holding back a lot of spend. At the moment it is treated as showing an ad to two different people when it’s not. In order for RTB to really take off on mobile it is a problem that needs to be solved,” he said, adding that he expects it to addressed properly within the next year.
However, the biggest challenge for the market right now is organising and enabling data assets to power intelligent buying.
“That is probably where the market has fallen a little bit short so far. It’s not just about getting onto an automatic trading platform and pushing a few buttons. It’s about enabling data assets from lots of different sources and using them to power via a trading platform.
Cocker reckons the biggest news last quarter was the launch of the Facebook Exchange, which he said is positive sign that RTB is entering the mainstream.
“One of the largest publishers in the world has opened up its inventory to trading via RTB,” he said. “It shows that this isn’t just a remnant channel anymore. Premium, top class publisher inventory is being made available on a massive global scale so I think it is a real endorsement that this is technology and trading protocol that is here to stay.”
He was keen to point out that this doesn’t mean the way Facebook advertising is currently sold is going to go away though.
Cocker reckons it is now only a matter of time before more companies in the social sector go down the same route, and over the next quarter he expects to see more big announcements from premium advertisers committing themselves to RTB as a route to market.
“We know that Twitter and LinkedIn are working on opening up their advertising platforms for programmatic buying. We would anticipate that at some point that would involve allowing RTB trading in some shape or form. That would be the logical next step.”