Real-​Time Bidding to Grow for Display Ad Market

A couple of weeks ago, I blogged about the ways that  marketers are improving the look of their display ads. It turns out there’s a lot going on behind the scenes before an online display ad appears in a consumer's browser. Marketers want to deliver their content to a specific audience for the best possible price. And the media space owners want to maximize the profits for delivering that audience to marketers. This situation has given rise to a real-​time bidding market for display ad space. By many accounts, this bidding business model will continue to grow in 2011.

According to eMarketer analysts, the bidding model allows marketers to ‘buy audience instead of inventory’. While they might choose a page position and the number of impressions they’d like in advance, marketers can place bids for how much they'll pay to have their ads served to consumers with specific cookie data history.

This method of buying display ads also affects ad networks. eMarketer analysts point out that publishers often use ad network resources to fill their surplus inventory. This larger marketplace allows buyers and sellers to access a deeper resource pool. At the same time, ad agencies note a preference for purchasing online ads through networks as the following responses to the question about methods used for purchasing online advertising shows:

  • Ad networks 81%
  • Traditional media outlets such as TV or newspaper sites 61.9%
  • Direct from publishers such as expedia​.com 46%
  • Through an exchange like Right Media 20.6%
  • Self-​service tools like PageGage 9.5%
  • Other 3.2%

These numbers clearly indicate that agencies prefer to use ad networks when purchasing display ads. But both marketers, and their agencies, must decide whether ads are more effective when delivered via a specific site because the content draws a unique audience or when delivered to an audience that travels to or visits multiple sites. For now, the top 2 strategies employed for online ad buys are data-​driven demographics (72%) and behavioral (69%).

Whether a marketer opts to bid on opportunities in a specific venue or through an ad network, it's clear that the  attention to and dollars spent on display advertising continue to grow.

[Source: 2011 Trends: Future of Online Ad Buys. 30 Nov. 2010. Web. 9 Dec. 2010] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.