PROGRAMMATIC TRADING QUARTERLY REPORT Q2 2013

Transcription

1 PROGRAMMATIC TRADING QUARTERLY REPORT Q2 2013

2 Media Experts Quarterly Report on the Canadian Programmatic marketplace presents actionable insights into the evolving real time media landscape from both the marketer and agency perspectives. Our Q Report utilizes aggregated data sets gathered by one of our partner trading platforms, New York based Accordant Media, to showcase year-over-year and quarter overquarter trends. In our Second Quarter Spotlight, we focus on the latest Canadian market results that illuminate the correlation between inventory pricing and advertising effectiveness. During Q2, XPETO, Media Experts Online Trading Desk, leveraged over 268,000 sites spanning display, video, mobile and social inventory to generate over $90M in e-commerce sales for our customers. Data Points: XPETO Q2, 2013 & Q RTB Canadian Market Indices compiled by Accordant Media.

3 Q CANADIAN MARKET PROGRAMMATIC TRADING INDICES The second Quarter of 2013 was characterized by a slowing in the growth of publisher inventory and a strengthening of RTB buying via a broader use of targeted sites, higher-value publisher performance, key verticals and a greater utilization of algorithmic buying tactics. By employing more sophisticated tools and tactics, buyers have been taking greater advantage of the rich amount of inventory in the marketplace, leveraging a greater breadth of sites to support campaign goals. 1. Q2 RTB media auction volume growth rates slowed from the exceptional growth experienced in preceding quarters when several new entrants were joining the market. Impression volume sold through auction in the Canadian marketplace grew 27% over Q2-2012, although remained flat against Q A combination of a rise in seasonally-driven advertising activity and market demand absorbing the inventory supply growth experienced over the past six months, contributed to a strengthening of Average CPMs paid at auction by 5% over Q1. 3. In this quarter s Spotlight on Targeting RTB Quality, Media Experts identifies the direct media price/performance correlation and pricing trends by supply vertical. KEY CANADIAN MARKET SIZE INDICES RTB INVENTORY (GLOBAL) RTB INVENTORY (CANADA) AVG. CPMS ($ S) (CANADA) CTR (%) (CANADA) YEAR CHANGE VS Q Data Points: Media Experts Q RTB Key Canadian Market Indexes QUARTER CHANGE VS Q % +98% +27% +1% -13% +5% +34% -6%

4 I. MARKET SIZE INDICES % TOTAL VOLUME % TOTAL VOLUME a) CANADA-GLOBAL PERSPECTIVE: In Q2 Canada retained its position as the sixth (6th) largest RTB market globally, and is growing faster than the US, UK and France. The top six global markets hold 67% of total volume. Q2 YEAR OVER YEAR GROWTH BY COUNTRY 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% VOLUME SHARE % CHANGE UNITED STATES BRAZIL UNITED KINGDOM GERMANY FRANCE CANADA RUSSIAN FEDERATION ITALY TURKEY POLAND MEXICO SPAIN ARGENTINA COLOMBIA NETHERLANDS ROMANIA GREECE UKRAINE CHILE EGYPT (Note: Asian market data may reflect sample bias due to XPETO s RTB activities.) 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 500% 450% 400% 350% 300% 250% 200% 150% 100% 50% 0% % CHANGE YEAR OVER YEAR b) GEOGRAPHIC DISTRIBUTION OF CANADIAN RTB IMPRESSIONS: Canadian RTB impression volume by Province reveals that, relative to population size, Ontario is the most active RTB geo, while RTB impressions in Quebec are scarcer. This may be explained by Quebec s distinct publisher network which caters very effectively to the demands of Quebec marketplace and has less inventory available for release to the exchanges than publishers in the Rest of Canada (ROC). By extension, due to the language difference, Quebecois generally tend to spend less time with the US-based inventory of Canadian impressions, which account for the majority of so-called Canadian inventory in the ROC. This also suggests that Quebec based publishers have been more cautious in releasing inventory to the programmatic trading marketplace. IMPRESSIONS/POPULATION SHARE BY PROVINCE ON QC BC AB MB NS SK NB NL PE NT YT NU IMPRESSION SHARE POPULATION SHARE

5 II. CANADIAN RTB BUYING DYNAMICS a) CPMs REMAIN STABLE IN 2013: CPMs in the Canadian marketplace stabilized following a comparatively softer Q1 suggesting a healthy balance between supply and demand. Media Experts anticipates continued strengthening of CPMs throughout 2013 which will be driven by an increased number of programmatic buyers coming online in Canada, as well as the added opportunity and demand for premium programmatic video and mobile inventory. b) EXCELLENT TRANSPARENCY INTO AD POSITION IN CANADA: During Q2, 41% of Canadian ad positions were reported by publishers at the auction event, the same percentage as reported in Q1. While this is an encouraging development for Canadian marketers, (in contrast only 33% of ad placements are reported at auction in the US), more robust position tracking would help the market to understand the position of the remaining 59% of ad placements and better inform bidding on those impressions. The supply of ad placements from Canadian publishers is less steady month-to-month which presents a challenge for buyers to be more alert in their decision-making and to exercise careful campaign monitoring. III. Q SPOTLIGHTS: FOLD POSITION IN RTB BUYING 24% 16% 17% 17% 21% 23% 24% 24% 55% 61% 59% 59% 17% 24% 59% In our Q Spotlight, Media Experts examines three evolving media strategies emerging as vital tools in the programmatic media buyers toolkit. First, we analyze the performance of media by clearing price. We then revisit mobile data from Q1, to track any emerging trends, and examine CPM trends by publisher vertical. a) INVENTORY PERFORMANCE BY CLEARING PRICE: In our analysis, RTB clearing price is emerging as a good predictor of quality. For performancerelated campaigns, we found that higher-priced CPMs resulted in conversions that drove lower average CPAs. Q2 Q3 Q4 Q1 Q

6 In an environment where some buyers may be focused primarily on lower-priced CPMs, Media Experts experience suggests that RTB buyers may find it a more productive strategy to consider testing the performance of branded inventory at higher price points. This serves to underscore that the Programmatic space is not just about purchasing low cost, remnant inventory. Significant value can be extracted from higher priced CPMs that can deliver strong results. % TOTAL VOLUME CPA INDEX CPA INDEX LINEAR (CPA INDEX) 0 $0-2 $2-4 $4-6 $6-8 $8+ a) FOR RTB MOBILE BUYERS In tracking mobile activity relative to Q1, we see that Canadian buying continues to show increased targeting of tablets over smart phone devices. In terms of targeted operating systems, there was a 25% increase in ios-targeted ads, at the expense of the larger Android-based market, which still dominates the platform with a 63% share. However, overall mobile impression volume increased by 52% from Q1 to Q2 meaning both Android and Apple saw increases in overall impression volume with Apple growing at a slightly faster rate. TABLET PHONE VOLUME BY MOBILE DEVICE TYPE Q1-Q % 66% 41% Q1 34% Q2

7 OTHER 3% 2% OTHER 28% 35% ios 70% 63% ANDROID VOLUME BY OPERATING SYSTEM Q1-Q Q1 Q2 CANADIAN MOBILE IMPRESSION VOLUME QUARTER OVER QUARTER IMPRESSION VOLUME INDEX Q1 Q2

8 C) CANADIAN TARGETED INVENTORY - VERTICALS: Since the midway point of Q1, Canadian RTB inventory prices have moved in lockstep across all verticals. Only in the latter part of Q2 did inventory pricing show some breakout with Finance, Home and Auto inventory moving relatively higher (see chart below). In our view this is reflective of seasonal activity surrounding the traditional Home and Auto sales cycles and the attendant interest on the part of consumers in financing solutions for both. The proliferation of demand for content in these verticals underscores the real-time nature of the Programmatic Trading channel and how seasonally-driven activity can impact the marketplace. Seasonally-driven activity can impact the marketplace. CPM INDEX BY DOMAIN GROUP CPM INDEX Currently, Media Experts sees overall prices across the seven dominant verticals changing together Q1 Q2 FINANCE GENERAL HOME & AUTO NEWS & POLITICS SHOPPING TECHNOLOGY/TELECOM TRAVEL & ENTERTAINMENT

9 SUMMARY: FROM HYPER-GROWTH TO ACTIVE BUYING TACTICS The Canadian programmatic media market continues to evolve in a healthy manner. While the initial inventory growth phase seems to have flattened considerably, there is arguably a more significant focus on quality and buying innovation involving a broader range of programmatic advertising strategies. As the Canadian Programmatic Trading market matures, and buyers become more sophisticated in their application of innovative tactics, this will continue to apply upward pressure on CPMs. For further information, please contact: Karel Wegert Vice President, Digital Solutions x-724 karelw@mediaexperts.com WHAT THIS MEANS FOR PARTICIPANTS: Advertisers have more opportunities to deploy programmatic media solutions than ever before. RTB buyers are finding greater scale, quality and targeting success. Publishers are well-positioned, given the steady buyer demand and the recent flattening of inventory growth. By offering quality, transparent ad placements, programmatic premium deals and expanded video and mobile channel solutions, the supply side can play an important role in supporting broader, vibrant RTB solutions. RTB Buyers are evolving from an initial phase of market entry to a second wave of program expansion driven by understanding quality and performance factors. As such, RTB buyers are shifting from strict CPM-based decisions to more sophisticated approaches to leveraging the channel and their resulting higher return on media investment.

10 ABOUT MEDIA EXPERTS MEDIAEXPERTS.COM Founded in 1981, Media Experts is Canada s largest independent media services firm. Powered by Service, leveraged by Customerization and guided by Tradigital Thinking, Media Experts employs an integrated approach to traditional and digital advertising media, orchestrating them to bring maximized, measureable return on investment to our customers. Media Experts executes media strategy on behalf of its customers from its three interconnected offices in Montreal, Toronto and Vancouver. XPETO is the online trading desk developed by Media Experts. The fully-transparent, data driven programmatic trading desk places, tracks and optimizes hundreds of millions of ad impressions each month for Media Experts customers. ABOUT ACCORDANT MEDIA ACCORDANTMEDIA.COM Accordant Media is an independent, programmatic media-buying and optimization company that delivers effective audience targeting and biddable display media programs for leading agencies and in-house marketing teams. Accordant s proprietary technology built off the Audience OpticsTM system, leverages advanced buying tools integrated with sophisticated campaign data management and cross-channel analytics expertise. Accordant Media is based out of New York.