Chandrakanth B NCo-founder & Managing DirectorTheorem India

Evolution of Display Advertising – From GIF to RTB

30-Nov-2012

Agenda

■ Relevance of Display in the era of search, social and

mobile?

■ Evolution of Display Advertising

■ Trends globally

Why is display advertising so effective?

� People are naturally drawn to images

� People respond positively to visual things

� Generate actions that go beyond clicks

� Mere exposure effect - subconscious multi-tasking

� Repeated exposures = familiarity = one of the goals of advertising

� Better value option than other media

Role of Display in Purchase funnel

Source: Eyeblaster: “Search & Display: Reach Beyond the Keyword”

US Interactive Marketing Spend - Forecast

Display advertising campaign life cycle

Media Buying

CreativeStrategy

CreativeBuild

Traffic/ Deploy

Report AnalyzeRetarget/

New Campaign

Media Planning

The Display Ad serving Value Chain

Pre - Order

Creative Generation

Inventory Management

Buyer Side

Seller Side

Order Management

Trafficking

ReportingTrafficking

Reporting

Integrated Platform

Ad Delivery

Billing & Finance

Optimization

Partnership Review

Invoicing

Optimization Invoicing

Publishers Trafficking ASP Tool (DFP, OAS, ADTECH, Yahoo APT etc.)

Advertisers Ad Serving ASP Tool (DFA, ATLAS, MediaPlex etc.)

Content Curation

MediaPlanning &

Buying

Proposal Generation

Ad Delivery

1994: Origin of banner ads

AT&T’s “You Will” campaign ran on HotWired in October 1994. It was among the first

web ads.

Standard Banners

Wide Skyscraper

Leaderboard

Full Banner

Medium Rectangle

Skyscraper

1996: Beginnings of rich media

HP’s Shockwave “Pong” banner; first rich media ad (you could play Pong in the

banner). Created by San Francisco-based agency RedSky Interactive in 1996.

Rich Media

Video Ads

• Pre-roll

• Mid-roll

• Post-roll

• Overlays

Future of Video

� There is a steep rise in professional

video content coming online

� High-definition, full-screen video is

becoming commonplace on the Web

� Improved players—most notably

Flash and Microsoft’s Silverlight

� At a 46.5% growth rate, digital video

ad spending will continue to post the

strongest gains

� Increasing sales of more expensive and more effective preroll ads on YouTube

� 70% of people are now engaging with video content outside of the traditional TV set

US Interactive Display Media - Forecast

Early days of ad serving

Source: Online Advertising Business 101 by Ian Thom as

Enter the publisher ad server

Source: Online Advertising Business 101 by Ian Thom as

Enter the advertiser (third-party) ad server

Source: Online Advertising Business 101 by Ian Thom as

Content Delivery Network (CDN)

Source: Online Advertising Business 101 by Ian Thom as

The Evolution of Display Media Buying

Direct from

Publishers

1996 �

Ad

Networks

1998 �

Ad

Exchanges

2005 �

DSPs

2009 �

Real-time bidding (RTB)

Real-time bidding (RTB) is a relatively new advertising technology that

allows online advertising to be purchased and served on the fly.

Is it Display’s answer to search?

Today�

Real-Time Bidding: How it Works?

Exchange

Site 1 Site 2 Site 3

Sites place an exchange tag on their pages with available inventory

1User types in a URL and browser renders webpage

2

Exchange federates bid request to all bidders for an auction

3

Bidder Bidder Bidder Bidder

BidderBidderBidder

Bidders evaluate request (hold auction among their advertisers) and send bid responses to the exchange, including bid price and creative

4Exchange evaluates all bid responses and selects winning bid

5

Winning bidder’s creative is served to the user. Bidder pays .01 more than 2nd place

6

Why RTB?

• Winning formula of right user, right placement at the right time

• Greater actionable insights at impression level

• Extensive reach, performance and scale with full transparency

• High level of control to optimize campaign performance.

• Enhanced ROI for advertiser

• Relevant ad experience for the user

• Revenue Maximization for Publisher

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Evolution of Media planning and buying

Trends globally and in India

� Strong growth for video and rich media is apparent

� RTB to get more sophisticated and greater adoption

� Currently this eco system is very fragmented

and too many players

� More consolidation possible as the space is very cluttered

� India in its early stage of adoption and as the digital

marketing eco system evolves we may see more players in the DSP and RTB

next year

� Higher scale of transaction and better audience data will drive RTB adoption in

India

www.theoreminc.net

chandra@theoreminc.net