Viewable Impressions

by Madhu Vudali
February 16th, 2012

Back in June 2011, the ANA, the IAB, and the 4A’s announced their release of Guiding Principles of Digital Measurement. The first of these guiding principles is the recommendation to use the “Viewable Impressions” standard to count impressions online.   There has been a recent flurry of vendor commentary on the “Viewable Impression” from comScore, C3 Metrics, and RealVu.  Undeniably, the ad being viewed is a good thing.  And, there’s 3rd party measurement and verification being proposed for viewability.  But, is that sufficient for success?

Marketers measure for a reason – to determine past ROI, and optimize future ROI.  ROI = selling products or services, profitably.  For brand marketers, on average 95% of their actual “sales” will occur offline.   So directly or indirectly, to be valuable, measurement indicators they pay for – either directly out of pocket, or in marked up CPMs from agencies, networks or publishers – need to be indicators of ROI.

Interestingly, I see little to nothing about this in the recent commentary from comScore, C3 Metrics, and RealVu.  Viewable Impression is treated as an end goal unto itself.  Estimates that somewhere between 25% – 94% of impressions are not viewable.  (94%? Really? I would love to see that site.) There is a reference to click-through rates.  For offline sales, some people think click-through is a strong indicator of ROI, some completely disagree.  All agree “the click, alas, is not the sale itself”; only some small fraction of the clicks equate to more in-store sales.  Even based on that – the Viewable Impression numbers aren’t compelling.  C3 Metrics reported that CTR went up 179% from viewable impressions.  That’s impressive. But, applying that improvement to Doug Weaver’s great example, we’ve increased the number of clicks from 25 to 70 – a whopping 45 more clicks from 10,000 viewable impressions.

Back to our Brand Manager, who has a big number on her head, and a set amount of marketing dollars to reach that target.  Her choices between working and non-working media, and her choices within working and non-working media, must be very good ones.  “Viewability” is certainly important, but the industry trying to sell her studies is doing a poor job indicating why precious budget should go there.

What measurements have been proven to be strong indicators of ROI?  Maximizing reach against the target audience with tightly managed frequency, preferably in a contextually relevant environment.

Closing Thoughts:

  1. The ANA Has the Right Principles:  The ANA’s guiding principles (#4) determine “metrics that matter” for brand marketers and (#5) make digital measurement comparable to other media are exactly right.   We need to empower brand marketers to measure to manage, and to empower them to do that across their working media alternatives, not just within our own.  Among others, Nielsen’s measurement approach dovetails nicely with these principles: measuring reach using GRP (#5) and measuring effectiveness using breakthrough metrics (#4).  As to viewable impressions (#1), I expect it to become part of the core ad-serving technology with a clear incentive for publishers to design their sites such that ads are always viewable.
  2. The Customer is Always Right:  Brand marketers have been right all along – marrying  what made/makes TV great – broad reach and controlled frequency – to what made them fall in love with Online from the get go – targeting their audiences – creates the most powerful marketing medium in history.
  3. The Real Win:  But “Online” is not as simple as it was 24, 12 or even 6 months ago.  Those precious target audiences are now found – and must be reached effectively – across multiple formats – Display, Video and Mobile.   In 2012, who among us will leap forward and consistently provide (1) broad reach and controlled frequency (2) while targeting the desired audiences (3) across all key Online formats (4) measured comparably to other media? Once that happens, the Guiding Principles of Digital Measurement for the brand marketer can be reduced to two simple words:  Buy That.
Filed under: Branding, Measurement
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Q & A on RTB

by Madhu Vudali
December 14th, 2011

When the 2011 digital advertising predictions rolled out a year ago, RTB’s transformative nature was often cited.  While many predictions didn’t come to pass – this one did.  In earlier posts, I explained how RTB will transform brand advertising, not just direct response.  With the right agency and vendor partners, optimizing for, measuring and proving brand KPIs, brand advertisers are beginning to access RTB’s advantages.  In 2012, as Video RTB explodes and Mobile RTB arrives, the opportunities seem limitless.  The pace of this change can leave brand marketers with a knowledge gap.  Heading into 2012, brand marketers need to know the RTB basics. There are no stupid questions – this is a brave new world.  Not surprisingly, right now the majority of questions center around environments – inventory quality and brand safety – with questions about formats a close second.

Here are my answers to some of the more common RTB questions:

Q. RTB increases price transparency, but it raises concerns due to blind buying. Placement and context need to be addressed.  How will RTB address placement concerns?

A. Contrary to popular perception, RTB is not all blind.  Most of the inventory is “branded,” with URL-level visibility to where the ad is going to be served.  Further, there are several semantic-categorization services that can provide page-level context at bid-time. And, of course, advertisers can vote with their feet (their bids).  If the inventory is anonymous, you need not bid.  If URL-level visibility matters, it is worth paying for. At Brand.net, we use SafeScreen™ for page-level quality filtering to bid only on brand-safe inventory. Similarly, we ensure that the context is relevant for the campaign, before we bid.

In general, the more and more economically attractive “demand” there is for branded inventory, the more and faster supply will come into the exchanges.  All in all, RTB provides the bidders with the levers that they need to manage the placement and context for every impression.

Q. Is there a rationale for quality inventory to be available on exchanges?  To what extent does RTB trade off quality for price? Seems that RTB may not solve for the concern of brand advertisers that they are being exposed to lower-quality inventory?

A. Greater transparency, the control that comes with “private marketplaces,”  increasing publisher yields, all are contributing to increasing quality.  It is a classic virtuous circle:  as more ad budgets move into programmatic environments, as more publishers add more inventory to RTB-enabled private marketplaces, programmatic buying will create more value for advertisers and this in turn will create more value for publishers.  Publishers are yield-driven, seeking the best overall economics.  If publishers can get the best price on an exchange – placing directly, through their SSP, whatever – we’ll see quality inventory flow into exchanges even more rapidly. 

Q. Speaking of trade-offs, when brand advertisers eliminate inventory that is considered to be brand unsafe, what enables them not to lose scale?

A. RTB scale is already massive. For example, AppNexus serves approximately 14B impressions/day via RTB. And, this number is growing as more and more publishers are adopting RTB. We are talking of a relatively small percent (<10%) of the inventory that is not brand safe.  That still leaves us with substantial scale to take advantage of — 90% of 14B impressions. 

Q. Will there be a day when brands can have it both ways: rich media and scale?  Will RTB be able to serve brand campaigns with large rich media placements?  How will standardization progress?

A. All signs point to a big leap forward in 2012.  Google AdX is in beta with a hover-to-expand rich media offering for RTB. Very interestingly, Mobile is ahead of standard display with respect to rich media standardization with efforts on ORMMA and MRAID.  This is one of several reasons (more below) why Mobile will come onto the exchanges much more rapidly than Video has come along – which is fantastic for the industry.

Q. RTB grew rapidly with display, and is now growing within Video. Does RTB Video have even greater benefit to brands than does display RTB?  Less?  What does the 2012 landscape look like for RTB Video inventory?

A. Yes – I think RTB Video has an even greater benefit for brand advertisers than Display.  Video volume has been lower (still is), so you need to assemble a lot of publishers to get scale – especially if seeking demos, geos, etc.  And technical standardization has been terrible.  2012 is the tipping point for RTB Video’s “virtuous circle.”   Consumer demand is surging, ad spend is jumping, both incenting publishers to make this their year to adopt VAST standardization.  And, RTB Video – coming from Adap.tv, BRX, AdX et. al – provides great monetization opportunities for those publishers.

Q. What about Mobile? How is Mobile evolving with RTB?

A. The rapid adoption and usage of smart-phones and tablets with ad-friendly form-factors is driving up Mobile impression volumes dramatically.   With more precise geo-location, better ad formats, and higher user engagement, Mobile presents a great opportunity for advertisers to reach their target consumers.  And, Mobile monetization is more readily taking advantage of exchanges and RTB – Nexage and MoPub are already transacting at a clip of multibillion impressions / month.  We now have the ability to apply the power of RTB to all the ad formats – Display, Video, and Mobile.   By the second half of 2012, best-in-breed vendors will be working seamlessly across all.

2011 has been a great year for RTB.  It has been a transformative development for digital advertising.  My prediction:  this time next year, we’ll look back at today as old history.  Once technology takes over, change accelerates at an incredible pace.  Our world will change more over the next 12 months than it has over the past several years.

Filed under: Branding, Display Advertising, Video
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comScore Reach Rankings: Whither RTB? (Part 2)

by Madhu Vudali
November 15th, 2011

Previously, I discussed how comScore’s reach rankings are not keeping up with the emergence of RTB. Agencies use these rankings for planning and to help select media partners. Hence, it is critical for them to figure out how RTB potentially affects this measurement. Until everything is nicely squared away in measurement land, here are the five key questions that agencies should ask their media partners when deciding which ones are the most RTB-fluent.

1.  Do you have your own bidder?

• Having a bidder gives the media partner control over scale (potential inventory and unique  reach) and operational efficiencies. It is also an indicator of their level of technical investment and sophistication. With the expected growth of RTB and its applicability to all ad formats, owning a bidder is “table stakes” for any media partner that wants to offer scale.

2.  Which exchange platforms are you bidding on?

 • Publishers are increasingly testing/using multiple exchange platforms for monetization. To get the broadest inventory and reach coverage with the best economics, it is best to be bidding on multiple exchange platforms. Alternatively, access to a meta DSP such as AppNexus can provide RTB access to inventory on multiple exchanges, although at somewhat less attractive economics (for both network and end customer) relative to direct exchange integration.

3.  What level of QPS (queries per second) do you have visibility to?

• QPS translates to “potential inventory.” So, higher QPS means more visibility and access to inventory and reach. Total exchange volume estimates range between 3B to 5B impressions per day in the US, which equates to 35K to 58K QPS. Exchanges enable “pre-targeting”, e.g. IAB ad-sizes, only certain sellers, domain whitelist, and other desirable constraints, which brings the total meaningful and desirable QPS range down.

4.  What are your Response Rate/Win Rate Metrics?

• Response Rate is an indicator of how much exchange inventory is “interesting” – after pre- targeting – to a bidding media partner. Higher response rates indicate a richer demand pool and thus higher likelihood that the media partner is bringing some scale advantage to the table, i.e. the scale for fine-grained audience targeting.

• Win Rate (the % of bids that you submit on that you actually win) is an interesting metric, but only meaningful when combined with response rate. If the response rate is very high, then an ad network can achieve its inventory goal with a low win-rate. Conversely, a lower  response rate would necessitate a higher win-rate to “earn” high inventory, reach, and overall ranking.

5.  Bottomline: What is your incremental reach with RTB?

• Ultimately, it’s all about the relevant additional reach RTB fluency creates for a network beyond what is measured by the increasingly outdated comScore/Nielsen metrics. The critical variables in this regard are QPS, response/win rate, and the resultant “cookie reach.”  Of course, cookies are not UUs but it’s how most networks do a basic approximation to UUs.

Let’s take a simple example to illustrate what we mean. Assume a modest 5000 QPS and a 50% response rate. This results in ~215 million impressions per day. Factoring cookies-to-UU adjustment and reach saturation over a typical month, we would estimate that this example partner has an overall potential reach of 145 million uniques per month.

For Brand.net, we had approximately 10K QPS and a 28% response rate in September. The resulting potential reach with RTB would have been 153MM uniques, increasing our reported reach of 92MM uniques by over 66%.

Of course, these numbers will vary depending on average campaign frequency, campaign breadth, and the contextual / audience focus of each partner. All further reinforcement that if “marketing is the new finance” and innovative marketers are already putting that dictum to practice, agencies and brands need to get familiar with the new math and metrics of RTB quickly.

This is yet another way RTB is altering the playing field for media providers, separating those with the technical investment and sophistication required to take full advantage on behalf of their customers. To date we have seen this trend primarily in the Direct Response world. Now it’s transforming Brand as well, so by this time next year we’ll see a very different landscape.

Filed under: Ad Networks, Display Advertising, Inventory
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comScore Reach Rankings: Whither RTB?

by Madhu Vudali
October 27th, 2011

comScore recently released its latest rankings of “ad-focused properties” (aka ad networks). “Who’s up and who’s down” always attracts much ink in the broader industry/business press. In seriousness, many of the agencies use this ranking as a filter to decide whom to work with: the higher the ranking, the better the chance of scoring that RFP.

That “footprint filter” may well have made sense at a point in time. But RTB is completely changing that. Here’s why: (a) the Exchanges/SSPs/DSPs provide a massive, if not near complete, coverage of US internet audience and (b) most ad networks (Brand.net included) are making full use of the inventory footprint enabled by these platforms. Essentially, all of us can potentially reach the entire US internet audience. In short, comScore understates the reach of ad networks that are successfully integrating RTB. As RTB grows, this understatement becomes more profound.

Given all of the above, Agency buyers no longer have an accurate way to determine the meaningful potential reach accessible through their largest media partners. Who in the ecosystem can and/or should step in to fill that gap? And what will new planning metrics look like?

One potential outcome would be for existing big players in measurement (e.g., Nielsen, comScore) to release new metrics that resolve the gap. Alternatively, Google or QuantCast, who have measurement capabilities but less tangible footprint with buyers, could use this as an opportunity to leapfrog the more established players.

Or the most intriguing option: perhaps there are startups on the horizon that will challenge existing measurement companies by innovating new methodologies and metrics to help buyers make informed decisions in our new RTB-enabled world?

In our next post on this topic, we’ll explore some related questions and alternatives that agency buyers should consider to address this issue. In the mean time, who do you think is most likely to take advantage of this opportunity?

Filed under: Ad Networks, Industry News, Measurement
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On RTB and Brand Advertising (Part 2)

by Madhu Vudali
August 3rd, 2011

Last week, I discussed how Brand advertising benefits from RTB. Very quick refresher: a $200B online display ad market (i) of which 35% has Brand KPIs and (ii) with 50% of the inventory in RTB.  Big money opportunity.  We’re on it:  our ad platform MFP on Demand extends our full suite of guarantees (reach, frequency, audience composition, delivery, etc.) to RTB-enabled inventory.  Google is starting down the path with its GDN Reserve. But even as we early adopters go forth, lack of standards in three key elements of the ad stack inhibit the full realization of the opportunity.   Standards are boring – but the money they free up is fantastic.  So:

-          Rich Media must be standardized to keep up with, and take advantage of, the new world of RTB. Brand advertising is all about a high impact high quality user experience.  The proverbial creative pillars of TV brand advertising – sight, sound and motion – are powerful drivers of that experience.  Online, we’ve used rich media to achieve that. But, to quote Ari Paparo of AppNexus, “rich media is a poster child of dysfunction and lack of scale”.   And, Ari wasn’t even addressing RTB.  ClickZ reports that “the popularity of ad exchanges and adoption of real-time bidding through exchanges are creating challenges for rich media ad firms and advertisers.” When exchanges offer expandable inventory, the reported default-rate (i.e., showing non-expandable Flash creative) is 30% – yikes!  (Apparently, those dreaded iframes are to be blamed.)  It certainly puts to shame our claims we are the media powered by technology and innovation. Those of us who’ve dealt with rich media campaigns know what that means – we will ignore RTB for any rich media campaigns.   Net result? Brand dollars will stay in TV. Who’s positioned to address this:  Rich Media vendors (PointRoll, MediaMind, et al)?  Exchanges? Are they working together?

-          Video Advertising must get VAST Fast: Video is an even deeper sight, sound and motion experience than Rich Media, and Brand advertisers love it.  With display, we are 10+ years into standards that enable advertisers (through their creative) and media buying agencies to advertise at tremendous scale.  Video was a mess of a format before RTB emerged.  The IAB created VAST – and pushes adoption – but it is too slow going.  VAST is a promising standard – it doesn’t suffer the dysfunction of proprietary rich media.  However, unlike standards such as IEEE 802.11 for networking, VAST is SINO (not Chinese but Standard In Name Only).  Compliance to the standard is spotty and there is NO enforcement.  Again, Video has to be standardized to keep up with and take advantage of the RTB opportunity. Who’s positioned to address this:  Publishers. It has to be the publishers. While intermediaries (ad networks, exchanges, etc.) can facilitate scalable monetization, owners of the video inventory are critical to getting VAST compliance right. (Speaking of publishers in the RTB context, it is great to see Yahoo! and NBCU entering the RTB game with private marketplaces – a good first step.) What will catalyze the transition?  A few big publishers getting it going – and taking lion’s share of the spend – and by default forcing everyone else to get into the 21st century. I am really looking forward to Google with AdX and YouTube inventory to demonstrate how VAST should be done on RTB.

-          Standardized RTB: For all the talk of RTB and efficiencies, the one thing that gets glossed over is that every RTB source has created its own proprietary RTB protocol.  (Personally, the RTB protocol is the last place where I’d expect the providers to innovate and differentiate their offering.) For the agency trading desk or a media buyer that is using “manual RTB” via a DSP or Exchange UI, this may not matter.  However, if we want to scale, the lack of a standard RTB protocol creates unnecessary hassles.  Whether it is the on-the-wire protocol or the creative / brand approval or even something as basic as pricing metric, there’s no consistency.  Here’s a proposal – one RTB standard (to rule them all?)!  Who is going to step up? IAB? Open RTB Alliance?

As an ad-geek, I have not been as excited about any new technology as I am about RTB.   (I have to admit Real-time Data comes in a close second.)   Money is moving while standards are stalling.  Will we see a few more leaders lead and innovators innovate to speed that along?

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Filed under: Branding, Display Advertising, Video
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On RTB and Brand Advertising

by Madhu Vudali
July 29th, 2011

At Brand.net, we focus on maximizing ROI for Brand advertisers.  We demonstrate day in day out that tight management of the Metrics That Matter – Reach/Frequency against the target audience, and high-quality, contextually oriented media – yields outstanding offline sales ROI.  Obviously, Brands need both high ROI and high volume sales to move their P&L needles.  We address this by broad reach buying. How broad? In 1H ‘11, our average campaign ran across over 80 publishers.

What happens when we bring RTB into this focus on maximizing ROI for Brands?

Having moved past the buzzword stage, RTB is taking a rapidly growing slice of the spot market avails.  There’s been nonstop discussion of its benefits for DR advertisers.  But does it help further Brand advertisers’ goals? And, what about Publishers – how good is RTB for them?

The discussion of RTB’s impact has centered almost exclusively on the undeniable benefits of a more efficient marketplace.  Increased liquidity in the market creates a virtuous economic cycle.  Advertisers benefit from more and more diverse supply and publishers benefit from increased demand and competition for the inventory.  Since Brand advertising, like DR advertising, requires broad reach to maximize financial return, an efficient marketplace is a benefit.

But is the positive impact of RTB on brand advertising limited to just a more efficient market? No. RTB also facilitates greater focus on those Metrics That Matter to Brand advertisers:

-          Reach / Frequency: A key principle in branding is to maximize reach against the target audience while controlling frequency.  We can maximize reach more efficiently with RTB by bidding only when it results in incremental reach.  That is, bid smartly for reach – winning a new user for a campaign outweighs winning an additional exposure/increased frequency to an existing user.

-          Targeting: With audience data integration, RTB allows targeting at the user-level.  This allows Brands to win the trifecta: at the same time audience composition is optimized, reach is increased and frequency is managed.

-          Context: Exchanges or other data providers can score the various contexts that are applicable to the page – NOT the domain/site – from which the bid is originating.  We can bid only when the page-level context matches a campaign’s requirement.

-          Quality: For transparent inventory, Exchanges provide the URL of the page from which the bid originates.  We can screen for brand-safety and appropriateness of the content at the page-level before we bid, thus ensuring a quality environment for the brand. (We can do the same for anonymous inventory in a private marketplace – more on that in a separate blog.)

Again, dozens of offline sales studies prove that tight management of these levers drives highest actual offline sales ROI for brands.

How did we manage all of this before RTB, i.e., when inventory could only be bought directly from publishers?  At Brand.net, we built ad-serving technology – supplemented with operations – in anticipation of the Exchanges and are excited to plug in to the Exchange-oriented “tech stack”.  For example, with SafeScreen™, we apply quality at the page-level and discard impressions when they are not safe for brand advertisers.  (In 1H’11, we discarded 4.4% of the impressions for brand-safety reasons, even with buys across top comScore 50 “premium” publishers.)  However, with RTB, we will bid only if it is safe – no wasted impressions.  Similarly, for R/F management or targeting, our ad server is built to make user-level and impression-level decisions.  With RTB, we just move this upstream into bidding to minimize waste.  Our buying algorithms have always focused on the right inventory, the right amount, and at the right price – with feedback to refine & improve. With RTB, the feedback is more fine-grained (better) and in real-time (faster) resulting in smarter decisions.  Better, Faster, Smarter – that’s a good tagline for RTB!

So, RTB makes “achieving brand advertising goals” a better, faster, smarter possibility.  BUT (always a but)…the technical challenges to achieve those benefits using RTB are a lot greater than with publisher-direct buying, and even greater for Brand advertising than for DR advertising. For example, while there is more inventory with RTB, coordination across 10x more inventory and more publishers smartly requires significantly more technology, predictive modeling, and analytics.  Since there is a greater possibility of unsafe inventory, filtering and quality management become more challenging.  Since there is greater volatility in inventory availability and pricing, guaranteed delivery and smooth delivery – basic needs of Brands – also become more challenging to engineer.  If an ad technology company can’t manage against that volatility, the problems outweigh the benefits.  Want another challenge? At a purely infrastructural level, factoring all these considerations and returning a bid before the server times out is in itself a critical challenge and is, essentially, table-stakes for RTB.

Large numbers of DSPs have sprung up to help media buyers achieve the maximum benefit RTB can provide to direct response campaigns. Predictably, they are eager to access the huge brand budgets as well.  Media buyers beware:  success in DR does not ensure success in achieving Brand campaign KPIs. Make sure that your vendors understand and can prove that they achieve these Brand KPIs.  At that point, the benefits of RTB are realized for Brand advertisers.

So, what could market players – exchanges, IAB, publishers – do to move this brand opportunity even bigger?  A lot.  In my next blog, I’ll call out the key levers.

Filed under: Branding, Display Advertising
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Measuring Reach

by Madhu Vudali
May 6th, 2011

eMarketer has an article on measuring Reach properly – a topic near & dear to our hearts – citing research from MediaMind.  The takeaway is that cookies tend to overstate Reach (Unique Users or UU) by a factor of 3.0, due to cookie deletion.  Readers may recall that comScore had also done a similar study in 2007, where they found that the inflation factor to be 2.5.  It is good to see that these factors are in the same neighborhood. (Sidebar:  These are separate studies…but notice the 20% increase in the inflation factor?  Might users be deleting cookies more often because of privacy concerns?)

Media planners can get a rough sense of Reach using these adjustment factors.  However, when it comes to campaign measurement, you need something that accounts for the uniqueness of the campaign.  For example, comScore’s factor is based on an analysis of “cookies from one prominent Web property and one third party ad server” over the course of one month.  Your campaign might be spread out over many websites big & small and for a longer/shorter period.  Just taking a haircut of 60% on your cookie count may not be accurate.

At Brand.net, we have always been aware of cookies inflating Reach in general and the differences in this inflation factor for each particular campaign.  Rather than applying a gross adjustment factor to our cookie count, we have created a patent-pending technology code-named Lazenby, which combines cookie data, campaign delivery by site, site-visit distributions and other data to produce a Reach (UU) estimate for each campaign.  Lazenby UU counts have been validated by a variety of campaign-level 3rd party counts.

So, next time you see a campaign Reach report from a media partner, please ask for a breakout of cookies vs. UUs.  If the report already has the breakout, be sure to ask how the media partner is estimating the UUs from the cookie counts.

You might be surprised what you hear.

Filed under: Measurement
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