DENVER, April 8, 2013 (ADOTAS) – According to a commissioned study*conducted by Forrester Consulting on behalf of SpotXchange, the largest global marketplace of digital video ad inventory, real-time bidding (RTB) in online video advertising will account for 24.7 percent of all U.S. online video spending by 2014. In the study “RTB Powers The Rapid Growth of Online Video,” Forrester found that over the past year, RTB has been the fastest growing segment of the online video advertising market, growing more than 100% from 2011 to 2012, and forecast to grow more than 70% in 2013.
Forecasted 57% CAGR Over 3 years Helps Eclipse Billion Dollar Threshold in 2014
Using Forrester’s Online Video Forecast, 2012-2017, and from interviews with online video buyers, sellers and technology providers, the research firm determined that U.S. online video RTB spending has and will continue to dramatically increase. In 2012, U.S. online video RTB spending accounted for $402 million, exceeding last year’s estimate of growth. For 2013, Forrester predicts RTB spending will increase to $686 million and by 2014, RTB spending will increase to $1.14 billion – which represents a 284% increase since 2012.
Additional Findings – Definitions and Publisher Intent
The growth in online video advertising inventory practically mandates an automated solution and the definition of RTB continues to evolve from a bidding platform to a programmatic tool for the automated buying and selling of online video advertising. RTB platforms will morph from bidding engines into real-time buying engines that base their decisioning on data and analytics such as audience targeting. Other key findings from the study include:
- Online video is supplementing TV ad campaigns. While advertisers have begun to move a small percentage of TV budget to online video, those dollars represent a major influx of revenue into this green-field medium. As buyers learn how to fill in the gaps of campaigns, they will use RTB to maximize reach, frequency, or sales-lift gaps midflight.
- Programmatic buying mechanisms will continue to grow but diversify. As the online video vocabulary crystallizes and more parties understand programmatic buying, its adoption will be significant as a replacement to manual insertions.
- The marketplace will cleave along three fault lines: private vs. public; fixed-price vs. bidded; and premium vs. run of network.
- As the use of the platform shifts to buying impressions and placing ads using different pricing mechanisms, premium publishers’ interest in the automated aspects of the sale will become more enticing.
- Those premium publishers that have tested automated platforms are doing so primarily in private marketplaces, where they are able to test the impact on pricing, fill rate, and targeting on a limited and controlled basis.
“I believe that this study validates the vision we saw years ago on the promise of online video through the eyes of RTB and programmatic,” said Michael Shehan (pictured), president and CEO of SpotXchange. “Buyers have recognized the inherent value and transparency that RTB and programmatic provides, but we’re bullish on making sure publishers realize the power of automation through private marketplaces and new tools that will put them on an even playing field with demand side platforms and agency trading desks. We are excited to lead this charge for publishers and remain committed to aiding in the continued growth of this market.”
With more than 400 million auctions per day, SpotXchange is the largest global marketplace of video ad inventory reaching 120 million unique visitors in more than 50 countries each month. The leading platform for programmatic buying and selling of digital video, SpotXchange connects thousands of publishers with advertisers, agencies, trading desks and ad networks, running top brand campaigns through its IAB-certified marketplace. SpotXchange shows premium publishers and more than 1,000 world class advertisers that there is a better way to buy and sell digital video — with solutions that guarantee total transparency, brand safety and real-time control in either a private or public marketplace.