First published here.
The industry needs to work together to convert the promises of online audio advertising into reality, writes IAB Europe's Marie-Clare Puffett
The audio advertising market is enjoying a renaissance. The traditional FM/AM, analogue and DAB advertising market alone is now worth €6 billion in Europe, and these formats are being supplemented by a new range of digital audio options – from IP radio to music streaming services to podcasts.
The growth of these new audio services is exponential: there are now around 700,000 podcasts, comprising 29 million episodes, up 27 percent from last year. This explosion in content shows little sign of slowing; and new channels, such as connected cars and radio apps in smart speakers, will help increase the opportunities for advertisers to reach listeners.
As a result of new audio services, and the increase in opportunities for such services to be consumed, IAB Europe has forecast that the European digital audio advertising market will grow to around €1.5 billion by 2023 – up from €471 million today.
The foundations for a renaissance
However, audio advertising is still a nascent market. The monetisation of the audio market has not kept pace with the growth in consumption of audio services, while challenges around measurement and attribution have limited its appeal to advertisers. The industry needs to work together to convert the promises of audio advertising into reality.
The foundations are already in place - several core characteristics make digital audio highly attractive for advertisers:
Digital audio currently only accounts for around 3 percent of the total display market excluding social, and the programmatic audio market is still too small to measure with any degree of accuracy. But it is early days and the foundations are strong.
Overcoming the barriers to programmatic audio
For the audio market to fully realise its potential, scale is key. And for that, there will need to be rapid growth in programmatic audio. However, until the barriers to unlocking programmatic audio are overcome, the audio advertising renaissance will be stuck in first gear. Some of the barriers are:
The market heats up
While significant barriers remain to the realisation of the programmatic audio market, and therefore scaling the audio market as a whole, there are some indications that key industry players are beginning to make moves on this front. Recent M&A activity speaks to a heated market and suggests that the audio advertising market will reach maturity rapidly.
To give just one example: Spotify, a streaming platform, has recently purchased a podcast network (Gimlet), creator tools for podcasters to build and monetise content (Anchor) and a production agency (Parcast).
The renaissance requires work
The boom in audio content, along with the emergence of new technologies that will give people more time to engage with audio content, is a huge opportunity for advertisers. However, the promised renaissance of the audio advertising market will only occur if the industry works together to define new measurement standards, puts in place the requisite pipes and data analytics tools, and finds a way of uniting fragmented inventory while integrating audio with other programmatic channels.
There’s much work to be done, but from the example of video streaming the industry has a good template for how to achieve these goals. The market is already heating up and when end-to-end audio streaming giants start to breakdown the barriers currently holding the market back, the sky's the limit.
On the 10th & 11th October, IAB Europe hosted its second Network Next event of 2019. Exclusively for leaders of National IABs from across Europe, the aim of the event is to share best practices, discuss the latest industry trends and challenges and collaborate on future European-level initiatives and projects.
Representatives from 24 National IABs met in Berlin for an agenda packed two days. Kicking off with IAB Europe’s Chief Economist Daniel Knapp, delegates were given an insight into industry growth areas. The first headline of ‘New growth does not come from hype and obscure language’ set the session up well to show Daniel’s predictions that future growth will be unlocked from old and new media, notably ‘new’ TV, Audio and Out-of-Home’.
Case studies, new standards and code of conducts from different National IABs were presented throughout the two days, with accompanying working group sessions so delegates could discuss and debate new initiatives including IAB Poland’s Programmatic Code of Conduct, IAB Italy’s Quality & Transparency Initiative and IAB UK’s DTC member engagement. IAB Europe’s CEO Townsend Feehan and team gave updates on the Transparency & Consent Framework, the latest policy developments, committee activities and upcoming events and membership activities.
A big thank you to BVDW for hosting all delegates in Berlin. They presented a fantastic opportunity to see both old and new Berlin and the schnitzel dinner and German beer were welcomed by all!
In the absence of a strong digitally oriented formal education system, training needs to be focused on the next generations of talent if we wish to close the skill gap
19 September 2019, Brussels. IAB Europe, the leading European-level industry association for the digital marketing and advertising ecosystem, today announced the launch of its annual Human Capital in the Digital Environment report. Developed under the guidance of the IAB Europe Education & Training Committee, the survey findings uncovered a series of critical areas of the digital training and human capital in the online ecosystem, ranging from the primary training needs of both employers and candidates, to the challenges faced by the two groups when filling positions in the industry.
75 percent of respondents cited the shortage of eligible candidates as the primary challenge they face when recruiting. This is reported across Europe relatively uniformly: 71 percent of employers in CEE and SE countries cite this shortage, a percentage which rises to 78 for respondents from Northern and Western Europe.
Townsend Feehan, CEO, IAB Europe remarked that “The findings of the Human Capital in the Digital Environment report once again reinforce the acute need in the industry for better and more sustained efforts in training and education. It is a call for closer cooperation and cross-support between all players to develop European programmes which help close the skill gap and ensure a thriving digital ecosystem.
Students and recent graduates are the future in more ways than one. They are the solution for the current shortage of digital talent and the key for a more efficient industry moving forward. While in the short-term there is not much that we, as an industry, can do to reshape education systems across Europe to better cater to a digitised world, we can - and must - support students by raising their awareness of the opportunities digital presents and the skills needed to capitalise on them.”
The majority of respondents cited programmatic (59 percent) and analytics (51 percent) as the most highly-desired skills by recruiters, for both candidates applying for a position, but also existing staff transitioning into a new role. 55 percent of respondents see programmatic as vital in the recruitment process, whilst 51 percent are interested in receiving training on this topic. In terms of analytics, 51 percent of responders see this as the main skill to have when seeking a job in digital advertising and marketing, whilst 46 percent would like to receive further training in it. A slight dissonance occurs when it comes to emerging technologies, with 48 percent of candidates marking this as a topic they would like to be trained in, though only 35 percent of employers have cited it as a skill they are interested in candidates possessing. Social media advertising skills are also in high-demand, according to 44 percent of HR and training experts.
Employers and candidates, the Human Capital in the Digital Environment 2019 Report shows, are aligned in terms of priorities. Candidates are more than willing to receive training and it is our mission as an industry to support them in their efforts. A wider range of programmes, covering not only fundamentals but also specialisations from within programmatic or analytics will help offset the skill gap and increase efficiency in digital advertising.
The IAB Europe Education and Training Committee will continue to support private and national initiatives that work to close the skill gap. It will step up efforts to leverage its Endorsement Programme and develop courses in concert with the other IAB Europe committees and leading experts in the market”, said Neslihan Olcay, CEO, Wavemaker Turkey, and Chair of the IAB Europe Education & Training Committee.
The findings of the report lead to the conclusion that responders have flagged for two consecutive years now: in many countries the formal education system is simply not adapted to today’s digital rigours. Future professionals in digital advertising, particularly the few who come from disciplines not directly tied to this field, find themselves in need of general training, whereas the industry relies heavily on very specialised skill sets. Students from fields such as software engineering, economics, mathematics, computer sciences, are not immediately aware of the opportunities presented by digital advertising and therefore the pool of potential candidates is lower than it could be, which is a determining factor for the shortage of talent cited in this report.
The IAB Europe Education & training Committee will continue to take steps to support the efforts of its National and Corporate members, through guidance, insight and visibility opportunities, alongside a more consistent library of training resources.
Download the full report here
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About IAB Europe
IAB Europe is the European-level association for the digital marketing and advertising ecosystem. Through its membership of National IABs and media, technology and marketing companies, its mission is to lead political representation and promote industry collaboration to deliver frameworks, standards and industry programmes that enable business to thrive in the European market. For further information please visit IAB Europe.
For more information, please contact:
Alex Macarescu, IAB Europe (macarescu@iabeurope.eu)
Helen Mussard, IAB Europe (mussard@iabeurope.eu)
TOTAL PROGRAMMATIC REVENUE GREW BY 33 PERCENT IN 2018 TO €16.7BN
ADOPTION OF ADS.TXT STILL LOW AMONGST BUY-SIDE, DESPITE HIGH PUBLISHER ADOPTION & ONGOING AD-FRAUD CONCERNS
11th September 2019, Cologne: IAB Europe, the leading European-level industry association for the digital marketing and advertising ecosystem, today announced the launch of its annual ‘Attitudes to Programmatic Advertising’ report, alongside its programmatic market-sizing research. Now in its fifth year, the report is the most comprehensive analysis of the European programmatic landscape, covering strategies and adoption trends, drivers of and barriers to growth, and forecasts for the future for 31 markets.
The latest research reveals that programmatic revenue grew by 33 percent in 2018, topping €16.7bn, with more than 70 percent of display and more than 50 percent of video now traded via programmatic methods. Social media buying dominates programmatic, but when this medium is removed the market saw impressive growth of 26.6 percent, to a total of €5.5bn.
Key findings in the ‘Attitudes to Programmatic Advertising’ report include:
Announcing the report, Townsend Feehan, CEO, IAB Europe said, “The programmatic industry is experiencing a period of rapid transformation, to ensure it continues to provide a safe environment for advertisers, a positive experience for consumers and addresses the demands made by new regulation throughout the world. In the context of this evolution, it is encouraging to see the majority of stakeholders expecting an increase in programmatic investments of up to 80 percent over the next 12 months. In particular, we expect digital out-of-home, audio and connected TV to be areas of growth. It is clear however that talent, the low buy-side adoption of ads.txt, and supply chain transparency remain impediments to this growth and these are areas we will be addressing with our members.”
A key finding within the report is that whilst many of the challenges the industry has faced - particularly around ad fraud and brand safety - remain an ongoing concern, the buy-side has not yet adopted ads.txt and the mobile-specific apps-ads.txt in significant numbers. Only 6 percent of advertisers and 26 percent of agencies are buying the majority of their inventory ads.txt verified.
Amongst publishers, ads.txt adoption is much higher, with 56 percent of them selling the majority of their inventory with an ads.txt file attached. This suggests that the ads.txt inventory exists but more buyer education and adoption is required.
Commenting on this insight, David Goddard, VP Global Programmatic Strategy, BBC Global News, said, “I hope the release of this year’s ‘Attitudes to Programmatic Advertising’ report will be the catalyst for greater levels of app-ads.txt adoption for publishers, increasing the volume of inventory that is verified, whilst increasing buy-side awareness of this simple, yet effective tool to tackle transparency and quality concerns.”
The study also reveals a clear shift to hybrid models for programmatic trading as the number of advertisers with in-house operations overtakes the number outsourcing to an agency, alongside an increase in the number using external consultancies. Advertisers using consultancies for programmatic buying grew to 7 percent in 2019, from zero percent reported in 2018. In addition, 52 percent of advertisers cite that they are considering taking programmatic in-house in the next 12 months whilst 50 percent claim they plan to use an external consultancy.
Download the reports below
IAB Europe Attitudes to Programmatic Advertising Report 2019
IAB Europe European Programmatic Ad Spent Report 2018
EDITOR NOTES
Now in its fifth year, the Attitudes to Programmatic Advertising study has become an industry benchmark to show how programmatic advertising attitudes, adoption and strategies are evolving. The survey attracted respondents who command significant volumes of advertising supply and demand. Over 70 percent of the respondents across advertisers, agencies and publishers manage annual advertising budgets of €1m or above. For the first time, IAB Europe surveyed ad tech vendors in the 2019 study. The survey asked about the following areas: How much programmatic is used for different formats (display, mobile and video); drivers and barriers to programmatic investment; operational models used for programmatic; measurement and data strategy; the future of programmatic investment.
The report, written by industry experts from IAB Europe’s membership, forms part of a comprehensive programme of pan- European educational and guidance outputs published by the IAB Europe Programmatic Trading Committee.
The IAB Europe 2018 Programmatic Market Sizing numbers distinguish between programmatic including social and platform self-serve; and programmatic as inventory traded using OpenRTB only. This is due to varying national market measurement practices and the need to provide a harmonised European number.
About IAB Europe
IAB Europe is the European-level association for the digital marketing and advertising ecosystem. Through its membership of National IABs and media, technology and marketing companies, its mission is to lead political representation and promote industry collaboration to deliver frameworks, standards and industry programmes that enable business to thrive in the European market. For further information please visit https://www.stg-iabeurope-iabeuropeold.kinsta.cloud/
For more information, please contact:
Marie-Clare Puffett, IAB Europe (puffett@iabeurope.eu / +44 7973 836 917)
Helen Mussard, IAB Europe (helen@iabeurope.eu / +44 7399 919 594)
Victoria Johnson, Too Many Dreams (victoria@toomanydreams.ltd / +44 7939 594 637)
Stephen Jenkins, Too Many Dreams (stephen@toomanydreams.ltd / +44 7957 803 685)
IAB Europe would like to express its sadness at the passing of former European Data Protection Supervisor Giovanni Butarelli. Like many industry associations, we had the opportunity to engage with Mr. Buttarelli on some of the legal and policy issues on which he became a figure of such influence in Brussels and beyond. His grace, warmth, humour, and intellectual and moral rigour touched and inspired us. We send our condolences to his family and his colleagues at the EDPS.
Townsend Feehan, CEO, IAB Europe
To support TCF v2.0, we have prepared collaterals to provide a clear overview of the framework, its mechanism, and what it entails for all stakeholders involved.
Want to get up to speed quickly on the TCF and TCF v2.0? Hear from the people involved in helping to shape and create the new Policies. Featuring members of the TCF Steering Group, these 90 second video provide digestible updates. Watch the videos below!
Video 2 - Who is the TCF designed for?
Video 4 - What’s new in the TCF 2.0?
Video 5 - User & industry benefits of the TCF 2.0
Video 6 - Transparency Consent Framework v2.0
Overviews of the TCF v2.0 for publishers, agencies & advertisers, Consent Management Platforms (CMPs), vendors and all stakeholders. Find all the information you need in these handy guides.
TCF Fact Sheet - Agencies and Advertiser
Find out why and how the TCF was created and details on TCF v2.0 updates and technical specifications - FAQs
