Member Guest Post with Smaato – Five Key Trends in Digital Ad Tech Every Publisher and Marketer Should Know

In our latest member guest blog post, Jane Handel, Product Marketing Manager at Smaato discusses how you can get ahead of the trends impacting the digital ad tech industry to help shape your monetisation strategy and extend your reach. She also shares a preview of some of the topics covered in Smaato’s Digital Ad Tech Trends Report. 

How did the COVID-19 Pandemic Shape Digital Advertising Tech?

Digital Ad Tech is rapidly evolving to keep up with an increasingly digital world

Any trend report would be remiss to exclude a thorough analysis of how the pandemic has altered not only history but also the future.

In this report, we dive into the impact in specific areas, including eCommerce, fintech, health and wellness, and grocery/food shopping, while fueling digital adoption for remote working, learning, and gaming.

Health & Fitness App Gross Revenue

Worldwide, 2020 – H12021

Source: Smaato Publisher Platform, 2021

Rather than focus on the negative impacts of the pandemic, our report examines the ways in which a more complete shift to a digital lifestyle has expedited online trends, and forced the ad tech industry to evolve quickly in order to keep up. For example, lockdown restrictions actually expedited the digital adoption trend, as can be seen by the monthly active WeCom (WeChat Work) app users in China:

Monthly Active WeCom (AKA WeChat Work) App Users

China, December 2016-March 2021

Source: QuestMobile, April 2021

You’ll see trends across verticals, as well as the impact (and steady recovery) of more negatively affected categories, like the travel industry.

Do You Know the benefits of OTT/CTV Advertising for Publishers and Marketers?

OTT/CTV (streaming video online) has been trending for a while, but this is just the beginning

According to eMarketer, by 2025 nearly 40% of households will have cut the cord, shifting from traditional cable and satellite subscriptions to internet-streamed TV.

Cord Cutters

US, 2016-2025

Source: eMarketer, February 2021

The shift to a reliance on OTT/CTV is just beginning. As 5G sweeps the globe, lightning-fast streaming speeds, reduced latency, and better quality on the go will further fuel OTT’s success.

Publishers and marketers recognise the opportunity to reach a highly engaged audience based on what they like to watch rather than who they are.

In the 2020-2021 Trends Report, we share how marketers can reach specific audiences while helping publishers monetise their inventory. We also go into detail about how different ways to auction OTT/CTV inventory can generate higher eCPMs.

Indexed eCPM for Non-Podded vs. Podded OTT/CTV Inventory on Smaato’s Platform

Indexed before eCPM

Source: Smaato Publisher Platform, 2021

If you’d like to learn more about the history of OTT/CTV and monetisation opportunities for publishers, check out our complimentary guide: OTT/CTV Advertising eBook here.

How Can You Improve Brand Sentiment and Engagement?

CTR is not the only KPI. Learn why delivering positive user experiences is key to long-term success.

From innovative new ad formats to a shift in how marketers and publishers measure success, learn why brand favorability is changing advertising strategies around the globe.

A major theme? Giving users/viewers more control over their advertising interaction and delivering more tailored experiences helps improve brand sentiment. After all, users will favor applications, websites, and content that gives them control over their advertising experience. In fact, Integral Ad Science found that delivering more relevant ads improves favorability by 107%. This means users are more likely to engage with advertisements while maintaining a positive feeling about the publisher’s application, website, or platform.

While ads can sometimes be an unwelcome interruption, users would almost always prefer to engage with ad content than make an in-app purchase:

Would US Mobile Gamers Prefer to Watch Rewarded Video Ads or Pay for In-App Purchases? US, Q2 2020

By Demographic

Source: DSIQO, September 10, 2020

Here are four key ad formats that can engage audiences with a less obtrusive experience, including deep linking and splash ads, shoppable ads, and rewarded video outside of gaming:

  • Splash Ads: Full-screen, eye-catching interstitials that fill an app launch screen as the app content loads. These ads deliver high engagement with easy-to-measure viewability.
  • Deep Links: Embedded URLs that drive a mobile app user to in-app content. There are three types of deep links: standard deep links, deferred deep links, and contextual deep links.
  • Shoppable Ads: Interactive ads allow users to directly purchase the product featured in the ad. These video or image ads have embedded tags that link directly to the product’s page on the marketer’s website.
  • Rewarded Video: 15-30 second, non-skippable video interstitials that reward users with in-app rewards upon ad completion. Users opt in to these incentivised video ads.

As users and viewers opt in to engaging with ads, brand sentiment improves, user experience improves, and the likelihood of conversion increases.

Why is Programmatic Bidding So Popular?

Programmatic Bidding gives publishers more flexibility and control over their inventory, and Marketers get to extend their reach

In 2021, eCPMs for direct marketplace deals (including private exchange and preferred deals) were 18% higher than for open exchange deals on our platform, mirroring a larger trend.

Here’s a quick refresher on the four main programmatic ad buys (open auctions, private marketplaces, preferred deals, and guaranteed deals):

Best for scale: The Original Programmatic Marketplace, Open Auction

Also Known As: Open Exchange, Real-Time Bidding (RTB), Open Marketplace.

As the name suggests, open auctions are open to all. All marketers on the exchange/SSP/ad network have an opportunity to bid on all available publisher inventory. This is the most traditional form of programmatic auctions.

With real-time bidding, publishers can set the floor price for an ad, but marketer demand still determines the final price, and the highest bid wins. Inventory is not guaranteed.

Historically, Open Auctions came with some risks. Publishers wouldn’t always know who was purchasing the inventory, which could hurt their brand image. Meanwhile, inventory isn’t necessarily disclosed, so marketers didn’t always know what they’d be getting. At Smaato, we share IDs with our partners to help improve transparency in the RTB process.

Best for offering premium inventory to relevant advertisers: Private Exchange

Also Known As: Private Marketplace (PMP), PMP Programmatic, Private Auction, Invitation-Only Auction

A private exchange is another form of real-time bidding, but instead of being open to all marketers and all publishers, a single publisher invites a mere handful of marketers to participate.

Private exchanges are quickly becoming industry standard. In 2020, US ad spend in private exchanges outpaced open auctions for the first time.

To access the auction, these hand-selected marketers will need a time-sensitive deal ID. Publishers set a floor price, and the bidding starts there. As in the open auction, the highest bid wins. Inventory is not guaranteed.

Best for a first look at premium inventory: Preferred Deal

Also known as: Unreserved Fixed Rate, Programmatic Non-Guaranteed

A Preferred Deal is a private, 1:1 relationship between a publisher and a marketer. In a Preferred Deal, publishers offer premium inventory to the marketer at a pre-negotiated fixed eCPM price.

While eCPMs are a bit higher, marketers are paying to get what’s essentially “first dibs” on premium ad space. When an ad request comes through, a marketer with a preferred deal has an opportunity to bid at the pre-negotiated fixed eCPM price in real-time, before the inventory heads to open auction. Inventory is not guaranteed.

Best for guaranteed impressions and set budgets: Programmatic Guaranteed

Also known as: Guaranteed Buy, Programmatic Direct, Automated Guaranteed

With a guaranteed buy, a publisher offers specific, reserved inventory to a marketer at a fixed price.

Publishers and marketers negotiate a price for a guaranteed volume of impressions or flight date. This is similar to a direct sale/buy, but programmatic automation replaces the manual IO process, improving efficiency and reducing error.

Meanwhile, header bidding solutions are also quickly becoming a favourite among publishers and marketers alike. Marketers love header bidding solutions because it gives them a chance to compete in the auction, while publishers love header bidding solutions because they ensure better fill and higher eCPMs.

Indexed eCPM for Unified Bidding (Smaato’s Header-Bidding Solution) vs. Exchange for one Publisher on the Smaato Platform

H1 2021

Source: Smaato Publisher Platform, 2021

How Can Publishers and Marketers Ensure Compliance with Privacy Laws?

Hint: first-party data is key

Crucial players like Apple and Google are leading a consumer movement towards increased privacy and data controls. As legislation like the GDPR, CCPA, and CPPA take hold, user privacy protection becomes not only the right thing to do but a legal requirement, as well.

In the full report, see the impacts of policy changes like iOS 14.5 and solutions like SKAdNetwork, to help ensure campaigns get properly attributed while maintaining compliance. Learn how audience targeting can help marketers reach audiences based on what they watch or engage with rather than who they are, and see how the crumbing cookie is paving the way for more relevant contextual opportunities for publishers and marketers alike.

There’s so much more to see.

Publishers, read the report to get familiar with each of these growing ad tech trends to help inform your advertising monetisation strategy. Marketers, advertisers, and DSPs, download your copy to learn how to engage audiences and deliver ROI for your campaigns.

Download the Complete Report Today!

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