Reports highlight rise and challenges of programmatic video advertising

Two vendor-sponsored reports on programmatic video advertising from TubeMogul and SpotXchange show mobile video ad market is growing, but transparency and brand challenges remain for marketers

Two new vendor-sponsored reports into programmatic video advertising have highlighted both the rapid rise in interest, as well as the challenges still present to its adoption.

The TubeMogul Australia Quarterly Research Report from enterprise software vendor, TubeMogul, found Australia’s programmatic mobile video ad market more than tripled in size in the first quarter thanks to content consumption on smartphones and tablets.

Programmatic mobile video advertising inventory rose 230 per cent in the first quarter of 2014 to 29.4 million available mobile video ad units, from 8.9 million in the last quarter of 2013.

TubeMogul also said an analysis of millions of pre-roll video ad views showed the premium part of the desktop video market leapt 25 per cent quarter-over-quarter, while comScore top 100 video inventory ads jumped 28 per cent.

“Smartphones and tablets are becoming the devices of choice for content-hungry consumers in Australia and advertisers want to reach those audiences,” TubeMogul Asia-Pacific managing director, Stephen Hunt, said in a statement. “We expect the programmatic mobile and tablet video ad market to skyrocket this year, and outstrip growth in the desktop video advertising market.”

The other growth area was programmatic direct, a method where brands buy private video ad inventory direct from the publisher and then optimise the video ad campaign using programmatic software, TubeMogul said. Direct inventory being traded programmatically increased from 33 million to 68 million quarter-on-quarter.

Hunt claimed advertisers were becoming more familiar with mobile and tablet video advertising formats and increasing their budget allocations as a result. He also said advertising agency desks were upping their focus on executing programmatic mobile and tablet video ad campaigns.

“This data shows that brands are eager to place their brand messages and video creative in top-tier publisher environments to reach affluent consumers, and drive lift in brand metrics such as purchase intent for their product,” he said. “It also highlights the willingness of top-tier publishers to make their audiences available for programmatic trading.”

Related: Programmatic advertising: Digital marketing’s saviour or real-time headache?

However, a report from fellow video advertising technology vendor, SpotXchange, and produced by Forrester Consulting, found a number of factors are hindering take-up of programmatic video advertising at scale.

The State of Online Video Programmatic and Real-Time Bidding in Australia and Southeast Asia also called for supply-side platforms (SSPs) and demand-side platforms (DSPs) to work more closely together to ensure video RTB usage continues to grow across the region.

Read more: Why Mars and Qantas are investing into in-house digital skills

Through phone interviews with 100 publishers, ad trading desks, DSPs, brand marketers and advertising professionals across Australia and Southeast Asia, Forrester found transparency and brand safety are key concerns around using real-time bidding in video. Both received an average rating (AR) of 7.2 and 7.1 respectively out of 10.

According to the report, Australia is the most developed market for video RTB in Asia-Pacific, with 34 per cent of online video ads traded programmatically, representing between 21-40 per cent of the marketplace. In comparison, 28 per cent of online video impressions last year were conducted through programmatic trading, representing 21-40 per cent of the marketplace.

Another gap on the demand and supply sides of the market potentially impacting programmatic take-up is DSPs who believe the price of video RTB CPMs will increase (30 out of 72) versus SSPs (12 out of 28) whom believe the price will remain the same, Forrester stated.

“SSPs perceive that prices will decrease to allow higher volumes of inventory to be traded; however low CPMs are not likely to drive demand,” the analyst firm commented.

Other inhibitors include a discrepancy in the value of targeting capabilities between DSPs and SSPs (AR: 7.9 versus AR: 6.7, respectively); and the quality of inventory being of higher importance to DSPs (AR: 6.7) than SSPs (AR: 5.9).

“At the moment, publishers are still focused on selling volume and closing the deals quickly,” SpotXchange Asia-Pacific managing director, Matt Von der Muhll, commented. “This behaviour stems from trading in the days of programmatic display, where it was all about driving down the price of display inventory in an open marketplace. However, this is not the case with programmatic video as it has a higher barrier of entry for publishers, greater controls and functionality.

“From the demand side, they are specifying more parameters around their video buys and this further diminishes the volume of inventory available and their willingness to pay a higher price for the inventory they desire.”

Von der Muhll called on the industry to work together to go beyond pricing.

“We need to look at industry definitions, guidelines and best practices. We are already seeing momentum from industry bodies and players who are coming together to make these changes,” he added.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO Australia conversation on LinkedIn: CMO Australia, or join us on Facebook:

Signup to CMO’s email newsletter to receive your weekly dose of targeted content for the modern marketing chief.

Read more: UK digital marketing tech company opens in Australia Read more: CMO-CIO partnership key in digital customer engagement

Join the CMO newsletter!

Error: Please check your email address.
Show Comments

Supporting Association

Blog Posts

What happens when the 'market' becomes a 'customer'?

One of the insightful things that has been said to me recently came from an independent consultant working at a major FMCG client. He said: “The problem here is that we have some people who are world-class at marketing to the masses, but they haven’t got a clue about how to speak to a customer.”

3 Metrics to measure B2B content marketing ROI

Content marketing has become a key pillar for marketing departments of all sizes across the world. But how do you measure – and ultimately prove – the effectiveness of the time, money and energy spent on content marketing?

How global brands can connect on a local level

The dot-com boom allowed brands to easily access the global market. Thanks to this increased exposure and worldwide awareness, brands can no longer exist in a local bubble.

Dan Ratner

managing director, Uberbrand

Informative comments , I loved the info , Does anyone know if my assistant could get ahold of a blank 2011 IRS 8804 - Schedule A document...


Telstra unveils fresh digital content media services

Read more

So, the one thing I would say is .. the customer already has a voice, whether you wanted them to have one or not .. and they have a platf...

Paul Gilbert

Why digital strategy equals customer experience

Read more

Appliances online are doing a good job online, but they're still not giving customers a truly powerful online experience in my view. Wher...

Graham Howlett

Navigating the future of omni-channel retailing

Read more

For both businesses and marketers alike who want a digital marketing platform that supports data visualization, integrated analytics and ...


Adobe to bolster analytics capabilities of Marketing Cloud with Digital Analytix acquisition

Read more

Good Content is a crucial part in Marketing ROI. No doubt metrics like sharing & engagement, consumption, & lead generation &...


3 Metrics to measure B2B content marketing ROI - B2B marketing - CMO Australia

Read more

Latest Podcast

More podcasts

Sign in