Paulo Cunha is Co-Founder, CEO at ShiftForward, and will present at this year’s ATS London. Here he discusses the paths that can be taken for those seeking to innovate and customise in ad technology, and how most will look beyond the monolithic stack as a solution.
For those not paying attention to the technical side of digital media, ad technology systems have come a very long way since their inception in the 90s. Particularly fueled by the recent Real Time Bidding architecture, the scalability requirements for most systems have grown by orders of magnitude – businesses now have the desire, and commercial ability, to evaluate peaks of hundreds of thousands of ad delivery opportunities per second (Queries per Second in industry jargon) in a relatively quick manner. Before RTB, this level of scale took years of business development to reach, if at all.
ExchangeWire is announcing the launch of its new mobile advertising event in 2013. Mobile Sessions is the first event ExchangeWire has created that is 100% focused on the mobile advertising industry. The half-day event will be hosted at the OXO2 on Monday, February 18.
Mobile Sessions will be a taster for our mobile track at ATS London in 2013 – and will discuss the big challenges and opportunities around mobile advertising investment. It will look to provide a framework that will help the industry adopt mobile as a scalable media channel.
The end of the year is a time for refection and projection, on what we’ve achieved and for what we expect. Adam Jablonski, CEO of the Polish ad server Epom, breaks down the current state of mobile advertising in Eastern Europe and what we can expect from the region in 2013.
Stay Alive and Advertise
Despite the widely spoken-of impending Apocalypse on December 21, 2012, we can’t help but look towards 2013 with a renewed willingness to get to work and great expectations for the future of advertising.
The ad industry, which has undergone numerous significant changes lately, will certainly continue evolving next year; and mobile advertising is surely to face many more substantial developments in comparison with other sectors of the market.
Forward Into Mobile
It has become obvious that the future of advertising lies in mobile, and the growth of the mobile ad sector in 2012 proves this fact to the fullest. In fact, the US market spend this year, according to Epom Data Center research, has grown to almost double what it was 2011. As for 2013, the increase of mobile ads’ portability and, thus popularity, is only going to rise, especially due to the constant introduction of new tablet models.
For the many pundits who anxiously forecasted the ‘Year of Mobile’, 2012 has provided some relief. Figures released by the IAB in October, showing a 132% increase in ad spend on mobile, suggested that advertisers are shifting from experimenting with mobile to making it an integral part of their media spend; but what are the key trends and developments that will affect mobile advertising in the year ahead? Here are five suggestions:
1. I expect to see further strong growth in mobile advertising. Figures from First Partner support this view, suggesting that mobile ad spend in the UK will reach £831.3m in 2013, up 63% on this year, with search and display continuing to dominate. This growth in revenue will come not only from advertisers investing more in mobile, but also from increasingly switching their ad budgets away from online and more traditional media budgets. According to the most recent IAB/PwC digital ad spend study, digital ad spend (online, mobile and tablet) now accounts for 30% of the total ad market, and while mobile alone still accounts for around 2% of total ad spend, this will start to change rapidly. As a result, the chasm between mobile usage and ad spend will narrow considerably.
It probably wouldn’t be an exaggeration to say that the modern user is almost 100% mobile, regarding both private time and work routine. Due to the fast pace of our lives, dynamics have already converted mobile into one of the key factors in development, no matter which industry is being discussed. Advertising is, obviously, even more affected by new mobility trends, which is perhaps why mobile ads in general, and in-app ads in particular, have recently become the new hit worldwide.
Hot on the heels of our Japanese launch, ExchangeWire is announcing today that it is rolling out a dedicated, localised site for the Brazilian market, www.exchangewire.com.br.
Brazil has one of the fastest growing digital advertising markets globally. The market is undergoing some huge changes in terms of ad technology adoption and the move to automated buying – with many local players either partnering with large ad tech providers or launching their own versions of buy and sell side technology solutions. ExchangeWire Brasil will be a native language site, and will deliver the best analysis and reporting on the Brazilian market.
Sixteen and a half million Germans play online games, according to the Federal Association of Interactive Entertainment Software (BIU), so it’s no surprise the industry’s biggest trade fair, gamescom, is in Cologne this year. (It started on Wednesday and is continuing through the weekend.) After double-digit growth rates in recent years, rates continue to escalate for free online games, which have now become established, financially strong and hungry for new users. This growth as given rise to three new companies: NEODAU, Traffic Captain and HitFox.
The market is still highly dynamic, even if the initial social games euphoria has subsided somewhat. According to the Facebook, social games reach 235 million people every month. The number of Daily Active Users (DAU) has reached 167 million (Source: AppStats), of which 51 million are on the market leader Zynga, followed by King.com, with 10.6 million players. Wooga from Berlin is currently at 7.2 million DAU.
€ 2.50 Per Registered Player
The operators of browser- or client-games, such as Gameforge, InnoGames, Bigpoint, upjers, Travian or Frogster also managed an impressive sum for fresh players. The annual budgets for major publishers are moving in the millions, and following an upward trend. “In the free-to-play segment there have been extremely high growth rates over the past three to four years. At the same time the increase in prices for new users have now approximately doubled in Germany, Austria and Switzerland,” said Stefan Hinz, Managing Director of gaming network NEODAU. Where a new user was previously 80 cents, today it can cost up to €2.50 to lure a player in desirable markets like Germany.
There hasn’t been a massive parade, no free USB sticks shaped like an iPhone, and certainly no trophy taking the shape of a gold encrusted Motorola Dynatac 8000x (made famous by Gordon Gekko) engraved with “we did it”. Furthermore, mobile spend didn’t overtake TV spend.
However we have seen HTML5 become more important and we have seen businesses built around mobile, ad networks open up mobile inventory, DSP’s for mobile specifically come into existence, such as Strike Ad, and VC investors say, “I need a mobile start-up – stat!” CB Insights confirmed that it has reported on 102 mobile VC deals in 2011, and within those, any company with a photo or video-focus saw up to 30% of those deals.
It’s been a pretty exciting few months. Technology continues to develop and proliferate, with the likes of NFC (Near Field Communication) and 5G testing. Adfonic’s second quarter AdMetrics report shows that iOS saw its market SOV decrease from 45% in Q1 to 34% in Q2, whilst Android’s share increased from 38% to 46% over the same period. UDID’s are no more on iOS, and it looks as though Apple will roll out their own tracking tool. Cookies probably won’t come to mobile in the way we imagine for Android, or other devices for that matter. Fingerprinting scares me, as there still seems to be no regulatory authority behind it and no one seems to want to step up to the plate. There have been a number of articles highlighting both the benefits and the concerns around device fingerprinting. If you’re not familiar with fingerprinting, it’s a process in which a user’s device settings are collated and then assigned a unique ID – much like a cookie – to use for tracking purposes. These settings can range from brightness settings to browser settings, time zone and fonts. It requires many more data points and therefore is not as easy for the consumer to opt out of. Until we see a regulatory company behind device fingerprinting I don’t believe it will get the seal of approval from the wider industry.
It’s the biggest data-driven advertising event in Europe. It’s the event that even has its own acronym. ATS London is now in its third year, and the line-up of speakers and content is the best yet. Often copied – A LOT! – but never equalled, ATS London brings together the best in the global online ad industry to discuss the latest trends and developments in the space. And this year is no exception.
It is clear that our industry is moving beyond the mess of the LumaScape to a platform-centric world, and this certainly is one of the key areas being explored by ATS London this year. The full-day programme will be organised into three core themes: brand, application and big data. All of these are effectively shaping the data-driven ad space, and speakers and participants on the day will explore these issues in more depth.