The Trough Of RTB Disillusionment

Martin Kelly is the co-founder and Managing Partner at Infectious Media. Here he discusses the RTB hype cycle and why the nascent media buying methodology is currently languishing in the trough of disillusionment.

2011 was the year RTB hit the mainstream marketing press as agency groups bought in to the concept wholesale. Spend is pouring into the real-time space with predictions for 2012 ranging from 10% to 20% of all online display (which is an incredible adoption rate for a technology just three years old). But, when you ask what the real benefits of RTB are there tends to be a scratching of heads. Impression level bidding, terabytes of data…what does it actually mean for advertisers?

Current benefits of RTB to an advertiser are pretty scant. Centralisation and control of retargeting, along with black box optimisation algorithms are as far as anyone can get, and are all trading and workflow related benefits. If we look at the market against Gartner’s Hype Curve, it feels as though we’re on the way down into the trough of disillusionment as RTB rather than ushering in a new era of display advertising, has merely shuffled budgets from one supplier to another. I’ve sat in quite a few meetings with advertisers recently where they tell me they’ve ‘tried RTB’ but it didn’t really work out and they couldn’t see any discernable difference from all their previous display activity. So is RTB really a game changer?

Taking a step back from where we are today, it’s clear that big changes are happening in display advertising. Behind the acronyms a new vision is emerging of a fully dynamic display advertising experience where audiences are targeted in real-time and creatives are tailored to the individual. But we’re not there yet. RTB is fundamental to that shift but it’s only part of the story and the clue to where the problem lies is in the name. All advertising campaigns have four core components: planning, buying, creative and optimisation. RTB has meant that the buying element of the campaign is now dynamic, but without the other elements going real-time the benefit is marginal and this is where we find ourselves as an industry now. In the starkest terms, what’s the point in targeting the right audience if you then don’t show them the right message? And, can an algorithm that’s right for a credit card advertiser also right for car manufacturer?

2012 is the year that we are going to wake up to the real challenge of changing the entire online display paradigm to become a fully dynamic customer experience. RTB will continue to be fundamental to that shift, but there is a growing realisation that it’s not enough on its own. To get out of the trough of disillusionment and onto the slope of enlightenment needs all the real-time pieces to come together to create campaigns that live up to the heady billing of a ‘New Era of Display’.

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Comments


  • Anonymous

    I totally agree – remessaging is fine with RTB. What’s lagging is the Prospecting piece.  This will come once the rest of the pieces that go into making a fully RTB approach efficient, logical, and actually time-relevant.  That means everything from SSPs, DSPs, third party data sources, first party data sources (advertisers), and agencies need to find a system that works to a fully RTB solution.

  • The only data you should trust is your own. Layering 3rd party data onto RTB buying adds complexity and expense while rarely providing real ROI in the form of better performing campaigns. http://www.johnhaake.com/2011/03/confessions-of-a-former-banner-man/?postcomment

  • ben trenda

    Martin- excellent post.  For all the initial hype and increasing disillusionment, RTB has clearly accomplished something important in the industry– namely an increasing interest in interoperability among the myriad legacy and newfangled systems on the buy and sell side.  The question of whether RTB is the most efficient framework for interoperability could be debated, however.

    The lackluster results many advertisers are experiencing today can probably be chalked up to a few important factors, such as the availability of quality inventory (no truly Tier 1 inventory as yet), and the way advertisers are approaching RTB in the first place (using multiple DSP’s concurrently with networks, trading desks, and direct buys, all without technical coordination.  It could be argued that RTB itself is somewhat to blame here– without full transparency and mutual commitments both ways, publishers are reticent to make their best inventory available to this channel, and advertisers aren’t committing meaningful budgets to technology platforms as a result.  

    The real question is this:  where do we go from here?  Private exchanges as they are currently envisioned don’t seem to be the answer.

  • Hoover

    I demand the death penalty for any writer who fails to spell out an acronym first time it’s used.

  • Asnoxall

    Absolutely RTB BS. What a LoC. Might as well be speaking Congolese.