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Video RTB Presents Both Opportunities and Hurdles for Brands

  19 July, 2012

Tubemogul Forrester ReportVideo real-time bidding (RTB) offers both opportunities and hurdles for brand buyers, according to a Forrester report commissioned by Tubemogul, a buy-side video demand-side platform (DSP).  Eleven RTB buyers were interviewed for the report (no mention of non-RTB video buyers), and Forrester found ‘strong support for RTB video as an effective and efficient brand-building mechanism, but also evidence that the ecosystem is still quite nascent’.

In setting out the benefits RTB brings to buyers, the report pointed to all of the arguments typically associated with buying on ad exchanges: increased granularity, deeper transparency, greater fluidity (no need for insertion orders, unrestricted by set periods of time), improved efficiency and direct control (in contrast to a black box ad network).

Lack of Supply an Obstacle to RTB Market Growth

However, in spite of the fact that many advertisers are eager to buy video via RTB, the report also highlights some of the problems – both real and misconceived – that need to be resolved. The availability of inventory is still a concern for many buyers, although it should be noted that similar complaints can be heard across all parts of the video advertising industry.

That said, the supply problem has been a little trickier for the RTB players as many publishers have been reluctant to put premium inventory on exchanges because: (a) they’re selling out via direct sales anyway; (b) there’s a fear they’ll cannibalise their premium inventory; (c) there’s a belief that auction-based RTB will lead to a ‘race to the bottom’ on pricing, making it difficult to reinvest in the production of premium content; (d) while data-driven advertising is gaining traction, context still matters greatly to major brands and they’re willing to pay to for guaranteed premium placements.

Other concerns from buyers related to the quality of inventory, although some buyers quoted in the report said it was a myth that inventory on exchanges is all junk (similar perceptions were widely held in the early days of exchange-based display advertising). Measurement was also an issue, although again this criticism could also be applied to the rest of the industry.

The report concludes with some recommendations for brand marketers, suggesting they educate themselves so they’re equipped to ask agencies difficult questions on performance and transparency.

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