Opinions

Technology triggers growth in online advertising

Posted by Dominic Joseph on January 20th, 2014 at 9:56 am

Research from the Internet Advertising Bureau (IAB) shows that the revenue generated from online advertising is consistently delivering double-digit growth. A large part of this growth is being driven by programmatic buying and Real-Time Bidding (RTB), the digital marketing equivalent of the most popular kids in the playground.

As more advertisers come to recognise the benefits of machine-based transactions, data, and algorithms, the popularity of programmatic buying has rocketed, representing 17 per cent of total UK display ad sales now, and estimated to grow to 30 per cent by 2016. This is symptomatic of the shift taking place in the advertising industry, away from analogue towards a digital environment where buyers get access to inventory at scale, at an appealing price point.

Technology continues to trigger innovation, but what developments does the year ahead hold for online advertising?

RTB will step up to the plate in the key European markets – The growth rate of RTB will be faster in the key European markets (UK, France, Germany) than in the US, with Europe catching up with the US much faster than has been predicted. There are a number of reasons for this, media-buying is more concentrated in Europe, campaigns are on average more performance-led and agency trading desks are more ingrained in the culture. This will unleash rapid RTB growth which will transform the display industry and the entire online advertising market.

Display will be the star of the show – With the rise of programmatic buying and Demand Side Platforms (DSPs), display will take the lead in online ad growth this year, providing more transparency, accountability and performance measurement.

Big data will get smarter – There’s a lot of talk around the importance of big data in advertising. It is data, not content, that’s king, and it is giving the edge to agencies, publishers and programmatic display buyers but, there’s more to be done to ensure that users are served relevant advertising that will lead to better results for advertisers. Thanks to machine-learning, DSPs and increases in computing, storage and server capabilities, the online advertising industry is moving towards audience-targeting down to the individual level. This year brands will start focusing on the quality of specific data sets to segment audience groups rather than focusing on the sheer quantity of data. Data will get smarter, and with it, advertisers will get better ROI.

Search Retargeting will become the fastest growing segments of display – Some data is more useful than others and should be treated as such. As more advertisers realise the benefits of smart data, there will be the increasing focus on specific data sets and audience segmentation. 2014 will be the year that display banners are shown to internet users based on the keywords they type into search engines. Search Retargeting is a new technique that has the ability to drive some of the most powerful changes in advertising: enhancing performance and ROI for the advertiser as well as making advertising more relevant to the user.

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