June 2016

PROGRAMMATIC MARKETPLACE
ROUNDUP
Last year, a majority of digital display ads were purchased programmatically.
This year, two-thirds of display spending will be transacted that way. With
programmatic taking over an ever-growing chunk of the ad world, marketers
and publishers alike are enjoying the benefitsand dealing with the
challengesof the channel. eMarketer has curated this Roundup of key trends,
forecasts and interviews to help all parties in the programmatic ecosystem
navigate the landscape.

presented by

PROGRAMMATIC MARKETPLACE ROUNDUP

Overview
Programmatic advertising continues to become
more sophisticated, and spending via the
media buying technique is growing, albeit at a
decreasing pace. In our latest US programmatic
forecast, eMarketer predicts that this year, more
than two-thirds of all digital display advertising
will be purchased programmatically.

US Programmatic Digital Display Ad Spending,

2014-2017
billions, % change and % of total digital display ad spending*
$27.47

118.6%
$22.10

$15.83
59.0%

72.0%

67.0%

49.0%

In 2016, US programmatic digital display ad spending will

reach $22.10 billion. Thats a jump of 39.7% over last year,
and represents 67.0% of total digital display ad spending in
the US.

$10.32

39.7%
24.3%
2014

Programmatic is extremely efficient and unparalleled in

its ability to pair rich audience data with ad inventory and
targeting, says eMarketer senior analyst Lauren Fisher.
Buyers and sellers are also becoming more comfortable
with the technology. As a result, it is being rapidly adopted
across a variety of channels and ad formats.

53.3%

2015

2016

Programmatic digital display ad spending

% change
% of total digital display ad spending*
Note: digital display ads transacted via an API, including everything from
publisher-erected APIs to more standardized RTB technology; includes
native ads and ads on social networks like Facebook and Twitter; includes
advertising that appears on desktop/laptop computers, mobile phones,
tablets and other internet-connected devices; *includes banners, rich
media, sponsorship, video and other
Source: eMarketer, April 2016
207037

Mobile is driving growth of programmatic ad spending.

This year, mobile programmatic spending will reach $15.45
billion in the US, representing 69.0% of all programmatic
digital display ad spending. Next year, mobile video
programmatic spending will exceed its desktop counterpart
for the first time.
With respect to programmatic video, 2016 will be a pivotal
year. More than half of all digital video ad spending in the
US will be programmatic. This year, programmatic video
ad spending will reach $5.51 billion, representing 56.0%
of total digital video ad spending. That figure represents
in turn 24.9% of total programmatic digital display
ad spending.
Next year will be the tipping point for programmatic mobile
video ads, as mobile surpasses desktop for the first time.
By 2017, programmatic mobile video ad spending will reach
$3.89 billion, representing 51.0% of total programmatic ad
spending in the US. By comparison, programmatic desktopbased video ad spending will reach $3.73 billion, dropping
to 49.0% of total programmatic digital display ad spending
in the US.

Programmatic Marketplace Roundup

2017

www.eMarketer.com

US Mobile Programmatic Display Ad Spending,

2014-2017
billions, % change and % of total mobile display ad spending
$21.22

234.3%

$15.45

118.2%
$9.68

78.0%

69.0%

$4.44
46.0%
2014

60.0%

59.6%
37.3%

2015

2016

2017

Mobile programmatic display ad spending

% change

% of total mobile display ad spending

Note: mobile display ads transacted via an API, including everything from
publisher-erected APIs to more standardized RTB technology; includes
native ads and ads on social networks like Facebook and Twitter; includes
ad spending on tablets
Source: eMarketer, April 2016
207045

www.eMarketer.com

Copyright 2016 eMarketer, Inc. All rights reserved. 2

Whats Important When Buying Programmatically?

The ability to buy rich media and video in-stream is significant
When buying programmatically, there are many
important factors that come into play. Being
able to buy display, as well as inventory across
channels via a single platform, are two of the top
ones, according to US media practitioners.

Important Factors When Buying Programmatically

According to US Media Practitioners, Oct 2015
% of respondents

More than two-thirds of US agency, media and marketing

professionals said the ability to buy display and the ability
to buy inventory across channels like mobile and desktop
via a single platform were important factors when buying
programmatically, according to an October 2015 survey
from Advertising Age and RhythmOne. Ratings of 8 to 10 on
a scale of 1 to 10, where one is not at all important and
10 is extremely important, were considered important.

Ability to buy rich media

The ability to buy rich media, in-stream video and native

ads were also important to more than half of respondents.

Offer inventory from wearables

15.0%

While offerings of inventory from digital out-of-home, via

connected TV or from wearables were also important when
buying programmatically, these factors ranked lower on
the list.
US programmatic digital video ad spending reached $2.91
billion in 2015, accounting for 39% of 2015s total US
digital video ad spend. Overall, enthusiasm for automating
the procurement of digital video ads remains high, but
investment trails in comparison to the broader digital
display market.
eMarketer forecast that 59% of the $26.15 billion spent
on US digital display ads in 2015 would be transacted
programmatically, but just 39% of US digital video ad dollars
were spent that way. By 2017, however, that portion will
move closer to the broader average for programmatic
activity (72%), accounting for 65%, or $7.43 billion.

Ability to buy display

67.5%
Ability to buy inventory across channels (e.g., mobile, desktop,
etc.) via a single platform
67.0%
60.4%
Ability to buy video in-stream
58.6%
Ability to buy native
51.5%
Offer inventory from digital out-of-home
26.5%
Offer inventory from connected TV
24.6%

Note: n=452; responses of 8-10 on a scale of 1-10 where 1="not at all

important" and 10="extremely important"
Source: Advertising Age and RhythmOne, "Viewability and Verification
Through the Programmatic Lens" conducted by Advantage Business
Research, Dec 21, 2015
202673

www.eMarketer.com

US Programmatic Digital Video Ad Spending,

2014-2017
billions, % change and % of total digital video ad spending
362.8%

$7.43

$5.37
238.0%
$2.91
84.5%
65.0%

12.0%
$0.63

39.0%

2014

2015

56.0%

38.3%

2016

2017

Programmatic digital video ad spending

% change
% of total digital video ad spending
Note: digital video ads transacted via an API, including everything from
publisher-erected APIs to more standardized RTB technology; includes
advertising that appears on desktop/laptop computers, mobile phones,
tablets and other internet-connected devices; includes pre-, mid-, post-roll
in a video player environment
Source: eMarketer, Oct 2015
197095

Programmatic Marketplace Roundup

www.eMarketer.com

Copyright 2016 eMarketer, Inc. All rights reserved. 3

Is Mobile Programmatic at Risk of Fraud?

Fraud is a concern for many advertisers
Mobile programmatic advertising will be grabbing
the majority of US programmatic digital display
ad dollars by 2017. But just because mobile
programmatic is popular does not mean ad fraud
is not a concern. More than a third of mobile
programmatic impressions is at risk of fraud,
according to 2015 research.
AppLift and Forensiq reported that 22% of mobile
programmatic ad impressions served worldwide on
AppLifts platform between September 21 and October 19
were suspected fraud, and another 12% presented a high
risk of fraud.

Share of Mobile Programmatic Ad Impressions

Worldwide that Are at Risk of Fraud,
Sep 21-Oct 19, 2015
% of total
High risk
of fraud
12%
Suspected fraud
22%

Not at risk
66%

Note: represents activity on AppLift's platform, broader industry metrics

may vary
Source: AppLift and Forensiq, "Fighting Mobile Fraud in the Programmatic
Era," Dec 10, 2015
202560

The bulk of mobile programmatic impressions was not at

risk of fraud.
Fraud is a concern for many advertisers, and publishers.
A September 2015 study from Operative and MediaPost
Communications revealed that fraud was one of the
biggest problems that US publishers said they faced.

www.eMarketer.com

Biggest Problems Facing Their Programmatic

Business According to US Publishers, Sep 2015
% of respondents
Low CPMs
52.5%
Too much manual labor
37.5%
Low revenue

In fact, 22.5% of respondents said so.

36.3%
Viewability

Low CPMs, too much manual labor and viewability were

also problems facing their programmatic business.
Click fraud is also a problem for mobile advertisers and
publishers. Fake clicks on app install ads, for example, are
an issue around the world, especially in markets in AsiaPacific and the Middle East.

33.8%
Optimization too difficult
27.5%
Fraud
22.5%
Lack of scale on owned inventory
20.0%
Lack of control over advertiser relationships
20.0%
Lack of visibility
17.5%
Inventory planning and forecasting
16.3%
Keeping up with demand
7.5%
None
5.0%
Note: n=80
Source: Operative and MediaPost Communications, "The Profitable
Publisher: The Future of Publishing in Digital," Oct 15, 2015
200953

Programmatic Marketplace Roundup

www.eMarketer.com

Copyright 2016 eMarketer, Inc. All rights reserved. 4

How Satisfied Are Digital Marketing Execs with RTB Win Rates?
Generally, US programmatic digital display ad spending is rising
Many digital marketing professionals worldwide
say they feel very satisfied, or somewhat
satisfied, with current real-time bidding (RTB) win
rates, according to September research.

Level of Satisfaction with Real-Time Bidding (RTB) Win

Rates Among Digital Marketing Professionals
Worldwide, by Country/Region, Sep 2015
% of respondents
Asia-Pacific
25%

ExchangeWire and Equinix surveyed 129 digital marketing

professionals worldwide.
In the US, 85% of respondents said they felt very
satisfied, or somewhat satisfied, with their current
RTB win rates, compared to 16% who said they were
somewhat dissatisfied.
Similarly, digital marketing professionals in Asia-Pacific,
Latin America and EMEA were not far behind in satisfaction
sentiment as well.

Latin America
18%

59%

16%
18%

55%

9%

EMEA
18%

52%

27% 3%

US
13%

72%

Very satisfied

Somewhat dissatisfied

Somewhat satisfied

Very dissatisfied

16%

Note: numbers may not add up to 100% due to rounding

Source: ExchangeWire, "Current Marketplace Attitudes Towards Fraud in
Programmatic and How a Neutral Data Center with Secure Ecosystems
Offer a Comprehensive Solution" in association with Equinix, April 12, 2016
208766

www.eMarketer.com

Interestingly, while 3% of EMEA and 9% of Latin America

respondents said they were very dissatisfied with current
win rates, no respondents in the US and APAC said they felt
that same way.
Overall, US programmatic digital display ad spending is
rising. In just two years, eMarketer estimates that nearly
three in four display ad dollars in the country will be spent
programmatically. As that growth persists, programmatic
direct will continue to increase more quickly than realtime bidding.

Programmatic Marketplace Roundup

Copyright 2016 eMarketer, Inc. All rights reserved. 5

Many Ad Agencies Dont Plan on Using Programmatic Ad Spending on

Local TV
Marketers see the most opportunity with mobile programmatic
Agencies are investing in programmatic ads on
a range of media, including television. But many
ad agency professionals say they are still not
planning to allocate any programmatic spending
to local TV.

Percent of Programmatic Ad Spending that US Ad

Agency Professionals Will Allocate to Local TV*,
Nov 2015
% of respondents
10%-20%
3%

20%-40%

40%-60%

According to November 2015 research by Strata, more

than two-thirds of US ad agency professionals said they will
allocate no programmatic ad spending to local television,
including spot and cable TV.
Some 18% of respondents said they will allocate 10%
to 20% of programmatic ad spending to local TV. Three
percent said they will allot 20% to 40% and 11% of
respondents said they will budget 40% to 60%. Only 1%
said they will allocate more than 61% of programmatic ad
spending to local TV.
While more marketers are advertising programmatically,
it still early days for TV. More marketers are advertising
programmatically on mobile and the desktop, with video
along with other display formats, including social media
and native. This is a wide range of popular digital ad
formats, and real-time bidding and other programmatic
buying methods have been available for longer.

1%

18%

11%

61%+

None

67%

Note: *includes spot and cable TV

Source: Strata, Nov 18, 2015
200736

www.eMarketer.com

Channel/Format Where US Marketers See the Most

Opportunity for Programmatic Advertising, Feb 2015
% of respondents

Native
10%
Social media
14%
Display
16%

TV
8%
Mobile
33%

Video
20%

Note: numbers may not add up to 100% due to rounding

Source: RBC Capital Markets and Advertising Age, "Social Media Survey,"
March 15, 2015
187020

www.eMarketer.com

In fact, February 2015 research by RBC Capital Markets

and Advertising Age revealed that just 8% of marketers
said they see the most opportunity for programmatic
advertising on TV. One-third of respondents said that
mobile is the channel where they see the most opportunity
for programmatic advertising and one in five said they saw
the most opportunity with video.

Programmatic Marketplace Roundup

Copyright 2016 eMarketer, Inc. All rights reserved. 6

B2B Marketers Get More Comfortable with Programmatic

Spending on the format grows as marketers focus on audience and
inventory quality
Consumer brands arent the only advertisers
spending more on programmatic these days.
Marketers in the B2B sector are also investigating
programmatic ad buying as a way to boost their
media buying efficiency and improve targeting.
According to Kantar Media and Connectiv, 79% of US B2B
marketers expected to purchase at least some portion of
their 2016 digital display ad budget programmatically, a
2% increase over respondents who said the same in 2015.
Whats more, the percentage of respondents planning to
spend 45% or more of their budget on programmatic digital
display increased from 27% to 33% of respondents over the
same time period.

Percent of 2015 vs. 2016 Digital Display Ad Budget

Purchased Programmatically According to US B2B
Media Buyers/Planners
% of respondents
0%
23%
21%
1%-14%
16%
14%
15%-29%
21%
17%
30%-44%
13%
15%
45%-59%
12%

Despite the gains, its clear that B2B spending on

programmatic has not caught up to spending on the
format among marketers in the consumer sector. When
considering the frequency of programmatic buying on B2B
vs. consumer campaigns, more than 50% of respondents
said they purchased programmatic digital display for
consumer campaigns always or often, while only
32% of respondents said the same about purchasing
programmatic for B2B.
When considering the criteria B2B marketers used to
evaluate programmatic buying opportunities, audience
and inventory quality are key factors. According to Kantar
and Connectiv, 95% of B2B marketers said audience was
an extremely important or very important evaluation
criteria, while 88% said the same about inventory quality.

13%
60%+
15%
20%
2015

2016

Note: n=150
Source: Kantar Media SRDS and Connectiv (formerly American Business
Media (ABM)), "B2B Programmatic Media Planning & Buying Study," May 23,
2016
211045

www.eMarketer.com

Frequency with Which US B2B Media Buyers/Planners

Buy B2C vs. B2B Digital Display Advertising
Programmatically, March 2016
% of respondents

Always
21%

Never
27%

Always
10%
Often
22%

Never
37%

Sometimes
21%

B2C

Often
31%

Sometimes
31%
B2B

Source: Kantar Media SRDS and Connectiv (formerly American Business

Media (ABM)), "B2B Programmatic Media Planning & Buying Study," May 23,
2016
211047

Programmatic Marketplace Roundup

www.eMarketer.com

Copyright 2016 eMarketer, Inc. All rights reserved. 7

Ad Blocking Is Bad for Programmatic Advertising

Ad blocking is one of the top problems with programmatic advertising
Three in four US marketers say that ad blocking
will have a negative effect on the programmatic
advertising ecosystem, according to February
2016 research.

Effect of Ad Blocking on the Programmatic

Advertising Ecosystem According to US Marketers,
Feb 2016
% of respondents
2%

Significantly positive
6%

RBC Capital Markets and Advertising Age surveyed 1,960

US marketers and asked them what effect ad blocking has
on the programmatic advertising space. The largest share
of respondents, 58%, said it has a somewhat negative
effect, and 20% of marketers said it has a significantly
negative effect.

Somewhat positive

No impact

14%

Somewhat negative

58%

Significantly negative 20%

Note: n=543
Source: RBC Capital Markets and Advertising Age, "Adtech: Programmatic
Advertising Highlights From Our Marketer Survey," March 14, 2016
206985

Still, some marketers believe ad blocking is actually good

for programmatic. Indeed, 6% said that ad blocking has
a somewhat positive effect, and 2% said the effect is
significantly positive.
According to separate research from Cowen and Company,
ad blocking is one of the top problems plaguing US senior
ad buyers who are investing in programmatic advertising.
While 57% of respondents listed multidevice measurement
as a problem for programmatic, topping the list, ad fraud
and ad blocking ranked second.

Problems with Programmatic Advertising According

to US Senior Ad Buyers, Dec 2015
% of respondents
Multidevice measurement

57%

Fraud

47%

Ad blocking generally

47%

Ad blocking on smartphones
Privacy issues
Other

35%

18%
16%

Source: Cowen and Company, "Ad Buyer Survey IV: Digital Looks Strong
Into '16," Jan 11, 2016
203235

Programmatic Marketplace Roundup

www.eMarketer.com

www.eMarketer.com

Copyright 2016 eMarketer, Inc. All rights reserved. 8

Viewability in the Realm of Programmatic Advertising

Scott Braley
General Manager, Programmatic Advertising
Ooyala

Programmatic, social and mobile advertising have

led to new controls and worries when it comes
to viewability in the UK, according to Ooyala, a
global ad-serving firm tracking viewability metrics
as well as providing sell-side programmatic
platforms to marketers. eMarketers Sean
Creamer spoke with Scott Braley, Ooyalas
general manager of programmatic advertising,
about how marketers are using programmatic,
social and mobile to bolster viewability.
eMarketer: Is viewability a concern when marketers are
engaging in programmatic advertising?
Scott Braley: Viewability is universally a concern across
any style of buying, including programmatic. Marketers can
signal off of demand-side platforms to tailor and optimize
for viewability easily through programmatic.
They want to understand viewability across both their
direct and indirect buysin other words, direct or
programmatic buys. This way they have more control and
capabilities [at the ready] to optimize for better viewability
with programmatic.
eMarketer: Is there a particular style of programmatic that
would be more suited to ensuring that an ad is viewed and
is not fraudulent?
Braley: All supply stores have a duty to curate their
inventory and ensure that there isnt ad fraud thats
artificially propping it up. When marketers are looking to
enter a private programmatic marketplace, carving out
viewability as an important segment criteria makes a lot
of sense.

Programmatic Marketplace Roundup

When marketers are looking to enter a

private programmatic marketplace, carving
out viewability as an important segment
criteria makes a lot of sense.
eMarketer: How is viewability defined in the UK?
Braley: The standard definition has been the ad must be
50% in-view for at least 2 seconds. But the bigger issue is
that there are different marketers who have taken it upon
themselves to say, For my particular marketing objectives,
I dont feel that 50% of the ad is enough. I dont feel that 2
seconds is enough.
eMarketer: Do you believe social media has
increased viewability?
Braley: When people do a quick scroll through a newsfeed,
marketers are asking how quickly consumers are scrolling
through content. If its an audio play ad with the audio off, I
might not consider a quick scroll through the newsfeed to
be an accurate view based on that fast-scrolling behavior
and limited screen space.
Social media is measured differently because the
environment is not the same. Its a different user
experience; therefore, theres different requirements for
in-feed.
eMarketer: Are there specific methods marketers will put
into play for mobile device viewability?
Braley: When you get into mobile, and in-app in particular,
theres a perception that in-app inventory is always
viewable, and thats not necessarily the case. In-app
inventory is usually more viewable because interstitial ads,
or pre-rolls, are typically embedded in the app content and
are scaled to the screen, and theres not a lot of scrolling
in most app environments. Mobile app supply is something
that you would buy more of if viewability was a top metric
that you were worried about.

Copyright 2016 eMarketer, Inc. All rights reserved. 9

New Data Will Help Advertisers Get More from Mobile Programmatic

Beth Gilmore
Head of Global Demand
MoPub

New and improved data thats becoming

available this year will allow advertisers to better
target their most desirable audiences via mobile
programmatic, according to Beth Gilmore, head
of global demand for Twitter-owned mobile
ad server and exchange MoPub. eMarketers
Tricia Carr spoke with Gilmore, whose focus is
the mobile in-app inventories within MoPubs
programmatic exchange, about what mobile
advertisers should focus on in 2016.
eMarketer: What opportunities in mobile in-app
advertising are important to marketers overall digital
advertising strategy?
Beth Gilmore: One is desired audiences and users
that are available in mobile. There is a misconception
that desirable users and inventories are only in labeled
premium contentfor example, I can only find Joe
Wall Street Banker on The Wall Street Journal. But Joe
who reads The Wall Street Journal also plays games and
uses utility and entertainment apps. You can find your
desirable audience and users across all different types of
app verticals.

You can find your desirable audience

and users across all different types of
app verticals.
In mobile, data has been fragmented. Most brands just
know the cookie, and all of the buyers that theyve worked
with give them user profiles or audiences based on the
cookie. But data is going to be the new term for mobile
programmatic this year. Its going to be easier for brands to
target their desirable audiences on mobile because of the
advancement of data.

Programmatic Marketplace Roundup

eMarketer: How will ad targeting improve this year?

Gilmore: Data is going to be huge this year. Publishers are
getting smarter about what they want to do with their data
and how they want to transact their data to advertisers,
especially in a programmatic setting. New data is going to
be available. Its up to the exchanges and platforms that are
supplying this data to make sense of it so that it transacts
across channels.
eMarketer: Whats the level of interest in
location targeting?
Gilmore: Location has become the most desirable firstparty data that an advertiser can get from mobile. Thats
what makes mobile uniqueyou can find your user
wherever they are. Brands should know that theyll have
to pay a premium for it as it becomes more desirable and
differentiates mobile against desktop, TV and all of the
other platforms.

Location has become the most desirable

first-party data that an advertiser can get
from mobile.
This year is also going to be all about verification with thirdparty data providersmaking sure that location is accurate
and standardizing what location looks like in mobile. It can
come through many different data points, like IP address
or DMA [designated market area], so marketers have to
standardize what it is that theyre looking for.
eMarketer: Is the added expense of buying ad
placements with location data worth it?
Gilmore: The expense is worth it if youre a brand
advertiser thats looking to focus on that user at that
location at that moment. Publishers are getting smarter
about the data that theyre dipping and what they want for
a premium.

Copyright 2016 eMarketer, Inc. All rights reserved. 10

Advertisers might not understand how cheap mobile is

right nowits much cheaper than desktop and theres
still more supply than demand at this point. This is their
opportunity to get in and take advantage of location,
and mobile advertising in general, before it becomes
more expensive.
eMarketer: What metrics are most important when
measuring mobile programmatic?
Gilmore: Over the past few years, weve seen brand
advertisers in mobile not knowing what convergence they
wanted. All they focused on was pushing impressions.
Performance marketers were the complete oppositethey
just tried to drive that app install. They just tried to find the
lifetime value of the user and only target users that they
knew would spend money within the app.
Now were seeing a switch. Performance marketers think
of themselves more as brands. They have TV commercials,
they want to make sure that their ads are high-quality
and the view is just as important as the install. Brands are
trying to drive performance metrics like clicks, installs and
lifetime value.
Its been interesting to see that transition, but you need all
of the above. You cant just run campaigns that are going
to drive installs or views. Campaigns should have clear
metrics and run the gamut.

Programmatic Marketplace Roundup

Copyright 2016 eMarketer, Inc. All rights reserved. 11

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