1. Programmatic + Premium: Current Practice
& Future Trends
Digiday Publishing Summit, March 18, 2013

2. Programmatic Trading is EITHER…

3. OR…

4. Both Buyers and Sellers are Committed to
Programmatic Ad Trading
• 71% of Buyers and
Sellers in our study
are “Doing It”

5. 71% of Both Buyers and Sellers Trade Ads
Programmatically
41%
Digital Publishers
71%
% of Total
31% Respondents
Media Buyers
71%
% of Group that
Trade Ads
28% Programmatically
Media Trader /
Intermediary N/A
*843 Digiday respondents over 2 weeks
inJan. 2013

6. What we found:
• Both publishers and buyers are committed to programmatic
trading.
• Publishers and buyers are using all channels to sell/buy online
ads – and some achieve markedly better success than others.
Overall, the percentage of display revenue to the whole is
small, but poised to grow by double digits in the coming year.
• Neither side thinks the current system is perfect
• Even with these challenges, both publishers and buyers plan to
invest more in the year ahead than they did in the past 12
months

7. What we found:
• Publishers, as well as buyers, are trading both non-guaranteed
and guaranteed inventory programmatically, but
“Programmatic Premium” is a term more familiar to sellers than
buyers.
• Publishers need the right technology foundation in order to
engage in programmatic trading. Of those publishers who
engage, in programmatic selling, 81% report they use an ad server
that has exchange capabilities integrated into the platform.
• There are elements of the traditional direct sales process that
publishers feel can be replaced programmatically, including
insertion order workflow (68%), billing/ reconciliation (60%), and
optimization (59%).

8. What we found:
• Neitherpublishers nor buyers want to give up their personal
relationships and the benefits they engender.
• There is some work to be done before publishers feel good
about programmatic selling – they see themselves at a
disadvantage. Encouragingly, many buyers acknowledge this
fear and are concerned about this perceived imbalance
adversely impacting programmatic trading.
• Also encouraging: both DSPs and SSPs recognize these fears
and appear willing to evolve to provide publishers as well as
buyers the protections they desire.

9. Non-Programmatic Publishers

10. Of the Publishers NOT Currently Trading
Programmatically, 30% Will Within the Year
Series 1
I don't know 38%
No 33%
Series 1
Yes 29%
0% 10% 20% 30% 40%
While the majority needs to be convinced.

11. And most newbies will move beyond
“remnant” once they commit
Together, the
Guaranteed / Mix 18% 21% 14% combination >
Remnant (53%)
Premium
Both
No Difference
Non-Guaranteed
46%
/"Remnant"
0 0.1 0.2 0.3 0.4 0.5 0.6

12. Programmatic Publishers

13. For Publishers Who’ve Made the Leap, the
AMOUNT of Programmatic Inventory is low
• 48% trade 1-10% on PRIVATE exchanges
• 34% trade 1-10% on OPEN exchanges
• 31% trade 1-10% on Ad nets, etc.

14. But, taken together…
• Publishers as a group are using every
kind of programmatic channel
available to them, even if it’s only a
little to test.

15. There’s a wide swath of “middle of the
roaders” for whom programmatics pay the bills
• 96% of respondents have a direct sales
force; the largest group of these say
direct sales accounts for 61-70% of
sales.
• 44% of digital publishers’ direct sales
are spread evenly between 40%-80% (a
wide swath of “10 percenters” across
this broad range)

16. Pubs: How much more/less inventory is
programmatic NOW vs. a year ago?
Column1
Somewhat More 37%
Substantially More 29%
No change 24%
0% 5% 10% 15% 20% 25% 30% 35% 40%

17. Going forward:
Anticipated INVENTORY contribution:
– 21% Predict it will fall an average of 19%
– 21% Predict no change
– 58% Predict it will rise an average of 25%

18. Publishers: Comparing REVENUE with likely
changes in inventory AVAILABILITY
Year over year REVENUE contribution:
– 8% Down an average of 19%
– 37% No change
– 55% up an average of 21% (answers ranged
from 1%-200%, 10% most common answer)
Anticipated INVENTORY contribution:
– 21% Predict it will fall an average of 19%
– 21% Predict no change
– 58% Predict it will rise an average of 25%

19. Publishers: How much of your programmatic
inventory is…
Series 1
Non-guaranteed inventory / Remnant 57%
Both Guaranteed & Non-guaranteed 35%
No Distinction 6%
Guaranteed / Premium 3%
0% 10% 20% 30% 40% 50% 60%

20. How Do you DEFINE Premium Inventory?
Series 1
Custom inventory (e.g.
68%
sponsorships)
Guaranteed inventory (e.g. inventory
66%
held in reserve)
By section (e.g. home page) 52%
By context (e.g. most popular
50%
content)
By audience segment 41%
By ad unit type (e.g. leaderboards) 34%
0% 10%20%30%40%50%60%70%80%

21. Comment:
• High ecpm inventory
• I define "premium" as above-the-fold placement(s) on engaging
content pages.
• above-the-fold
• All the above
• the word premium is nonsense, only a pricing indicator for
publishers, there is simply high value and low value inventory based
on what value you add to the advertiser

22. Familiar with “Programmatic Premium”?
Series 1
Yes 57%
No 43%
0% 10% 20% 30% 40% 50% 60%

23. How do YOU define “Programmatic Premium”?
“Baloney from exchanges.”
“Nonsense, a term coined
to persuade publishers to
move into automated.”

24. Definitions, Summarized
• Involves means, access and audiences
• Uses automation or technology, typically via exchange or
“machines”
• In real time
• Informed by data, and pre-defined terms, either regarding price or a
“guarantee” involving the inventory’s placement and/or delivery
timeframe
• It implies quality, premier placement and results
• Buyers may be the ones best able to define it
• At the end of the day it has to benefit every one to work

25. …OrAs One Publisher Put it:
• Programmatic premium is good for both advertisers and publishers.
Marketers can serve the right message to the right consumer,
reducing waste and improving returns on their guaranteed media
investments.

26. Does your ad server integrate exchange
capabilities into the platform?
Series 1
Yes 81%
No 19%
0% 20% 40% 60% 80% 100%

27. If Yes, are you more or less likely to engage in
programmatic selling as a result?
Series 1
More likely 62%
No impact 33%
Less likely 5%
0% 10% 20% 30% 40% 50% 60% 70%

28. If No, how likely are you to convert to an ad
server that accommodates programmatic or
exchange selling within the next 12 months?
Series 1
Highly likely 35%
Somewhat likely 35%
Series 1
Not at all likely 29%
0% 10% 20% 30% 40%

29. Preferred ad-technology solutions (top 2
choices averaged)
Series 1
Yield optimization 88%
Reporting Insights 87%
Set price floors by buyer or segment 79%
Transact directly w/terms 76%
Manage guaranteed and non-guaranteed 74%
Content optimization 73%
Sell inventory in real-time markets 68%
Overlay audience data 67%
Screen out certain buyers 58%
0% 20% 40% 60% 80% 100%

30. Elements of traditional direct sales process
that can be replaced programmatically?
Series 1
Insertion order workflow 68%
Billing/Reconciliation 60%
Optimization 59%
Trafficking 52%
Price Negotiation 36%
Ad quality review 25%
None of the above 6%
0% 10% 20% 30% 40% 50% 60% 70% 80%

31. Publishers Want Control Over Pricing,
Relationships
Series 1
Controlling CPM / Pricing by advertiser or
segment 75%
Maintaining direct relationships with advertisers /
buyers 67%
Controlling ad quality / brand safety 66%
Setting different deal terms for advertisers /
buyers 54%
Predictable volume / revenue guarantees 54%
Blacklisting / whitelisting advertisers / buyers 47%
Maintaining data security 47%
None of the Above 4%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Q: What would lead you to sell more premium inventory
programmatically? (Please check all that apply.)

32. What else would impact programmatic selling?
• More demand
• Competitive CPMs with direct sold
• Seeing an increase in net CPM's flowing to the publisher.
• [Better] margins
• Getting higher prices from current remnant sources, which we've
been unable to achieve via programmatic selling.
• I'm interested in learning about programmatic selling.
• Building out our capability
• I am currently prohibited from doing this well because I use DFP
through WordNow. Once I move, there should be more opportunity

33. Bottom line: In its current state, does
programmatic selling benefit buyers and
sellers equally?
Series 1
No 45%
Don't know 30%
Series 1
Yes 25%
0% 10% 20% 30% 40% 50%

34. Who DOES Benefit?
• Buyers “win” hands down:
– As a premium publisher [I believe] the advantage goes to the
advertisers that are buying our inventory at below market rates.
Until the eCPM starts climbing to match direct sales eCPM the
advantage will never be to the seller.
– Buyer, currently. They're calling the shots on price, and you play
the game or don't get the volume. Buyers are biased too much
towards audience and not enough towards context.
– Benefits buyers more, because it allows them to use their 1st-
party data to identify valuable audience and buy it cheaply --
because the seller does not know the value.
– buyers are benefiting more, as they are able to get massive reach
on top sites for bottom dollar. meanwhile, publishers are playing
catch up & struggling to optimize the balance between direct
sales & programmatic buying in their yield strategies, & in
particular trying to limit cpm erosion.

35. Who DOES Benefit?
• Publishers… for now
– At this point, publishers have more leverage as they hold back
inventory from these new platforms. But, that will change.
It depends…
– I think that publishers with premium inventory need to make sure
they can still command a price closer to premium than public.
Buyers need to know the benefit of this.
– The sell side still doesn't have the insight, controls and
automation to really optimize yield and manage an integrated
direct/indirect strategy.

36. Programmatic Buyers

37. Nearly all buyers still buy direct…But
substantial inventory is going programmatic
• 97% of buyers do still buy media directly from publishers, or through
an agency, but nearly 60% say this accounts for less than half their
inventory.
• 84% of buyers have bought from a private exchange – but greater
than 70% of these buyers say this accounts for less than 10% of
their purchases.
• 91% of buyers buy on open exchanges and 93% from networks or
other intermediaries. They think they’re buying as much as ¾ of their
inventory from both networks and programmatically through
exchanges – though this obviously can’t be true for both channels.

38. Nearly 80% Say They’re Buying More Inventory
Programmatically Than Last Year
Series 1
Somewhat More 47%
Substantially More 30%
No Change 18%
Somewhat Less 4%
Substantially Less 1%
0% 10% 20% 30% 40% 50%

39. How Has Programmatics Affected Buyers’
Digital Spending?
• 51% see an increase of 14%
• 47% see no change
• 2% see a decline of 17%
More than half of digital ad
buyers say they’re spending
MORE because of
programmatic buying.

40. In the Coming Year, Programmatic Spending
Could Increase 30%
• 86% of buyers say they’ll increase their
programmatic buying over the next year by an
average of 31%
• 15% of buyers say they’ll likely decrease their
programmatic buying over the next year by an
average of 21%

41. Buyers Aren’t Shopping for “Remnant”
Inventory
Guaranteed / Mix 18% 55% 16%
Guaranteed
Both Guaranteed &
Remnant
No Distinction
Non-Guaranteed Inventory
12%
/ Remnant
0 0.2 0.4 0.6 0.8 1
Q: What kinds of inventory do you buy
programmatically?

42. Publishers, Rejoice…
• 70% of buyers would rather buy “premium” inventory direct than
programmatically.
• WHY?
– Confidence, Control, Customization, Creativity, Collaboration,
Contextual Relevance
– Human touch, direct relationships
– MORE efficient pricing, and
– “Because much of the premium inventory is not yet available to
buy programmatically”

43. Why Deal Direct?
• Ability to more custom creative/programs that take advantage of the
publishers unique position and relationship with their audience. We
only work with publishers in this capacity that have such
relationships.
• Able to include custom inventory and sponsorships
• Added visibility and transparency
• Because much of the premium inventory is not yet available to buy
programmatically
• Better control
• Better integration opportunities
• better placements and more control over frequency
• Better placements...better tie in deals with other media (print, tv)

44. Why Deal Direct?
• Bigger brand experiences
• brand safety, brand value
• confidence in delivery, quality of publishers
• Control over specific placements tends to produce more quality
engagement
• Customization, Ad Format Choices, etc
• define premium though. what is premium? premium that has a
higher conversion rate for DR or is it premium because it is more
expensive??
• depends on the channel and other opportunities, but it's more
contextually relevant

45. Why Deal Direct?
• Direct relationship, want to ensure best pricing, want to ensure
dedication to managing the buy/customer service.
• Feels safer
• for specific sponsorships/placements generally a more custom
solution that requires more sales support
• High Impact ad units
• I feel like there greater control and pricing flexibility as well as more
creative options.
• I work in LatAm, where data market is immature. Publisher targeting
is often the highest quality data we have.
• If we know it works and exchange supply is low
• it depends on the brand objective and metric

46. Why Deal Direct?
• Maintains direct sales relationships Many times, premium inventory
requires custom build, something that requires a human touch and
direct relationships
• Media promotions, editorial integration, and account management
• Monitoring ease and guaranteed target alignment
• more comfortable with exact placements from publisher
• More confident in the inventory my client will receive
• More control of where you run.
• more direct control over the ad experience
• More efficient pricing
• More trust with direct pub than exchange

47. Why Deal Direct?
• Premium Space (i.e. Sponsorships) require collaboration between
the agency and publisher teams. Therefore is not valued as just
"real estate".
• pricing & control
• Pubs are also now layering data at efficient rates plus guaranteed
content
• quality-sensitive clients
• Satisfies the media strategy
• security reasons
• Seems more reliable at this point
• Sense of security

48. Why Deal Direct?
• The ability to develop custom programs
• This depends on the client's objectives.
• To ensure a guaranteed placement or volume
• Transparency and custom integrations
• Transparency and trust
• Trust when we buy premium we usually attach more to it - rich
creative, specific placement and audience combinations, custom
elements, etc. that are usually better handled person-to-person
instead of programatically
• Why not? In this case it is still streamlining operations. And if you
can do it on an ongoing basis, even more efficiency.
• Yes for sponsorships or out of the box ideas

49. Why Buy Programmatically? Difference in
Performance?
Series 1
Programmatic performs better 35%
Not Sure 31%
Direct Buying Performs Better 19%
No Difference 16%
0% 5% 10% 15% 20% 25% 30% 35% 40%

50. Define “Premium” Inventory
Series 1
Custom inventory (sponsorships) 79%
Guranteed inventory 72%
By Section 56%
By Context 43%
By Ad Unit Type 27%
By Audience Segment 26%
0% 20% 40% 60% 80% 100%

51. Other Definitions of “Premium”
• higher quality content
• Top tier sites instead of long tail sites
• It really could be all of the above - whatever the key targeting criteria are
combined with the media tactics, where those things come together are
"premium”
• I don't think there is such thing as premium. it's a phrase publishers and
exchanges alike like using to inflate CPMs, raise floor prices. premium is a kind
of inventory that offers more information than other which then leads better
buying decisions i.e I'm willing to pay £3-7 CPM for that inventory because of
the wealth of information (this will probably result in conversion as well)
• Above the fold, first impressions, known publisher
• Placement, clutter, content quality
• all of the above, situationally
• Any kind of fully integrated, native sponsorship or advertising program.
Typically, these are done on a publisher by publisher basis.

52. Familiar with “Programmatic Premium”?
Series 1
No 60%
Yes 40%
0% 10% 20% 30% 40% 50% 60% 70%

53. Buyer Perception of “Programmatic Premium”
• Guaranteed: Sites, placements, audience, date/time
• Brand -- the publisher-- matters and may be the negotiated seller
• Exchange or DSP facilitated -- could be private Involves discovery:
"Defining audiences and objectives then system mathes premium
publishers who can get to those audiences"
• Quality -- not "run of site junk"
• Accountability, e.g. "defined data points"
• Convenience: "No longer needing insertion orders to obtain
premium inventory from publishers. Usually a set floor price or
minimum number of impressions to buy in a month."
• Preference: "premium is first pick of inventory on sites and
programmatic premium is second pick"

54. Detailed Responses: “Programmatic Premium”
• A guaranteed, selective site list where you know you will be served
• a premium or direct buy, leveraging audience targeting to define and
measure and negotiate against 'true' audience reach
• Ability to buy "premium" inventory (ie guaranteed, rich, by specific position
and run date) via an exchange.
• Ability to buy premium inventory through an exchange.
• Access to either non-exchange inventory or guaranteed inventory.
• Simply inventory that is not offered in the open market.
• Audience buying that occurs on premium sites that have strong composition
of our demo
• Brand recognized purchased through automation usually including audience
data

55. Detailed Responses: “Programmatic Premium”
• Buying inventory such as video through DSPs or exchanges.
• Custom targeting or sponsorship purchased on a trading platform
• Defining audiences and objectives then system matches premium
publishers who can get to those audiences.
• Buyers and sellers negotiate through the platform. Buys are then executed
like a direct buy, with delivery monitored against the desired audience and
objectives.
• Guaranteed above the fold inventory
• Guaranteed placements by publisher
• Guaranteed Programmatic Impressions
• high quality, first tier placements on top publishers with guaranteed
inventory
• I assume it means being able to buy premium invnetory but in a similar
fashion to curent programmatic (non guarenteed) buying

56. Detailed Responses: “Programmatic Premium”
• I equate it more to a private exchange. It isn't run of site junk, it's likely
unsold inventory in better locations (above fold - section 1st pages etc.).
• Inventory on private exchanges that come with defined data points
• Inventory that has more structure around it (limited types of sites or
specific site categories) but is still purchased programmatically vs.
direct.
• inventory that is allowed to carry some level of restriction/selection
• Inventory that is guaranteed by date, time, and location, that you can
purchase and execute through a programmatic platform like a DSP.
• it defines itself.
• it is using programmatic tools to execute a "premium" program, that is
often, but not necesarily negotiated outside of those tools
• n/a

57. Detailed Responses: “Programmatic Premium”
• No longer needing insertion orders to obtain premium inventory from
publishers. Usually a set floor price or minimum number of
impressions to buy in a month.
• Pre-selected or guaranteed content with data driven audience layers
for impression decisioning
• Premium advertising you are able to buy in a programmatic fashion.
• Premium inventory available through exchange
• Premium inventory not available on public exchanges that can be
purchsed programmatically via direct publisher relationship.
• Premium inventory that is set aside by the publisher but sold through
an exchange, typically as a subset of the overall inventory or
through a private publisher exchange.

58. Detailed Responses: “Programmatic Premium”
• Premium inventory within programatic (non human) buys.
• premium is first pick of inventory on sites and programmatic
premium is second pick
• Programmatic buying that uses additional criteria such as safe
content, specific publishers, guaranteed inventory, or enhanced
controls over delivery (R/F/or Visibility are ex). These criteria
typically yield a higher price per contact, hence "premium"
• Publishers open up premium inventory (sponsorships, premium
sizes, etc.) to be purchased via real-time bidding.
• purchasing premium inventory through perhaps a private exchange,
allowing this inventory to be added to our overall frequency structure
and comprehensive platform.

59. Detailed Responses: “Programmatic Premium”
• Purchasing top placements through networks and exchanges not
directly from publishers.
• Refers to premium environments where we can reach audiences.
• Restricted programmatic selection
• Securing space on premium publishers in highly visible content
(homepage, etc.) just purchased through programmatic platforms
instead of direct. top tier sites
• Using data and programmatic techniques to purchase user-targeted
impressions on specific Web sites or channels

60. What would lead you to buy more premium
inventory programmatically?
Series 1
More data to inform bids 68%
Exposure to inventory not currently
67%
available
Preferred access to inventory ("First
57%
Look")
Maintain or expand direct buying
39%
relationships
More easily negotiate direct buys 29%
0% 10% 20% 30% 40% 50% 60% 70% 80%

61. Other factors…
• premium buys go beyond automation, so anything
mentioned in this question would help us buy more
premium ads programatically
• transparency, trust and client needs
• Transparency
• transparency and ability to optimize by publisher
• better conversion rates
• all of the above

62. How likely are you to replace your direct publisher
relationships with programmatic ad buying?
Series 1
Depends on successwith
programmatics over next few 34%
years
Not at all likely 30%
Somewhat likely 27%
Highly likely 8%
0% 5% 10% 15% 20% 25% 30% 35% 40%

63. Why “Highly Likely” to Displace Direct
Relationships?
• This is the future of advertising; pulling together media planning .
• If 100 publishers called me in a week (not unusual) I bet fewer than 5 have
something unique or different to say.
• We have better data on what drives the client business results vs publishers
• More efficient operationally
• In LatAm, we have lots of forms of indirect buying. Programmatic buying will
first take over the other forms of indirect before treading onto direct territory.
DSP Programmatic will though take share from large platforms like FB and
Google this year.
• we need to keep on building better supply, more data seeding, and better
metrics
• we have purposely developed no direct publisher relationships

64. Programmatic buying impact on the number of
publishers / suppliers for your campaigns?
Series 1
No change 27%
Decreased Somewhat 24%
Increased Dramatically 18%
Increased Somewhat 17%
Don't Know 7%
Decreased Dramatically 6%
0% 5% 10% 15% 20% 25% 30%

65. Which Exchanges Buyers Use
• “All of them,” 95% of them”, 30+, DSPs manage this (20 responses)
– “we don’t tend to buy exchanges individually.”
– “we use the agency trading desk. The exchanges that participate
are blind to us…assumption is it is most if not all of them.”
• Custom Exchanges / DSPs
– Appnexus, InviteMedia (9 mentions each)
• DSPs like TURN, AOD, Cadreon, Criteo, Xaxis, DataXu, GroupM;
Network DSPs like RocketFuel
– TURN (10), Xaxis (5), MediaMath (4), Vivaki’s AOD, DataXu (3
each); RocketFuel (3)
• Private / Dedicated exchanges
– AOL, Bing, Yahoo, Facebook, Google ad words, Microsoft
*75 responses

66. Which Exchanges Buyers Use
• Actual Exchanges (# of mentions)
– DoubleClick (10), Adx (6), Google (5), AdMeld (4)
– RightMedia (10), Yahoo (2)
– OpenX (11 – Most popular independent)
– Rubicon (9); Pubmatic (7)
– Faceboox Exchange / FBX (6), Microsoft 4, Bing (1)
– Adap.tv, AdBrite (3 each)
– Accuen, Brightroll, SpotXchange (2 each)
– AOL, Brand Exchange, CDX, Chango, Collective, Lijit, Max, Mbuys, MIM,
Mojiva, Mopub, Nexage, Orange, Pointroll, Pulpo, Pulse, Taobau, Where
(1 each)
• Marketing analytics, data, platform facilitators (some blurring of the lines
here)
– Datalogix, Mediaplex, MediaOcean, X+1 (1 each)
*75 responses

67. In its current state, does programmatic selling
benefit buyers and sellers equally?
Series 1
Don't Know 44%
Yes 38%
No 18%
0% 10% 20% 30% 40% 50%

68. Who DOES Benefit?
• 58% said Buyers benefit more:
– Buyers as the sellers are likely receiving lower CPM's per impression, depending on the
sell-through rate of direct buys
– Buyers benefit more because exchanges do not provide enough tools for publisher
balance
– Currently buyers benefit more as they 'bypass' direct sales and obtain low CPMs
however as publishers get better at selling programmatically 'premium' inventory will
command rates consistent with the value and reduce the need for 'direct' sales
– It benefits buyers more than sellers. Until publishers wise up and stop creating ad
avails, their inventory will continue to be undervalued. Less inventory means more
quality to the exchange. Greed is keeping the price low for buyers.
– it benefits buyers. not because it can't benefit sellers, but because sellers just haven't
figured out how to use it to their benefit yet, as the benefit for buyers is directly in the
buying activity, while the benefit for sellers is less direct, more in the information and
data management side, which is less easy to leverage quickly.
– It causes the sellers to have to give their premium placements away if I know I can buy
it through the exchanges. Publishers need to stop selling their premium inventory on the
exchanges where I can pick the publisher if they are wanting to sell direct at a higher
cost.

69. Who DOES Benefit?
• 58% said Buyer benefits more:
– It greater benefits buyers as sellers will need to move quickly to adjust their models
for them to continue to be competitive and keep up with trends.
– Right now, it is a buyers market and likely to remain so as inventory is essentially
endless. As buyers become more advanced in understanding what they are buying,
they are likely to become more demanding in what they buy (let's face it - almost
nobody is doing really advanced tracking and measurement with RTB today, flat
CPA, CPC, CTR. These are not good metrics). I believe this will benefit "quality"
publishers (ie NY Times, etc).
– sellers have less control over content of ads
– it's a great time to be a programmatic media buyer
– There are not yet enough buyers of programmatic ads to form the market pricing.
Exchange buying is unrealistically cheap today. That will change as more buyers
move to programmatic tools

70. Who DOES Benefit?
• 26% said Buyer benefits more:
– Effects sellers more than buyers. Less need for more sales reps
– I think publishers, the seller side has always been progressing faster then the
buying side. the programmatic buying enabled publishers to sell their inventory
more efficiently, with less overhead. the double whammy of efficiency increase
could have quadrupled their revenue just by switching from direct sales to an
exchange model.
– I feel the seller has a greater advantage, and greater visibility
– Publishers are benefiting more, but also losing marketshare to lesser known digital
properties. Publishers are now able to gain additional profit from inventory that
would have been remnant or even unsold
– Sellers
• 16% said No one / Not Sure
– no one benefits. buyers don't understand the landscape other than cost efficiencies,
and sellers don't understand how to sell effectively other than cost.
– I can't say it benefits one more than another, but it is a slippery slope than hurts the
quality of all media, so end users suffer
– The sell side need to invest in their people, data and infrastructure in order to fully
manage yield and supply.

71. Non-Programmatic Buyers

72. Move to Programmatic Buying
• 31% of buyers who don’t currently buy advertising programmatically
say they will in the next 12 months.
• But NONE of that inventory will be non-guaranteed
• 46% who don’t engage currently don’t because of philosophical or
strategic reasons; 36% because they lack the financial resources to
convert and 1/3 because they lack the technological know how

73. What’s Holding Back Programmatic Buying?
• Not that familiar; 76% of non-participating buyers say they don’t
know whether programmatic buying benefits buyers and sellers
equally
• Client acceptance low
• It's very new and there's a lot of client education that needs to
happen.

74. What capabilities would lead you to purchase
premium inventory programmatically?
Series 1
More Data to Inform Bids 58%
Exposure to Inventory Not Currently
47%
Available
Maintain or Expand Direct Buying
44%
Relationships
Preferred Access (First Look) 36%
More Easily Negotiate Direct Buys 33%
0% 10% 20% 30% 40% 50% 60% 70%

75. What Else?
• Capability to buy "Premium" media units that are currently not even
sold via exchange
• more buyers
• Cost and results

76. Benefits of direct relationships w/sellers you
fear may be lost by buying programmatically?
• PERSONAL, LONGTIME CONTACTS WITH TRIED AND TRUE PROS
• negotiating power for CPMs for an agency's entire spend w/ a media seller, as
opposed to optimization of bids for each individual placement
• I have direct contact and can negotiate directly.
• Sometimes the sellers can offer insight into which buys are better deals
• Integrated (360) marketing opportunities
• The negotiation and activation of more complex, more engaging, and more robust
sponsorship/partnership opportunities
• Custom opportunities, sponsorships, maintaining expected SOV levels within set
content channels on publisher sites. I work on B2B clients. As with most ad formats, it
is easy to craft them to work for consumers. It takes time to make the effective for
B2B. Programatic just isn't there yet for B2B advertisers who have a very complex
story to tell.
• Context, Best Opportunity to intercept consumer engagement, Tangibly Unknown
Destinations

77. Benefits of direct relationships w/sellers you
fear may be lost by buying programmatically?
• The opportunity for added value and/or premium placement.
• Perks Integration
• Special Deals
• Ability to learn of new ideas, tips, avails based on a frequency of information. Not all
personal relationships are equal and good ones can tip the favor our way.
• When issues arise I need/want someone to directly contact to resolve the issue
• Client leverages virtually all spends for editorial and promotional elements and
requires hands-on contact
• automation of the media efforts lead to decrease effectiveness and lack of visceral
knowledge of the effect of the creative
• Control over premium inventory
• content control
• Control and quality
• Quality

78. Benefits of direct relationships w/sellers you
fear may be lost by buying programmatically?
• loss of control
• Flexibility
• automation of the media efforts lead to decrease effectiveness and lack of visceral
knowledge of the effect of the creative
• Cohesive placements or larger campaigns that fit with overall strategy
• High Impact Opps
• AV elements can largely be determined and negotiated via real people in real
scenarios
• Less work for me
• As long as the buyer and seller still keep in regular contact to discuss
performance/efficiencies and the seller is as transparent about the data, inventory
and analysis/methodology used to purchase inventory and reach certain consumers
there shouldn't be a problem.

79. DSPs

80. DSP Practices
• 54% of DSPs in our study said that 91-100% of their inventory is
transacted via Real-Time Bidding
• 89% of them say they support both open and private ad exchanges
• 53% say that less than 10% of their transactions are publisher
direct, and 46% say less than 10% of their deals involve private
exchanges. 44% of DSPs said 91-100% of their transactions are
programmatic via open exchange.
• 81% of those who don’t currently trade with private exchanges
would do so if they had exposure to inventory not available
elsewhere.

81. What Is Holding Back Spending on Exhanges?
• Publishers’ Fault
– Publishers are still hesitant and afraid of the open market and need to
become comfortable that large brands have shifted their spend to RTB,
and publishers need to follow suit if they want to capture these buyers.
– Publishers not opening up more of their inventory to the exchanges.
– channel conflict
– Premiumness of inventory.
– Lack of super premium inventory made available to exchanges
– Inventory quality and transparency
– transparency of inventory, client fear, quality of inventory in the long tail
– Lack of transparency.
– The nature of the available inventory - long tail content such as "Pimple
Popper" app that is not seem as desirable to advertisers

82. What Is Holding Back Spending on Exhanges?
• Advertisers’ Fault
– Education from advertisers
– A lack of education of the landscape as well as a tendency for
buyers to resist change.
– Lack of client understanding, education, adverse to change ...
• Agencies’ Fault
– Agencies not utilizing the DSP platforms properly and thinking
that they will solve all of their clients’ DR Campaigns within a
week. The platform needs time to test and learn if they are a new
advertiser to the programmatic space.

83. What Is Holding Back Spending on Exhanges?
• Everybody’s Fault
– 1) Belief that RTB is only suited for remnant inventory 2) Lack of
awareness around how 3rd and 1st party data can enrich exchange-
based buys to offer better targeting for buyers and premium CPMs for
publishers
– Brand safety Custom ad units beyond IAB standards
– brand safety issues and guaranteed separation from competitive
advertisers
– Stereotype that there is no high quality inventory on the exchanged.
– Blind domains, grouping many domains into 1 visible domain
– Tradition
– quality of inventory, no predictability, no creative freedom, no
relationship.

84. Does programmatic buying benefit buyers and
sellers equally?
Series 1
Yes 58%
No 31%
Don't Know 12%
0% 10% 20% 30% 40% 50% 60% 70%

85. Who DOES Benefit?
• Buyers
– Buyers benefit more based on market pricing
– Sellers can be at a disadvantage due to the lack of data they have
regards to their own asset
– Has brought down CPMs of publishers over past few years by
decoupling audience from context.
– buyers – performance
– On the RTB exchanges clearly buyers benefit as the quality of
their content is not considered. an article on NY Times is equal to
my mother blog. As a result and to balance it - premium
publishers will make available on the RTB environment the lowest
quality and hence this is not a good environment for brands.

86. Who DOES Benefit?
• Some sellers
– It has hurt 'premium' sites because now advertisers have access
to a massive long tail in a way that wasn't being serviced by
networks, and those long tail sales are eating into premium sales.
Long long tail sites benefit because there's never been an easier
time to get a site onto a mainstream buy
– sellers--cut out sales and features and benefits of specific
publishers
– As long as the audience is correct according t the algorithms then
we as a DSP will pay more for it

87. DSP Customers Define “Premium” Inventory:
Series 1
By Context (Most popular content) 50%
By Section 46%
Guaranteed Inventory 31%
Ad Unit Type 23%
Custom Inventory 23%
Audience Segment 19%
0% 10% 20% 30% 40% 50% 60%
*Both write-ins: Content Source / Publisher brand name

88. 77% of DSPs Say They Are Familiar
With the Concept of “Programmatic
Premium”

89. “Programmatic Premium” DSP Definition
• Quality:
– non-remnant
– Bid on specific impressions in real-time for the opportunity to show an ad on
"privileged" inventory
– Ability to secure and provide tier 1.5 inventory
– Still executing through RTB, but for pre-negotiated quality inventory
– Ad decisioning on premium inventory.
– Higher priced higher quality impressions available for bid.
• Source / Access
– inventory on the private exchange
– The ability to buy programmatically premium inventory, inventory that is not
available through the open exchange.
– Premium inventory that is reserved to sell to buyers in a programmatic way.

90. “Programmatic Premium” DSP Definition
• Means
– Different people have different perceptions. The one I least like is the concept of
buying inventory through a platform - programmatic BUYING, but not auction. The
best answer for programmatic premium in today's space is premium through a
deal id in an auction environment (non fixed price).
– a programmatic manner to reserve and deliver ads on premium content. From the
buyer side premium also require creative freedom, guaranteed delivery, viewable
placement and quality placements.
– Taking the tools developed to make remnant media buying more efficient and
applying them to the guaranteed buying space, which is still mostly face to face,
paper-based, and manual.
– Programmatic access to inventory that wouldn't be available on the open
exchange. Also likely sold on a fixed CPM rather than an auction model, this is
more of an sales process efficiency play than a value play

91. “Programmatic Premium” DSP Definition
• Real-Time
– The ability to buy/sell ad inventory that has normally been the exclusive domain of
guaranteed buys via programmatic means, including but not limited to RTB.
– The ability to purchase inventory in an RTB ecosystem that is traditionally only
available via direct sales.
– Programmatic Premium is just a subset of RTB. Each advertiser defines it based
on the goals of their campaign.
– It is using algorithms to purchase inventory only on what the industry deems
premium
• Cost
• Paying a higher CPM to buy media programmatic but of the benefits it offers over
traditional network-style buying (i.e. higher percentage audience on-target is
higher, more efficient, less wastage)

92. DSP Exchanges in Use
• AdX (12) / AdMeld (9) / Google (4) / DoubleClick (2)
• Pubmatic (11), OpenX (12), Rubicon (13)
• Nine: Appnexus
• Six each: RightMedia / RMX / Yahoo!; FacebookExhange / FBX
• Four each: Lijit, Nexage
• Three each: All major, Brightroll/BRX
• Two each: Adap.tv, AdBrite, Casale, Collective, CPX, LiveRail,
Mobclix, Mopub, Pulsepoint, SpotXchange
• One each: Adrise, Auditude, Flingo, Glam, Microsoft Ad Exchange,
Private exchanges, Smaato, Technorati, Trialpay, YouTube

93. Are you interested in an “audience futures” exchange capability
that would lock up inventory from publishers targeted against
your proprietary data on a guaranteed basis?
Series 1
Yes 58%
Don't know; need to understand it
35%
better
No 8%
0% 10% 20% 30% 40% 50% 60% 70%

94. SSPs

95. SSP Practice
• The largest group of SSPs (21%) generate between 31% and 40%
of their revenues from RTB.
• 76% of them can support both open and private exchanges
• 39% of SSP conduct less than 10% of their transactions as
publisher direct deals
• The majority – 53% -- derive only 1-10% of their revenues from
private exchanges
• The “sweet spot” for SSPs to drive revenue is from open exchanges,
where 45% derive between 41% and 80% of revenues.
• 67% are familiar with the term “Programmatic Premium”

96. SSP Customers Define “Premium” inventory as:
Series 1
Guaranteed Inventory 54%
By Context 47%
By Section 44%
Custom Inventory 40%
By Ad Unit Type 33%
By Audience Segment 30%
0% 10% 20% 30% 40% 50% 60%

97. Programmatic Premium Involves
• Guaranteed Delivery
– Automating guaranteed delivery
– Programmatic premium is selling guaranteed inventory to ad buyers, for a
premium price, through a system that handles the handshake between the
advertiser and the publisher vs. the typical spreadsheet intensive manual process.
– Reserved / Guaranteed
• Brands
– A Network (ABC, CBS, etc.) or band name site (WSJ) with quality ad placements.
ATF, prominent placement for display and large player user-initiated video content
– Inventory delivered on premium websites via programmatic technology
– Programmatic buying platforms such as demand-side platforms (DSPs) have
become the most powerful tools for marketing in a digital world. While
programmatic buying was proven on ad exchanges using real-time bidding,
advertisers are now expanding the tools and techniques to a much bigger part of
the media plan: guaranteed buys on premium publishers.

98. Programmatic Premium Involves
• Pricing
– Exposing the inventory that is typically sold by a direct sales team to real
time buying with the stipulation that all the inventory will be purchase at
no less than the floor price.
– fixed price bulk buying for particular segments in front of RTB
– Using programmatic capabilities to transact buying and selling media
that's deemed to be premium based on buyers' and sellers' criteria. And
allowing the bidding for this inventory to compete with non premium
inventory.
• Selectivity of participants
– Directly sold inventory sold programmatically.
– Premium content sold through an exchange to a select group of buyers.
– Running top of funnel direct sales through the programmatic channel

99. Programmatic Premium Involves
• Selectivity of content
– ability to leverage programmatic channel for premium non-direct
inventory
– brand safe inventory available via programmatic buying
– High value inventory sold thru programmatic pipes--as opposed to the
type of inventory generally associated with thru-the-pipe buying, which is
generally considered remnant.
– Premium inventory available to be purchased on the exchange
– Programmatic premium envolves the establishment of custom segments
of inventory, that would traditionally be acquired via direct campaigns, but
are now leveraging programatic plumbing. Opening up the doors of
control to the buyers and directly from their access points.
– specific slots or "pools" of inventory

100. Programmatic Premium Involves
• Audience targeting
– Ability to target and reach the audiences that Advertisers and Brands are
looking for at internet scale, using machine learning combined with
human insight and reasoning to deliver maximum ROI.
– Using programmatic framework and systems to funnel brands dollars to
specific audiences.
• Automation / RTB
– Automating the media buying processf for any available inventory.
– fixed price bulk buying for particular segments in front of RTB
– Technology (as opposed to IO) to buy and sell professionally prodeuced
video (RTB. Platform etc)
– The ability to buy premium inventory in an exchange environment.
– Trading premium inventory programmatically w/o a race to the bottom

101. Just One Definition…
• Programmatic premium is nothing but making high-quality publisher
inventory available into automated sales channels (with direct and
controlled access to buyers and similarly, to sellers) so that inefficiencies in
planning and buying digital media are improved. Premium buyers define
their desired audiences and the system helps them find premium publishers
to reach to those audiences. Similarly, premium publishers can define their
premium inventory packages and reach out to buyers. Buyers and sellers
can negotiate through automated platform and agree on an optimal media
plan. Such buys/deals are then executed like a direct buy/deal, with delivery
monitored against desired audience in desired frequency along with pre-
defined metrics. Finally, it is reduction (and not elimination) of human
decision-making in the serving of digital ads. Programmatic premium needs
tremendous efforts in educating buyers and sellers. Once the concept is
validated, it will bring more money, drive innovation and drive display space
in next few quarters. However, the concept itself will evolve in next few
quarters based on how buyers and sellers see benefits.

102. What factors restrict spending on exchanges?
• Fear / Publisher Perceptions
– Fear of downward CPM pressure. Fear of data leakage. Perception that there
is no control of your brand, pricing, data.
– Fear, lack of resources, lack of innovation strategy.
– Perception it commoditizes inventory.
– Perception that there's a decline in CPMs for publishers... advertisers feeling
that they don't know where their money is going.
– Publisher price protection and brand safety
– transparecny, pricing controls, publisher hesitance
– Transparency, price, margins
• Buyers lack control
– Although this is quickly changing, i don't believe buyers have enough control
over the inventory to move their budgets the exchanges yet.
– Non-transparent audiences, inadequate framework to facilitate buy/sell

103. What factors restrict spending on exchanges?
• Poor quality inventory
– Not able to buy "High Impact" placements....pushdowns,
interstitials, etc.
– Access to guaranteed inventory, transparency, relationships with
publishers that go beyond just a standard banner buy.
– lack of premium content and knowledge
– Lack of quality supply from publishers. Typically only remnant
inventory is available.
• Lack of brand safety
• Lack of vision
– Buyer vision. Certain advertisers (like Kellogs) are putting a
majority of their spend on the exchange. Others have most of it
tied up in direct deals. In the future we can expect more to shift to
the non-guaranteed market.
– Legacy industry inertia

104. What factors restrict spending on exchanges?
• Lack of training / education (Too complicated)
– Ease of use Information exchange and bidding
– Education on buyer/seller side Lack of Transparency Inefficiency
Controls Actionable insights
– Education, availability, adoption.
– knowledge, ad quality and transparency
– Lack of awareness of the controls that exchanges can offer
publishers.
– technology is still new integration is not familiar to ad ops teams
there is a lot of buzz and not enough actual action
– Transparency and complexity

105. What factors restrict spending on exchanges?
• Too impersonal
• Duplication, Lack of Differentiation
– duplication and confusion between exchange and ad network
aggregation
• Lack of Standards, Measurement
– It's new, lack of standards, lack of targetable inventory in scale (in
mobile)
– lack of standard content classification and taxonomies across all
sources to help create fluidity in market by eliminating guesswork
and mismatched targeting.
– Lack of standards between exchanges.
– Limited TV like metrics
– predictability/accurate forecasting - ability to spend budget ability
to measure results/effectiveness

106. Does programmatic buying benefit buyers and
sellers equally?
Series 1
Yes 68%
No 28%
Don't Know 5%
0% 10% 20% 30% 40% 50% 60% 70% 80%

107. Who Benefits?
• buyers
• Buyers have better tools
• Buyers. Commoditizes inventory.
• Buyers. It waters down the content of the publishers.
• Currently no, it definitely skews to the buy side and drives pricing
downward instead of fair market value, but publishers and SSPs are
finally coming up with their own solutions to remedy this.
• Sellers often don't know who is buying their product
• Still primarily benefits buyers. The buyer benefits more as they are
able to pay a more accurate rate for the impression. Sellers would
like to see higher CPMs
• Today the buyers have the advantage because publishers have not
invested in yield management technology or expertise.

108. Who Benefits?
• Pubs benefit more as it allows the publisher to capture a higher
share of the value of an impression.