The State Of Ad-Viewability In 2016: The Viewable Marketplace
In a previous post of mine, trends of 2015 for ad-viewability, I talked about the IAB’s advice on taking a 30% “margin of error” when buying viewable impressions. This certainly didn’t come as good news for the industry because it implied that measurement technology wasn’t ready, yet.
But one year later I’m very happy to report that my other predictions have come to fruition.
In the same post, I recommended that our industry “train [itself] on the concept of cost per viewable impression”, and “optimize on viewable impressions.” I hope that you followed this advice, since these have now become the new reality.
AppNexus has done all the work of converting CPMs to Viewable CPM (Cost Per Thousand Viewable Impressions), as well as managing the optimization for you. If you’ve studied up on these concepts, then the Viewable Marketplace is here for you.
In a Viewable Marketplace, buyers only pay for viewable impressions, so sellers are only paid for impressions that are viewable. This is now a built-in capability of the AppNexus platform called Viewable Deals.
Here are a few things you should know about Viewable Deals:
Are Viewable Deals a tool that only benefits buyers?
Absolutely not! Viewable Deals bring premium demand (branding campaigns) to sellers. This demand competes with the other bids (CPM, CPA or CPC). In every liquid market, more demand means higher prices, which means higher CPMs!
Wait, so buyers pay more?
No, buyers pay less for what matters to them. Instead of buying CPM and getting computed Viewable CPM, they now control the Viewable CPM they pay. And this Viewable CPM is lower than the one they used to pay.
So this is basically a win-win situation?
Yes, it really is. Buyers can decrease their Viewable CPM and sellers can increase their CPM at the same time! This happens by way of the AppNexus auction mechanism, which automatically optimizes the bids to achieve these two goals all at once.
Each Viewable CPM bid is turned into an Effective CPM (eCPM), using predicted viewable. For instance, for a Viewable CPM of $2, an impression whose probability to be viewable is 50% is equivalent to a CPM-based bid of $2 x 50% = $1. This $1 CPM bid competes with other buyers and wins only if no one bids higher; hence a higher CPM for the seller.
In this example, the buyer pays $2 (not $1) only for the impressions that are measured viewable. So, the Viewable CPM is 100% controlled by the buyer.
At AppNexus, we strongly believe that non-viewable impressions will soon disappear. We do not say there will be zero non-viewable impressions, we say that they will always exist, but their value will be zero. This Viewable Marketplace is a great step towards this goal.
So in 2016, how will the Viewable Marketplace change our industry?
For starters, everything still running on non-viewable impressions will have to adapt:
The reach of served impressions will evolve into “viewable reach,” which means that only individuals who really see the ads will be reached by any given campaign.
Frequency will follow along the same lines. We’ll continue serving ads to those who did not see them, but stop serving ads to those who have reached their viewable cap limit.
Viewable ads don’t just matter for branding: non-viewable ads can’t be clicked and they don’t drive conversions. The last element of the Viewable Marketplace is the necessary evolution of post-view attribution models that take into account the viewability of impressions.