Sunday, November 08, 2015

Ads that no one sees

AppNexus announced that it would allow advertisers to pay only for those digital ads that are actually seen by people. This is a very important innovation in the digital advertising industry, given that most studies estimate that only about half of digital ads are seen by real people.

However, many marketers might still pay for ads that no one sees. As programmatic advertising auctions became popular, they have put a downward pressure on ad rates as measured by CPMs  and advertisers have developed a taste for the cheapest option available. The problem is that the CPM metric measures page impressions but not always whether someone has actually scrolled down to where the ad is shown.

Ad agencies often have to promise advertisers lower ad rates as a way to land competitive deals. "One really interesting aspect of this is that procurement for marketers may effectively be forcing agencies to buy non viewable impressions." says Mr. O'Kelley, CEO of AppNexus.

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