the ecosystem predicts on adexchanger.com! · offline to interactive media. emerging platforms will...

The Ecosystem Predicts on AdExchanger.com!

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TABLE OF CONTENTS

Marketer .................................................................................................................. 3

Publishers............................................................................................................... 5

Publishers – Kirk McDonald, Time Inc. ............................................................... 7

Investment.............................................................................................................. 8

Data ....................................................................................................................... 11

Data – Siddarth Chaudhary, Adobe/Omniture.................................................. 15

Platforms, Networks and Exchanges – Part I ................................................... 16

Platforms, Networks and Exchanges – Part II .................................................. 19

Platforms, Networks and Exchanges – Part III ................................................. 22

Agencies – Part I.................................................................................................. 25

Agencies – Part II................................................................................................. 27

Publisher Technology ......................................................................................... 30

Global.................................................................................................................... 33

Search, Display .................................................................................................... 35

Creative, Display.................................................................................................. 37

Video ..................................................................................................................... 39

Analysts ................................................................................................................ 41

Editors note: There are hundreds more companies and thousands more people in the ecosystem that could offer compelling

predictions. This is only a selection!

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Marketer

AdExchanger.com reached out to brand marketers for their predictions about the digital advertising ecosystem in 2011.

Click a name below to begin, or scroll:

• Doug Chavez, Del Monte Foods • Onil Gunawardana, Online Display Advertising, AT&T

Interactive • Mark Redetzke, VP, Ecommerce & Digital Marketing,

Bluestem Brands, Inc. • Anonymous Big Brand Marketer

Doug Chavez, Del Monte Foods

• 2011 will see margin compression accelerate as DSPs, exchanges and ad networks continue to duke it out

• The cacophony of ad networks will lead to more consolidation and better services of targeting and scale.

• Advertisers, online publishers will engage in the privacy conversation as an outcome truly starting to understand implications.

• Success on scale for advertisers using social targeting data outside of a walled garden (e.g RadiumOne, Media6, 33Across)

• The Cubs will win the World Series

Onil Gunawardana, Online Display Advertising, AT&T Interactive

• We believe the rise of locally targeted display advertising will provide a significant revenue opportunity for publishers with geo-location information.

• Several studies including the Harvard Business Review April 2008 article have demonstrated performance lift from combining display and search campaigns. Our view is that platforms that make it easier to flight and track these combined campaigns will emerge.

• In our experience, the ability to execute integrated buys across interactive media such as online display, mobile, and video will provide the necessary scale to hasten the movement of awareness dollars from offline to interactive media. Emerging platforms will support integrated campaign management with combined reach and frequency reporting.

• Rumors that ad networks will disappear over time are highly exaggerated. Anticipate the emergence of new models that provide a service layer to mask the complexity of ad exchange and data buying.

Mark Redetzke, VP, Ecommerce & Digital Marketing, Bluestem Brands, Inc.

• 2011 will be a watershed year for digital addressability. We'll see the fusion of offline and online data at scale by year’s end

• Privacy concerns will persist, but legislation will not be passed mandating ‘Do Not Market’ for behavioral advertising

• The DSP category will try to evolve to become a marketer's overall dashboard for all marketing as attribution gets folded into DSP functionality.

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Anonymous Big Brand Marketer

• Data-driven display brand advertising begins chewing into TV dollars in a meaningful way. Most marketers switch on no-brainer ads on mobile platforms (such as search). QR codes become ubiquitous. Data and privacy legislation doesn't change the landscape drastically, but at least some players get serious heat.

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Publishers

AdExchanger.com reached out to the web publishers for their

predictions about the digital advertising ecosystem in 2011.


• Bob Carrigan, CEO, IDG Communications, Inc. • Tyler Fitch, Director, Yield Management, Mindjolt • Marc Goldberg, SVP, Business Development, About.com • Josh Jacobs, SVP Brand Advertising Products and Global

Marketing, Glam Media • Richard Jalichandra, CEO, Technorati • Peter Naylor, EVP, Digital Media Sales, NBC Universal • Bennett Zucker, SVP / GM, Data Solutions, Ziff Davis, Inc.

Bob Carrigan, CEO, IDG Communications, Inc.

• Leading vertical networks will increase in advertiser value by becoming vertically integrated platforms encompassing better data, exchange capabilities, and real-time bidding. The formula for success is expert industry knowledge coupled with advanced targeting capabilities.

Tyler Fitch, Director, Yield Management, Mindjolt

• Google (and maybe RMX) will position itself to compete with Yield Optimizers and beat them easily due to the fact that they bring their own demand to the equation.

• DSP's will turn to Video Advertising as a new outlet. Scaling will still be the biggest problem. (pretty obvious).

Marc Goldberg, SVP, Business Development, About.com

• Advertisers will remember that the what and where are important, not just the who, and the "surplus" of inventory will quickly shrink.

• The famous Luma slide will change again as most of the players on the chart will have to "pivot" to survive and that will require a big funding round, which few will have the ability to raise.

• Mobile Advertising will celebrate its 10th year of it being its year. • If Facebook comes out with a new contextual ad product offsite, publishers will re-architect their pages,

deleting banner inventory that was once given to the networks.

Josh Jacobs, SVP Brand Advertising Products and Global Marketing, Glam Media

2011 is the year that we will see premium publishers start to claim their place in the exchange/RTB ecosystem. In 2011 we will see:

• Standards which allow publishers to merchandise their own data and premium classes of inventory, • Premium & exclusive inventory access coupled with preferred media agreements, and • Publisher protection and analytics tools.

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This will serve advertisers by allowing for more impactful and creative executions at scale (and make RTB much more interesting for brand advertisers), and Publishers by making them more equal participants in the marketplace and allowing them to open new pools of premium inventory in ways that enhance their sales efforts.

Richard Jalichandra, CEO, Technorati

• The ad ecosystem depicted by the famous banker slides will continue to be wild and wooly. Innovation will displace and/or move the frontlines back and forth with these things certain: a) consolidation amongst players in the ecosystem has to and will happen; b) ad technology will become more commodified (or at least the leads will be shorter); and c) scale matters.

Peter Naylor, EVP, Digital Media Sales, NBC Universal

• I predict the industry will continue to work hard to find ways to make it easier to buy and sell digital media. Some innovations are adding more complexity to the ecosystem. The ecosystem is already too complex. We really need innovations that make everything easier.

Bennett Zucker, SVP / GM, Data Solutions, Ziff Davis, Inc.

• Online advertising is due for a correction, but not in the form of plunging budgets, rates or yields. • Instead, the still immature ecosystem itself will get pounded by principal sellers and buyers intent on

slashing the VST - the "Value Subtracted Tax" charged by hundreds of intermediaries who've enjoyed a remarkable run despite enduring global recession.

• Networks, exchanges, data vendors, DSPs, SSPs, ad verifiers, measurers and the rest of the VC-fueled, tech-driven online ad underworld will be held to account for performance over promise and challenged to live or die by the very numbers they push on publishers and advertisers.

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Publishers – Kirk McDonald, Time Inc.

AdExchanger.com reached out to the digital advertising community for their predictions about the digital advertising ecosystem in

2011.

The following predictions are from Kirk McDonald, President,

Digital, Time Inc.

• I predict the industry will continue to work hard to find ways to make it easier to buy and sell digital media. Some innovations are adding more complexity to the ecosystem. But, the ecosystem is already too complex. We really need innovations that will make everything easier.

• Data finally gets that "day job" that we have heard everyone talk about. Additionally, the importance shifts from raw quantitative metrics, and becomes more sophisticated with analysis and insights that can be useful for qualitative evaluations. Data also realizes that it has to connect offline and online to really have value to senior level marketers who have to take a holistic view of the media strategies.

• The pendulum corrects a little from the current over-dependence on "algorithmic advertising"... I love math in media as much as the next person, but the thought that media is all math is wrong. It's about people with lives and soul and energy, and we need to have creative ideas and innovation in advertising to make meaningful connections with people. Getting the right message in front of the right person means that we have to make sure that we've put as much energy and innovation into the message as we think we have put into the delivery.

• Everybody needs new friends. Not only will we see consolidation happening, but we will see some strange alliances form to create differentiation and compete. The point solutions need partners to really be of significant value to buyers or sellers. We will see the re-emergence of the General Contractor role for advertising technology solutions, as some players will bring together best of breed partners to meet buyer and seller needs.

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Investment

AdExchanger.com reached out to the angel and venture capital investment community for their predictions about the digital

advertising ecosystem in 2011.


• Gil Beyda, Genacast Ventures • Jeff Crowe, Norwest Venture Partners • Chris Dixon, angel investor, co-Founder Hunch • Roger Ehrenberg, IA Ventures • Chris Fralic, Partner, First Round Capital • Jonah Goodhart and Noah Goodhart, WGI Group and

entrepreneurs • Seth Levine, Foundry Group • Jerry Neumann, angel investor • Matt Nichols, Highland Capital Partners • Satya Patel, Battery Ventures • Bipul Sinha, Lightspeed Venture Partners • Andy Weissman, Betaworks

Gil Beyda, Managing Partner, Genacast Ventures

• First, we will see the rise of Data 2.0. Data 1.0 is the raw or lightly processed data points we see today. This data is very inconsistent and thus very difficult for algorithms to extract signal for targeting purposes. Data platforms will begin refining and scoring this data to produce highly enriched data that is consistent, predictable, scalable and of very high quality. Data 2.0 will be the foundation of next generation "smart" segments that will provide significant signal and thus lift to targeting engines.

• We will begin to see consumer privacy policies implemented in technology platforms. Now that self-regulation is firmly in place and direction has been provided to industry, technology platform providers will begin implementing reporting and enforcement tools into their solutions.

• Finally, we will begin to see consolidation in the online advertising ecosystem. Too many players have point products or features while the buyers and sellers need full solutions. Look for roll-ups or mergers to simplify the landscape as larger players fill out their product lines.

Jeff Crowe, General Partner, Norwest Venture Partners

• Demand side platforms and supply side platforms exploded onto the scene in digital advertising in 2009-10. DSPs and SSPs were all about efficiency, optimization and scale. Now it is the turn of data management platforms. Platforms which enable superior audience management and targeting through the sophisticated use of data will give strategic advantage to both advertisers and publishers alike. DMPs will be the next high stakes battleground in 2011.

Chris Dixon, angel investor, co-Founder Hunch

• Online-offline attribution will be increasingly important area. • Facebook will launch off facebook.com display network. • Display will grow dramatically as more brand advertisers move to web.

Roger Ehrenberg, founder and Managing Partner, IA Ventures

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• The balance of power will begin to shift from the demand side to the supply side, setting the stage for 2012: The Year the Publisher Takes Control of Online Ad Monetization.

Chris Fralic, Partner, First Round Capital

• Consolidation will continue as ad networks continue to look to incorporate data, targeting and non-display formats into their offerings. Related to that, the innovation and trends we've seen around targeting, data, and platforms will move into search, mobile, video and email. Also related - CPM's will continue to rise in 2011.

• 2011 will likely be the year we see legislation take shape in the area of privacy, largely driven by the WSJ.com/WhatTheyKnow and similar series of articles.

• We'll also likely see Facebook continue to be a critical and growing component of the display landscape, and the share of dollars spent there (currently around 9%) will grow towards their share of impressions (currently around 22-23%).

Jonah Goodhart and Noah Goodhart, WGI Group and entrepreneurs

• Creative, creative, creative - while 2010 was the year of the science of advertising (data, retargeting, RTB, etc), in 2011, we'll start to see a renewed focus on the art of advertising. Why? Because advertisers are starting to realize that creative has a multiplying effect on the success of their campaigns - combining the art and science in a thoughtful way can lead to 4x-10x lifts in performance.

Seth Levine, Managing Director, Foundry Group

• Where to even start... I think we'll see acceleration of the consolidation that we've been talking about for years on the ad network side, but the overall number of companies in the online advertising ecosystem will continue to rise.

• 2011 will see a billion dollar M&A event in ad tech, at least 2 ad tech companies going public and one (or two) deals that we all scratch our heads about and wonder how the acquirer could have possibly justified paying up that amount (possibly the billion dollar outcome? not sure).

• I also suspect we'll see some kind of public hearing on data and privacy in Washington, followed by very little in the way of incremental regulation (plenty of grandstanding, however).

Jerry Neumann, angel investor

• The trend towards building companies that solve problems closer to the marketer and publisher will continue; innovation will keep moving away from the core towards the edges.

• Marketers and publishers will finally start to digest the massive wave of innovation that washed over them in the past few years. The emergence of ad tech solutions that actually provide real and large improvement to marketing ROI will speed this along. Services and solutions that help marketers and publishers figure out how to navigate the landscape and implement best practices will flourish.

• Towards the end of the year, the smartest entrepreneurs will start thinking about how to reinvent the core platforms to better support the needs of the best emerging applications. A dynamic similar to the software/hardware co-evolution of the '70s and '80s will begin, creating similar strategic opportunities.

Matt Nichols, Highland Capital Partners

• 2011 will be the year of social for ad tech with implications rippling across the industry. • Massive shift in display inventory (Facebook nears 50% of total display ad inventory). • Breakout success for targeting using social data (33Across, Media6, xGraph, etc.). • Notable privacy breaches as companies try to utilize social data effectively before the rules for its use are

clearly defined.

Satya Patel, Partner, Battery Ventures

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• There will be less consolidation in the ad tech market than people anticipate, largely because there is still too much venture money flowing into startups and established companies. Most consolidation that does happen will be modest private-to-private transactions and small tuck-in acquisitions rather than big dollar M&A by the large online players.

• Data will continue to increase in importance, with both the buy-side and sell-side looking for solutions to help access, manage and measure both first party and third party data so that they can stop pushing dollars, audience and inventory through middlemen.

• Networks and exchanges will look to expand from just display into multiple online ad types/channels, particularly video and mobile.

• An entire ecosystem of companies will develop around Facebook ads, similar to what happened with Google AdWords.

Bipul Sinha, Principal, Lightspeed Venture Partners

• iPad and its clones will open up large inventory for brand advertising - lean back media consumption pattern will attract brand advertisers.

• Audience buying will be the main driver for brand ad spend on online media. • Advertisers will demand cross channel attribution intelligence on media spend. • 2011 will be the inflection point for social media advertisement - social media advertisement will move from

experimental budget to real spend. • Continued consolidation of Ad Networks and commoditization of DSPs. • Android will increase mobile ad inventory by an order of magnitude - agencies/advertisers would be able to

buy scaled audience on mobile.

Andy Weissman, COO, Betaworks

• Publishers will realize that concurrent users is a better measure of a site's value than monthly unique visitor.

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Data

AdExchanger.com reached out to executives in the data tech space for their predictions about the digital advertising ecosystem

in 2011.


• Sam Barnett, CEO, Struq • Dan Beltramo, CEO, Vizu • Paul Cook, CEO, TagMan • Sam Cox, CEO, Milabra • John Donahue, CTO, BuzzLogic • Andy Ellenthal, CEO, Peer39 • Konrad Feldman, CEO, Quantcast • Russell Glass, CEO, Bizo • Florian Kahlert, SVP, KN Dimestore • Scott Meyer, CEO, Better Advertising • Oren Netzer, CEO, DoubleVerify • Ari Paparo, EVP, Nielsen • Chris Scoggins, SVP and GM, DataLogix • Josh Shatkin-Margolis, CEO, Magnetic • Omar Tawakol, CEO, BlueKai • Kirby Winfield, CRO, AdXpose • Meir Zohar, CEO, eXelate

Sam Barnett, CEO, Struq

• 2011: Display growth rate to double and at least a third of all display advertising will be personalised. • Measurable performance where display can act as a cost of sale and new technologies that enable display

to be a real-time communications channel - which is more effective than Search and as immediate as social media - will lead to new marketing dollars flowing into this channel at an unprecedented rate.

Dan Beltramo, CEO, Vizu

• Online video will begin to achieve strategic parity with TV advertising in terms of media planning in 2011. Online video will also become a serious testing ground for TV creative and will eventually drive creative development for broadcast TV to the point where TV commercials routinely become re-purposed online video assets rather than the other way around.

Paul Cook, CEO, TagMan

• Companies will be forced to allow consumers to opt-out out at a ‘tag level’ in response to to new EU privacy legislation and others.

• Wider uptake of attribution reporting/understanding sees dollars move away from brand paid search terms towards organic search display retargeting/extension.

• Someone needs to 'manage' all these predictions on Adexchanger as the industry evolves: Agnostic, boutique agencies will win back direct-to-vendor dollars and handle more supplier review processes/paperwork/analysis etc.

• Terry Kawaja will release a Monopoly Board which pivots into a DSP

Sam Cox, CEO, Milabra

• Data and targeting combinations will be key for 2011, as campaigns will layer more data for implementation and analysis pushing the capabilities of both the supply and demand side. This will lead to

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three things 1) new premium advertising opportunities that will be bought in a non-guaranteed marketplace; 2) bring on ops and analysis infrastructure as companies try and tie more data together from point multiple point solutions on an adhoc basis. 3) Corporate consolidation as bigger companies need to incorporate technology solutions across their media.

John Donahue, CTO, BuzzLogic

• Procurement at the brands begin paying attention to how agencies are making money on the trading desks and the squeeze begins.

• The mass consolidation of ad networks begins in order to shore up and protect the assets that they have built and invested in.

• A major agency loses an entire piece of digital buying business to the non-agency trading desk solutions (DSPs).

Andy Ellenthal, CEO, Peer39

• In 2010 exchange markets were dominated by direct response and performance-based campaigns. There’s one more big hurdle to get the large brand spenders into the exchanges. 2011 will be the year we get better at identifying high quality inventory and start to see bigger brand budgets and an influx of new advertisers. There’s just too much efficiency for them to ignore.

Konrad Feldman, CEO, Quantcast

• Truly scalable, audience-based, media strategies require algorithmic sophistication far in excess of today's status quo and 2011 will test the computational mettle of those seeking to combine media, data and advanced bidding strategies to deliver performance at scale. As RTB utilization gathers steam, many market participants will discover that their dominant strategy - retargeting - only scales so far, and beyond that limit performance drops off quickly.

• RTB won't get all the audience attention. Leading publishers and media sellers will find increasing advantage in the application of audience data to create compelling impression level media packages, accessing new revenue streams, offering superior performance for their advertisers and creating greater relevance for their consumers.

Russell Glass, CEO, Bizo

• Privacy issues get resolved by industry and codified by government • Online data management will be the next frontier where large advertisers and publishers will be managing

their first party data, and augmenting at scale with third party data • Direct response spend continues to rapidly move to RTB, forcing consolidation to begin in earnest in ad

network space. • Brand spend stays largely in premium publishers direct and within ad networks, and continues to grow

substantially online as offline spend shifts to online to chase media consumption. • First easy attribution measurement solutions begin to roll out to broadly prove value of display as part of

marketing mix.

Florian Kahlert, SVP, KN Dimestore

• My prediction is that the need to move more Brand dollars online will drive the next changes across the industry.

• Ad Networks will be forced to further redefine/refine their value propositions if they want to stay relevant in a world that is less driven by clicks/conversions

• Mobile is still a training ground and will get another revenue boost as the brands try out different approaches (but it will take at least until 2012 before solid models emerge)

• Technology will emerge/adapt to cater to the brand's needs and deliver successful campaigns that have metrics other than clicks and conversions.

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Scott Meyer, CEO, Better Advertising

• Meaningful Transparency Technology Displaces Conversations about Privacy - By the end of 2011, every creative unit in every behavioral campaign served online will bear the Advertising Option Icon. Consumers and advocates no longer will be able to claim that our industry is hiding anything about data collection, and anyone who thinks self-regulation can’t possible work for our industry will find their views relegated to the same trash bin of history as the views of haters back in the early 1970s, when the Better Business Bureau introduced self-regulation for the advertising industry as a whole after numerous complaints Agency buying platforms and large ad budgets in mobile will both become far more prevalent than in 2010. But, 2011 will go down as the year that our industry learned to self-regulate effectively.

Oren Netzer, CEO, DoubleVerify

• There will be widespread adoption of the DAA's Self-Regulatory Program for Online Behavioral Advertising, which provides consumers with a notification icon for behaviorally targeted ads and a clear choice to opt-out. This proactive initiative to protect consumer privacy will satisfy the FTC's suggestions for doing so and will prevent a 'do not track' list from being implemented.

• The majority of online inventory (display, rich media and video included) will go through some sort of verification and all players will be held accountable in some way. Increased accountability will lead to increased trust, which will lead to more brand dollars online for everyone.

Ari Paparo, EVP, Nielsen

• 2011 will be the year that brand advertisers go "all-in" to web and mobile display advertising, driven by engaging new formats and audience-based reporting.

Paul Pellman, CEO, Click Forensics

• Online display advertising will continue to look a lot more like search advertising through the aggressive use of data and the rapid adoption of RTB. In other news, the sun will rise in the east almost every day.

• Brand safety will fade as a concern for advertisers when the supply-side publishers and ad nets embrace the need for greater transparency and accountability. Brand safety vendors will find new business models to pursue.

• The adoption of RTB and the use of ad exchanges will finally bring about the consolidation in the ad network world that has been predicted every year for the past 5 years. (Please save this prediction to re-use next year. And the year after.)

• The industry will finally put to bed the use of CTRs and last-view/last-click conversion as measures of online display advertising effectiveness.

Chris Scoggins, SVP and GM, DataLogix

• Two primary drivers of an accelerated Brand $ shift to Digital: 1) Quality online video inventory has reached sufficient scale and 2) new analytical offerings in the market allow for brands to measure the offline impact of digital advertising (~85% of consumer spending still occurs offline) across multiple verticals.

• Advertisers and Agencies begin to "de-silo" their marketing efforts: It's becoming less and less relevant to label a marketer as "digital" vs. "traditional". These worlds are colliding at blinding speed and for "always-connected" consumers the distinction is meaningless. The marketers that focus on the interplay of these environments will be the ones that win.

• Rise of the Data Management Platform: Advertisers, Agencies and Publishers are struggling with how to synthesize and rationalize all of their data sources and data sets. DMPs will play a valuable role this process, thus driving further data adoption by the ecosystem.

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Josh Shatkin-Margolis, CEO, Magnetic

2011 will be the perfect storm against search engine marketing and in favor of display advertising:

• There will be an almost doubling of targeted display buys enabled by data exchanges, ad exchanges and demand-side platforms.

• Search engine marketing spend will be flat and display spend will grow as offline dollars that move online predominately move to display.

• Attribution model becomes major focus as people realize search has been given too much credit and display has been given too little.

Omar Tawakol, CEO, BlueKai

• Data is king and in 2010, we saw an increased adoption and acquisition of valuable third party data for true audience targeting anywhere on the Internet. In 2011, continued success from data-centric targeting will urge marketers to become more sophisticated about how they target AND just as importantly, how they can bring their own first party data to the table. This is the year that marketers take control of their own data by seeking tools and technologies to better understand their ideal prospect and to achieve more efficient audience targeting. In figuring out their data strategy, marketers will also become more cognizant of consumer data sensitivities. Early adopters will start to experiment with innovative ways to deliver on the promise of consumer transparency including 1) in-ad disclosures, 2) non-legalese verbiage on websites that clearly explains data collection and usage in plain English and 3) more advanced consumer tools and registries that shows exactly what data is being collected.

Kirby Winfield, CRO, AdXpose

• 2011 is the year buyers will stop paying for unseen ads. Blind ad networks will become transparent. Ad servers will buy or partner with analytics companies to augment their offerings. And display impressions will get the SEM treatment of algorithmic bidding based user engagement as a proxy action for downstream conversion at a defined rate, driving efficient media valuation and increased spend.

Meir Zohar, CEO, eXelate

• Publishers and 3rd party data sellers will become more sophisticated in their data handling capabilities and will look to do more direct, transparent selling of their data as opposed to letting data exchanges do all the selling for them.

• Data “theft” will decline as tools (like the one we're releasing very soon) begin to shed light on "non kosher" practices, which will single out a few "bad players" among the ad networks and forcing a more direct approach to acquiring data (i.e. paying for it!).

• Enriched data will become the “must have” advertising accessory, as online data leaders build real analytics abilities resulting in proprietary, branded data sets mimicking the process of the offline data world.

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Data – Siddarth Chaudhary, Adobe/Omniture

AdExchanger.com reached out to the digital advertising community

for their predictions about the digital advertising ecosystem in 2011.

The following predictions are from Siddharth Chaudhary, Senior

Product Manager, Omniture, an Adobe Company.

• Demand-side platforms and their close cousins will continue to distance themselves from cracking the code of performance advertising for Display; instead they will fragment offerings to chase brand dollars where expensive 3rd party data is more easily justifiable. Google and their new Display Campaign Optimizer product will start to gain marketshare for performance advertising.

• Data management platforms and the partner data providers will realize that their implicit audience data will not be available at the scale and the price point that advertisers require to invest more than experimental performance dollars. They will use techniques that infuse user contributed data into the optimization algorithms since it will prove to be cheaper and of better signal. MediaMath/KN Dimestore and RocketFuel/Dynamic Logic partnerships are the beginnings of this trend.

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Platforms, Networks and Exchanges – Part I

AdExchanger.com reached out to platforms, networks and exchanges for their predictions about the digital advertising

ecosystem in 2011. This is part one of their predictions.


• Joe Apprendi, CEO, Collective • Elizabeth Blair, CEO; Andy Atherton, COO, Brand.net • Iggy Fanlo, CEO, adBrite • Jeff Hirsch, CEO, AudienceScience • George John, CEO, Rocket Fuel • Tyler Moebius, CEO, Adconion Media Group • Jay Sears, GM, CONTEXTWEB • Yoav Shaham, CEO, Kontera • Art Shaw, CEO, Epic Media Group • Greg Skipper, director of network strategy, Advertising.com • Gal Trifon, CEO, MediaMind • Bill Wise, CEO, MediaBank

Joe Apprendi, CEO, Collective

• The distinction between ad network, ad exchange, DSP, SSP and DMP will blur with the display, video and mobile advertising sectors. Consolidation among these players will happen swiftly in 2011 in effort to provide large connected buy-side/sell-side solution for advertisers and publishers as alternative to Google. Expect the largest buyers and sellers of display advertising to take control of their audiences via technology and limit their dependencies on 3rd party intermediaries.

Elizabeth Blair, CEO; Andy Atherton, COO, Brand.net

• EB: Yahoo! bets big on display advertising, either: (1) launching a huge platform investment (including multiple acquisitions across brand, DR and core infrastructure), or (2) going 180 degrees opposite, concentrating its human and financial capital in publishing, and outsourcing its display ad platform to Microsoft, as it has done very successfully with search.

• AA: At least one highly-publicized incident of an ad-related privacy breach resulting in felony criminal activity and/or death.

Iggy Fanlo, CEO, adBrite

• The standardization of formats and technology will accelerate the growth of online video as well as provide the scope for audience buying (BT) within video. The importance of standardization in the video space cannot be overstated. Standardization through VAST and VPAID are key in breaking down format barriers, and the operational efficiency that standards such as VAST bring rapidly increases the amount of available inventory.

Jeff Hirsch, CEO, AudienceScience

• The use of data will demand a more discriminating view as its true value continues to be examined. The notion that data is "simple" to use will be challenged. Advertisers will take more control of their own data assets and audience definitions. Data ownership and usage rights issues will reemerge. RTB will progress, however with the realization that this is a nascent technology with corresponding unmet technical

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and operational capabilities. Premium publishers will push back on being valued solely on price. The long needed media transaction platform for the premium buy/sell relationship will emerge to satisfy brand marketing requirements.

George John, CEO, Rocket Fuel

• The current furor over privacy will die down as true bad actors are removed (e.g., history sniffers), and consumers realize the good guys never tracked them personally to begin with.

• Advertisers and their agencies will begin to think and plan more holistically, measuring how marketing activity in one channel or strategy might amplify or interfere with another -- and they'll begin to optimize spend with these interactions in mind.

• Marketing will continue to evolve towards a more scientific discipline, with less spend going toward vanity buys like homepage takeovers, and more spend going towards measure-and-optimize strategies.

Tyler Moebius, CEO, Adconion Media Group

• Ad Networks will call themselves DSPs, because DSPs are really just Ad Networks. • In banner-video spend will be as big as pre-roll spend because of its scale and targetability. • The use of Email lead generation will become the alternative to overpriced Google search.

Jay Sears, GM, CONTEXTWEB

• First, I'm sticking with CONTEXTWEB's 2009 prediction on AdExchanger that 2010 and 2011 are the breakout years for RTB. The RTB pony is riding hard-don't bet against it.

• Second, content rises again. As brand dollars, brand safety concerns and bidder appetite for more attributes rise, audience PLUS content wins.

• Third, there used to be 400 ad networks and now there are 400 DSPs-in part because Appnexus has become the Adify of DSPs. Watch for specialization across DSPs and a separation of those that have planned for high scale computing and those that will struggle with their infrastructure.

Yoav Shaham, CEO, Kontera

• In 2011 we will continue to see a focus on results on the part of advertisers, and this will extend to brand awareness campaigns and top of funnel metrics, not just traditional response campaigns. I expect that the industry will see a continuation of the shift towards advertisers wishing to be more relevant and targeted to users' interests and intent. This trend manifests in two ways: 1. An increase of advertisers seeking to provide related information and relevant offers to the right people. 2. Being a part of the ongoing "dialogue" that consumers are having across both the web and social platforms. Lastly, I'm seeing tremendous interest in providing relevant and helpful ads, in just the right context, across mobile devices. Mobile contextualization and value will be a very interesting and active space in 2011.

Art Shaw, CEO, Epic Media Group

• I would say that you can always count on change. For instance, looking back at some of the predictions made about 2010, some came true but others did not. I do think that for 2011 advertising spending will continue to funnel towards digital, that privacy and fraud concerns will still be front and center on everyone’s minds, and that the industry will continue to change or perhaps consolidate. I also believe that more and more traditional branded advertisers will work with service providers like us to maximize their online campaigns. It is tough for advertisers and agencies to catch up with technology and optimization at this stage and so they will need to rely on strong partnerships.

Greg Skipper, director of network strategy, Advertising.com

• Continual blurring of the lines and further consolidation in the display space, specifically among ad networks, agency trading desks, DSPs, and ad serving technologies. Technology companies will become

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the primary (acquisition) target of established media and agency holding companies as this will allow them to keep as much of the advertising value chain in-house.

• Convergence of digital mediums. Ongoing innovation (e.g. evolving platforms, operating systems, browsers and devices) and faster adoption rates in the mobile space will bring mobile and display even closer.

Gal Trifon, CEO, MediaMind

• Data for targeting and optimization will exceed other assets in its importance, as ad exchanges become more liquid and accessible.

• Advertisers and their agencies will pay more attention to access and leverage of their data by others and will push for greater transparency and controls by their buy management and inventory brokerage partners.

• Social, mobile and digital video will accelerate their growth and further enhance the fragmentation of digital media and grow the demand for cross channel campaign management.

• Cross-channel campaigns will become a standard for premium brands who look to communicate with consumers wherever they are and with greater consistency of messaging and data. Solutions that offer efficiency and maximize performance I multi-channel campaigns will benefit.

Bill Wise, CEO, MediaBank

• DSPs, targeted ad networks, and ad exchanges have tackled some of the biggest problems in media buying, but the industry as a whole still has a lot more ground to cover... To start, so much innovation has gone into the spot market display business, which is a ton of ad inventory, but a very tiny percentage of total ad spend. The telling trend is the advertisers' interest to not use context as a proxy for audience, to move dollars from the upfront market to the spot market with a level of predictability, and to manage marketing with accountability and as a P&L. We are banking that 2011 is the year we start to take all of this DNA and advanced solutions and extend past digital and into other mediums. Media consumption is holistic and across multiple mediums- TV, print (yes, print is still alive and still 2-3x larger than digital spend), out of home, spot, search, display and mobile. Ad spend and technology solutions should also be across mediums. I believe DSP's and exchanges will migrate across mediums as well in 2011.

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Platforms, Networks and Exchanges – Part II

AdExchanger.com reached out to executives from platforms, networks and exchanges for their predictions about the digital

advertising ecosystem in 2011. This is part two of their predictions.


• Amit Avner, CEO, Taykey • Zach Coelius, CEO, Triggit • Bill Demas, CEO, Turn • Rob Leathern, CEO, XA.net • John Nardone, CEO, [x+1] • Brian O'Kelley, CEO, AppNexus • Tim Ogilvie, CEO, Adbuyer • Ajay Sravanapudi, CEO, LucidMedia • Joe Zawadzki, CEO, MediaMath

Amit Avner, CEO, Taykey

• Facebook will try to build a new advertising model, to help divert performance advertising money from search to social.

• Unified platforms for social media advertising will start popping around (how to manage your Facebook, Foursquare and Places ads in one place).

• Brand advertisers will move in to the real-time world, trying to react ti what's going on around them immediately.

Zach Coelius, CEO, Triggit

The most important number to watch in 2011 is the average CPM on RTB exchanges. I predict it will cross $3.00. That number is a tipping point with significant ramifications.

• Virtually all unsold inventory will be cleared in the exchanges. • Ad networks will not be able to buy from publishers directly anymore. • Yahoo will bite the bullet and roll out real RTB • Microsoft will buy someone. • Traditional media companies will realize Google’s play with RTB is really about TV. • We’ll all continue to have a blast

Bill Demas, CEO, Turn

• With the rapid adoption of audience buying this year, it seems our industry has been obsessed with targeting and media optimization. In 2011, I expect that the buzz will pivot to data- to the point that we'll need to update that overused John Wanamaker quote to, "Half the money I spend on data is wasted; the trouble is I don't know which half." Data will also facilitate the adoption of multi-touch attribution models. Instead of looking at "last click" or "last ad" models, marketers will leverage the data available to analyze the effectiveness of multiple touch points of users' experiences.

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Rob Leathern, CEO, XA.net

• We're going to see some really exciting developments that bring the concepts of 'social media advertising' and 'social media marketing' together in 2011. The two trends that are only beginning are that (1) certain savvy, large advertisers are taking more control of the media that they buy and the interactions they are having with their customers. It's not that transactions are turning into 'conversations', but also that (2) both things need to happen and need to be managed (Twitter, Facebook, user reviews, etc.) in order for the marketer to be successful - and (3) as a result, you'll see more creative become a big focus for brands (and I don't JUST mean thousands of iterations, I mean actual interactive creatives that engage users).

John Nardone, CEO, [x+1]

• The new portability of data means that clients can develop customer contact strategies across touch points. Data, and the insights it drives will be the catalyst for marketplace buying decisions rather than external factors like the old-media upfronts. Marketers and their agencies will develop new planning methods and competencies to drive new program opportunities.

Brian O'Kelley, CEO, AppNexus

• 2011 is the inflection point for the currency cycle of innovation. Companies with true competitive advantage and strong partners will explode; everybody else will stagnate or implode.

Tim Ogilvie, CEO, AdBuyer

I expect 2011 will bring more of what we saw in 2010:

• The number of ad networks and DSPs will continue to increase, though the definition will keep getting fuzzier. The technology is table stakes for the new ecosystem.

• Publisher yields will continue falling, despite all the new solutions. There's simply too much inventory. • Agencies will continue moving demand onto their buying platforms and clients will move dollars directly to

DSPs. There's a big storm brewing here.

Ajay Sravanapudi, CEO, LucidMedia

• The new “ad network” is a DSP and vice-versa. As exchanges make it easier to reach scale with technology, display advertising will be even more ROI focused. DSPs will be the way to deliver on desired outcomes for an advertiser. Networks that do not have DSP-like technology will build, buy or license it.

• Data will NOT be sold independent of the impression. Anyone running display campaigns understands that optimization is a soup that includes all kinds of data ingredients and changes in real-time. Buying data independent of the impression forces advertisers to make suboptimal choices. Technology will solve this. Data providers will figure out how to bundle it with the impression or they will die.

• Agency trading desks mature. As they staff up and try to run and optimize campaigns with their own people, they will finally understand that ad networks provide real value. Who knows how they will react.

Joe Zawadzki, CEO, MediaMath

2011 will be serious. 2011 will be the last transition year of mad men becoming math men. Last year was fun because doing anything different than business-as-usual was a win. This year, people are making big decisions and the stakes matter more. Small lifts on small budgets don’t matter much. Large lifts on large budgets matter a lot.

Thus:

1. Performance will out. End results for the marketer will truly matter

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2. Rigor will increase. How results are delivered will matter: privacy; economics; scalability of the solution, the team and the business model within the ecosystem.

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Platforms, Networks and Exchanges – Part III

AdExchanger.com reached out to executives from platforms, networks and exchanges for their predictions about the digital advertising ecosystem in 2011. This is part three of their

predictions.


• Jeff Green, CEO, The Trade Desk • Jay Habegger, CEO, OwnerIQ • Brent Halliburton, CEO, Deconstruct Media • David Jakubowski, CEO, Aggregate Knowledge • Josh McFarland, CEO, TellApart • Andy Monfried, CEO, Lotame • Murthy Nukala, CEO, Adchemy • Alan Pearlstein, CEO, Cross Pixel Media • Eric Picard, Chief Product Officer, TRAFFIQ • JB Rudelle, CEO, Criteo • Vlad Stesin, co-founder, AdGear

Jeff Green, CEO, The Trade Desk

• Search and display will continue to integrate with one another and create momentum around full-funnel attribution.

• Advertisers will begin to digest the technological advances that have happened over the last 24 months.

• RTB will advance in adoption and continue as the fastest growing segment of Display.

• 2011 will be a better year for marketing budgets and Online will get more of the overall budgets than ever before.

• Data leakage/data protection will become the central data issue of 2011. • In 2H 2011 online advertising M&A will heat up substantially as compared to 2008 to today.

Jay Habegger, CEO, OwnerIQ

• 2010 was the year of gaining access to audience data. Media-buying DSPs and ad networks asked us to believe that access to data implied the ability to use it. As clients raise their eyebrows at lackluster audience-targeting performance, however, the buzz will center on the ability to use data to drive results for advertisers. Ability to use data, not merely access, will drive the audience-buying stories of 2011.

Brent Halliburton, CEO, Deconstruct Media

• 2010 was a year that saw more adoption of previous innovation than introductions of new technology. While it is exciting to watch technology innovations round themselves into whole products and find market adoption, I hope to see more break-through thinking introduced in 2011 - if you have an idea, talk to me about it.

David Jakubowski, CEO, Aggregate Knowledge

• Big advertisers will realize that they are using audience-centric ad strategies but inventory-centric measurement and execution tools. 2011 will be the last year that inventory will be the dominant pivot point.

• The DSP layer will expose the unruly margins being charged by current arbitrage players.

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• Agencies will figure out that one DSP won't fit all. Two to three DSPs will be needed across the agency. • Retargeting will be exposed as the “emperor’s new clothes” of ad targeting. • Mobile will lay the groundwork for a 2012 ad explosion.

Josh McFarland, CEO, TellApart

• 2011 is the year of the click. The ad exchange infrastructure, user data, targeting technologies and dynamic creatives have finally materialized to yield user CTRs that rival search. RIP, false view-based metrics... the click is back.

Andy Monfried, CEO, Lotame

• Major advertisers will begin the process of looking towards smaller, more nimble agencies, who are heavy in engineering, and creative talent – and less reliant on media planning and buying. 2011 will be the beginning of the trend of "smaller independent shops" taking away significant business from larger more established agencies and holding companies.

Murthy Nukala, CEO, Adchemy

• New technologies and abstraction layers will emerge that reduce complexity in digital advertising - making online ads more relevant for users and digital agencies more profitable.

Alan Pearlstein, CEO, Cross Pixel Media

• "Audience Planner" becomes the hot, new job title at interactive agencies. • Audience data is utilized to personalize publisher content, not just display advertising. • Retargeting helps calm the privacy debate. Here’s my logic: retargeting becomes so commonplace and

pervasive in 2011 that consumers are exposed to retargeting campaigns constantly. Consumers will begin to understand how audience targeting works through their personal experiences with retargeting and become comfortable with the practice. Awareness, education and experience leads to acceptance by most consumers.

Eric Picard, Chief Product Officer, TRAFFIQ

• Privacy and targeting are going to run headlong into each other in 2011. The industry has got to figure out a way to resolve that problem. I don't know if we'll see legislation this year or next year, but I predict in the next few years we're going to see it. A lot of businesses have built their revenue models around the ability to follow people as they move around the Internet and track what they're doing without their consent. I believe we’ll be forced to move to an opt-in model over the next 1-3 years.

• Also, we're going to see brand budgets start to spend in real-time bidded inventory or use programmatic buying. The fastest growing segment of new spends in 2011 will be brand budgets.

JB Rudelle, CEO, Criteo

• Display advertising technology will become even more sophisticated, including the ability to drive automated real-time creative optimization, driving substantial levels of campaign performance and ROI for e-commerce companies and advertisers.

• Online advertisers will realize huge benefits from shopper-specific (personalized) technology that combines real-time creative optimization with real-time bidding and buying - allowing e-commerce merchants to maximize display campaign reach & results.

• Performance display ad campaigns will become substantial complements to traditional search campaigns due to the greater scalability, reach and ROI.

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Vlad Stesin, co-founder, AdGear

• Widespread emergence of "private pipes" between agencies and premium publishers as both parties create controlled environments where advertisers can benefit from the holy trinity of quality of formats, context and data – but at a price.

• Facebook display network becomes the golden standard in data for display, making data companies feel more pressure and pivot towards business models emphasizing more transparency.

• As brand advertisers push the ecosystem towards richer, bolder formats, SSPs play an increasingly important role in enabling brand dollars to pour in.

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Agencies – Part I

AdExchanger.com reached out to the agency community for their predictions about the digital advertising ecosystem in 2011. This is

part one of predictions from the agency world.


• Tim Hanlon, CEO/Managing Director, Velociter, Mediabrands, IPG

• Tom Hespos, Chairman, President, Underscore Marketing • Vik Kathuria, Managing Partner, Mediacom, WPP Group • Amanda Richman, EVP, Managing Director, Digital,

MediaVest USA, Publicis

Tim Hanlon, CEO/Managing Director, Velociter, Mediabrands

• My sense is that 2011 will become the "Year of the Inevitable" - where consumers and regulators alike will finally make tangible strides in re-defining the limits of data management, consumer privacy, and the unintended consequences of always-on/real-time social media. It will be messy, but a re-set in this space is overdue.

Tom Hespos, Chairman, President, Underscore Marketing

• The transactional media space will face several serious threats. Data privacy and price transparency issues will team up to sour major advertisers on the notion of buying media with networks and exchanges. A top 50 advertiser will get headlines in the trades after spurning the networks and exchanges entirely.

• US Governmental regulation may not come in 2011, but it will loom large enough to create a business climate where online advertising players are separated into "white hat" operations and "everything else." Smart digital companies will create contingency plans for scenarios where governmental regulation kills third-party cookies. Or worse.

• Consolidation will continue, but in a haphazard way that keeps everybody scratching their heads. Publishers will acquire agencies. Agencies will acquire technology companies. Advertisers will acquire ad networks. It won't make sense until everyone takes a step back and looks at the big picture - It will all be about acquiring smart digital talent.

Vik Kathuria, Managing Partner, Mediacom Interaction - Digital Investment Group, WPP Group

• Audience-based Buying: The premise of the Exchange is to give agencies access to large pools of liquidity with a public auctioning system, with full transparency to ensure efficient pricing and tracking. Ad exchange platforms and their attendant real-time bidding ("RTB") capabilities will be an important factor in delivering an efficient and liquid "marketplace" for buying and selling data-driven audiences, offering enhanced scale, behavioral targeting, audience segmentation and improved transparency. This will aid in driving down overall cpm's for advertisers for part of their media bought thru audience based buying vs. the traditional content / site based digital buying.

Amanda Richman, EVP, Managing Director, Digital, MediaVest USA, Publicis

• In the past two years, data has powered new buying approaches. In 2011, our ability to drive conversation, intent, and purchase will require equal attention to the message and the media. With data's role expanding from informing the 'where' to 'what', dynamic creative optimization will be applied as brand-builders seek real-time messages for real-time delivery. Data visualization will become a new form of content while functionality and mobility will have a lead role in more creative conversations. In the deluge of data in

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2011, simplicity is key to focus on the data that matters, and the media and message that drive measurable actions, not just attention.

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Agencies – Part II

AdExchanger.com reached out to the agency community for their predictions about the digital advertising ecosystem in 2011. This is

part two of predictions from the agency world.


• Adam Cahill, EVP, Media at Hill Holliday • Jason Deal, SVP, Digital Group Account Director, Initiative

USA • Dax Hamman, iCrossing, VP • Will Margiloff - Founder / CEO, Innovation Interactive • Ed Montes, CEO, Adnetik • Brendan Moorcroft, CEO, Cadreon • Megan Pagliuca, Vice President of Display Media, Merkle

Inc. • Matt Spiegel, CEO, Annalect Marketplaces, Omnicom

Group • Kurt Unkel, SVP, VivaKi Nerve Center • Mitch Weinstein, VP, Director of Ad Operations at

Universal McCann

Adam Cahill, EVP, Media at Hill Holliday

• There will be a government-mandated Do Not Track list in place (or at least in the works). But regulation will turn out to have been a boogeyman; it won’t affect the industry in any material way because it won t be widely adopted by consumers. (prediction sent pre-announcement)

• Google TV will be viewed as an emerging success. We ll be talking about how TV is Google’s next core business. And the TV networks will be wishing they had played nice to begin with as they watch Google’s power grow.

• Half of display impressions will be available through the exchanges on a daily basis, and some small amount of TV inventory will be available through DSPs (probably through Invite + Google TV Ads).

Jason Deal, SVP, Digital Group Account Director, Initiative USA

• Video starts its rapid ascendency towards becoming THE standard digital ad type, causing rich-media in particular to take a hit. Marketers stop troubling over whether or not to do web-specific video creative as research and results show that their TV spot can be effective if its delivered using targeting data and is relevant to the customer.

Dax Hamman, iCrossing, VP

• Time to bring out the 2011 (digital) crystal ball and swap thoughts about what comes next in this dynamic industry of ours.

• I believe we will see a continuing shift of marketing dollars towards Performance Display, the goal to generate an ROI by targeting individuals with intent rather than simply shouting at the crowd.

• Techniques such as site and search retargeting will grow as part of this, but whilst 2011 will be filled with lots of attribution modeling talk, it is unlikely to the 'year of attribution' - that will be for next year’s crystal ball. Or the next.

Will Margiloff - Founder / CEO, Innovation Interactive

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• DSPs will continue to grow in popularity as a way to access exchanges BUT will not be the end all be all that folks think they can be. Buyers will start to realize the necessity for proprietary inventory, algorithms that provide unique opportunities. The DSP hype will mellow a bit as marketers and agencies decide how best to use these platforms.

• RTB will remain the most important acronym on the supply side. • Data will become more transparent, as big companies will attempt to utilize data exchanges to manage

the purchasing of their data more directly. Instead of buying blind segments, marketers will be able to buy specific companies data using these platforms and know if there has been explicit consent or not.

• Attribution will become even more important in a client's vocabulary - and not only conversion attribution on the media they are buying, but attribution across the data they are buying as well.

Ed Montes, CEO, Adnetik

• Several "premiere" or well known media brands/publishers will band to form premiere private ad exchanges. These exchanges will further prove the potential for exchange based buying and the power of information asymmetry.

• There will be consolidation of providers of enabling technologies such as DSP's and DMP's, not ad networks.

Brendan Moorcroft, CEO, Cadreon

2011 marks a new transformation for the Audience Marketplace in three words: Consolidate, Build, Scale. In 2011 Cadreon believes:

• Major consolidation across the DSP, DMP and other service environment will take place, so we should all expect to see fewer logos on Terry Kawaja's chart by the end of the year.

• Building new and proprietary data assets will become a necessity to rise above the commoditization of third party data. Cadreon will begin to work with advertisers to build client-side data platforms, to successfully leverage internal data assets across their marketing activities. Additionally, cross-channel (i.e. display, video, TV and mobile) audience-based buys, leveraging identical centralized data-sets will become a reality.

• More and more media companies will supply have value inventory to the trading desks through premium marketplaces.

• Audience-based buying across multiple channels - at scale - will become a reality.

Megan Pagliuca, Vice President of Display Media, Merkle Inc.

• Cross channel measurement. Measurement and more specifically attribution will be addressed for advertisers not only to understand the impact of display beyond the last click, but between display, search, social, video, and mobile.

• Cross channel targeting and insights. In 2009, the use of search data for display retargeting became mainstream. In 2010, we saw advertisers begin to use audience insights from targeted display media, which is a low risk, cost effective test ground for understanding customer segments, and incorporating those insights into their full media mix. In 2011, we will see both of these trends expand and advertisers will leverage data and insights between display, website analytics, email, video, mobile and offline channels such as direct mail.

Matt Spiegel, CEO, Annalect Marketplaces, Omnicom Group

• 2011 will be the year that marketers and agencies begin to take back full control of their digital advertising investments by utilizing buying platforms as the central tool for targeting, performance, and audience intelligence.

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Kurt Unkel, SVP, VivaKi Nerve Center

Normally one would create a top 10 list for a request like this, but in keeping with this marketplace’s theme of efficiency, here are my top 8 predictions for 2011.

1. At least two DSP will be bought in 2011 – could be ad-serving or web analytics providers rounding out their offerings or could be SEMs accelerating their expansion into the more lucrative display marketplace.

2. Google will put display ads into Gmail – it’s not evil if it works, and Yahoo and Microsoft have known for awhile that mail works.

3. The Top 15 ‘premium’ publishers will be operating transparently via exchanges by year’s end – it may not be on the open market, but rather thru private exchanges, but we will see the top sites embracing the operational efficiencies of the exchange world more aggressively.

4. At least three DSPs will support ‘BYOA’ by year’s end – couldn’t agree more with Darren Herman on this one. The ability to either create your own or integrate a 3

rd party set of optimization rules will be at the

core of a ‘true’ DSP. How you pay for it and license & protect it will be interesting... 5. There will be 4 video exchanges by year’s end – however, the private aspects of these exchanges will

be what fuels the growth in Video in 2011, as scarcity will continue to constrain liquidity too much for viable open marketplaces to really thrive at the scale that's in demand.

6. At least 5 publishers will enter the ‘branded’ data marketplace – sites that offer deep consumer intent-based insights will want to work transparently with buyers vs. being aggregated and blended together with other sources.

7. The OBA initiative will bring the clash between media buyers and sellers over data ownership to an end – this may be a reach, but if all BT sources must be registered and transparent, many data capture tactics employed today will have to be more rigidly audited by the media buyers and their clients. This will lead to more scrutiny and due diligence by buyers of BT then has ever existed at this scale before.

8. Clients will make up 25% of attendees at industry events by year’s end – The focus and scale of the exchange-centric marketplace and all the education efforts that agencies have developed to support it, will result in a substantially higher number of clients (i.e. marketers, not agencies) attending events.

Mitch Weinstein, VP, Director of Ad Operations at Universal McCann

• An independent Mobile Ad Server will emerge as the leader in the Mobile space. Advertisers will no longer have to rely on site served placements.

• The concept of serving customized dynamic creative based on 3rd party data (DCO + Audience Targeting) will continue to gain momentum, and will become more widely used

• Apple will open up their platform, allowing for Flash to run on all devices.

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Publisher Technology

AdExchanger.com reached out to the publisher technology community for their predictions about the digital advertising

ecosystem in 2011.


• Frank Addante, CEO, Rubicon Project • Michael Barrett, CEO, AdMeld • Tom Chavez, CEO, Krux Digital • Mario Diez, CEO, quantrantONE • Rajeev Goel, CEO, PubMatic • Marc Kiven, Founder and CRO, Bright Tag • Jonathan Mendez, CEO, Yieldbot • Steve Pelletier, CEO, FatTail Inc. • Steve Perks, GM, EMEA, aiMatch • John Ramey, Founder & CEO, isocket • Tom Shields, CEO, Yieldex • David Soloff, CEO, Metamarkets • Curt Viebranz, CEO, ad summos

Frank Addante, CEO, Rubicon Project

• Publishers will realize that sales channels are a critical part of their revenue growth (ad networks, exchanges & DSPs) because they don't have the sales coverage to reach every advertiser or the technology to support every campaign. RTB will be the key driver of this realization.

• Defragmentation of inventory due to marketplaces centralizing inventory will cause RTB to see explosive growth.

• Automation is going to put more strain on publishers, they are going to get killed with channel conflict and ad quality.

• Further developments in regulation discussions around data will set the rules of the game, becoming more of an enabler for legit companies (similar to CAN-SPAM act in email - email industry thrived once the rules were defined) than a threat to the industry.

Michael Barrett, CEO, AdMeld

Programmatic buying will increase at least 4x globally. Contributing factors will be:

• Further improvements in audience targeting and creative optimization will drive advertisers to shift more budgets to display, away from search, TV.

• As big publishers get more comfortable with sell-side tech & audience selling,there will be a huge increase in the scale & quality of biddable inventory.

• Mobile and video inventory will begin to hit RTB, cross-platform audience buying will begin to take hold. • RTB will emerge as a meaningful channel for guaranteed buys, branding campaigns. • Data management will get white hot as large publishers begin to more strategically tap the value of their

first party data.

Tom Chavez, CEO, Krux Digital

• I fear that in 2011 we'll see a BP-scale data disaster that makes the AOL search spill, the Google street view kerfuffle, the Rapleaf hubbub, and the Facebook/MySpace id leaks look like minor disturbances. Cleanup and recovery will be costly for the offending company. Regulators and privacy advocates will use the debacle to bring their protests to a feverish pitch, but a split Congress (remember ex-Representative

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Rick Boucher?) will stymie any attempts at privacy legislation. In a lucky twist, legislative gridlock will give commerce, content, and advertising companies a little extra time to get their data house in order.

Mario Diez, CEO, quadrantONE

• Premium marketplaces emerge to drive more value to holding company trading desks. Advertisers are already preparing to increase the amount they spend on real-time bidding inventory next year, making RTB the hottest area in display. The increased desire for premium, audience-based buying will make trading desks far more valuable for both premium publishers and advertisers looking for better intelligence and campaign analytics. Trading desks are already creating closer relationships between publishers and advertisers/agencies. As more money flows through the trading desks, the intermediaries who don't own inventory are going to feel the pressure created by the new buying model, and premium sellers could be the main beneficiaries.

Rajeev Goel, CEO, PubMatic

• RTB will remain the #1 driver of increased revenue for publishers. The most advanced publishers will begin to have RTB campaigns sold and controlled by their own sales force. Transparency and control of data will continue to be the #1 hot-button issue of 2011 - for consumers and publishers alike. However, continued market education will alleviate a lot of the fear and lead to improved solutions that benefit all parties.

Marc Kiven, Founder and CRO, Bright Tag

• In 2011 publishers will start to seriously rethink all of their third-party data relationships as they wrestle with issues around privacy, transparency, the value of their data and the impact these issues have on their businesses.

• Data collectors will deploy improved methodologies and use better practices for how they connect with, use and share the data they are "allowed" to collect from publishers.

Jonathan Mendez, CEO, Yieldbot

• Brand dollars continue glacial migration to digital with spending on building owned assets and Facebook amplification.

• Twitter advertising drives traffic but agencies are slow to adapt to a real-time channel creating opportunities similar to early days of Search.

• By EOY 2011 for vast majority of advertisers Google = Display same as Google= Search. • Delta between Search and Display spend continues to widen as Google focuses on local, mobile, location

based search advertising. • Advertiser interest in massive and realtime link economy (Google, Twitter, Facebook, Bitly) and

accompanying data begins shifting market power back to Publishers.

Steve Pelletier, CEO, FatTail

• Premium publishers will de-emphasize ad exchanges and any other sales channels that do not fairly compensate them for the value of their brands and audiences.

• Focus will shift from systematic pricing and buying of spot inventory to systematic pricing and buying of forward inventory.

• The RFP step itself will be de-emphasized as orders are booked directly through automated channels. • A robust digital scatter market will emerge for transacting "last minute" guaranteed, transparent inventory

as a middle ground between the spot and forward markets. • Straight Through Processing (STP) defined as system to system buying and invoicing will become a reality

in 2011 and drive transaction costs down.

Steve Perks, GM, EMEA, aiMatch

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• In 2011 publishers will awaken from their slumber, realizing that many of the third parties with which they do business extract more value than they add. Agency Groups and portals invested heavily in technology over the past four years. Now it’s the publishers’ turn. To monetize platforms like mobile and video, more and more publishers will invest in innovative technology, employing multiple data sources and advanced sales & pricing analytics to package their inventory for agencies and exchanges.

John Ramey, Founder & CEO, isocket

• A blessing and challenge is that our industry and tools are starting to work more closely together. I think we'll see more "are they friends or foes?" situations like the recent AppNexus vs Google post. It's like a big game of Risk.

Tom Shields, CEO, http://www.yieldex.com/Yieldex

• In 2011, the display ad galaxy's focus will turn from armies of clone impressions on exchanges, to premium inventory managed by Jedi ad ops teams, and balance will be restored to the universe of buyers and sellers. In other words, publishers will they turn their attention from how to squeak a little bit more from the low-value inventory, to how do they capitalize on their strengths in context and related audiences. Agency trading desks will begin to enable (and prefer) guaranteed buys of audiences directly from premium publishers through new programmatic interfaces, instead of RTB in a sea of impressions. And publishers will embrace solutions that provide inventory transparency and accurate availability to take advantage of these new sales channels.

David Soloff, CEO, Metamarkets

• 2011 will feature ad technology focusing on the unmet need for publisher revenue enhancement via core ad pricing, dynamic channel allocation and sales operations. Despite a tremendous amount of attention paid to emerging data and privacy issues in 2010, there remain a number of 'first order' problems that have not as yet been addressed: pricing, sales channel discipline, market indexing, channel management. These are high leverage opportunities which will (re)emerge to move recent data and targeting hot topics to the back burner. Call me a contrarian, but we may well see investors and deep pocketed acquirers begin to pay close attention to businesses featuring real technology for publisher revenue and margin enhancement.

Curt Viebranz, CEO, ad summos

• The ability to buy premium audiences at scale will swing ad sales back to premium publishers. • We just witnessed a record quarter for digital revenue, and the surge will continue next year as more

advertisers shift their brand messaging online. • Technology enhancements by premium publishers will drive higher digital ad spending In addition, better

inventory analysis, improved understanding of ROI, and a complete picture of how online ads affect offline behavior will make premium publishers far more appealing than ad networks or exchanges.

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Global

AdExchanger.com reached out to companies based beyond North American borders who concentrate on growing their data-driven, digital businesses regionally as well as internationally and asked them for their predictions about the digital advertising ecosystem in

2011.


• Andres Alterini, Co-Founder & CEO, Smowtion • Simon Aurik, CCO, Yieldivision Europe • Sacha Berlik, CEO, Mexad • Andy Cocker, Co-founder/ Managing Partner, Infectious

Media • Yann LeRoux, Co-Founder, Matiro • Matthias Pantke, CEO, AdScale • Sebastiaan Schepers, COO, BannerConnect

Andres Alterini, Co-Founder & CEO, Smowtion (Argentina)

• More focus on supply instead of demand. 100% of inventory is sold. The real challenge is the price!

• More proprietary technology platforms adding value optimizing eCPM's for advertisers AND publishers.

• Advertisers need more customers (Audience) and not more web sites to advertise! Facebook will teach us how to evolve in online advertising audiences.

• The large dinosaurs will try to enter into the digital business like never before with strong focus on M&A

Simon Aurik, CCO, Yieldivision Europe

• European advertising market will grow > 20% • Advertisers will take more control on their insights which will have enormous impact on budgets for

agencies • A significant number of traditional agencies will drop 25% in FTE • Data availability within the European market will explode • 40% of all publishers are facing challenges to increase revenues • Ad exchange inventory can get ready for a increase of > 200% - In a year RTB will account for 25% on

display • Mobile internet usage will gain > 14% on desktop usage

Sacha Berlik, CEO, Mexad (Europe)

• 2011 will be the year of the European data-driven-marketplace. • Data driven display is still niche when it comes to press coverage. You can count all articles about RTB in

Europe in 2010 on two hands. (Excluding Exchangewire.com in the UK and Adzine.de in Germany) • I see great success for Ad Exchanges & SSPs in most European countries. • Germany and France are quite similar in terms of getting a first understanding what the data driven

marketplace means. Rubicon is already in Paris & Hamburg, Admeld has its Hamburg office, Invite acts as secretive as Google always does, and so on – Germany and France are in the same evolutionary stage, trying to catch up with the UK.

• Central Europe is moving fast. Southern Europe will adopt it 1-2 years later, and the Nordics don’t really need it due to limited inventory. Eastern Europe is waking up very, very fast – and it seems as 2011 will be the year for Eastern Europe, too.

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• Main obstacle of growth in Europe will be to find the right people to operate the automated space. However it’s not as new a market as PPC was in 2001. It’s the first time that new technologies are entering the existing market, but you need experienced people to operate them.

Andy Cocker, Co-founder/ Managing Partner, Infectious Media (UK)

• 2010 was the year of the DSP and RTB infrastructural innovation. Expect 2011 to see the next wave of marketer focused product innovation coming from demand side service/tech hybrid businesses.

• Most advertisers are only scratching the surface of what is possible via database integrations and segmentations. 2011 will see greater customization and integration of advertiser data sets into RTB powered valuation and optimization engines.

• As marketers take greater control of their data, expect to see them demanding and adopting more sophisticated models for conversion attribution (beyond last click). This will unlock greater upper funnel marketing budgets.

• The industry will proactively engage in public dialogue around cookie based ad targeting. Consumers will be better informed on the 'value exchange' of data usage versus free content and will have visibility and choice around what/how and if.

Yann LeRoux, Matiro (France)

My predictions for 2011 in France and continental Europe:

• Some of the large media agencies will announce media trading offerings, backed by white-labeled, managed services provided by DSP companies, and likely arbitrage with little or no financial transparency.

• Everyone will brand themselves a media trader, whatever type of display he/she works with. • A dozen new acronyms and a 3D ecosystem map

Matthias Pantke, CEO, AdScale (Germany)

• Automated Data Driven Audience Buying vs. Guaranteed Content Driven Media Buying: The share of audience buying will increase even more, thus strengthening the position of Demand Side Platforms (DSPs), Sell Side Platforms (SSPs) and Ad Exchanges.

• Within that context, prices on AAA+ web properties remain under pressure whereas price levels on high volume sites (eg social media) will increase.

• The combination of data, pricing levels and technology will continue to make display advertising more effective thus driving the growth in that segment of the online marketing mix.

• Video will continue to be a key driver of online marketing growth as more and more video content is licensed by producers to websites on a ad revenue share basis.

Sebastiaan Schepers, COO, BannerConnect (Netherlands)

• All Digital advertisments will become auctionable. • Display, Search, TV, Mobile devices and even digital outdoor commercials will all be served through

auction-based platforms. Among other things this will make conversion attribution more sustainable, enlarge scale for advertisers and simplify Media buying. In the future specialists in auction based trading can act in the roll as advisor, media buyer, technology and service provider for traditional agencies, big brands and TV stations.

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Search, Display

AdExchanger.com reached out to the companies active in the search and display communities for their predictions about the

digital advertising ecosystem in 2011.


• Venkat Kolluri, CEO, Chitika, Inc. • Matt Lawson, VP, Marketing and Alliances, Marin Software • Jason Lehmbeck, CEO, DataPop • Justin Merickel, VP of Marketing and New Product

Development, Efficient Frontier • Niel Robertson, CEO, Trada

Venkat Kolluri, CEO, Chitika, Inc.

• Mlocal (mobile and local) ad revenue will cross $1B. • By the end of 2011, iPad will account for over 2% of

internet traffic.

Matt Lawson, VP, Marketing and Alliances, Marin Software

• Search marketers will grapple with automation. With keyword costs continuing to climb, advertisers who rely on paid search marketing campaigns will have to push the envelope to maintain ROI levels – using more campaign automation tools to streamline keyword management, creative testing, and campaign structure.

• Social and mobile will make marketing more complex. With consumers becoming more mobile and social, advertisers will not only have to build different campaigns for mobile apps, Facebook pages, and Google Places, but will also have to invest in new tools to measure integrated campaign performance across all these channels.

• Google gets more social, Facebook gets serious. Google adds sentiment analysis to organic rankings, changing the algorithm to factor in user “likes” for websites and search results. Facebook syndicates their ad network to publishers, allowing advertisers to target users by demographic across the web.

Jason Lehmbeck, CEO, DataPop

• 2011 will be the year of Search ... yes, Search! Though many exciting things will happen in social, mobile and display the biggest sea change in 2011 will happen in Search. Search is the largest online ad channel so any significant change has a big impact on marketers. Search hasn't changed much since Google became a verb but there are major changes taking place that will impact the scope and economics of Search while dramatically improving the consumer experience ...

• Now that the Yahoo/Bing merger is complete, Bing is the first large scale competitor with both the money and focus to significantly mix things up in old school Search.

• Search marketing is reaching beyond the generic search box. Amazon, Quora, Kayak and many others are generating new ways for marketers to engage consumers expressing their intent.

• Search becomes more than text. Through innovations like Google Product Ads and Search retargeting marketers will be able to engage consumers with richer creative, leading to deeper customer engagement.

Justin Merickel, VP of Marketing and New Product Development, Efficient Frontier

• Stand-alone, display-only DSPs become the exception rather than the norm as advertisers demand tight integration with other channels including search and social.

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• Last-click and last-view attribution takes its last gasps before being put to rest, replaced by multi-event attribution models that value all ad interactions. Intelligent attribution showcases the value of exchange buying in a mix of advertising tactics.

• Advertisers become hyper-sensitive about their data. Gone are the days of multiple publishers, networks and platforms all managing retargeting programs. With the necessary reach in the exchanges, advertisers limit data-sharing to trusted partners offering full control and transparency.

Niel Robertson, CEO, Trada

• Performance-based display advertising becomes more accessible to and effective for small businesses. • For years, online display advertising spend has been dominated by large brand advertisers and focused

on impressions. The growing list of serious players in the performance-based display space (Google, Facebook, et al) are taking what they have learned from CPC and applying it to self-service display campaigns. Expect broader adoption of display advertising by small businesses primarily due to their comfort with the CPC pricing model.

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Creative, Display

AdExchanger.com reached out to executives at companies involved in creative and display technology for their predictions

about the digital advertising ecosystem in 2011.


• Hari Menon, CEO, Tumri • Greg Rogers, CEO, Pictela • Karl Siebrecht, CEO, AdReady • Jesse Thomas, Founder and CEO, JESS3 • Gustav Von Sydow, CEO, Burt

Hari Menon, CEO, Tumri

• 2011 will be the year of accountability - digital marketing which raised expectations of accountability will now be held to the promise by marketers. Multi-channel attribution will be key.

• Personalization and Optimization of user experiences onsite and off-site (display, mobile, email and affiliate channels ) will take off in 2011.

• Advertisers will start looking for Integrated media and creative optimization that deliver a 1+1=3 performance optimization.

Greg Rogers, CEO, Pictela

• 2011 is going to be the year of rich media. While last year rich media comprised just 6% of online display ad impressions, we believe that number will double next year. Whether it is AOL’s Devil ads, the OPA’s large units, the IAB’s new ad format competition or the work that Pictela has done to revolutionize rich media, the industry is providing marketers with an exciting new set of tools to create and serve immense amounts of brand content into display advertising.

Karl Siebrecht, CEO, AdReady

• Creative automation technologies will emerge. 2010 saw a plethora of advances in targeting and bidding capabilities that enhanced the ability to purchase unique audience segments, but what lagged was the ability to mass produce creative for the seemingly unlimited audience segmentations now available to marketers. In the coming year we’ll see more and better creative capabilities to more completely deliver on the promise of sending the right message to the right person at the right time.

• Demand-side fragmentation will increase. Display is still highly concentrated on the demand side; the largest 1,000 or so advertisers still drive 90%+ of industry spending. Increasingly, the sophisticated tools that have been available at the high end of the market will become economically viable for marketers with smaller budgets.

Jesse Thomas, Founder and CEO, JESS3

• As we continue deeper into a recession we will see more deal based advertising. Groupon and LivingSocial were right to make those inroads early. Sites like Gilt, and PLNDR are being really innovative with their sales strategy and its paying off for them.

• Location based advertising was big in 2010, and it will continue to get even bigger in 2011 as Facebook expands the technology behind its location platform Places. Mobile advertising is of course the larger trend associated with location based advertising, and that is also a hot trend.

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• We can always hope for more smarter better google, twitter and facebook ad units. Social ads are really exciting, and they have never before been possible. What comes with that is smarter better metrics.

• Last year we saw some advertisements online that allowed you to click facebook connect and suck your permission based info into the video ad to create a powerful experience. This is in the dynamic ad space that still use the upload photo trick to get custom content in the ad. I personally find this super interesting and predict we will see more of this for sure in 2011 and beyond.

Gustav Von Sydow, CEO, Burt

• Facebook will follow in Google's footsteps and announce their own flavor of AdSense. Coupled with more efficient distribution tech (RTB, audience targeting) this will continue to drive momentum around display advertising as it continues to become the direct marketing tool of choice next to mail and search. However, the biggest driver of growth in display ads will not be direct response but brand marketing, which will have started to gain serious traction by the end of 2011. The main obstacle currently standing in online branding's way is a lack of impact. Since this is mostly due to poor creative execution and low placement quality, innovation and control will move from companies focus in on distribution optimization (DSPs, ad servers, exchanges, networks) to those catering to the edges (advertisers, agencies, publishers).

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Video

AdExchanger.com reached out to the video advertising, technology community for their predictions about the digital advertising

ecosystem in 2011.


• Bill Day, CEO, Tremor Media • Toby Gabriner, President, Adap.tv • Scot McLernon, CRO, YuMe • Dave Morgan, CEO, Simulmedia • Atul Patel, CEO, OneScreen Inc.

Bill Day, CEO, Tremor Media

• As the video market increases dramatically, CPE model garners larger share of new budgets: CPE moves success criteria away from CTR toward more relevant branding metrics. CPE unites viewer interests (self-selection, fewer ads/less clutter) with advertiser interests (paying only when viewers engage) and publisher interests (no wasted inventory). As more advertiser dollars enter digital video, the hottest segment online, we expect the trend toward CPE not only to continue, but to flourish in 2011 and beyond since it provides the triangle of benefit while focusing results criteria on more relevant branding metrics and not on clicks.

Toby Gabriner, President, Adap.tv

• The growth of addressable video ad expenditures will be more than 50 percent year over year. • TV budgets will start to make a move to online video. • All publishers, big and small, will have some type of video content on their site by the end of 2011. • More than 20 percent of all non-search digital spends will be bought via some type of DSP platform. • Horizontal display ad networks will begin to experience revenue loss due to DSPs/Agency Trading Desks. • We will begin to see large growth in video syndication in 2011.

Scot McLernon, CRO, YuMe

• The test of online video for efficiency and effectiveness took place in 2009 and 2010. The research shows that online video is more effective than TV, and that by using video advertising in concert with TV advertising, ad campaigns see better results. Moreover, personal experience demonstrates that audiences are consuming more and more video content through the computer, the iPad, and other connected devices. A significant shift of money from TV to video is starting to come to fruition, and I predict that in 2011 that shift will be more fully realized.

Dave Morgan, CEO, Simulmedia

• I believe that 2011 will both prosperous and tumultuous for advertising and media companies. Online ad companies will find continued growth, but exits for start-ups and their investors will continue to be sporadic and newer, lower-cost competitors will continue to enter the market. TV companies will find themselves continuing to rule to roost, but increasing audience fragmentation and "Over-the-Top" distribution will threaten the business models of many incumbents and we will see the the growth of next-generation TV

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ad companies. Finally, the print industry will continue to face tough times and tight margins. Unfortunately, the iPad won't be the "silver bullet" to save them in 2011 as many hope and expect.

Atul Patel, CEO, OneScreen

• Paid access to content through pay-per-view, subscriptions, or incentive for data will become more prevalent, especially with trends showing that consumers are open to paying for valuable content and services as seen with mobile apps and subscription services such as Pandora. Abundance of non-paid paths to content will be the biggest challenge for paid access, and will be balanced with increased ad-supported distribution supplied with ad-friendly content creation, premium content alteration, and archival content exploitation. Network bias and possibly device bias will become more critical in shaping content distribution and access, and monetization will have to be shared between content owner and distributor no matter the network or device.

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Analysts

Daniel Salmon of BMO Capital Markets and Joanna O'Connell of Forrester Research offered their predictions about the digital

advertising ecosystem in 2011.

Daniel Salmon, Equity Research Analyst, BMO Capital Markets

• The average tenure of Chief Marketing Officers will begin to increase again as "digital natives" ascend to the top marketing roles at a faster clip and "digital immigrants" that haven't been able to adapt move aside.

Joanna O’Connell, Analyst, Forrester Research

• Agency trading desks and DSPs mature out of the 'awkward teenage phase'. Some look like ad networks. Others look like centralized performance and audience buying hubs. All will have to prove their worth as the hype factor wanes.

• Clients' reactions are mixed. While understanding of - and enthusiasm for - this model grows dramatically, skepticism for the trading desk model also grows as some desks falter on clearly communicating their value or, worse, on execution. Several large marketers begin building their own in-house solutions.

• 2011 is the year of the DMP. Publishers are finally waking up to the real threat of data leakage, while simultaneously feeling the pressure to start selling "audience" to the buying community. Most marketers don't yet know they need a DMP, but the smart ones will invest in 2011.

• Audience targeting goes mainstream, but both buyers and sellers will only get there through a painful process of testing, failing, and trying again, all the while arguing over the “true” value of data. No agreement will be reached.

the ecosystem predicts on adexchanger.com! · offline to interactive media. emerging platforms will...

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