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WerbeplanungJuly 11, 2013

Jay Stevens, GM & SVP International

@jayrstevens

THE TRUTH ABOUT RTB & PRIVATE MARKETPLACES

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PREMIUM PUBLISHERS TRUST RUBICON PROJECT

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GLOBAL SCALE

Los Angeles

Seattle

AtlantaNew York

London

ParisHamburg

Sydney

San FranciscoLas Vegas

Salt Lake City

Phoenix Alabama

OfficesRemote People

Los Angeles Corporate Headquarters

HR, 200+ employees

FrancePublisher Development Account Management

Germany Publisher Development Account Management

AustraliaPublisher DevelopmentAccount Management

United Kingdom EU HQPublisher Development Account Management

Milan

ItalyPublisher Development Account Management

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RUBICON PROJECT IMPRESSIONS IN EUROPE

50+ billionPer month

14B

11B

5B

2.6B

4.5b

0.7B

2B

2B

1B

0.5B

0.5B

1B

1B

2.2B

1B

1B

2.4B

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WHAT IS RTB & HOW DOES IT WORK?

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HOW RTB WORKS

RTB bid system

$3.25$3.25

2nd highest bid (“charge price”)

is accepted

ad call

$3.25

- A 2nd price auction gives the highest paying bidder the ad call at the 2nd highest price

- Publishers have complete control over who is allowed to bid

non-RTBdemand sources

On behalf of:$4.17

On behalf of:

$0.83

$2.09

$0.25

$1.16

$4.17

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RTB – BENEFITS FOR BOTH BUYERS & SELLERSMORE LESS

Efficiency Work on manual, repetitive tasks

Speed Human error

Margins Fax

Insight Excel

Revenues 20-30% operational costs

= more time to focus on high value creative partnerships

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RTB = THE PROTOCOL FOR ONLINE AD TRADING

• Transparent, industry-agreed standard shared by all operators in the market

• Like HTML is for the web• Authorised and governed by IAB• Granular controls to protect direct sales

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RISE OF THE AGENCY TRADING DESK

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THE PROBLEM RTB IS AIMING TO SOLVE

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WHICH TOOL IS POWERING 80% OF DIGITAL SALES?

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EXCEL

http://www.nextmark.com/2013/03/what-we-love-hate-and-desire-in-our-digital-media-jobs// by NextMark

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RESULT: THE DIRECT MEDIA BUY IS HIGHLY INEFFICIENT

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SOLUTION: AUTOMATION AT SCALE

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FINANCE TRAVEL RETAIL ADVERTISING

Premium NEXT

Mid Market

Remnant 2007 - 2012

AU

TO

MA

TIO

N

NOW

THIS HAS HAPPENED BEFORE

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WHAT IS A PRIVATE MARKETPLACE?

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DEFINITION & BENEFITS OF PRIVATE MARKETPLACES

DEFINITION: A direct deal between an individual buyer and a publisher, executed through the RTB protocol.

BENEFITS:o Introduce new advertiserso Reduce the cost of managing performance advertiserso Leverage strength in creative solutions to take a larger share of

displayo Capture spend from existing advertisers without causing channel

conflicto Leverage existing trading agreements for preferential pricingo TIP: Use the Bid Landscape Report as a ‘feedback loop’ for new

advertisers & PMPs

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RTB IN THE INVENTORY STACK

CPM

Class 2Non-Guaranteed

Class 1PremiumPremium

RTB

Networks & Exchanges

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PRIVATE MARKETPLACES BLURRING THE LINE

Standard RTB

First Right/PrivatePremium

Preferred(Floor Override)

Gua

rant

eed

Non

-Gua

rant

eed

Premium

RTB

Networks & Exchanges

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FUTURE OF THE AGENCY?

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GROWTH OF PRIVATE MARKETPLACE DEALS

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A VISION SHARED

‘Anything that can be transacted automatically will be’Katie Eyton, Executive Director, Digital, Manning Gottlieb OMD

‘Over the next three to five years, you will see that the majority of digital advertising is being traded through programmatic systems’ Brian Lesser, CEO, Xaxis

‘Private marketplaces are another step towards what could be the majority of digital ad spend going through platforms’ Marco Bertozzi, MD EMEA, VivaKi

‘All ads will be traded programmatically within five years.’Jamie Labate, MD of Advertising, Dennis Publishing & Chair of UK Association of Online Publishers Commercial Committee

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RTB – FEARS & SOLUTIONSFEAR SOLUTION

Channel Conflict Granular Controls in RTB

CPMs not as High as Direct Sales CPMs in Private Marketplaces as High & Higher, With Overhead Costs Removed

Loss of Jobs New Roles Created: Among them, Analysts & Yield Managers

Lack of Skills Training & Guidance Provided by Consultative Tech Partner

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jay@rubiconproject.com

@jayrstevens

Thank You