“Overall, this trend will have a positive impact on advertisers who can expect to get more bang for their buck with less spend wasted on viewability and fraud issues,” said Jay Friedman, COO, Goodway Group.
Philadelphia, PA (PRWEB) November 30, 2016
Goodway Group, a managed services programmatic media firm serving hundreds of advertising agencies and marketers across North America, has released its 2017 programmatic pricing forecast with projections for programmatic pricing over the next year. The report, titled “What’s Programmatic Costing You?: An Insider’s Guide to Understanding the Rising Costs of Programmatic Advertising,” predicts that programmatic display ad pricing will increase by 15 – 20 percent by 2018. The report also predicts several trends poised to take an even greater hold in the marketplace including a continued industry shift to dynamic CPMs, continued rise of header bidding, more robust price discovery practices and continued adoption of artificial intelligence by ad tech next year. The full report is available for download here.
For the forecast, Goodway Group’s data science team analyzed billions of bids and weekly median media prices in the U.S. over a 12-month time period from September 2015 – September 2016. The analysis uncovered an average price increase of two percent per month across all programmatic display purchases. Taking into consideration several predictable fluctuations over the course of the next year, Goodway Group predicts that pricing for programmatic display ads will increase between 15 – 20 percent by 2018.
“We are expecting a fairly significant jump in pricing throughout the next year due to the changing nature of the market. We as an industry are getting much better at removing fraud and improving viewability, which causes our inventory pool to be smaller with each improvement in these areas. With less to buy, prices increase,” said Jay Friedman, COO of Goodway Group. “Overall, this trend will have a positive impact on advertisers who can expect to get more bang for their buck with less spend wasted on viewability and fraud issues.”
Another key finding from the report includes a continued industry shift away from fixed CPMs to dynamic CPMs (dCPMs). Many large agencies and marketers migrated to a dCPM strategy as programmatic dominated their digital strategy, but now is the time for regional marketers and agencies to catch up. This trend will especially impact smaller advertisers with limited ad budgets, who will look to dCPMs to optimize their ad dollars by paying for impressions based on specific conversion goals and bidding on a wider audience.
The continued rise of header bidding and working to ensure it doesn’t slow page loads, advertisers coming together for better price discovery practices and the adoption of machine learning and artificial intelligence are also discussed.
“Machine learning has been in use for a long time, but we haven’t had the right data with which to learn,” continued Friedman. “The supply-side ad stack’s added complexity can actually benefit the buy side as both sides agree to improved bid price and density discovery.”
About Goodway Group
Goodway Group is a leading managed-services programmatic partner to local, regional and Fortune 500 brand agencies. Bootstrapped and 100 percent privately owned since 1929, Goodway moved into the programmatic digital media space in 2006 to continue its rich history of tackling complex local and regional campaign executions with data science-driven targeting and support services to make achieving success easy for agency clients. Its proprietary algorithms pair with a technology-agnostic approach to enable agencies and marketers to achieve their ultimate goal – better results while remaining lean and nimble.