European publishers expect video, native and mobile ad formats to grow 26% next year

29/11/2018

European publishers believe revenue generated by video, native and mobile formats will grow by more than a quarter (26%) over the next 12 months.

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The research, from Oath, in association with IAB Europe, indicates that over 60% said these formats are paramount to the success of their business.

The study entitled ‘Understanding Programmatic Challenges for Publishers’ was commissioned by Oath in order to gain insights on the biggest opportunities and challenges that the publishing industry faces in programmatic advertising and technologies. Industry professionals from across the IAB Europe and national IAB networks in Europe, responded to the survey which revealed that publishers are looking for partners to simplify their offerings, develop new ad solutions focusing on multi-user living room experiences through audio and in-stream video technologies.

The report pulls on responses from IAB members and contacts across 30 markets. Below you’ll find the European release, but we’ve also provided the UK comparisons for your reference here:

• Revenue spurred on by mobile and video
o UK revenue from video set to grow by 27%; the same as Europe
o UK revenue mobile to grow by 28%; whilst Europe is at 26%
o UK revenue native revenue to 22%; whereas in Europe it is 26%
• UK less likely to bring teams in-house - compared to France and Germany
o 55% of the UK market have brought programmatic teams in-house in comparison to France (65% and Germany 81%)
• Publishers want more control when it comes to off-platform solutions
o In the UK 63% voted control as the biggest challenge to their off-platform content strategy
o In Europe 53 % voted control - ROI and reach were mutual challenges for both markets gaining 2nd and 3rd place respectively.
• The UK is investing more time into video
o 71% of the UK believes that video content should be top of mind for their company over the next 12 months (in comparison to 55% in France and 63% in Germany)

Previous research carried out by IAB Europe found that €12 billion was spent by advertisers through programmatic display across Europe last year, with a third of this spend on video and 57% spent on mobile (including native formats), so it’s no surprise then that video, mobile and native ad formats are top of mind for European publishers.

Other key findings from the study include:

The competitive edge of programmatic trading

• Programmatic trading is high on European publishers’ agendas, with 76% stating its extreme importance ‘today’ in the survey, with 83% saying it will become even more important over the next 12 months.
o In the UK 61% stated it was extremely important both today and in the next 12 months
• 52% of European publishers also believe that it provides a competitive advantage, although there is still a large proportion (30%) that remain unsure.
o This is of particular importance in the UK with 59% publishers stating it provides a competitive advantage
• In-housing continues to be a hot topic as the research showed 59% of European publishers are carrying out their programmatic trading functions in-house.
o With 55% in the UK bringing trading in-house - significantly lower to France 65% and Germany 81%

Giving value to every impression

• Two-thirds of all European publishers identified ‘giving value to each impression’ as their top challenge.
• Managing GDPR and consent was down in 4th place in their list of concerns. Connecting inventory to all demands sources and maximising mobile revenue came in joint second at 47%.
• Publishers want their partners to simplify programmatic ad sales whilst ensuring that premium ads are allocated to their inventory.
• Through this streamlined solution, publishers can sell their inventory at a reasonable price without compromising on the quality of ads hosted.

Obstacles for audience growth and maximising value of inventory

• Better monetisation and higher quality ads remain key to optimise audience growth amongst European publishers in the owned media space.
o 57% of UK publishers ranked monetisation as the top factor to realise this audience growth
• 63% of European publishers’ content distribution solutions are on-platform, whereas 37% are off-platform, using partners such as Oath, Twitter, Google and Facebook; a trend set to continue for the next 12 months.
• Control, price and reach equate for 78% of all responses as the top challenges for publishers in off-platform audience growth
o In the UK these were the top ranking factors - 63% voted control as the biggest challenge to their off-platform content strategy
• Resources are allocated to driving audience growth over the next 12 months, with 30% of European publishers claiming there will be a greater focus on earned media vs paid media.
• Audience growth continues to face challenges, with 38% of European publishers citing revenue as their main concern in driving audience growth, with lack of control on where their content is shown, quality of inventory, fill rates and video play technology worrying them too.
• Scale and key formats are big issues when it comes to maximising the value of publisher inventory.

Henk Van Niekerk, Head of EMEA Supply Platforms said: “Programmatic trading continues to offer clear opportunities and growth for publishers across Europe, but many challenges still remain. Maximising revenue is still top of mind for most publishers even as GDPR and managing consent drops down their list of concerns. As a publisher ourselves, Oath understands many of these challenges and we strive to develop our Oath Ad Platforms solutions for publishers based on our own experience and learnings through partner research like this with IAB Europe.”

Methodology

Oath conducted a quantitative study in partnership with IAB Europe, whereby IAB members and contacts across 30 markets were invited to answer a survey in order to develop industry guidance on how to develop programmatic strategies. Fieldwork was conducted in Aug-Sep 2018

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