Blog Post

The not-so-distant future of mobile and video

Galia is COO and head of sales for Taptica.

The mobile video advertising ecosystem is headed toward a major eruption. By the end of next year, the industry will take colossal strides to combat fraud and eliminate bogus inventory, while simultaneously working to meet advertisers’ growing demand for mobile video ads. Savvy businesses will continue to buy or build platforms that allow them to offer a complete mobile video ad solution — the content, the audience, and the ad tech — and increase their revenue streams. As with any massive overhaul (and it will be massive), there will be casualties. But, the end result will be more effective and more secure mobile video advertising opportunities to help feed the already burgeoning demand.

Here’s what we know. Advertisers and agencies are scrambling to create or fine-tune their mobile strategies and to contend with the now irrefutable fact that consumers are spending more time on their mobile devices. We’ve been talking about a “mobile-first” media landscape for a while; now it’s time for marketing strategies to catch up with user behavior. Simultaneously, consumer and brand interest in video is mounting, and for basically the same reason: high-quality video is engaging. Neither mobile nor video is without its challenges, but marrying the two helps alleviate some of the issues. Video mobile ads are more engaging than mobile banner ads. Couple that with the rich data we can harness through mobile devices, and you open up video to a host of new marketing use cases. Now we can monitor viewers’ subsequent behaviors and better measure the ROI of our investments. Video isn’t just for brand awareness anymore.

Within the next few years, it’s basically inevitable that the bulk of ad buying, mobile included, will be done programmatically. Spending levels are already soaring. Programmatic buying is lauded for its benefits, which include increased efficiency, more accurate targeting capabilities, and easy scalability. But it’s also rife with fraud. According to research from the Association of National Advertisers and WhiteOps, 23 percent of video ad views are actually from bots. This is simply not acceptable. As an increasing number of brands and agencies look to embrace video advertising, they’ll clamor for more stringent regulations and better protection against fraudulent traffic. They’ll also take a hard look at programmatic trading, the practice of buying media and then reselling it for profit. In the not-too-distant future, 2016 will be the year brands demand more transparency across the board. The writing is already on the wall. BrightRoll has begun cleaning up its traffic and taking steps to educate the market about the ubiquity of fraud. AppNexus, which has been a big player in programmatic trading, made huge strides this year by working to improve the quality of its inventory, limiting media arbitrage and increasing viewability. Perhaps predictably, it’s also shifting its focus toward video.   

Mobile media consolidation

Even with the growing amount of fraudulent mobile video traffic, there is still a pressing supply and demand issue. There’s simply not enough inventory to meet advertisers’ needs. We’re going to have to rethink our definition of “premium” and become more open to running video ads in-stream and alongside user-generated content, a change that’s already underway—just look at the buzz Snapchat’s video ad product is generating.

The increased demand for mobile video will continue to drive up prices for publishers, which is part of the reason why a growing number of companies are working to buy or create quality video content. Mobile media has already begun consolidating, as content distributors and content creators realize they’re more powerful together. Look at AOL’s acquisition of Adapt.TV, a programmatic video ad platform, and Vidible, a content syndication solution for publishers. (Expect to see an increase in the syndication of quality content as one solution to the challenge of meeting expanding demand quickly.) With these moves, AOL now has the audience, content, and technology needed to offer advertisers a full-service ad solution. And don’t forget, it’s owned by Verizon, which recently announced a plan to launch its own Hulu/Netflix-like app (Go90) for streaming mobile video, and also revealed that its focus is on mobile video.

RTL Group’s purchase of SpotXchange last year and Facebook’s acquisition of LiveRail, the third-largest online video advertising management platform, are also harbingers of industry-wide change. Facebook can now extend its video ad reach beyond its platform, and LiveRail is already working to improve the quality of its exchange by cutting out providers who don’t work directly with advertisers. If they manage to improve their supply and leverage Facebook’s in-depth data, the results will be what marketers’ dreams are made of: the ability to reach their target audience via quality mobile video traffic while gaining precise insight into what type of creative is resonating.

These types of intelligent mergers will continue as the industry works to reduce fraud, improve viewability, and better harness data. These changes will punish suppliers with less-than-stellar practices, but the net result will be an industry that’s more mature, regulated, and effective. Mobile video advertising will be a no-brainer investment.

2 Responses to “The not-so-distant future of mobile and video”

  1. TechYogJosh

    No wonder the article does not at all address what the consumers want. Do they really want mobile advertisement? Think about you using your phone and suddenly a sound plays from your mobile disturbing not only you but people near you and also letting them know what you were doing. This looks like a typical advertising mechanism with little regard to customers. Anyways advertisers have to counter the fundamental disconnect where the customers want to be left alone, whereas the advertisers must talk to the customers. Mobile video appears to be a poor idea for advertisement. How many of us have mute TV when their is an advt, or use “skip this advt” option on YouTube, or have installed ad-blockers, etc? That means, users fundamentally do not want pushed advertisements. Mobile video will take this annoyance to the next level. And the worst part is unlike let’s say TV where consumer is just paying for the electricity bill and the bill of the cable connection, on mobile the consumer has to pay for the bandwidth consumed by the mobile advt, an advt which the consumer never wanted to see at all ! Strange is the technology world and stranger is the marketing world.

    • Galia Reichenstein

      You’re right, this article discusses brand perception in the mobile industry. Mobile advertising is working hard to become non-intrusive and relevant for the right user in order to avoid the exact annoyances you mentioned. However, it’s important to keep in mind that in order for users to be able to enjoy free content and free services on YouTube (or other similar services offered on mobile), brands need to be able to capitalize on these services in different ways – creating a win/win situation. The mobile industry is an amazing platform, demonstrating how brands can utilize data to make our lives easier. Of course, the more seamless the ad serving is, the better for the user, so the brand “wins” by getting the right ad to the right user and the user “wins” by being offered relevant content in the right context.