As mobile phone features mutate faster than viruses, AdTech vendors are working like mad to change with them in order to capture all possible revenues. And with good reason.
In 2014 alone about 60 percent of web users worldwide were reaching the Internet primarily through mobile, and 83 percent planned to conduct mobile commerce, according to a 2014 study by InMobi. Part of that growth is being attributed to a years-long expansion cycle boosted by the strong U.S. economy and an influx of investment capital.
Such stats are leading to spiked demand in hyper-local marketing (62 percent of ad requests now include location data, according to Thinknear research) and the other programmatic advertising that encourages businesses to use their own data for immediate campaign adjustments.
What kind of market are we talking about? A huge one. Programmatic ad spend now represents almost 70 percent of the entire spend worldwide, according to PubMatic. Sixty-eight percent of mobile ads were bought programmatically in 2014, it reports, and an 88 percent buy is expected by 2017. This year, eMarketer predicts mobile ad spend will top $100 billion and take the biggest share of the digital ad market, with U.S. and China accounting for 62 percent of that spending.
Evolving technology is creating significant industry demand as more brands and advertisers become comfortable with the ad formats and industry metrics involved. And the players involved are competing to create the functions that will meet that need.
Recent years saw a number of consolidations as larger players like Facebook, Google, Yahoo and Twitter sopped up many smaller, even more innovative upstarts. While the big dogs benefit from the vast data they’ve already gleaned about social and search behaviors, many smaller firms have achieved their own success by standing out from the crowd.
Survival of the Fittest?
One way small and medium AdTech firms are competing is by taking advantage of growing demand for hyper-local marketing (62 percent of ad requests now include location data, according to Thinknear research). For example, one of our customers, PlaceIQ aggregates digital signals from mobile devices to perform 5 trillion computations daily, allowing for specific audience targeting and real-time ROI. It does that by fusing info from maps with complex dimensions, categories, dayparts and behavioral patterns to create actual (not projected) data.
Other firms are also demonstrating expertise in specific niches, offering specialized analytics and insight, tapping into unforeseen markets and/or demonstrating expertise in scaling. Current examples include an upstart whose technology tracks what consumers are shopping for online, then places vendor-designed ads on their desktop, tablet and smartphone. Another uses complex algorithms to predict the (likely) shared ownership of various mobile devices, using that intelligence for more comprehensive campaigns. Still another finely analyzes data to find and automatically bid on the best buys in AdTech. Other successful firms have saved clients money by effectively translating print ads into mobile interface form.
A dynamic market? Absolutely, experts say, but there’s always room for AdTech firms with the ability to think outside the box.
“As long as advertisers are buying digital ad space from publishers — the only constant in this industry — there will be opportunities for AdTech companies to present niche solutions,” concludes Ilya Pozin in Forbes.