Advertisement Tech — Business As Usual
Is the Ad industry needed at all?
Doing business without advertising is like winking at a girl in the dark. You know what you’re doing but nobody else does. ~Stuart H. Britt
To a lot of us, the advertisements seem more infuriating than any good. Even I’ve on many occasions found myself hovering over the ‘Skip Ad’ button while watching a video.
Why is the industry still thriving then? Let’s back up our hypothesis with some stats. The chart below indicates the global spendings in the whole of the advertising industry. Major forms of advertising include print advertising like Magazines, Newspaper advertising, Television advertising, Outdoor advertising like billboards, and digital advertising among others.
Let’s see how does digital advertising fare in global ad spending. These are, of course, pre-COVID 19 numbers:
Like any other mature sector, the ad tech industry is crowded and competitive with a lot of big names included.
And it’s here to stay.
Even in the current scenario, with shrunk advertising and marketing budgets, we see a shift in change of advertising strategies, digital advertising as the frontrunner. That makes the online Adtech industry not only all the more relevant but it also awaits a major metamorphosis as more users would be at the receiving end with lower acquisition costs than ever before. This gives a plethora of innovation opportunities in the fields of product feature enhancement, Machine Learning algorithms, Sales, etc.
Coming back to the original question. Is this industry doing any good?
Certainly, yes.
1. Publishers making money to fund their work. Quality content in today’s scenario on any given topic is just a few clicks away and this has been made possible as content creators can pursue their writings or videos curation not just as their hobbies but as full-time employement.
2. Making it easy for businesses large and small to reach consumers. Entrepreneurers are finding it easier to market their products and customize them according to the consumer demand.
3. The creative and diverse content we all enjoy. Let’s not forget the ‘Nike’ ad that motivated us to start gymming again and the ‘Money-Heist’ promo which gave us hope amidst the lockdown.
Now, we’re convinced that the Adtech sector is of immense use and we’re likely to see more traction and innovation from this field in the post-COVID world.
Some buzzwords in the Adtech sector that are widely used and important to understand from a business standpoint:
Display Ad Metrics that Matter:
Assume that you’ve built an AdTech platform that can place and serve up ads for your clients. Great! The next thing a client will want to know is “Are my campaigns performing?” To answer this question, it’s extremely important to know what metrics you should be surfacing for your clients.
Impressions: the number of people who have seen an ad, with a breakdown between Unique Impressions and Total Impressions.
Exposure: the average number of times an ad is served per person.
Engagement Rate: the number of people who have “engaged” as a percentage of all ad views. For most ads, engagement is typically a click-through to the advertiser’s site but can be a video play or other interaction.
Conversion Rate: the percentage of people that convert on the desired outcome, such as becoming a paying customer, as a result of an engagement.
Relevance Score: a score between 1 and 10 that indicates an ad’s effectiveness and relevance to an audience, calculated by combining other metrics such as Conversion and Engagement Rates.
Revenue: total value of all purchases made as a result of an engagement with an ad or campaign.
Before leaving, let me cite out a few companies that could not make it to the above revenue list, but are making major upheavals in terms of technology in a highly fragmented market.
mParticle, Lotame, Liveramp, Salesforce, MediaMath, Freshdesk, Audiense, Statistica, Tableau, Eventbrite, Acxiom.
