Sherrill Mane: October 2013 Archives
Since releasing the IAB PwC Internet Advertising Revenue Report for the first half of 2013 on October 9, 2013, the IAB has seen misconceptions about the report, mostly centered on programmatic. Speculation about why the report does not cover programmatic revenue came from a highly esteemed and particularly smart writer and editor. We’ve seen guesstimates of programmatic’s contribution to overall interactive ad revenue based on the IAB numbers.
Why we do not report programmatic buying revenue
There are two primary reasons for not breaking out programmatic revenue in the IAB PwC Internet Advertising Revenue Report:
- The industry has yet to reach a consensus on how to define programmatic
buying, spend and selling. If we cannot define it, how can we collect
credible revenue information? Does anyone really expect that a revenue
bucket or a spend bucket that has not yet been clearly defined is being
accurately tracked by any of the entities we would have to get the information
- Programmatic is a FORM of selling. It is not a format or medium of distribution. Currently and throughout its history, the IAB/PWC report has explored formats and mediums; it’s never looked at selling mechanisms.
Guesstimates of programmatic revenue based on the IAB PwC report are not sound
Based on how the revenue data are collected and how they are reported, it is simply not possible to estimate programmatic ‘s contribution to growth in overall revenue. This would be true even if we had an agreed upon definition of programmatic to use in order to make inferences. That is why we do not engage in speculation about how much programmatic contributes to spend in the official report.
It is PwC that independently collects the data and authors the report on behalf of the industry and the IAB. It is PwC that is charged with maintaining the quality of the data collection and reporting. And it is both PwC and IAB that consistently opt to be rigorous on methods and in reporting.
It would be irresponsible to include guesstimates in the official, published revenue report. It would also be inadequate to release the report without providing context. That is precisely why we host a well- attended webinar with our members and members of the press together to hear the revenue numbers from the report along with context from PwC, the IAB and a guest speaker. This occurs twice a year to coincide with the releases of the half yearly and the annual reports. Contrary to what we’ve heard lately, programmatic has been part of the discussion. The materials are posted to the IAB site and readily available to all.
IAB activity aimed at understanding programmatic buying: what it is and how it impacts the broader marketplace
Revenue reporting aside, the IAB recognizes that programmatic buying and selling are an important part of our ever evolving marketplace. In order to serve our members and the larger ecosystem, it is our responsibility to convene thought leaders, experts and practitioners to clarify and illuminate how market forces are operating and changing.
We have the following key efforts underway in the programmatic arena.
In July, we convened the IAB Publishers Programmatic Task Force, a group of 40 publishers working to identify the issues surrounding programmatic selling and understand which ones can have actionable solutions through consensus.
In September 2013 we released a programmatic terminology piece that explains the four dominant methods of selling programmatically entitled, Digital Simplified: Programmatic and Automation - The Publishers’ Perspective.
On the technical side, the Digital Advertising Automation Task Force is working to standardize, implement, & support adoption of common datasets for IOs, media plans & invoices. The Open RTB & Exchanges Working Group supports the development of OpenRTB specifications.
The IAB regularly holds Town Hall meetings where different ecosystem players convene to discuss and debate some of the bigger challenges we all face. These town halls provide inspiration for many solutions that ultimately make our businesses better. Coming soon is a Town Hall on programmatic selling and buying.
Will the IAB add revenue reporting capabilities?
Yes. We will be trying to supplement revenue reporting so that we capture dynamics and transactional forms that are outside of the purview of the IAB PwC report. We seek the right way to measure programmatic spend and the support from our members to provide this kind of research.
About the Author
Sherrill Mane is SVP, Research, Analytics and Measurement, at the IAB.