Holiday sales are forecasted to be strong this year, and that’s good news for everyone in the advertising ecosystem. We’re seeing predictions that consumers are confident, and that US retail sales will hit north of $855 billion in November and December this year–representing the biggest year-over-year growth since 2011.
Mobile ad spend is on the rise
The holiday season presents a huge opportunity for mobile publishers. Retail marketers typically increase their advertising spend to reach holiday shoppers in the final months of the year, and mobile is increasingly being recognized as key to reaching consumers during this busy time, while they’re traveling and shopping. In fact, mobile is projected to account for 51.9% of total digital ad spend this year , surpassing desktop for the first time ever . This increased overall mobile spend is coupled with the fact that mobile programmatic is on the rise . These holiday advertising transactions present a great opportunity for mobile publishers who are set up nicely to capitalize on the increased demand queued up to flow through mobile exchanges.
Programmatic demand increases during Q4
It can be tempting for publishers to sign guaranteed Q4 deals up front with advertising partners, as these may initially seem lucrative. But in reality, publishers may be better off taking advantage of the high levels of demand projected to flow through programmatic exchanges this holiday season. Year-over-year, we saw a 15% increase in eCPMs from Q4 2013 to Q4 2014 in our MoPub Marketplace. Retailers are leading the way, making up 23% of the total programmatic ad spend in the US this year ; and many major brands are expected to spend two-thirds of their annual advertising budgets in Q4 alone . With all these ad dollars flowing in Q4, publishers who have locked in deals ahead of time could be missing out on the opportunity to benefit from higher-than-ever programmatic demand for their holiday inventory.
Brands are driving programmatic spend during the holidays
Publishers can also look forward to a greater percentage of brand dollars flowing programmatically during this time. Last year, brand advertisers constituted 52% of the total advertiser spend in the week leading up to December 25, as noted in our Marketplace Report . This increase coincided with higher premiums paid for mobile app inventory overall. Programmatic buying is becoming increasingly attractive to brands as they learn how it can solve for issues such as pricing inefficiencies, impression wastage, targeting imprecision, and operational problems. During the holiday season, marketers looking to drive sales will likely focus their programmatic buying efforts on re-marketing, app-installation, and app re-engagement to reach consumers wherever they are.
Publishers can certainly choose to use both guaranteed network deals and programmatic selling in a complementary way this holiday season, but should allow enough inventory to flow through programmatic channels to take advantage of the competitive race to reach the right consumers at the right time. At the very least, savvy publishers will want to configure their line items and orders so that exchanges can compete with networks and ensure that they are maximizing revenue. Given industry expectations for 2015 mobile ad spend, there is a tangible opportunity for mobile publishers to ride the wave of holiday programmatic spend to record-breaking revenue totals by year-end.
Note: MoPub data points represented above are solely representative of quarterly trends from exchange-traded media; it does not include any ad network or ad network mediation data. MoPub does not sell advertising and does not buy inventory. The data includes quarter-over-quarter and year-over-year trends across several dimensions that impact revenue for mobile application publishers.