Integral Ad Science Says Fraudulent Ads Cost UK Advertisers £277m; TubeMogul Delivers Strong Revenue Results for Q2
In this week’s ExchangeWire European Weekly Roundup: Integral Ad Science says fraudulent ads cost UK advertisers £277m; TubeMogul delivers strong revenue results for Q2; Facebook enhances its Audience Network with new ad formats; Tapad and Medialets team up; and Sizmek turns to Screen6 and programmatic.
Integral Ad Science Media Quality Report finds over 12% of UK advertising impressions fraudulent
UK advertisers are paying more than £277m for fraudulent ad impressions, Integral Ad Science’s Q2 media quality report reveals. Analysing hundreds of billions of impressions in the three months between April and June 2015, the report labels 12.2% of the impressions as fraudulent.
In the UK, the exchange and network environment shows significantly more fraudulent activity than the direct buy environment. While 6.6% of UK impressions on direct buys with publishers were found to be fraudulent, the number rises to 13.6% via exchanges and networks.
A similar picture emerges in relation to inappropriate placement of ads. Within network and exchange environments, 13.6% of the advertising impressions were affected, in directly published campaigns, only 6.3%. Direct buys also resulted in better viewability rates (63.4%) than via programmatic buys (52.1%)
Integral Ad Science’s UK Managing Director, Niall Hogan, says: “Fraud is at the forefront of the media quality debate, and when we see figures in the order of nearly £300m being siphoned off from ad budgets, we understand why advertisers like Unilever and Nestle are voicing concerns.”
He appealed to the industry to address media quality issues by educating and building advertiser confidence and through participation in anti-fraud initiatives.
Strong Q2 Revenue for TubeMogul
Programmatic TV seems to work well for TubeMogul. It reported its Q2 results and surpassed analysts’ expectations: The second quarter of 2015 resulted in a revenue of USD$45.44m – a growth by more than 58%, compared to Q2 2014 (USD$28.7m). However, TubeMogul reported a net loss of USD$1.3m, as opposed to a profit of USD$2.1m a year ago.
“Revenue from our expansion into Programmatic TV contributed to our outperformance in Q2, and we are excited to begin offering brand advertisers cross-screen planning and buying, with TV as the centerpiece of this effort”, says TubeMogul CEO Brett Wilson. According to TubeMogul, combining their own DSP with placemedia’s SSP has widened their reach to more than 96 million households in the US.
Analysts had estimated a revenue of roughly USD$40m. TubeMogul is targeting for a revenue of USD$39-40m for the third quarter, and projects a gross profit of USD$26m-28m, as well as an adjusted EBITDA loss in the range of USD$5-3m. After two successful 2015 quarters, the full-year outlook has been raised to revenue between USD$395-401m, as well as profit in the range of 111m USD$111m-117m.
TubeMogul stock price had initially dropped ahead of the earnings report, but rebounded after the release of the quarterly financial review. Similarly, other ad tech stocks also have taken a battering after recent quarterly results. Millennial Media reported a revenue decline of 2% year-on-year, USD$65.8m, their stock fell to its lowest point ever. Rocket Fuel shares have been tumbling despite revenue increases of 30%.
Industry insiders put faltering stock performance down to various factors: not only are investors confused about an industry that is highly complex in terms of technology as well as terminology, they are also concerned about the impact of ad blocking and anti-ad fraud developments in the sector.
The fact that industry giants Google and Facebook continue to jealously guard, plant, and tend their walled-garden ad tech stack is also influencing investors’ trust in ad tech companies.
New Ad Formats for Facebook Audience Network
In an attempt to further increase the adoption of native ads by publishers, Facebook’s Audience Network has added several new ad formats to its current offering – most notably among them the autoplay video ad. Facebook’s interstitial offers are expanded with carousel ads, which showcase up to five images within a single ad unit, as well as dynamic product ads, and click-to-play videos.
Interactive ads and in-feed autoplay video have been available on Facebook properties for some time – except for the Audience Network. Now Facebook is strongly pushing its native ad solution within the Audience Network. According to the company, five times more apps are using native ads since the beginning of 2015, and native ads represent more than 80% of the impressions in the Audience Network.
Partnership between Tapad and Medialets
Tapad and Medialets are partnering to provide marketers with cross-platform insights into the effectiveness of their mobile campaigns. From the end of 2015, Tapad and Medialet hope to supply “a 360-degree view of the consumer journey with unified cross-platform ad serving, measurement and attribution for desktop, mobile app, and mobile web.”
Medialets’ Servo platform and Tapad’s Device Graph will integrate in order to track media effectiveness. Servo utilises a combination of deterministic and probabilistic signals to identify devices across various mobile environments. Tapad’s Device Graph uses a cross-device algorithm which determines ownership of multiple devices by single users on the basis of trillions of data points.
“We want to provide marketers with the essential cross-platform insights they need to be successful both today and in the future”, says Medialets CEO Richy Glassbberg. “This means continuing to expand the broad range of privacy-friendly signals we use to provide comprehensive measurement and attribution.”
Sizmek integrates Screen6 solution; misses expectations in Q2 earnings
A new partnership between Sizmek and Screen6 is aimed at enhancing measurement of clients’ campaign results, and enabling their users to target customers across devices. To that end, Sizmek integrates Screen6’s cross-device solution into their Device Intelligence Framework, combining the data sets of both solutions in order to support accurate user identification.
“True cross-device ad measurement and targeting has been elusive, especially on a global basis,” says Neil Nguyen, president and CEO, Sizmek. “The problem has been exacerbated by large industry players’ ‘walled garden’ approach that casts blind spots all across a customer’s journey and device use. The integration of Screen6, which will bring comprehensive and consistent measurement capabilities both across devices and within the same device, will address one of the most fundamental needs of our clients today and bring them closer to their customers.”
The new cross-device functionalities will be available across all Sizmek products, including attribution, mobile media buying, reporting, and targeting.
Meanwhile Sizmek has reported its Q2 results. The company missed the consensus estimate and announced a revenue of USD$40.2m in the second quarter of 2015, missing the expectations by USD$4.1m and decreasing 9% year-on-year. The adjusted EBITDA for Q2 comes to USD$2.9m, a 57% decrease, compared to the same period of 2014.
Going forward, CEO Neil Nguyen is betting big on programmatic for future growth: “We believe pairing our leading global ad management platform with a robust mobile programmatic offering will drive growth in the second half of 2015 and beyond.”
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