Programmatic ad spend tops $10BN

DetailsMichelle Clancy | 21 July 2015

Programmatic buying and selling of online display-related advertising generated $10.1 billion in 2014, comprising a fifth of last year's overall Internet advertising revenues ($49.5 billion).

That's according to the IAB Programmatic Revenue Report, prepared by PwC US, which found that programmatic advertising made up approximately 52% of display-related advertising in 2014 ($19.6 billion), while non-programmatic display-related revenues accounted for the remaining 48% at $9.4 billion.

"Over the last several years, publishers and advertisers have increasingly adopted programmatic buying and selling of digital inventory into their media strategies," said David Silverman, partner at PwC US. "This in-depth study reflects that growing trend, but in addition to pointing to where programmatic is today, we also look at where real-time bidding could be tomorrow."

Open auctions made up approximately 70% of the online video programmatic revenue in 2014, and the report discusses marketplace indicators that point to a shift in the next few years to other programmatic transaction types, such as private auctions, unreserved fixed rate or automated guaranteed methods.

Display banner ads made up approximately 80% of programmatic revenues in 2014, but the findings demonstrate that mobile and video formats will take more of advertiser and publisher budgets and inventory over time.

Ad tech companies received approximately 55% of programmatic revenues, while publishers garnered approximately 45% of programmatic revenues in 2014.

"Sizing the programmatic market has proven both challenging and illuminating, as we learned more about how that sector moves ads and money," said Sherrill Mane, SVP of research, analytics and measurement at IAB. "Once we garner deeper understanding of how things work and where standard definitions and best practices are needed, we will also gain insights into where greater opportunities exist for publishers and advertisers to capitalize on programmatic channels."