Q4 Digital Advertising Trends

Looking into the crystal ball to predict Q4 2011 digital advertising trends

Available industry research about Q4 digital advertising trends is limited. From
it, we found 3 major predictions for the coming quarter:

Q4 2011 budgets will remain unchanged from Q4 2010
2012 overall budgets are under pressure, due to economic factors
Mobile and Video advertising investment is expected to grow in Q411

In a quest for better insights into Q4 digital advertising trends, we compiled our
own research based on Googles Q4 data from past years. Here is a summary of
our findings:

Impressions Purchased Expected to Increase by 5-10%, but CPMs Expected
to Rise Almost 40% in Q4
Biggest increases in CPM happen week before Halloween and from Nov.
22 to Dec. 28
Nov. 1-22 presents opportunity impressions increase, CPMs decrease.
Recommendation: Increase CPMs and budgets to prepare for Q4 trend

Several Verticals Experience Above Avg. CPM Increases
Verticals that increase most in Q4 are broadest, have highest total
impressions and concentration of remarketing spend
Internet & Telecom +60%
Online Communities +52%
Books & Literature +51%
Arts & Entertainment +48%
Recommendation: If you rely on these verticals for impressions, increase
bids accordingly

CTR Fluctuations More Prevalent in Q4, Not Correlated with CPM Trend
CTR highest on weekends, CPM highest on weekdays overall advertiser
and consumer demand is not aligned
CTR highest on weekends in December
Mid-week CTR highest from 11/21 to 12/18
Recommendations:
CTR remains high post-holidays ensure budgets dont run out early
Reconsider day parting on weekends in Q4 due to higher CTRs
11/30 to 12/12 feature high CPM and CTR concentrate Q4 buying
here

Available Anonymous Inventory Decreases by 10% in Q4

Anonymous inventory as % of AdX available inventory decreases
significantly in Q4 as publishers sell more inventory directly and
increased CPMs lead to more impressions clearing publisher branded
minimums
Recommendation: Reach out to AdX Team for help negotiating direct deals
to make up for drop in Anonymous Inventory

3PAS, Flash Spend Increases Most in Q4
3PAS spend more than doubles leading up to December 25th
Recommendation: Consider using Video Ads to offset loss of impressions
from increased Q4 competition for 3PAS ad slots

Topics & User Targeting Dominate, Peak at Different Times
User targeting trends closely follow consumer buying trends - dominating
in Nov and peaking on Cyber Monday
Category and Placement Targeting claim vast majority of share in Dec, as
advertisers dump remaining budget
Recommendation: Raise bids in Dec, if you depend on User targeting for
majority of your traffic

Here are some other helpful data points to keep in mind for Q4, but apply to all
quarters:

CVR Hourly Change Much More Defined than CTR
CTR is less varied throughout the day than CVR
Conversion rate increases in the afternoon and evening
Both CTR and CVR low at night
Recommendation: Ensure your budget lasts the entire day and take
advantage of late spike in CVR, especially if using Accelerated Delivery

CTR and CVR Impacted by Recency
Highest CTR and CVR within first 3 hours of user cookie life
CVR for users increases again after 24 hours
Recommendation: Bid most aggressively for the most recent users by cookie
age (available field in RTB callouts)