64 per cent of Mobile Ad Sales Programmatic in the UK

Tim Maytom

Share of UK display ad market by sales methodAlmost two thirds of mobile ad sales were sold through programmatic technologies in 2014, nearly doubling from its 37 per cent share of sales in 2013.

The figures come from the IAB's second annual Media Owner Sales Techniques study, conducted by research consultancy MTM, which revealed that across 2014's total digital ad spend, 45 per cent (or £960m) was traded programmatically, up from 28 per cent in 2013.

Direct sales between publishers and buyers remains the dominant source of digital sales, but with 49 per cent share the distance between programmatic and direct has shrunk considerably. Network sales dropped significantly from 22 per cent of sales in 2013 to six per cent in 2014.

In mobile, traditional direct sales accounted for just 30 per cent, while networks also accounted for six per cent. Programmatic direct was responsible for 40 per cent of sales, while programmatic sales through exchanges accounted for the remaining 24 per cent, taking programmatic up to 64 per cent overall.

"Programmatic's role in digital ad buying has grown from virtually zero to nearly half of all transactions in just five years," said Tim Elkington, chief strategy officer at the IAB. "However, the impact of mobile has been even greater due to its more fragmented ecosystem providing a ripe breeding ground for intermediaries.

"Some still consider programmatic primarily as a direct-response tool. However, its increasing role in video ads – a branding medium like TV – shows programmatic is on advertising's top table. Consequently, due to the rise in mobile and video ad spend, we estimate around 70-80 per cent of all digital spend will be programmatic by 2018."

"The promise of programmatic is exciting but most advertisers are still at the beginning of their journey," said Martin Kelly, co-founder and CEO of Infectious Media. "The increase in spend has largely been a straightforward divert from the ad networks, with most advertisers still missing out on the advantages programmatic can offer.

"This is why we are seeing the deluge of global media pitches. Advertisers are not happy with the current agency trading desk model and are working out the model that is right for them, be that ATD or working with a specialist business."