Examination of 4 Clients Shows Incremental Revenue Growth and Simplification of Sales Process
NEW YORK - PubMatic (www.pubmatic.com), the digital media platform company for publishers, announced the results of a commissioned Forrester Total Economic Impact Study performed on four PubMatic clients which revealed a three-year risk-adjusted ROI of 334%; 30% lift on eCPM for discretionary inventory through RTB; and 50% incremental lift by leveraging a Private Marketplace strategy with use of the platform. The company released the findings of this study at its Ad Revenue 5 client and industry leadership conference in New York on October 23rd in a presentation by Forrester Consultant Reggie Lau. The presentation was followed by a panel discussion led by Forrester Principal Analyst Joanna O’Connell with the study’s surveyed organizations: Belo Interactive, NBCNews.com, National Rail Enquiries and Rodale.
The goal of the study, which was commissioned by PubMatic, was to examine the total economic impact and potential return on investment (ROI) publishers may realize by deploying the PubMatic sell-side platform (SSP). Other benefits included incremental revenue generated through real time bidding (RTB) and through Private Marketplace (a functionality within the platform that enables advertisers to sell media openly to specific buyers at agreed upon prices), the ability to capture revenue from short term opportunities, the ability to use the platform to prevent non-optimal advertising from running, and operational efficiencies achieved from reallocating sales staff to higher margin sales opportunities.
In order to produce the total impact report, Forrester Consulting did in-depth interviews with the four PubMatic clients to obtain data on costs, benefits and risks, and created a composite organization from which to do the ROI analysis. The topline results of that analysis are as follows:
Composite Organization Three-Year Risk-Adjusted ROI1
|Source: Forrester Research, Inc.|
Forrester Consulting broke down the platform benefits into the following areas: Incremental RTB revenue of 69%; incremental private marketplace revenue of 23%; relationship efficiency of 7%; and opportunistic revenue capture of 1% [see Figure 1].
In addition to the ROI benefit, Forrester Consulting highlighted the following themes in the study:
1. Yield optimization works: All customers interviewed experienced a lift in CPMs by placing inventory on an auction platform that allows buyers to competitively bid for remnant inventory. Platform integrated controls, like pricing floors and block lists, ameliorate customer fears of direct sales cannibalization.
2. Working with an SSP increases reach of demand partners (buyers of media) and results in higher fill rates.
3. Private Marketplace, which is viewed as a tier between direct and indirect sales, is growing in popularity and encouraging the release and subsequent sales of premium inventory into a programmatic environment.
4. Data analytics and dashboards are giving customers insights about advertiser trends and trajectories that can be acted on to increase sales.
5. Brand protection violations (including malware prevention and ads not aligned with a publisher’s brand) are kept to a minimum with use of the platform.
6. Simplifying programmatic sales frees up resources of salespeople to focus on direct sales and Private Marketplace relationship development.
7. Working exclusively with one platform (in this case PubMatic) leads to higher revenue performance for the publishers.
Rodale, the publisher of Women’s Health, Men’s Health and Prevention sites, was one of the participants in the study. “We were happy to share our data for such an analysis,” says Michael Kuntz, Executive Director of Digital Sales. “The importance of having the right platform to help us monetize and enhance the value of our inventory has never been greater. Our results, in combination with the other publishers, shows a discernible pathway for programmatic selling that can lead to increased revenue across our sites.”
“We believe that Forrester is providing us with third-party validation of publishers who have learned to take control of their assets and fully use the capabilities of our platform,” says PubMatic president Kirk McDonald. “In particular, we saw very high rates of return for those using Private Marketplace. We look forward to companies like this beginning to use first-to-market tools like Unified Optimization, which enables publishers to maximize opportunities between direct and programmatic sales.”
To download the complete study, go to: http://www.pubmatic.com/reports
The release of the Forrester Total Economic Impact Study at the Ad Revenue 5 conference follows a period of dramatic growth in terms of product development and funding increases for PubMatic. The company announced a $45 million dollar mezzanine round of funding lead by August Capital that has been earmarked for strategic acquisitions. PubMatic experienced 2011 year-over-year revenue growth of 150% and recently expanded into Germany and France. Their last major product releases included PubDirect (audience and deal management and, the ability to dynamically optimize inventory across all sales channels) and PubLink (which helps publishers seamlessly integrate best-of-breed partners to drive efficient execution) and an integrated platform for mobile monetization.
Since 2006, PubMatic has been at the forefront of developing innovative technology to help publishers automate the process of evaluating and selling their advertising inventory. PubMatic (http://www.PubMatic.com) gives premium publishers a real-time media selling platform for managing revenue and brand strategy. PubMatic’s platform combines real-time bidding (RTB), the most comprehensive brand protection tools, unified optimization and audience insights as well as hands-on support to serve the world’s leading publishers. PubMatic is privately held, backed by funding from August Capital, Draper Fisher Jurvetson, Nexus Venture Partners, and Helion Ventures, and has seven offices around the world in the U.S., Europe and Asia.