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Why Highly Interactive Display Advertising Spend Is About To Jump

Ruud — Mon, 14 Jun 2010 16:39:25 +0000

We know that the spend on online advertising has been going up fairly consistently over the last 8 years (see table 1), but the rate of growth has been suppressed by the US economic turndown which began in early 2008. Of all the online display spend, the amount allocated to highly interactive units experienced a disproportionate amount of the downward pressure because of a hesitancy to experiment in a down market. However, we project that as the economy recovers, a disproportionately large amount of dollars will flood back into this segment. This is because of the incredible innovation that has taken place in online display during the downturn.

Table 1 Quarterly revenue growth online advertising industry

Comscore’s ‘Digital Year in Review 2009’ report discloses that users viewed 21% more display ads between the end of 2008 and 2009, and reported a growth 15% from Q1 2009 to Q1 2010. In context of the slow growth in revenue, this continuing growth of impressions reflects significant losses in average CPM pricing. A recent research publication by interactive advertising agency Razorfish is in line with these figures. In their ‘Outlook Report 2010’, Razorfish reports that the bad economy in 2009 has kept advertisers from experimenting with new social display ad technology. As the market bounces back, however, buoying up CPM prices will require better performance through these innovations that have been slow to market.

While growth of display ad revenue was slow, ad technology providers have not stopped innovating. For example, at Sprout we’re pioneering ways to make the production of highly interactive rich media ads more scalable. The combination of new technology and a recovery in the US economy, is expected to significantly boost the rich media ad spend. A recent forecast by Forrester research visualizes this expected growth of rich media display ads (see table 2).

Table 2 Forecast US Display Advertising Spend, 2009 to 2014 (source: Forrester Research)

Recent signals from major players in the industry also show us that there’s significant confidence around upcoming growth. Major acquisitions and announcements are happening in the online display advertising industry, the most prominent one of which is Apple’s introduction of the iAds. Not only is Apple putting its money on mobile display advertising, in the WWDC this week, Apple CEO Steve Jobs even announced that they’re expecting the iAds to generate no less than 60 million dollars in just the rest of 2010. Apple is not the only one jumping on the mobile display ad train, we’ve also seen Google getting on by acquiring Admob in May this year and Adobe partnering up with ad provider Greystripe to create ads that compete with the iAds.

That’s why we think the online display ad industry is once again poised to make some giant leaps forward in the upcoming years. Some major innovations are coming up and we are excited to be part of that at Sprout. In the past months, we’ve received a great deal of interest in our HTML5 authoring solution and we look forward to bringing that out of beta and fully into our product. Stay tuned.

Sprout Announces HTML5 Beta Program

Roland Smart — Fri, 16 Apr 2010 16:30:39 +0000

Sprout is thrilled to announce that it’s now possible to export both HTML5 and Flash versions of the content created with the Sprout Engage Platform. This means, that it’s now possible to create rich-media Engage Ads that are interactive in both Flash based desktop browsers and non-Flash mobile browsers. We’re currently reviewing partners for our beta-release who are looking for a mobile ad solution that will combine their Flash and HTML5 production workflows. For more information about this program please visit our HTML5 beta program signup page or read our press release.

We’re also excited to be making this announcement as HTML5 is gaining momentum in the broader online display ad space. Just last week on Thursday April 8th, Steve Jobs announced the launch of the iAd platform which will serve ads built exclusively in HTML5. And, to our delight he used a Sprout Engage Ad as an example of how interactive and engaging display ads can be. Here’s a photo of Steve with our Alice in Wonderland Ad on stage.

Jobs stated that the iAd platform would serve 1 billion ads a day which makes it a very attractive opportunity for advertisers. But, this also poses a challenge for advertisers because the tools they use to create Flash ads do not export HTML5. Apple is not providing advertisers with a development platform and Jobs suggested that advertisers should use existing tools for authoring this content. This would mean that advertisers would have to acquire new tools to rebuild their Flash ads in another format. Sprout offers a better alternative by allowing advertisers to build their ads once before simultaneously publishing Flash and HTML5 versions. Here’s a short video that explains why we think this is so important and how it will enable advertisers to scale their HTML5 production to meet the iAd platform opportunity:

Here’s a closer look at how serving HTML5 ads can help advertisers gain better performance from their ads. In short, it allows advertisers to avoid the static GIF images that currently dominate the mobile browsing experience.

At Sprout we’re thrilled to start the process of identifying partners to participate in our beta-program. We believe this will make our Engage Ad Platform event more attractive to advertisers, publishers and agencies that are looking to scale production of rich, interactive, and socially connected ads that can be served in both Flash and HTML5.

Sprout Engage Launches With Disney

Roland Smart — Wed, 24 Feb 2010 21:38:55 +0000

Sprout is proud to announce the introduction of Engage Ads, the next generation of online display ads that integrate rich media, interactivity, and social connectivity into standard IAB ad units.

Disney is our first customer, using Sprout Engage Ads to promote Alice In Wonderland. When users encounter these ads on IMDB.com, X, and Y, they can join the Alice In Wonderland experience by ‘Mad Hattering’ themselves, using their web cams to take photos that go directly into the ad unit. Check out the experience below:

You can also watch this short video which explains how Sprout Engage Ads work. And if you’d like more information about this release you can read the entire press release.