LGBT Programmatic Advertising and the Concept of the Ad Network "Waterfall"

We've discussed in previous blog posts about the advent of programmatic ad buying in the LGBT online media world, which allows us to better appreciate how the online advertising market has evolved over the last few years.  Due primarily to the technology of programmatic ad buying and real-time ad bidding, websites large and medium-sized (not small just yet) are able to place their banner ad inventory on the programmatic ad exchange and make real revenues on the banner ads placed on their sites.  They are also better able to compete with the larger media companies and the larger website networks that caught the attention of ad agencies in years past.

Ad agencies LOVE, LOVE, LOVE programmatic.  It provides them full control over every aspect of their ad placement.  They no longer need to negotiate with the media companies over price, and they can analyze and monitor every aspect of their banner ad buy in real time, testing out creative, landing pages and more.  The media companies set their price for their banner ad inventory on the programmatic ad exchange, and the ad buyers compete for this inventory, usually layering additional data on top of their ad buy such as targeting online viewers in a specific region or who have a specific interest such as travel, home buying, automotive, etc.  The typical rates for ads purchased averages around $7 CPM (cost per thousand ad impressions delivered), with the net result to online media companies averaging around $5 CPM.



These CPM rates are no longer “remnant” ad inventory, which was the case back when these types of banner ad network ads yielded around $1-2 CPM.  Today, programmatic advertising is typically positioned just below a media company’s in-house ad sales department.  The ad banner flow typically starts with an ad server looking to place an in-house ad, sold at a premium CPM.  If it can serve an ad, great, but if not, it then looks next to the 1st tier programmatic ad placement, which is typically a $5 Net CPM programmatic ad.  If there is an ad to place from this 1st tier, it places the ad, but if not, it then looks to a 2nd tier programmatic ad network and so on down the line.  This is what is known in today’s programmatic ad lingo as the “waterfall”, starting with an in-house premium ad, then a 1st tier programmatic ad placement and ending with a sponsorship ad or ‘freebie’ the publisher may have promised to a business partner or a charity. 

And did we mention inventory? The agencies have LOTS of LGBT banner ad placements to choose from… there are several million LGBT banner ad placements available today on the programmatic ad exchange, including Towleroad.com, GayStarNews.com, Gay.com, InstinctMagazine.com and more.  We haven’t even discussed mobile advertising yet, with the millions upon millions of well-performing ad units available on Grindr, Scruff, Growlr, Jack’d and more.

If you're looking to target an LGBT audience on these sites and other leading LGBT websites online, let us know... shoot us an e-mail to matt@pinkbananamedia.com and tell us more about the specific LGBT demographic you're looking to reach.

To learn more about how programmatic ad buying works, check out our recent blog posts "Look Who's Making A Comeback - LGBT Banner Ads" and "Programmatic Ad Buying Using Your LGBT SEO and PPC Campaign Search Terms".  To learn more about how to reach an LGBT audience BEYOND the traditional LGBT websites, check out "Target LGBT Audience on Huffington Post, DailyBeast.com, Jezebel and more".

For more information, check out:
http://www.pinkbananamedia.com/ads.cfm

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