Cooperation between media companies : Changing landscape in the online advertising market has been added to your bookmarks.
Cooperation between media companies
Changing landscape in the online advertising market
The global advertising market is going through radical changes, with increasing market share of online advertising dominated by technological trading platforms, which leaves traditional media companies with reduced advertising revenues and less control.
To reinforce their position and remain competitive, traditional media companies are setting up alliances and cooperation initiatives to create economies of scale and become more competitive in the online advertising market. This point of view of Deloitte explains the added value of collaboration as well as the requirements for success in the new digital advertising era.
Key Insights :
- Online advertising spend in Europe and Belgium increases its share in total advertising budgets at the expense of traditional media and becomes the second largest advertising channel, behind television.
- The online advertising market is increasingly captured through technological trading platforms controlled by various new market entrants, resulting in loss of control and decreasing advertising revenues for traditional media companies.
- Media companies reinvent their online advertising business model by: (1) Aligning offering, transaction types and channels, yield management, and sales teams to work seamlessly together in tune with the market, and (2) Building technological expertise and data management capabilities.
- Worldwide, especially in Europe, cooperation between media companies is clearly manifesting itself. The main motivation is to create economies of scale in order to be able to compete with international technology players.
- In general, these cooperation platforms are initially focused on creating scale by bundling and selling the unsold inventory of various media companies. Later on, additional inventory segments and product types (e.g. mobile and video) are included in the offering to the market.
- Belgian media companies could benefit from cooperation initiatives by setting up a platform to automate selling of premium inventory, pooling unsold display inventory or focusing on a niche platform for video inventory.