GroupM Report Predicts Inflation in Digital Inventory Cost in 2018

In 2018, 42% of online ad spend from India will be on video ads and 12 of all digital advertising will be programmatic, GroupM predicts

e4m by Venkata Susmita Biswas
Updated: May 4, 2018 3:52 PM

In its latest report - The State of Digital - GroupM predicts inflation in inventory cost on mobile formats in India, continued stronghold of Google-Facebook duopoly and online time spent overtaking linear TV watch time.

The report found that in India the rapid growth in reach propelled by the surge in cheap data is inflating the price of “impact display” mobile formats. North America will also experience inflation due to the high demand for premium, brand-safe content, and the lack of measurement on many of these platforms (OTT, mobile, etc.) The US could see effective CPMs rise across programmatic display and video ecosystem as sites improve viewability rates, the report said.

The study delved into understanding emerging data and technology trends, video behaviour, ad investments, and value, viewability, and verification. The report was unveiled in New York and London on Thursday.

Duopoly Reigns

Despite the concerns over brand safety, quality of programmatic inventory in the Google Display Network, and the most recent Facebook data breach scandal which forced CEO Mark Zuckerberg to unequivocally apologise and make fundamental changes to the Facebook platform, the two media giants will maintain a stronghold over the digital landscape. The Google-Facebook duo will continue to be the key growth driver for digital in 2018, the report observed.

That’s because Google Search is critical to clients, DoubleClick Bid Manager allows the advertiser to access to Google’s proprietary audience segmentation. Buying on Facebook is driven by Instagram’s captive young audiences.


Escalating spends on e-commerce will support the growth of digital advertising in 2018. “The progress of e-commerce bears a striking coincidence to that of digital ad expenditure,” the study said. E-commerce data crunching from 35 countries revealed cumulative transactions worth $2.105 trillion in 2017, growth of 17 per cent over 2016. GroupM predicts 15 per cent growth for e-commerce in 2018 to $2.442 trillion or about 10 per cent of all retail.

Programmatic Spends

Globally, on average programmatic spending increased nearly 42 per cent from 31 per cent in 2016 to 44 per cent in 2017. GroupM predicts this will rise to 47 per cent in 2018. For online video investment, programmatic is smaller; 22 per cent in 2017 versus 17 per cent in 2016 and predicted to rise to 24 per cent this year.

Online to overtake TV

The time spent with online media will overtake time spent with linear TV for the first time, globally, in 2018. Online will have a 38 per cent share, TV 37 per cent, and the balance spread primarily across print and radio (weighted by local media investment).

Desi Details

In 2018, 42 per cent of online ad spend will be on video ads and 12 of all digital advertising will be programmatic, GroupM predicts.

Studying programmatic ad tech tax trends across the world, GroupM found that the tax as a percentage of the media spend stands at 19-25 per cent in India. DSP tax is around 9-10 per cent and SSP around 10-15 per cent.

India has a successful in-view rate expectation of 50 per cent for static ads. In markets like the US and Canada this figure is as high as 70 per cent and in countries like Australia, South Korea and Hungary it is around 80 per cent. India has low standards for viewability because it is a “new concept” in the country, and “only a minority of apps are covered.”

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