Mobile ad networks: Whos No. 1?
By Dan Butcher
August 5, 2009
CBS and Hollywood.com are two publishers in the TSM Network, a division of AOL's Platform-A
In June, the active mobile Web audience in the United States surpassed 55 million unique visitors, according to Nielsen, and mobile ad networks are touting their ability to reach those eyeballs. So who's No. 1?
That question is not as straightforward as you would think, because not all mobile Web sites and ad-supported applications are counted, and each ad network provides its own list of publisher sites, effectively defining its own network. Nielsen said its report is not intended for ranking purposes.
"It's difficult to compare each network's data to other things, because they probably don't have 100 percent of their ads on each site, and the report measures the potential reach of the sites included in each ad network, not necessarily the total actual reach of the ad networks," said David Gill, Austin, TX-based director of mobile media and advertising at Nielsen.
"It's very difficult to compare the findings of this report in terms of apples to apples -- it's not meant to compare one network to another in the public sphere," he said. "Also, at the end of the day, it's not really all about reach.
"What I think is great about the ad networks, they're able to strike at the essence about what's valuable about mobile advertising, which is that it's highly targetable, and the benefit for publishers is that they have access to pretty good-sized potential reach, so they can put together a composite target demographic that is really compelling for media buyers."
Paran Johar is chief marketing officer of JumpTap
Partnering with mobile ad networks gives publishers a better spread of advertisers, according to Mr. Gill.
"Part of the reason mobile ad networks are growing in popularity is that they really understand this market really well. Mobile is still somewhat of a mystery for media buyers, so education is key, and mobile ad networks have a repository of knowledge about the size and the scope of mobile advertising," Mr. Gill said.
"Ad networks are putting together packages with inventory that otherwise would've gone unsold, because it wouldn't have had the reach advertisers are looking for," he said.
Paul Palmieri is president/CEO of Millennial Media
Nielsen said that its report does include mobile applications.
"There are 62 million mobile Web and instant-messaging application users in the U.S., compared to 55 million uniques for the mobile Web alone," Mr. Gill said. "There's a massive amount of duplication between users of mobile Web and applications, so it doesn't really change the uniques that much.
"It's all about the goals of the campaign, and the differentiators between the ad networks are about targeting different types of demographics depending on the brand and the campaign," he said.
To cast as wide a net as possible, publishers and brands spread their dollars around all of the major mobile ad networks.
That said, there are certain factors brand advertisers should take into account when choosing a mobile ad network.
"I think it's important for advertisers to take into account all that an ad network can offer, over and above reach," Mr. Gill said. "Many networks are offering full-service site development, effectiveness studies, site demographics and analytics, application inventory and unique post-buy analysis.
"By shopping around the ad networks, a media buyer will inevitably talk to some of the most knowledgeable people in the mobile industry," he said.
"The key to successfully choosing which networks to work with will be full disclosure of the campaign goals, metrics for success and target audience so that the ad networks can build a campaign plan that fits what the client is looking for."
Jumptap wanted to raise the issues of reach -- and analysts' ability to measure that reach -- when the company went public with the results of Nielsen's June 2009 Mobile NetView, Custom User-Defined Report.
Nielsen requires that the ranking include the following statement: "Public use of this data must clearly state that this is nonstandard aggregation and cannot be compared to other custom reports or the syndicated reports on a rankings basis, including category level rankings.
"Nielsen makes no claim as to the correctness of the custom aggregations but does certify the measurement traffic data at the Web site-level as accurate."
That said, according to Nielsen, the top five mobile ad networks in the U.S. in terms of potential monthly reach are Millennial Media with 45.6 million monthly unique visitors, AOL/Platform-A's Third Screen Media with 28.6 million, AdMob with 25.7 million, Microsoft's MSN Ad Network with 25.4 million and Jumptap with 23.4 million.
Based on those numbers, all of the top five claim to have more than 40 percent potential reach of the 55.3 monthly unique U.S. visitors to the mobile Web that Nielsen reported for June.
Bragging rights aside, to what extent does Nielsen's research accurately gauge the clout of the various mobile ad networks?
"We are ranked in the top five, but the numbers are all fairly similar," said Paran Johar, New York-based chief marketing officer of Jumptap. "The more important message here is to look at more than just the numbers."
Mr. Johar said that it is important to consider whether the ad network works with carriers as well as publishers and applications. It is also important to look into the breadth and sophistication of the targeting.
Nielsen is only responsible for auditing the list of mobile publishers that the ad network provides and cannot attest to the accuracy of that list.
"For example, say an ad network submits NBC on their list, yet they can only serve ads to one-fourth of the inventory," Mr. Johar said. "Sixteen thousand uniques will be attributed to the ranking instead of the accurate number of 4,000 uniques.
"Ad networks can also include applications in their numbers, which can increase their reach numbers," he said.
Nielsen also recommends that given the nature of these user-defined reports, other factors should be considered as inventory or actual measurement of consumer exposure.
In addition, Nielsen does not count some of the sites submitted by the mobile ad networks because they do not meet the necessary sample size for them to audit.
Given the difficulty of measuring actual reach, what else should advertisers look for?
"Ultimately reach is only one criteria and there are so many other to consider, including audience channels, unique reach versus reach, post-click tracking or pages views to measure user engagement," Mr. Johar said. "User engagement is the most important.
"Relevancy is the key to a great user experience which leads to higher levels of response and engagement," he said. "Anyone can serve billions of ads, but the company who can deliver a wide degree of targeting parameters that ultimately delivers the best ROI to advertisers and the most effective CPMs to publishers will dominate the mobile advertising landscape.
"We are delighted to work with Nielsen and be in the top five, but we, like Nielsen, hope to encourage buyers to go beyond comparisons of reach' only and to educate the marketplace on the value of targeting and relevancy when making a mobile ad buy."
Millennial Media releases a monthly SMART report that details the company's reach and metrics. Based on the Nielsen numbers above, Millennial claims 75 percent potential reach of U.S. mobile Web users.
"The bulk of the reach in mobile is in the largest 100 sites versus the long tail of the wired Web," said Paul Palmieri, president/CEO of Millennial Media, Baltimore, MD. "In general, although we are working collaboratively with Nielsen and others -- WIC, MMA and Comscore -- on the next generation of mobile measurement, this report matches pretty closely with our server logs.
"Audience size is important because clients need to target mobile audiences at scale," he said. "At a point, reach will determine the audiences that are a must buy' or a must consider.'
"We think Millennial is approaching this status, and has a significant and sustainable market position."
So what other criteria should be used to gauge the reach, effectiveness and market share of mobile ad networks?
"Ideally, one would use revenue, but private companies will generally not disclose revenues," Mr. Palmieri said. "Reach is actually a great metric, because in a highly competitive market, reach is an outcome driven by the capability to deliver revenue.
"Our perspective is that reach is earned by an ad network, not grown like a publisher grows an audience," he said. "We work tirelessly every day to continue to earn our position in reach."
Despite the highly competitive nature of the mobile advertising space, there are positive signs that the ecosystem can support multiple players going forward.
The mobile Internet is growing, and the mobile advertising industry is growing faster than any other area in media.
"Our focus is on the growth of advertising budgets in mobile," Mr. Palmieri said. "Every dollar invested in mobile ads with another media company is another dollar invested in the future of the industry."
AdMob subscribes to a monthly report from comScore called Ad Metrix Mobile that exposes which ads were served on which sites by which ad network.
"We use that report to determine the site lists of each ad network and we use this as our input into the Nielsen Mobile Media View tool," said Tony Nethercutt, vice president of sales at AdMob, San Mateo, CA. "In this way, AdMob is able to produce a double verified output.
"Neither of these reports tell the full story about reach as they do not track any of the 2,500-plus iPhone apps AdMob has in our network and they only track a subset of our sites," he said.
"However, we believe that when used with a validated set of inputs, Mobile Media View is a useful tool."
Third Screen Media, a subsidiary of AOL's Platform-A, claims that on average it has had greater than 50 percent reach of the mobile audience throughout the year.
"In addition to these broad reach numbers, we also work directly with advertisers to create customized audience segments designed to meet their unique needs to reach a specific demographic target," said Kent Johnson, New York-based director of business operations for mobile advertising at AOL's Third Screen Media.
"We have a wide breadth of publishers we can draw from and inventory that meets the specific needs of our advertisers," he said.
So how accurate are Nielsen's measurements?
"Nielsen provides us with some great insights into our audience, but they only track about half of our sites," Mr. Johnson said. "While there is always room for improvement when it comes to measurement, we believe that Nielsen's work is reasonably representative of the inventory we have."
A common theme in the industry is that analytics and metrics measuring the mobile space are still evolving.
"The mobile space is not equivalent to other forms of media in terms of the availability of third-party data," Mr. Johnson said.
"This is an evolving space and Nielsen and some other third-party measurement companies are well-positioned to improve their audience measurement process and provide the most accurate and rich data available," he said.
"We continue to work with these groups to improve the quality and quantity of mobile information," he said.
Nielsen's June report lists Quattro Wireless as providing the opportunity to reach more than 23 million monthly uniques, placing the company sixth in the U.S.
However, Quattro believes the study paints an incomplete picture.
"This is based only on selected sites in our network," said Lynn Tornabene, New York-based chief marketing officer at Quattro Wireless. "We have currently identified additional sites in our network, such as CNET, Fox Sports and Edmunds that will be added to the next month's update.
Quattro said that advertisers should keep a few things to keep in mind, first and foremost that the report does not measure ads served, but the opportunity to reach consumers on the mobile Web -- potential reach.
"What really counts for advertisers is who actually sees an impression," Ms. Tornabene said.
In addition, Quattro says the Nielsen study counts mobile Web sites but leaves out many ad-supported applications.
"This report only accounts for sites that are measured by Nielsen, which does not include many of the sites on our network," Ms. Tornabene said. "Also, we are being very conservative.
"We don't count Yahoo or MSN, for example, even though we may serve some impressions there, while other networks might be including those in their custom roll-ups," she said.
This custom report aggregates all uniques for each site, but it does not account for what percentage of those uniques that are actually reached by each network, according to Quattro.
"For example, if MySpace is on one network's custom roll-up, they are counting all of those uniques in their total, when actually MySpace works with many networks and each one on a monthly basis only reaches a portion of the site," Ms. Tornabene said. "The numbers are really an opportunity to reach.
"If the advertiser was able to buy 100 percent share of voice on that site through that network in a given month, they would then reach all of those uniques," she said.
"This is just where the mobile measurement is today, and means that networks need to be clear when presenting data what it means."
What other criteria can brands use to gauge the reach, effectiveness and market share of mobile ad networks?
"At Quattro, we believe that the role of a mobile ad network is not just to aggregate an audience -- it does not add much value to the bottom line of individual advertisers to just be an aggregator of eyeballs," Ms. Tornabene said. "Advertisers need a mobile strategy partner that can not only target the right audience, but create high-impact campaigns and superior results.
"Exclusive reach is very important," she said.
Quattro claims that its exclusive list includes such mobile sites as the NFL, Hachette Media's Elle, The Onion, Edmunds, Gawker, Univision and the NHL.
The bottom line is that for advertisers, what matters is reaching the right audience, the one that will engage with their brand, according to Quattro.
"And that audience is often reached on what might be thought of as niche' sites, many of which are not measured by Nielsen due to their size," Ms. Tornabene said. "Even direct marketers want this type of quality reach, as the best sites have greater conversion and thus are more efficient to buy.
"In terms of effectiveness, reach is not a measure of that at all, of course," she said. "Effectiveness is measured by each advertiser based on their goals, but in general includes engagement levels and conversions, along with click-through rates."
Nielsen issued a letter to its mobile ad network clients clarifying how the results from the study should be interpreted and used.
The following is Nielsen's "Mobile Internet Product Update":
This communication is to alert clients that Nielsen has issued a new guidance to users of custom, user-defined reports in the Mobile NetView tool. These reports enable clients to evaluate various potential reach scenarios, un-duplicate site lists and offer opportunity to describe individual business capabilities.
Given the nature of these user-defined reports, they should not be leveraged for benchmarking purposes, particularly because they do not factor in such elements as inventory or actual measurement of consumer exposure.
As of July 29, the following disclaimer has been added to the Custom Roll-up section of the Mobile NetView online tool:
This report is produced for the convenience of Nielsen clients requiring user-defined aggregations of Website-level audience traffic. These custom, user-defined roll-ups are subject to redefinition and renaming upon client request and may be changed or restated at any point in time.
Clients may use the data contained within these custom roll-ups to illustrate their unique business models or partnering relationships for internal analysis. Public use of this data must clearly state that this is nonstandard aggregation and cannot be compared to other custom reports or the syndicated reports on a rankings basis, including category-level rankings.
Nielsen makes no claim as to the correctness of the custom aggregations but does certify the measurement traffic data at the Website-level as accurate.
We appreciate your attention this matter. Please contact your client service representative with any questions.
Julia Resnick, vice president of mobile media solutions at Nielsen, New York
Related content: Ad networks, Mobile advertising networks, Nielsen, David Gill, Jumptap, Paran Johar, Millennial Media, Paul Palmieri, AdMob, Tony Nethercutt, AOL, Platform A, Third Screen Media, TSM, Kent Johnson, Quattro Wireless, Lynn Tornabene, Microsoft, MSN Ad Network, Mojiva, J
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