Programmatic advertising set to expand

Source: IHS

European online programmatic video revenues jumped from €22 million in 2012 to €375 million in 2015, according to research by IHS and SpotX, and programmatic advertising is expected to account for over 50% of the online video total by 2020.

IHS forecasts programmatic advertising revenue will reach €2 billion by 2020, or over half of all online video advertising revenue. This compares with 2015, when the €375 million generated programmatically is outweighed by the €1.85 billion generated by other buying mechanisms.

Programmatic revenue is revenue generated by automated buying mechanisms based on consumer behaviour algorithms.

The Netherlands, UK and France are leaders in programmatic advertising. In the Netherlands, over a third of video advertising revenue will be generated programmatically by the end of this year, followed by the UK at 22.8% and France with 18.6%. Other markets covered by the survey range from Denmark, with 13.5% of ad revenues generated programmatically this year, to Poland with 2.9% generated this way. In Germany – the third largest market overall – 9.3% of ad revenue is generated programmatically.

IHS expects programmatic revenue to account for over 60% of the total in the Netherlands and France by 2020, with France still in third position at 54.1%. Other countries are expected to catch up rapidly, with 49.3% of Danish revenues expected to be generated in this way and 44.9% of German ad revenues expected to be generated programmatically. In Poland, the only central and eastern European country included, the total is expected to be 27.7%.