The Rubicon Project’s Q3 Market Report Refutes Industry Chicken Littles: The Sky is Not Falling on Online Ad Industry

News & Reference Sites’ 36% Revenue Gain Leads Quarter
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NEW YORK – The Rubicon Project, an advertising technology company focused on global ad network optimization, divulges noteworthy market data and industry trends in the Q3 edition of the 2008 Online Advertising Market Report series. From its independent third-party position between ad networks and Website publishers, the Rubicon Project provides a unique and un-biased perspective of the changing Internet advertising landscape. The company, which is optimizing ads for publishing customers at the pace of 15 billion per month thus far in Q4, based its analysis for the Q3 Report on the 28 billion impressions optimized during that quarter, from more than 270 ad networks.

“We’ve all seen how the economy, in the U.S. and around the globe, is affecting consumer and corporate spending. As marketers look at the challenges ahead, however, online advertising continues to grow, despite the negative dip in most traditional advertising markets,” said Frank Addante, CEO and founder of the Rubicon Project. “With this report we’re happy to deliver a glimmer of hope in uncertain times; based on in-depth market intelligence and informed analysis of data-backed trends, we think online advertising, especially by way of the best ad networks, has the potential to thrive even as Wall Street struggles.”

The Sky Is Not Falling

With the global economy facing stronger headwinds there was much speculation about how online advertising, and the ad industry as a whole, would weather the storm. Still, VC firms and other investors pumped $241 million into ad networks over the course of Q3, according to investment bank Petsky Prunier.

As marketers follow consumers’ lead and seek ways to tighten the belt, they’re shifting hundreds of millions, potentially billions, of dollars away from hard-to-measure traditional media to online advertising. The Internet offers directly measurable return on ad spend, something television, radio and print can’t deliver nearly as effectively, and ad networks are a critical channel through which fewer media buyers can access online media. Based on these market factors, and the trends revealed by the company’s own massive volume of data, the Rubicon Project is confident that online advertising will continue to represent a significant and growing portion of marketing spend. This will drive continued demand for ad networks and platforms like the Rubicon Project’s Ad Network Optimizer, which builds revenue and offers tremendous time and resource efficiencies for website publishers.

Sample Findings:

* Newspapers are struggling with sales and circulation numbers offline, but recent deals they’ve brokered with ad networks and other web-based properties have started to net positive results;
* News & Reference site CPMs outperformed other verticals with an across-the-board CPM increase of 36 percent over Q2 – only Food & Drink sites garnered higher absolute prices during Q3;
* Social Networking sites (and other channels like Young Adults, Music and Entertainment) struggle to match inventory with demand. Already-low CPMs in the Social Networking channel slipped 3 percent in Q3. With more than 150 million consumers spending time on social networking sites, however, advertisers will continue to spend to reach this audience, driving overall revenue upward;
* Network performance in Q3 varied by type – behavioral networks, while still delivering the highest CPMs across all networks, were slightly down, while all-purpose networks saw marked pricing lifts;
* Average CPMs served across thousands of sites and 270 ad networks slipped 11 percent from Q2, but performance varied by network type and channel. Several channels experienced greater than 25 percent lift in CPMs from Q2, while others dropped by almost 20 percent. This fluctuation among verticals appears little different from past quarters’ analysis.

To access a free download of the Q3 Online Advertising Market Report, as well as past published reports, visit:

About the Rubicon Project

Based in Los Angeles, the Rubicon Project launched in 2007 on a mission to automate the $65 billion global online advertising industry. Responding to one of the largest problems plaguing website publishers today – monetizing ad space that goes unsold (as much as 70-80 percent) across a fast-growing number of global ad networks – the Rubicon Project pioneered the category of Ad Network Optimization (ANO). Backed by $22 million in funding from Mayfield Fund, Clearstone Ventures and IDG Ventures, the Rubicon Project developed its patent-pending Smart Matching™ technology, which uses billions of pieces of proprietary market data to match each publisher ad impression to the best money-making opportunities from ad networks.

The company serves 1300 premium customers (publishers like Gannett, Salon, Washington Post/Newsweek Interactive and American Greetings) by optimizing more than 15 billion ads each month across more than 300 top ad networks. Reaching more than 250 million unique Internet users, the Rubicon Project is one of the largest sources of ad inventory and reach on the Internet and the preferred source of targeted, audience-segmented inventory for ad networks around the world. The unique combination of ad network optimization and Smart Matching™ technology drives revenue lift ranging from 30-300% for the Rubicon Project’s customers.

Web sites who Demand More From Unsold Ad Space should visit:

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