2018 China Digital Ad Viewability Benchmark Report

© 2018 Sizmek Inc. All rights reserved.

I. Background:

Sizmek is a global independent advertising technology company, with headquarters in New York, USA. In China, we offer digital campaign management, ad serving, and verification solutions. We also provide dynamic creative optimization, viewability measurement and brand safety solutions. Sizmek is accredited by the Media Ratings Council (MRC) for multiple ad formats, including display, rich-media, and video, as well as cross-platform viewability solutions. All data included in this report is in compliance with the MRC accreditation standards. We have adopted the IAB standard to determine whether a measured impression is considered viewable, which states that 50% of the ad must appear on a user’s screen for one second or more.

Sizmek has been monitoring data on digital ad viewability since 2015, and this is the fourth consecutive year that we have released the China Digital Ad Viewability Benchmark Report. From the analysis and findings in this report, we reveal interesting trends in viewability rates throughout the year. These insights can be used as guidelines for future campaign planning, particularly how viewability rates differ between verticals and across different buying methods. This year’s annual report placed considerable emphasis on vCPM (viewable cost-per-thousand impressions), which is very helpful for media planners and buyers evaluating advertising effectiveness.

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1 © 2018 Sizmek Inc. All rights reserved.

II. Methodology:

The report was compiled using 2017 data from the Sizmek Advertising Suite, specifically, data collected from all advertising activities that took place on the platform in China between January 1, 2017 to December 31, 2017. There were over 12 billion recordable impressions, representing an increase of more than 20% when compared to the previous year. The media types monitored were portals and mainstream vertical media.

Glossary of terms used in this report:

Serving volume: Number of advertising impressions served

Recordable Impressions: The percentage of impressions successfully recorded for viewability evaluation purposes, out of served impressions. (Due to the complexity of certain page environments where an ad is located, some iFrames for example, not all impressions can be measured for viewability rate.)

Recordable rate (%): Recordable Impressions Rate = Recordable Impressions / Served Impressions. (The detected viewability rate is only meaningful when a high recordable rate was ensured. The recordable rate in this report reflects the capacity of our platform’s technology.)

Viewable Impressions: The number of viewable impressions measured based on the IAB viewability thresholds.

Viewability rate (%): Viewable Impressions/Recordable Impressions;

Viewable cost-per-thousand impressions (vCPM): vCPM = Total cost/((Recordable Impression*Viewability rate)/1000); (MRC accreditation)



“

CPM80 Yuan

vCPM178 Yuan

Recordable impressions: 900Recordable rate: 90%

Viewable impressions: 450Viewability rate: 50%

Serving Volume Recordable Rate Viewable Rate

In this 2018 annual report, we have analysed recordable rate and viewability rate performance on different platforms and via different buying methods, for example: Differences between ads

on mobile devices versus on PCs, and between direct and programmatic buying.

Example: Viewability rate vs. vCPM

Total impressions CPM (Yuan) Recordable

rateViewability

rate

Viewable impression

volumevCPM (Yuan)

1,000 80 90% 50% 450 178

(*Viewability rate monitoring result already excludes volume that comes from ad fraud)

0%

20%

40%

60%

80%

100%



1. Overall: The average viewability rate for China in 2017 was 31.17%, only a small climb when compared to the previous years. The overall mobile viewability rate was 84.38% and the overall PC viewability rate was 28.42%. With mobile being significantly higher, this may be a valuable consideration for future campaigns where viewability is the main KPI.

2. Recordable rate: The recordable rate for PC and mobile devices both exceeded 80%. In the case of mobile devices, the recordable rate was as high as over 90%.

3. Viewability rate: In 2017, the viewability on both PC and mobile devices was higher than in 2016, in both direct and programmatic buying channels.

4. Analysis of the changes in viewability rate:In this annual report, we see several variances in viewability rate: as page content length changes, different types of media show different characteristics in ad viewability rates. For example, fashion media content pages show a higher viewability rate whilst the price for advertising is relatively lower, and financial media content pages and financial channel pages both have a higher viewability rate than the homepage itself. This discovery shows the effectiveness and efficiency of content pages which should be considered for future planning.

5. New metric in this report:Viewable cost-per-thousand impressions (vCPM) was used as a metric, which reflects the actual value of ad placements.

III. Key findings:



IV. Annual trends:1. Viewability rate trend from 2015 - 2017.

V. Digital display：1. Comparison of recordable rate and viewability rate on mobile devices and on PCs shows the following:

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

2015 2016 2017

Mobile PC

PC terminal total

viewabilityrate

PC terminal homepage

average viewability rate

PC terminal channel

homepage average

viewability rate

Recordable Rate

Viewable Rate

As media buyers become increasingly more aware of the importance of viewability rates, media owners have reacted by continuously optimising their pages and content to boost the viewability rates. This ultimately improves the value of advertising. Looking at the trend over the years, the ad viewability rate has continued to increase at a steady pace, which means ad effectiveness has been increasing.

Recordable rate and viewability rate both performed very well on mobile devices.

Viewability metrics on mobile devices have been better (than desktop devices) because the screen itself is smaller, there is often less content to ingest and fewer ad placements.



2. Looking at recordable rate and viewability rate in regards to the different buying methods:

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

Direct Buying Programmatic Buying

Mobile Recordable

Data

Mobile Viewability

Data

PC Recordable Data

PC Viewability

Data

Viewability rates for programmatic campaigns were better on PCs, and we believe this to be the case because the layout for direct buys is consistent with more ads on a single page; whereas there is constant filtering and optimizing for programmatic buys thereby boosting the viewability rate.



3. Viewability rate performance across different verticals and varying page depth:

News Portal Finance Fashion Luxury Products

Welcome Banner Top Banner Skyscraper Middle Banner Bottom Banner Others Rich Media

News portals performed better in terms of the viewability rate when compared to other categories. However, as page depth increased, the vertical media viewability rate began to stand out significantly and their content pages had a better viewability rate. Take fashion and luxury products for example, whose content pages have excellent readability, and as a result, their advertisement viewability rate performed better when compared to other types of content pages.These results show the importance of content — greater user engagement, greater viewability — ultimately it means more effectiveness and greater efficiencies.

Now, if we look at the ad format viewability rates, different ad formats and placements demonstrated changes in various degrees compared to last year; we saw an increase in viewability for top banners but a decrease in skyscrapers.

0% 20% 40% 60% 80% 100%

PC terminal average

viewability rate

PC terminal homepage viewability

rate

PC terminal channel

homepage viewability

rate

PC terminal content page

viewability rate

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

PC terminal viewability

rate by ad type



4. Viewability rate in media content and page depth.

0% 20% 40% 60% 80% 100%

0% 20% 40% 60% 80% 100%

News portal media

Financemedia

4.1 News media channel homepages have better a viewability rate.

4.2 Financial media and financial channel homepages and content pages have better viewability rates.viewability rate.

There are certain patterns in the change in ad viewability rates, and those patterns differ amongst the different media verticals and different page depths. The viewability rate performed very well in all content pages we observed. The existing data demonstrates certain patterns of change, from which we can see that a content page with more readable value has a higher viewability rate. This is also influenced by the users’ reading behaviours and habits.

Financial media and financial channel homepages often present highly readable information such as current trends and real-time market performances, and their content pages usually have high viewability rates.

Homepage Channel homepage Content page



0% 20% 40% 60% 80% 100%

Luxury products

media

4.4 Viewability rate performance in different page levels of luxury product media:

In luxury product media, the viewability rate changes as page depth changes, and such changes are very noticeable. The homepages are not necessarily favored.

0% 20% 40% 60% 80% 100%

Fashionmedia

4.3 Viewability rate performance in different page levels of fashion media:

In fashion media, content pages have better viewability rates versus their homepages and channel pages.



VI. Case studyExample 1: Consider the recordable rate factor, aka, the MRC accredited method of measure;

In this fine-grained case study, we used a certain website’s actual advertising price and actual recordable rate and viewability rate to create this set of comparative data.

We analyzed the CPM and vCPM for the same ad spot on the same website at different page depths. Ads placed on the homepage come with a higher price tag yet a lower viewability rate, which means the vCPM of such ads are relatively more expensive; whereas the vCPM fluctuations of ads placed on channel homepages and content pages appeared to be less drastic, thus those ads are more effective.

vCPM Viewable Rate

0% 0

20%

40%

60% 900

600

300

HomepageCPM standard pricing 60 Yuan

vCPM779 Yuan

vCPM185 Yuan

vCPM75 Yuan

Channel HomepageCPM standard pricing 45 Yuan

Content PageCPM standard pricing 35 Yuan

Homepage Channel Homepage

ContentPage

CPM standard pricing (Yuan) 60 45 35

Recordable rate 77% 81% 93%

Viewability rate 10% 30% 50%

vCPM (Yuan) 779 185 75

CPM vs vCPM (Yuan)



Example 2: This is calculated using the viewability rate directly, assuming that the recordable rate is 100%; The formula is: vCPM = Total cost/((Total impressions*Viewability rate)/1000); the only distinction is that in this formula, the total impressions are used;

In this report, we’re thrilled to see an overall improvement in the viewability rate across the industry, and a better viewability rate for mobile devices. We are also seeing a better vCPM and more resources for content pages and some of the channel homepages of vertical media in different categories. Even when homepages traditionally suffer from a lack of resources, high prices, and low viewability, target group-oriented content is delivered more precisely, which means ad serving is more effective. For ad buyers and media buyers, this is a good time to discover undervalued opportunities. Not all media support viewability rate monitoring, but the situation is gradually improving. More and more media owners are opening up for viewability rate monitoring, and the technical capacity, reporting capacity, coverage and industry standards are all on the rise. Thus, we believe that in 2018, the viewability rate metric will be used more and advertisement serving will become more transparent.

If we consider Recordable Impressions as a sample, when we use the viewability rate detected in the sampled lot to represent the viewability rate of the whole ad serving, we may proceed with the calculation using this viewability rate, “A”, as the viewability rate that represents the entire serving’s impressions, and the vCPM resulting from this calculation will be different from the vCPM resulting from the calculation in “Example 1”. Here’s one more case study for your consideration.

vCPM Viewable Rate

Homepage Channel Homepage

ContentPage

CPM standard pricing (Yuan) 60 45 35

Recordable rate 100% 100% 100%

Viewability rate 10% 30% 50%

vCPM (Yuan) 600 150 70

0%

0

20%

40%

60%

700

350

CPM vs vCPM

vCPM600 Yuan

vCPM150 Yuan

vCPM70 Yuan

(Yuan)

HomepageCPM standard pricing 60 Yuan

Channel Homepage CPM standard pricing 45 Yuan

Content PageCPM standard pricing 35 Yuan



VII. Sizmek’s independent ad viewability and brand safety verification solution (Viewability & Verification)

Sizmek is dedicated to providing comprehensive ad serving solutions to its customers, which includes campaign management, creative production, dynamic optimisation and the provision of data analystics and optimization services. Our core data solutions such as viewability rate monitoring and brand safety are built around real time data collection and analysis. In order to better adapt to the Chinese market and to satisfy our customers’ growing demand for data monitoring, starting last year, Sizmek began to research and develop independent viewability and brand safety validation and verification services covering several different platforms (PC and mobile devices) and different ad formats (display, rich-media, and video). We effectively resolved the issues stemming from not using Sizmek ad serving services or media that does not accept third party ad serving, and significantly improved the diversity of our solutions.

Technology innovations continue to roll out, and obtaining data is also becoming easier than ever. These factors made customers and agencies increasingly aware of this data and how to better use data to support actual media negotiations, buying and optimization. At the same time, they have also become more open and are paying more attention to refining their operations. Using viewability information can also help them to prove their value and the effectiveness of their ad campaigns to their customers. This is the first time we have attempted using the vCPM calculation in our annual report, and by comparing the differences between this calculation and the CPM, it became apparent that we are looking at a new way of thinking about media value and the effectiveness of ad serving costs. Although it takes longer to process procurement since many parties are involved in this process, customers are increasingly intolerant towards waste and fraud, and this attitude will help to speed up these developments. As a leading technology provider in the industry, Sizmek is looking forward to working with customers, agencies, and the media alike, to continuously perfect and explore new possibilities while encouraging continued development and innovation in the advertisement industry.



About SizmekSizmek is the largest independent buy-side advertising platform that creates impressions that inspire. In the digital world, creating impressions that inspire is vital to building meaningful, long-lasting relationships with your customers. Sizmek provides powerful, integrated solutions that enable data, creative, and media to work together for optimal campaign performance across the entire customer journey. Our AI-driven decisioning engine can identify robust insights within data across the five key dimensions of predictive marketing—campaigns, consumers, context, creative, and cost. We bring all the elements of our clients’ media plans together in one place to gain better understanding for more meaningful relationships, make every moment of interaction matter, and drive more value across the entire plan. Sizmek operates its platform in more than 70 countries, with local offices in many countries providing award-winning service throughout the Americas, EMEA, and APAC, and connecting more than 20,000 advertisers and 3,600 agencies to audiences around the world.


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