“The Global Address” is a column written by members of the digital media community with an international perspective on the digital space.
John Childs-Eddy is VP of Business Development at Australian direct response ad network, Funbox.
When AdExchanger.com first asked me to discuss the Australian market, my verbatim response was:
“The thing about this market is that it’s consolidated, and dominated by traditional media – it’s the only English speaking market in which the five biggest digital media companies are owned by the biggest traditional media companies – which is an interesting anomaly on the face of things… however it seriously slows the adoption of ad exchanges in Australia… and reduces the discussion about these kinds of things. It’s not exactly an innovative marketplace like the States is in this area.”
To reflect just how deeply the Australian Media market is regarded as an oligopoly, you can check out this Wikipedia article on the definition of oligopolies.
And to paraphrase what is possibly the most important note in the Wikipedia article: “… competitors will generally ignore price increases, with the hope of gaining a larger market share as a result of now having comparatively lower prices. However, even a large price decrease will gain only a few customers because such an action will begin a price war with other firms. The curve is therefore more price-elastic for price increases and less so for price decreases.”
In other words, there is very little incentive to suddenly allow the majority of the media company’s remnant inventory to become liquid in an exchange market place. Indeed the companies have far more to lose than to gain by allowing the devaluation of their inventory through an ad exchange. The companies will correctly point out that they are better off *not* selling their remnant inventory at all, and keeping their eCPM average more than 1000% higher than the avg. in an exchange environment.
After all, if none of the “big five” discount, then buyers will have no choice but to pay whatever they ask for.
However, all is not lost. It is quite possible to run successful campaigns at scale in Australia… you just need to strategize. So here’s a few tips:
- Ensure you are using segment pixels on your landing pages.
- Work directly with the large publishers on a “remnant” buy. The publishers will still do “performance deals”, and run your campaign on their unsold inventory internally. They most likely won’t place your ad tags though.
- I suggest you set up different landing pages for each major RON remnant buy for each of the big five publishers.
- Retarget your segment pixels through your own exchange seat if you have one, or arrange a retargeting campaign with one (or more) of the major tier 1 players in the exchange space.
- Optimize your premium buys from the data you gather from the segmented campaign performance and fine tune.
- Rinse and repeat for each campaign.
In this way, you will be targeting premium users as efficiently as possible across Australia’s major publishers, while retargeting those same users at scale via retargeting in the exchange space.
Viola! 🙂 You are now buying premium audience very efficiently (and at scale) in an “Oligopolized” market.
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