AppNexus Now Offering Viewable-Only Buying

System Lets Buyers Pick Their Viewability Standard

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AppNexus CEO Brian O'Kelley.
AppNexus CEO Brian O'Kelley. Credit: Buck Ennis for Crain's New York Business

As the debate over ad viewability rages on, AppNexus is the latest to introduce a tool for advertisers that only want to buy ads that people have some chance to see.

Traditionally, advertisers buy digital media based on how many impressions they want, before the ads are actually served, and pay even for impressions involving ads that rendered further down a webpage than consumers ever scrolled. The ad-tech giant is now giving advertisers the option to shop only for ads that are considered viewable, and to pay only after the ads have met the criteria.

The criteria for "viewable" in this case is up to the buyer, so long as publishers are able to meet their preferences.

That may mean the dominant industry definition set by the Media Rating Council, which defines as viewable display ads in which 50% of their pixels are visible for at least a second and video ads where 50% of the player is in view for at least two seconds. Or advertisers might buy against their own viewability standard.

WPP's GroupM, the largest network of media buying agencies, counts as viewable display impressions where 100% of an ad is in view for any length of time and video where 100% of the player is in view, at least half the ad plays, the sound is on, and a person actually clicks to start it. Conde Nast became the first major publisher to publicly agree to the GroupM standards last year.

WPP said last September that it would invest $25 million in AppNexus.

While CEO Brian O'Kelley said the company's move to launch a viewable-only option has nothing to do with its ties to GroupM, the media agency network's stance on viewability, and its leverage with publishers, can't hurt.

"It is convenient that the largest holding company decided this was the standard," said Mr. O'Kelley.

For advertisers, the system offers a guaranteed view, but not necessarily a guaranteed saving. With AppNexus' existing business, advertisers are paying for impressions, both viewable and not. Publishers may be able to charge more per impression for the smaller supply of viewable ads.

"You can buy viewable impressions for the same as non-viewable today," Mr. O'Kelley said. "Will we see a premium on this? I think at some point, when more [advertisers] transact on a viewable currency, you'll see more price competition for viewed impressions."

For AppNexus, Mr. O'Kelley hopes the offering attracts new advertisers and more transactions, which will lead to a "significant upside." But immediate financial motives aren't the only driver, he said. This kind of offering will help to absolve "friction in the market," according to Mr. O'Kelley, and "put fears marketers have around digital to bed."

A viewability-based system is still rife with challenges.

AppNexus is gradually involving publishers in its network, and some might not participate. "A publisher does have to agree," said Mr. O'Kelley. "So far, we've not had any publisher opt out."

And not every buyer may want to pay more for ads that meet "viewable" criteria, if a standard ad buy still achieves their goals. "According to a standard they're not viewed, but there might be some ads that do influence people that don't meet that standard," Mr. O'Kelley said. "If you want to go around buying 40% of an ad seen for 1 second and make a margin, you can."

AppNexus is not the first to offer a viewable-only inventory alternative. Google also has an offering. But Mr. O'Kelley is confident that his inventory is a differentiator. Publishers available through AppNexus include Microsoft, Hearst, Shazam and a local media consortium with members like Cox, Chicago Sun Times and The Boston Globe.

The new offering is based on the platform gained when AppNexus bought the French company Alenty a year and a half ago.

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