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What’s the state of programmatic in Canada? A case study with Slimcut Media

Last updated on July 24th, 2015 at 12:34 pm

Programmatic is a growing sector of the Canadian online advertising landscape, with video and mobile ad spends at the head of a notable upswing. Yet this method of automated advertising, which is still largely misunderstood, lags behind its U.S. counterpart. But some publishers in Canada aren’t content to wait on the sidelines.

Enter Upscale, Slimcut Media’s private programmatic marketplace dedicated to selling its proprietary Splitbox video ads. Early successes look promising for Slimcut, and it just signed deals with Torstar, Postmedia, St. Joseph Media and TC Media. International publishers who use Splitbox include IAC and Microsoft.  But does the current programmatic climate in Canada offer the right conditions for Upscale to take off?

If you are familiar with Facebook’s autoplay video ads, then wait until you see Splitbox (if you haven’t already). Developed by Slimcut Media, Splitbox is an in-article video ad unit for publishers of text-dense content. As a user is reading an article, Splitbox appears out of nowhere, sliding smoothly into view between text paragraphs. The video ad will remain muted until the viewer hovers over it. When the ad ends, the text slides back into place seamlessly, as if the ad was never there.

Splitbox is another, more sophisticated step in the evolution of automated video advertising. In their infancy, video ads were heavily criticized on the user end, leading one reporter for Time Magazine to say, “They’re a bad idea. Not just bad like junk in your mailbox, but bad like someone planting a Vegas billboard outside your window that turns on any time you want to admire the scenery.”

Despite this, video advertising experienced significant gains in 2014 of spending and viewership, with predictions from Venturebeat that 2015 will be the year it settles into a more mature phase. Even more astonishing, programmatic video advertising, which is the automation of buying and selling video ads through real-time bidding (RTB), has skyrocketed. This year, BI Intelligence reports that programmatic ad revenue in the U.S. alone will top $15 billion, with mobile and video RTB at the forefront of this remarkable upswing.

Slimcut Media is seeing this positive reaction to its in-article Splitbox videos. Founder Damien Véran states that publishers who use Splitbox are seeing full completion rates for their videos of between 55 to 70 percent.

Not to impugn Time Magazine, but it would seem that consumers like the Vegas billboard.

Because a video won’t register as a completed view if it is no longer 50 percent on screen, Splitbox helps these top-tier publishers to better meet advertisers’ demands for viewable impressions. And, as a nod to the consumer, a built-in frequency cap ensures that they will only be hit with one Splitbox per session. “We wanted something that is equally beneficial for the advertiser and the audience,” says Véran.

With the success of Splitbox, Slimcut Media has launched Upscale, its private programmatic marketplace dedicated to selling Splitbox video. Upscale focuses on premium inventory only, and will sell audience-targeted impressions on an upfront, guaranteed basis to participating buyers.

And, in an effort not to cut in on publishers’ direct sales, Upscale buyers will only be able to purchase impressions from audience and category targets, instead of from specific publishers. In a recent press release, it was announced that Toronto’s Acuity Ads, a programmatic demand-side platform, is the first partner to come on board.

Though Véran promises that other publishers are testing this new marketplace, and are expected to follow Acuity Ads’ lead, premium publishers have, in the past, been wary of automated buying platforms. Large-scale automated buying is generally seen as being lower in quality. In Canada particularly, programmatic RTB growth lags behind its U.S. counterpart for a variety of reasons, including a lack of data for targeting, and a smaller number of marketers in the bidding pool.

Julia Casale-Amorim, chief marketing officer of Casale Media, says, “Canada is dominated by a considerably smaller number of major marketers [than the US], many of whom are environment conscious and well educated on the fraud that can plague open exchanges. It is no surprise then that these advertisers value the security that comes from directing buys at trusted national publisher brands.”

Since this is the case, Canada is probably the right advertising landscape for a private programmatic marketplace like Upscale to flourish. Casale-Amorim states that private exchange is attractive in Canada, because “publishers can enhance the value of run-of-site inventory by packaging buys with rich data products and audience analytics not available through an open exchange.”

Its early release into the Canadian programmatic game is promising for Upscale’s outlook, and watching its development over the coming months will be top-of-mind for advertising executives. At the very least, it has a solid foundation for success.

Véran sums that foundation up nicely, when he says, “We only work with top premium publishers, so why not gather that inventory, give advertisers what they want — premium audience — and give the publishers what they want — premium revenue, without competing with their own direct sales?”

For more on programmatic and its role in B2B, read our primer here

Photo via Slimcut Media


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