June 21, 2017 | Written by: Dvir Doron, CMO/BDO of Cedato
Categorized: Big Data
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When you’re browsing a news website such as CNN, you will no doubt run across ads that autoplay on the sidebar or before you can watch a news report.
Not everyone who visits CNN is shown the same ad. Behind the scenes, there is a complex profiling process to target the viewer with the right video.
Advertisers bid for a “good user” — someone who fits their criteria, perhaps who uses a Macbook to search online for vacations, lives in a specific demographic and makes regular online purchases — in a process called real-time bidding. The highest paying company that matches additional compatibility and verification criteria will win the bid and show the user its ad.
All this happens between the time the user clicks the play button and when they’re presented the ad. This is what’s called “programmatic video advertising.”
State of Digital defines programmatic advertising as the purchase and sale of advertising space in real time using algorithms. Software automates the buying, placement and optimization of media inventory in a bidding system in real time without people doing manual insertions and trading.
According to eMarketer, more than two-thirds of US digital display ad spending is programmatic, and it’s being rapidly adopted across a variety of channels and ad formats.
Cedato is a company that’s perfectly poised to take advantage of the almost $230 billion per year online digital advertising industry.
How Cedato monetizes video
Cedato powers digital video transactions with its predictive programmatic video advertising software, which is a technology stack that enables advertisers to deliver video and monetize it across any type of screen in any type of content, be it video content, standard web editorial content, apps or other types of content.
Cedato engages with all aspects of video delivery, ad serving, yield optimization, and other requirements to monetize video. In parallel, the company operates a private video marketplace that’s reaching extremely high volumes. The company powers about 15 billion video views every month across two million sites and apps. Cedato is a young company, established in 2015, and is among the fastest growing startups in the ad-tech space.
Disrupting the video advertising market
Many companies in Cedato’s industry niche operate in a revenue-sharing model in which every link in the chain that leads from an advertiser to a publisher takes a small cut out of the budgets that are passing through it. Cedato operates with a totally different approach.
The company positioned itself a programmatic video technology provider, offering a software-as-a-service (SaaS) model by which it charges based on the actual transactions that go through the platform. This business model is highly attractive and highly differentiated, which enabled the startup to grow quickly.
Because Cedato is media agnostic, it can work with everyone that operates in its ecosystem. Cedato enables publishers as well as platforms to repurpose advertising spaces from display to video. They can perform very effective yield optimization across multiple demand sources, enabling customers who do not have video content to take advantage of the fast-growing video advertising space.
Scaling to meet demand
Because of its great product-market fit, Cedato experienced rapid growth.
As a SaaS company, Cedato’s cloud environment is critical to its business flow. The company needed an “elastic” hosting service that would support its nimble growth and future expansion across the globe. Cedato’s leaders were looking for a trustworthy partner that would provide the technical skills and know-how to push the envelope in terms of performance, availability and reliability.
Cedato chose IBM because of its worldwide data center presence and powerful technology. IBM Bluemix offers Cedato multiple bare metal configurations – far more than other providers – that can be almost instantly provisioned when the order is placed.
The company counts on the strong IBM brand and reputation, which provides substantiation for its customers. Its programmatic video solution runs on an IBM-powered infrastructure, which helps to close deals with some of the industry’s leading publishers. Cedato customers know they have a reliable infrastructure that keeps their data and transactions safe, while they automatically lift engagement and business results.
Learn more about IBM Cloud Video.
Read the case study about Cedato.